RUSSIA MONITOR

Date: 8 October 2019

Rostec CEO Chemezov Gathers Steam

CEO of Russia’s state hi-tech corporation Rostec Sergey Chemezov has been awarded the Hero of the Russian Federation medal. He has been handed out the highest state awards by President Vladimir Putin for his “outstanding contribution to the development od the defense and industrial conglomerate and raising the country’s defense capabilities.” Interestingly, neither the Kremlin nor Rostec’s CEO has informed about this fact. Russian President allegedly signed a relevant decree a few weeks ago. The title Hero of Russia, which is a successor to Hero of the Soviet Union, is most often handed out to military personnel, with very few civilians so far bestowed with the title. Granting these honors to a former KGB officer proves his prominent position in the state’s top-level authorities.

SOURCE: KREMLIN.RU

A peculiarity of Putin’s system of power consists in giving people who do not hold any official positions a real impact on the state’s decision-making processes. Among such figures are the CEO of state-owned oil firm Rosneft Igor Sechin and the head of Rostec Corporation Sergey Chemezov. The latter, like Rosneft’s Sechin, takes advantage of his friendly ties to Vladimir Putin to push forward Rostec’s business interests. But, in addition to that, he has a lot to say about other state-related matters. Recent times have seen a hike in Chemezov’s political activity as Rostec’s CEO has an appetite for a front-row role in handing over the reins to Putin’s successor in 2024. This stems from his latest press interview, in which he mentioned amendments to the Russian constitution, naturally in a bid to keep Putin in power.

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Bestowing the highest state awards to Chemezov confirms his mighty position in Putin’s system. Chemezov belongs to a circle of Putin’s decades-long comrades and associates. These two first met in the 1980s when Putin served as a KGB officer in Dresden. Later, while Putin was climbing up the career ladder in Moscow, Chemezov remained in his circle. They worked together in the Kremlin administration. When Putin took office, Chemezov started working for the Russian state arms exporter Rosoboronexport. In 2007, he was named CEO of a large state corporation poised at that time to become a vital element of the Russian economy. All the assets of the Russian arms industry were consolidated at Rostec. After Chemezov took the post of Rostec’s CEO, some defense firms were deprived of their earlier possibility of exporting goods on their own terms. Since that time, Rosoboronexport, Rostec’s foreign trade arm, has had a monopoly on signing deals with foreign-based partners. As years passed by, the corporation remained consequently committed to expanding its portfolio. In addition to armaments production facilities, Rostec holds control of Russia’s largest aviation and automotive plants. In 2017, the company’s revenues were about 1.3 trillion roubles. Putin seems satisfied with both centralizing arms trade and Rostec’s all-out achievements. Not only has the corporation managed to consolidate the state’s armaments, aviation, and automotive industries, but it also extended its area of activity. Companies that are part of Rostec also deal with pharmaceuticals, IT technologies, and telecommunications. This is yet not the first time when the title of the Hero of the Russian Federation was given to a senior civilian official. In 2018, Putin by a classified decree handed out the same medal to his own first deputy chief of staff, Sergey Kiriyenko.

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