Russian companies hit by sanctions continue to pump large sums of money to lobby their interests in the U.S. and the EU. But is it really worth it?
Russian President Vladimir Putin addresses the media at the end of an EU-Russia summit, at the European Council building in Brussels. Photo: AP
With Europe and the U.S. showing no signs of lifting sanctions against Russia any time soon, the Kremlin and different Russian businesses continue to spend large sums of money on lobbyists and consultants to influence the Western decision-making mechanism in order to roll back sanctions.
Just last year, according to Bloomberg, Russia’s Gazprom spent around $300,000 on lobbying in Washington, DC while Novatek, one of the world’s largest private oil producers, paid about $560,000 to the public relations firm Qorvis MSL LLC.
On the European lobbying scene, another Russian oil giant – Rosneft – is working with the London firm Zaiwalla & Co., which has previously represented the interests of a large Iranian bank hit by Western sanctions. Rosneft, according to Russian media, was planning to spend on the services of lawyers in London around $28.3 million.
To what extent might such efforts prove successful over the long term? Russia Direct examines this question in its latest brief, “Kremlin lobbyists in the West.”
The author of the brief is Sergei Kostiaev, associate professor at the Financial University under the Government of the Russian Federation. Kostiaev touches upon a wide array of issues, from the differences in promoting Russian interests in Brussels and Washington to the effects of the crisis in Ukraine on the Kremlin’s foreign lobbying opportunities.
Starting with an overview of the history of Russian lobbying since the break-up of the Soviet Union, Kostiaev suggests that today the main objective of Russian entities is mostly about ending Western sanctions. While in Brussels interest representation is mostly done via different advisory boards and government relations offices, lobbying in the U.S. is more about working with Washington-based consultants possessing relevant connections inside the Obama Administration.
“Working with Western consultants, however, will not help resolving major issues, such as economic sanctions against Russian companies,” writes Kostiaev. “In this case, lobbying is just an extra instrument – the resolution lies in the field of politics.”
According to him, the most that Russian lobbyists can do is to monitor the general situation and request the removal of their client from the sanctions list when the right moment comes and the geopolitical situation changes.
Looking at different cases and comparing Russian lobbying efforts to those of other countries, Kostiaev comes to the conclusion that Russians, while spending large sums of money, have support neither from domestic groups nor from high-ranking government officials in the U.S. and the EU. This, coupled with the negative impact of the crisis in Ukraine on Kremlin’s image, limits the range of opportunities available to Russia for promoting its agenda abroad.
In this situation, in order to establish a credible domestic support in the West, Russia should build strong ties in the academic field. “Russia has to support interest in Russian Studies at Western universities and think tanks. Future political leaders, journalists and scholars should have better understanding of Russian culture, history and politics,” Kostiaev concludes.
How does Russia promote its interests in the West? What are the main achievements of the Russian lobby in the U.S.? What happened to Russia’s contract with public relations giant Ketchum? Download the new RD report to find out.