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Johnson's Russia List


November 12, 2000    

This Date's Issues:  4633


Johnson's Russia List
12 November 2000

[Note from David Johnson:
1. The Observer (UK): Russians launch crackdown on 'sex slave' traffickers. Campaigners attack 'risk-free' trade in women, reports Amelia Gentleman.
2. Reuters: Russian election chief has lessons to teach to US.
3. The Russia Journal: Ekaterina Larina, Russia prepares for a Bush presidency.
4. BBC Monitoring: Bush win "could mean trouble for Russia"
5. Masha Gessen: Re: 4631- Lucas .
6. AFP: Russia braces for Teletubbies invasion.
7. BBC Monitoring: Russian government, Duma on collision course over oil windfall - newspaper.
8. St. Petersburg Times: Anna Shcherbakova, MARKET MATTERS.  IN economic terms, Russia's regions are hopelessly undervalued.
9. The Guardian (UK): Working in Russia. Will your career go west if you go east? From Moscow to St Petersburg there are opportunities for Brits who are willing to take a chance - and, as Jessica McCallin reports, the rewards could just make the risk worthwhile.
10. AFP: India, Russia engage in post-Cold War charm offensive in Asia.
11. The Russia Journal: Vera Kuznetsova, Union of Red Directors unites the oligarchs.
12. The Observer (UK): Amelia Gentleman and Rory Carroll, Was reporter killed by Putin's secret service? Antonio Russo, found dead near a Caucasian mountain pass, may have discovered too much about atrocities in Chechnya.]


The Observer (UK)
November 12, 2000
Russians launch crackdown on 'sex slave' traffickers
Campaigners attack 'risk-free' trade in women, reports Amelia Gentleman

Had it not been for the long queue for tickets at St Petersburg's central
railway station, Lara Matveyeva might never have found herself working in a
German brothel - one of hundreds of thousands of East European women
unwittingly sold into prostitution in the West.

As it was, the slow movement of the queue provided an ideal forum for
recruitment. The tedium of waiting was lifted by the appearance of a
friendly, well-dressed woman behind her.

Enticed into conversation, Lara told her that she was returning home to a job
and a town that bored her. The woman replied that she had a friend in Germany
who was looking for help with the housework for a few months, and that if
Lara was eager for a change she could put them in touch. The money would be
bad, but she would be required to do little except water the plants and feed
the pets; most importantly, it would be a chance to travel.

Only mildly surprised by this stranger's desire to be kind, Lara accepted. A
few days later she was travelling by bus to Hamburg. A Russian woman was
there to meet her at the bus stop, accompanied her to a flat nearby and took
her passport from her - for safekeeping. After three days she told Lara, then
24, that there was no housework to be done, so she would have to work as a

Intelligent and well-educated, it nevertheless took her six months to escape
from imprisonment in a series of bars and nightclubs in Hamburg and its
suburbs. Most of the other Russians she met there had given up even trying to
return home. Even now that she is back in her small provincial town on the
southern border with Ukraine, she remains so anxious about reprisals from the
people who organised her trip that she refuses to reveal her real name.

Her horror at her own experience and at the scale of the problem in Russia
motivated her - in spite of the dangers - to start tackling the problem. She
was one of the participants at a conference of 43 anti-trafficking
organisations from 25 regions of Russia and six former Soviet republics that
finished last week.

These groups hope to combat a phenomenon that, according to the Organisation
for Security and Co-operation in Europe, has swept up something like 500,000
Russian women in the past decade (although the trade's clandestine nature
makes it impossible to estimate accurately the numbers). Activists say that,
despite its scale, human trafficking is still not treated seriously by the
Russian government.

'There is a great reluctance to recognise and address this problem,' said one
of the conference organisers, who also requested anonymity. 'The reality is
that it is a modern slave trade, just as profitable as it was 200 years ago.'

The trade stems from a mixture of poverty, naivety, a weak legal system and a
prevalence of well-organised criminal groups. Ignorance lies at the heart of
the problem. According to MiraMed, the charity that organised this month's
conference, around 90 per cent of the women trafficked abroad are unaware
that they are headed for a career in the sex industry.

The small ads columns of provincial newspapers are filled with adverts
encouraging young, attractive women to apply for work as waitresses in Italy
or barmaids and nannies in Germany.

With the economy in Russia's remote regions deeply depressed, many women are
desperate for an escape. The novelty of travel in the West remains high,
while awareness about life there is low. Not suspecting any possible threat,
the women - mostly in their teens or early twenties - are easy prey.

For the groups organising the trafficking there are few obstacles. Compared
with selling drugs or weapons abroad, trade in women is highly profitable and
relatively risk-free. Unlike guns or drugs, women can be sold over and over
again, acting as a regular, long-term source of income. And, crucially, in
Russia there is still no specific legislation which decrees illegal the trade
in humans . The few women who make their way back to Russia have no recourse
to the law. Even now, two years after her return, she has told none of her
friends or family about what happened in Germany; they believe she spent an
uneventful few months as an au pair.

The memory of those months remains painful. 'I'm not scared of anything any
more because the worst thing that could possibly happen to me already has.
Very few of the women I met had willingly become prostitutes. Most were
tricked. Most alarming was the sense that there was no way out. Our passports
had been taken; we spoke no German and knew nothing about the country, so we
didn't know what punishment would face us if we went to the police. We were
illegal immigrants involved in an illegal activity - we didn't expect any

'To begin with I refused to do the work, but later I had to - there was no
other way of feeding myself, and by that time I had seen the beatings other
women got when they refused to co-operate.'

Each of the new recruits was presented with instant debts to their pimps of
around $1,000. The bar's exits were monitored by security cameras,
heightening the sense that there was no escape.

When the woman who had first pushed her into prostitution decided she was no
good at it, Lara was sold on to a man for $1,000, the sum of her 'debts'. It
was only when his bar was raided and she was arrested that she realised the
police were not as terrifying as she had anticipated. They spoke no Russian,
so she was never able to explain her situation, but they handed her a
deportation order and she was able to leave.

The main conclusion to come out of this month's anti-trafficking conference
was the need for greater information. A privately sponsored advertising
campaign showing pretty young fish being ensnared by evil fishermen is soon
to run on regional television, and lectures in schools are being organised to
warn girls to be wary of offers of casual labour abroad.

Russian election chief has lessons to teach to US
MOSCOW, Nov 11 (Reuters) - Russia's election chief says he has some advice
for his U.S. colleagues struggling to unravel confusion over the outcome of
the 2000 presidential poll.

Alexander Veshnyakov, head of the Central Election Commission, returned from
the United States Saturday after a visit to seek ideas for improving Russia's
young democracy.

Instead, he found an increasingly messy political situation moving into
uncharted areas.

"Americans should not put on airs. They have things to learn from Russia, on
ways to prepare and conduct a really free and democratic election," a
confident Veshnyakov told Russian television channels at the airport.

He said some U.S. election procedures could be useful for Russia, but did not
specify what he had in mind.

In the United States, Republican George W. Bush and Democrat Al Gore are
still locked in a ferocious battle for the state of Florida's 25 electoral
votes needed to win the November 7 presidential election.

Elections in Russia, whether regional or national, rarely pass without bitter
argument over suspected vote-rigging. Veshnyakov himself has had on many
occasions to fight off accusations of electoral impropriety.

"The most typical mistakes and violations we have in Russia are also present
in the United States. We just write and talk about them more than they do,"
Veshnyakov said.

He said it was time the United States moved to elect its president by direct
ballot, citing Russia and France as successful examples of this mode.


The Russia Journal
November 11-17, 2000
Russia prepares for a Bush presidency
The neck-and-neck and still-undecided U.S. presidential election may have
Americans on edge and the rest of the world totally baffled, but political
discussions in Russia during the week focused on the implications of a
George W. Bush presidency.

"A Bush victory would be positive for Russia," said Vyacheslav Nikonov, the
president of Fond Politika. "For us, despite the Republicans' more
threatening rhetoric, things were always better with the Republicans than
with the Democrats."

Many others agreed, saying that Russia might have warmer personal feelings
for Democratic contender and current Vice President Al Gore, but they think
that nonetheless, Bush could actually prove a better partner in getting
things done around the world.

"Detente began when [Richard] Nixon was in power; the Cold War ended while
[Ronald] Reagan was president; and START-2 was signed while George Bush Sr.
was president," Nikonov said, referring to three other Republican presidents.

"But it was under [Harry] Truman that the Cold War began; the Cuban missile
crisis took place during [John F.] Kennedy's time; and the [Bill] Clinton
presidency saw an eight-year long worsening in Russian-American relations,"
he added, naming off three Democratic leaders.

Russian observers are unanimous in saying that a Republican administration
would be less inclined than a Democratic one to meddle in Russia's domestic
affairs. The experts welcome even the fact that the Republicans would make
more demanding and pragmatic partners, saying that this would do more to
help the Russians bring order to their affairs than the Democrats' abstract

"The harsher the demands on us, the quicker we'll understand that there is
no easy road and that we have to work hard to hold on to our place under
the sun," said Fyodor Shelov-Kovedyayev, who was a first deputy foreign
minister in the early 1990s. "There's an old German proverb that goes:
'Sometimes, to take a step forward, all you need is a kick in the backside.'"

Shelov-Kovedyayev has worked with both the Bush Sr. and Clinton
administrations. He said that the Republicans make a point of standing up
for issues they consider part of U.S. national interests, but at the same
time, they know how to respect the clearly motivated interests of their

"If we have a clearly thought out and formulated national interest, which
we can explain and justify, the Republicans will show respect for our point
of view," said Shelov-Kovedyayev. "With the Democrats, we would see a more
abstract approach, more humanitarian rhetoric and so on."

Nikonov thought the Republicans could have more freedom than the Democrats
in their relations with Russia. Firstly, because they wouldn't have to fear
being accused of betraying national interests, and secondly, because there
are a number of moments that cast a shadow over Russia's cooperation with
the Democrats.

"The Republicans have a clear pro-American policy and are not afraid to be
accused of betraying national interests," he said. "At the same time,
paradoxical as it may seem, it is the Democratic establishment that counts
among its ranks the greatest number of people from Eastern Europe, who have
a whole range of prejudices. Most Republicans, meanwhile, are Anglo-Saxons
and don't feel any genetic complex toward Russia."

Even Russia's Communists, who by definition are on the left of the
political spectrum, feel more sympathy for Bush Jr. and would rather see a
Republican administration in the United States, according to observers.

"The Republicans always followed a more balanced, conservative policy with
regard to Russia, and unlike the Democrats, didn't try to meddle in our
domestic affairs," said Andrei Andreyev, a spokesman for the State Duma's
Communists. "As for the fact that the Republicans won't be lenient when it
comes to debts and loans, it's high time we learned to live according to
our means."

In his statements on the U.S. elections, President Vladimir Putin was
careful not to show outward sympathy for either one or other of the
candidates. Speaking to journalists in Rostov-on-Don, he said only that the
United States "is one of our most important partners, and we have therefore
examined carefully the programs of both candidates. [Both programs] speak
clearly of developing relations with Russia, and this approach suits us."

Other officials have also kept to a carefully neutral position.

"I can't add anything to what the president said," said Security Council
spokesman Vladimir Nikanorov. "We respect the choice of the American people
and will work with the president they elect."

Kremlin spokespeople repeated the official line that Russia can't and
shouldn't comment on the choice of the American people. They also took
pleasure in repeating the joke that, facing the problem of having to
recount votes in Florida, the Americans turned to Russian electoral
officials for help. The result was that in a matter of hours, Vladimir
Putin took the lead.

While many in Russia took the whole affair of the vote recount with a pinch
of irony, not many seriously agreed with head of the Central Electoral
Committee Alexander Veshnyakov's statement that this demonstrated the
superiority of the Russian direct election system over the U.S. two-tier

"Obviously, since the American electoral system was created 200 years ago,
it's a bit archaic, but I think things won't go beyond a burst of
discussion on improving it," Nikonov said.

"The American system is like a Formula One race where two cars are nose to
nose and you need a photo finish to determine the winner; and the Russian
system is like free races on Minsk Shosse, where anyone who wants can
participate, but you've got a motorcade roaring through with lights
flashing, and traffic cops always stopping everyone else."

The Communist Party's Andreyev said that if Russia had any experience it
could share with America, it was his party's experience in fighting
election fraud.

"This chaos when it comes to vote counting is a scandal over there, but it
happens here every time we have elections," Andreyev said. "A lot of people
are surprised to see that there too, you can have boxes turn up with votes
that haven't been counted. We could share our experience in fighting
election fraud. We've got more experience than anyone else."

BBC Monitoring
Bush win "could mean trouble for Russia"
Source: 'Nezavisimaya Gazeta', Moscow, in Russian 9 Nov 00

America has finished the elections, but has not yet been able to elect a
president. This is the paradoxical situation that emerged yesterday [8th
November] after the end of voting in the United States....

It essentially makes no difference to Americans - and the tiny gap between
the figures of Albert Gore and George Bush merely confirms this - which of
the two candidates gets into the Oval Office at the White House. Over the
last decade (mainly over Clinton's final term in office, when the Republicans
had the time and potential to ponder the reasons for the crushing defeat in
the 1996 presidential elections) the process of convergence between the
dominant political currents in the United States has reached its highest
point in the entire history of the US two-party system: The Gore-Lieberman
pairing are the most Republican of Democrats, and the Bush-Cheney pairing the
most Democrat of Republicans.

As for foreign policy and the influence of the election results on Russian-US
relations, we should not expect anything good if Bush wins. The only question
is just how bad things will be. Yesterday morning, when the results were
still not definitely clear, an extremely high-ranking US diplomat in Moscow
said that there would be no fundamental review of US foreign policy under
President George Bush. There will be merely a point-by-point revision of its
main directions, he added. The addendum means the precise opposite of the
diplomat's first thought, namely - a fundamental review of US foreign policy
is exactly what there will be. And we can assume that the Russian direction
will be carefully checked.

The advent of George Bush, with his - to put it mildly - Texan approach
towards solving extremely complex world problems, could mean plenty of
trouble for Russia. The first bit of trouble could be the real threat of the
rapid destruction of the 1972 ABM Treaty. Bush has stated that if Russia does
not accept the amendments proposed by the United States, Washington will
withdraw from the treaty. All this is fraught with a slide into a new arms
race, which will bring nothing good for the Russian economy. In addition,
there will be serious difficulties for the development of our relations with
countries like Iran, India, and China since Washington will impede them.

Under Bush US foreign policy will lose the last traces of subtlety, which
have already almost disappeared thanks to the endeavours of the current
secretary of state. The simplest solutions will be deemed to be the best. A
Bush administration will scarcely go into details. Yet international
relations are a sphere where a great deal is determined by nuances and by the
subtlest details. Bush is accustomed to broad brushstrokes.

It is worth noting that if Bush wins one party will control the executive and
legislature for the first time in 40 years...

Given the unfailingly negative attitude towards Russia among an influential
number of Republicans in the Senate and House of Representatives, we can
expect anti-Russian tendencies to increase during decisionmaking by the new
US leadership.

However, this may benefit Russia. A shock, an unexpected blow, and sudden
immersion in a state of discomfort always stimulate inner resources. Few
people are interested in a tranquil Russia, but a wounded Russia could become
a much stronger rival, including for the United States itself.

Moscow was certainly backing Gore. But it has no instruments for influencing
the outcome of the vote (unlike, say, the Jews, Irish, and so forth who have
"their own" lobbies)...

However, George Bush is no specialist in foreign policy and will evidently
entrust this sphere to his extremely strong team, which is made up partly of
old "hawks" and partly of pragmatists. We can reach agreement with the
latter, although on tougher terms than would have been the case with the
Democrats, including on anti-missile defences, even if this would mean
revising the whole complex of disarmament agreements. In addition, the
Republicans have harshly criticized the IMF, which signifies agreement with
Moscow - the result of this coincidence between positions could be
restructuring of the Russian debt.


From: "masha gessen" <>
Subject: Re: 4631- Lucas
Date: Sun, 12 Nov 2000

OK, Edward, come on! "The country is less free than 10 years ago?" I think
this country is going to hell faster than most of us could have imagined,
but let's not get ahead of the process here. Ten years ago, if I may remind
you, was the eve of the Vilnius crackdown. Then, in March 1991, there was
the Gorbachev decree banning all demonstrations in Moscow. There were tanks
in the streets of Moscow the last week of March, and no one in the city
thought much of it. Ten years ago we were still seven months away from
abolishing the censorship agency.

Perhaps more important, ten years ago, no one but the nomenklatura had food
on the table. A normal (non-hard-currency) food store in the center of
Moscow had the following for sale (this is from my notes of nine years and
nine months ago): three-liter glass jars marked 'plum juice'; shapeless
clumps of black dirt marked 'carrots.' THAT'S IT. As it happens, I was here
for the first time after ten years' absence, and I can attest that the
situation was worse but not significantly worse than I had remembered it.
Twenty years ago, people didn't have much to eat either. They--that is,
we--also did not have toilet paper, shampoo or coffee. Not to mention
clothes, furniture, calculators, plastic bags or anything a person might
possibly need--paper to type on or an apple tree to plant at her dacha. You
name it, it was 'deficit.'

I do believe that all people, regardless of how hopeless their situation may
have been twenty years ago, have a right to a life of dignity. But this is
no reason to regard comparisons between the state of things now and twenty
years ago as 'facile optimism.' In fact, such comparisons are essential
because the dominant political discourse in this country is driven by a lie
about what things were like twenty years ago. People support Putin as a
symbol of the time when they 'could afford sausage,' forgetting that they
had to take the train to Moscow to get anywhere near a store where sausage
was sometimes sold. The stock lies about 'affordable sausage' and 'fat
chickens' are a cover for a desire for predictability, a life that was
equally miserably for most. Considering this may well be where we are once
again headed, I think our memories of ten and twenty years ago deserve not
to be glossed over.


Russia braces for Teletubbies invasion

MOSCOW, Nov 12 (AFP) -
Red Square, long a bastion of Russian invincibility, succumbed to an invasion
by four brightly-coloured fluffy creatures Sunday when the "Teletubbies"
children's programme launched its Russian-language version.

The programme, to be known as "Telepuziki" (or "TellyBellies") in Russian,
gets its first airing on the RTR channel Monday when its stars "Tinky-Vinky"
-- as he is known here -- Dipsy, Laa-Laa and Po are unleashed on the
unsuspecting public.

To celebrate Russia's initiation into the worldwide craze that has won a
loyal following among the world's television teenies since it was first
broadcast on Britain's BBC three years ago, the Russian channel organised a
mass party off Red Square.

More than 3,000 Russian infants were specially invited to attend the launch,
described as the world's largest "Teletubbies party" but there was expected
to be some disappointment at the no-show of the fluffy Teletubbies themselves.

"Many children get a bit frightened when they see the Teletubbies in
real-life because the actors are, of course, life-size, and so in their
costumes they can be over nine feet tall, which is not our viewers imagine
thems," said BBC spokesperson Rachel Booth.

"Children tend to think of the teletubbies as their special friends, their
peers or contemporaries if you like, and so we don't want to disillusion
them," she added.

However, she said that Tinky-Vinky and his mates would be making a virtual
appearance at the party in the form of a special video preview of the Russian

The RTR channel has bought up all 365 episodes of the programme made by the
Ragdoll Production company, whose bosses readily accept that the challenge of
translating the quasi-lingustic scripts into Russian presents certain

"If you close your eyes for an instant, you should be able to tell who's
talking in any language," said Nick Kirkpatrick, head of International
Programme Development at Ragdoll.

In other respects, however, the Cold War flavour given to the Teletubbies
launch by its proximity to the Kremlin was welcomed by the programme makers.

The show tells the all but surreal adventures of the four fluffy creatures
who appear to live in what one US commentator called "a post-nuclear
landscape in sunshine."

The Teletubbies phenomenon created a wave of protest among educationists
worldwide when it was first broadcast in Britain, with many experts saying
the show's non-verbal content talked down to its infant viewers.

But Russia's Telepuziki team waxed lyrical in its praise of the show's
intellectual content

Sergei Brisitsky, the producer of the dubbing project, said the scripts
helped to expand children's imaginative horizons.

"My younger daughter is already past the age for the Teletubbies, but she
still watches it with pleasure," he told the Moscow Times newspaper.


BBC Monitoring
Russian government, Duma on collision course over oil windfall - newspaper
Source: 'Kommersant', Moscow, in Russian 10 Nov 00 p2

The Russian State Duma lower house of parliament is expected to have plenty
to say on how to spend the country's anticipated oil windfall when it comes
to debate the third reading of the 2001 budget. The extra cash is set to come
from higher-than-expected oil export revenues. But with Russia liable to an
additional 3bn-dollar bill on its foreign debt payments if the Paris Club
fails to restructure the ex-USSR's debts, disagreements are likely to arise
between the government and Duma on how much of the windfall should be
allocated to foreign debt repayment, according to the `Kommersant' newspaper.
The following is the text of the article by Irina Granik, published on 10th
November under the headline "Use unplanned revenue for unplanned

Next week the Duma starts preparing the draft 2001 budget for its third
reading. The most turbulent debates are expected to be over the articles
distributing possible additional revenue. However, it is possible that next
year Russia will not only receive additional revenue, but will also have to
pay debts that are not envisaged in the budget.

Last year the Communists were the first to suspect that the budget would
receive additional revenue. And they forced the government to decide
immediately what this money would be spent on. As a result R6bn were
allocated actually in the text of the budget (the Duma decided that this sum
would definitely be collected). Expenditure priorities were set for possible
additional revenue over and above this sum. Wage indexation and debt
servicing were in first place.

But it was not possible to place the additional revenue under the Duma's
control. The additional revenue turned out to be no less than R270bn. And
only now is the government submitting to the Duma a draft law on allocating
this money. This whole situation may be repeated this year. At any rate,
nobody doubts that there will be additional revenue if only because the
export revenue of the 2001 budget is calculated on the basis of world oil
prices of 18-19 dollars per barrel. In all, according to the estimates of
Budget [and Taxes] Committee Chairman Aleksandr Zhukov, the additional
revenue will be at least 100bn-150bn dollars.

The government has suggested to the Duma almost the same distribution as last
year. Admittedly, not R6bn but R20bn have already been definitely
distributed. Not in absolute sums, but in percentages. It is proposed to give
30 per cent to national defence, 25 per cent to the regions, 25 per cent to
the highways fund, 15 per cent to law enforcement and 5 per cent to state
administration. And everything on top of R20bn will be assigned according to
the priorities, but without any figures. The government has suggested that
each quarter the Duma report on the use of additional revenue and is also
prepared each quarter to submit an appropriate draft law containing
amendments to the budget.

The Duma may accept this. Of course, there will be some who want to
thoroughly allocate all R100bn-R150bn or all R200bn-R300bn (the Communists
think there will be at least that much). But in any case it is not very
logical to enshrine in a law what is only possible revenue.

It is something else that may be the real stumbling block. All debt payments
in the 2001 budget are calculated on the assumption that the Paris Club will
restructure for Russia the former USSR's debts. However, as Aleksandr Zhukov
stated yesterday, "this will be difficult". Without this restructuring, next
year Russia will have to pay not 11bn dollars in respect of foreign debts,
but 14bn dollars. The IMF will scarcely provide credits - after all, Russia
now has an excessive balance of payments surplus because of high world oil
prices. So we will have to repay the debts independently, as this year. And
pay 3bn dollars more than assumed in the budget. So the government is
proposing to use 70 per cent of the additional revenue to repay foreign debts
and only 30 per cent for all the other purposes. The Duma may prefer a
different option: 50 per cent for the debts and 50 per cent for the national
economy. At any rate, Aleksandr Zhukov does not rule out this development.
Which view has prevailed will finally become clear on 1st December, when the
Duma gives the budget its third reading.


St. Petersburg Times
November 10, 2000
By Anna Shcherbakova

IN economic terms, Russia's regions are hopelessly undervalued. The
statistics say that Moscow has about about a quarter of the entire national
economic volume, with the remaining 75 percent divided among the other 88
regions. This distortion will not be easy to correct, and it won't be done
soon. But the first signs of a shift in balance are already there to be seen.

One such sign was the recently disclosed intentions of two big financial
players, Norilsk Nickel's CEO Alexander Khloponin, and the legendary oil
baron Roman Abramovich.

Khloponin is running for the governorship of Taimyr, while Abramovich is
giving up his seat in the State Duma for the sake of the same position in
Chukotka. And one shouldn't forget Russia's first millionaire Artyom Tarasov,
who made a return to St. Petersburg from London for an untimately futile shot
at unseating Gov. Vladimir Yakovlev this May.

Branching out into the regions after having built up a business empire is a
logical move for the kind of person whose managerial skills have already been
proven by the successful operation of a major enterprise or two. And their
ability to make sound predictions is also unquestioned.

Some regions are ripe for the picking, with massive natural resources, plenty
of unregistered and unused property, as well as undervalued human resources.

Another reason for moving tycoons into regional power seats is that the
business community is terribly tired of the arbitrary rule of some governors.

I don't know what is hardest to put up with - the neccessity of financing
election campaigns every four years, the inevitable rackets run by small-fry
bureaucrats in the time left to them before a new governor appears, or the
differences in regional legislation that makes relationships between one
region and another so difficult. "When we are looking at exporting to a
foreign country, we naturally investigate what kind of legislation they have
there," said the head of one company that operates both in Russia and abroad.
"But why should we have to investigate the legislation of a particular region
in this country before we sell anything there? It's simply disgraceful!"

It's true that the regions are unequal in territory, natural and mineral
resources, and industries. They also have very different people at the top,
which makes for a varied investment climate depending on where you go. All 89
regions introduce their own taxes, fees and restrictions in order to fill
their budgets and to feed local officials.

Regions have turned into small states striving for independence from Moscow.
Are businessmen ready to change the rules after winning a governorship? Or
they will demand more independence from the capital?

The hour for the regions has not yet come. But those who get their hand in
now stand to win a great deal.


The Guardian (UK)
November 11, 2000
Working in Russia
Will your career go west if you go east?
>From Moscow to St Petersburg there are opportunities for Brits who are
willing to take a chance - and, as Jessica McCallin reports, the rewards
could just make the risk worthwhile

Winston Churchill once said that Russia was a riddle wrapped in a mystery
inside an enigma. That was in 1939. But 60 years and a multitude of political
changes don't seem to have made the country any more comprehensible to the

All claim to be baffled by the amount of time it takes to get even the
simplest thing done. And bureaucracy might as well be a taboo word - at the
least the kind of bureaucracy that gets things done. Utter it to a foreigner
working in Russia and a look of total despair will come over their face.

Nevertheless, the fact that so many foreigners do work in the country must
mean it can't be all bad. So what are the opportunities?

If you work in finance, banking, accountancy and law - UK sectors which all
have a strong presence in Russia - the benefits are serious amounts of money
and endless opportunities, with company cars and flats thrown in to sweeten
the package. The country is crying out for people to work in these sectors
and, as Stephen Ogden - whose story is detailed opposite - found, won't rule
you out if you don't speak Russian. In fact, as the international business
language, English is a sought-after commodity.

A job in one of these sectors is also likely to mean responsibility at a much
younger age and experience in areas that would not be open to someone in the
UK. Company offices based in Russia tend to be smaller than their UK
equivalents and staff are required to be generalists, capable of running
several aspects of their employers' business. This approach means that formal
qualifications are less important than in the UK. Having a degree or diploma
becomes irrelevant as long as you are willing and able to do a job.

If you like variety and are open-minded about what your future career holds,
this can be attractive. With your finger in so many pies, opportunities that
you never would have thought about are presented to you.

This doesn't suit everyone and should be avoided by people with specific
career aspirations. British people working in Russia say it's often a case of
"out of sight, out of mind" with their company's headquarters. Once overseas,
you're no longer a small wheel in the corporate cog and can be forgotten
about during promotion time. So, if you're aim is to make managing director
as soon as possible, it's not for you.

John Tarrant, chief executive of recruiter TMP Worldwide, says that the
advent of a relatively stable economy has harmed the chances of some workers
looking for a senior job with a multinational.

"The nature of the jobs on offer in Russia has changed over the last 10
years. Whereas all senior staff for an international company were once
expats, now its only the top two jobs that are reserved and the rest are for

On the upside, he says wages tend to be paid on time, and unemployment is
falling as is inflation. And there is still a shortage of people in a diverse
range of industries, including pharmaceuticals and building. Local companies
offer decent prospects these days and will pay higher salaries for English
speakers "just like they do in the Middle-East."

Russia is also opening up to British teachers and journalists.
English-speaking schools in Moscow and St Petersburg need teachers from all
academic disciplines. And the English language dailies, the Moscow Times and
St Petersburg Times, are both edited by British journalists and on the
lookout for English speaking writers.

Opportunities outside these two main cities are understandably more limited.
Mike Haddock, at the British Embassy in Moscow, says that while British
people are scattered all over the country, the need to speak fluent Russian
and a willingness to put up with a comparatively sparse quality of life, keep
most foreigners in the cities. Most far-flung British workers are in the
voluntary sector, working in areas as wide ranging as medicine, drug
addiction, human rights and environmental conservation.

Whilst most claim to find their jobs rewarding, they say the mindsets they
are up against can sometimes be very frustrating. "Attitudes towards the
voluntary sector differ significantly," says Jeremy Jacka, the only British
employee of the Charities Aid Foundation in Russia. "Many are hostile because
they think the state should provide such services. This is especially so with
the 50-plus generation who still hold on to Soviet rhetoric. Others can be
obstructive because of ingrained attitudes. Charities working with disabled
children are facing an uphill struggle. In the days of the Soviet Union it
was deemed shameful to have such a child. You have to be extremely patient
sometimes, especially with some of the local administrations and
bureaucracies. And there is no point throwing your weight around and
demanding that things be done in the way they are in the UK. You have to
accept that things are done differently in Russia."

The same applies to your private life, where creature comforts, such as a
guaranteed water supply, cannot be taken for granted. And Russia might not be
your best bet if you've got a family. Concerns over safety and health care,
for example, mean many foreigners say they would not bring up children in

After the fall of Mikhail Gorbachov and the election of Boris Yeltsin,
Russia's two main business centres, Moscow and St Petersburg, were like the
wild west, says Mr Tarrant. "Most of the staff we recruited there needed
someone in a dark overcoat to follow them around, mainly to bribe the people
they did deals with, but also to protect them from street crime." He agrees
that both bribery and street crime directed against foreign nationals are
still problems, despite the steadying hand of Mr Yeltsin's successor,
Vladimir Putin.

But for all its apparent downsides, Russia manages to imprint itself in
British people's hearts. Jeremy Jacka has already been there over seven
years. "Every year in April, at the end of winter, I say to myself that this
will be my last year. But every year I stay." It's a sentiment echoed by
other Brits. Try as they might they just can't leave. Some hop between
companies and cities whilst others branch out on their own. Meanwhile,
anecdotal evidence suggests a surprising number settle down and marry
Russians. Forging the kind of links that might help them solve Winston
Churchill's riddle.


India, Russia engage in post-Cold War charm offensive in Asia

Regional giants Russia and India have launched a post Cold War charm
offensive to expand ties with the rest of Asia amid shifting geopolitical
alliances and expanding global economic linkages.

President Vladimir Putin is expected to use the Asia Pacific Economic
Cooperation (APEC) forum later this week in Brunei to sell Russia's role in
the emerging political and economic landscape and allay lingering fears of
the former superpower's hidden agenda.

Russia's influence has weakened after the breakup of the mighty Soviet empire.

Analysts say India, which reversed an inward-looking policy in the mid-1990s,
is a country to watch because of its size and emerging economic strength.

In an article contributed to Singapore's Straits Times newspaper, Putin said
Moscow can offer vast areas of economic cooperation aside from playing a role
in maintaining regional stability and security.

"I think the time has come for us and the countries of the Asia-Pacific
region to go from words to deeds, that is, to build up economic, political
and other contacts," said Putin.

"Russia as a responsible partner is not going to stand aloof from the effort
to unravel complex regional tangles," he said, citing efforts toward
rapproachment in the Korean peninsula.

Addressing residual post-Cold War fears, Putin was blunt: "We have no 'secret
agenda' for the Asia-Pacific. The objectives of Russian policy in the region
are crystal clear."

Putin will join US President Bill Clinton and other Asia-Pacific leaders in
the Brunei capital of Bandar Seri Begawan next week for the annual APEC

Indian leaders also embarked on their own roadshow.

President Kocheril Raman Narayanan flew into Singapore on Thursday and
Foreign Minister Jaswant Singh joined five Southeast Asian ministers in Laos
on Friday to launch a new regional grouping dedicated to boosting transport
links, culture, education and tourism.

Honouring the visiting Indian leader at a state banquet Friday, Singapore
President S.R. Nathan said the end of the Cold War and rapid changes
resulting from globalisation were transforming the region's strategic

"But whatever new equilibrium or geopolitical balance eventually emerges, we
believe that India will be an important player," he said.

Singapore Foreign Minister S. Jayakumar also welcomed New Delhi's move to
enhance its engagement in the region, saying India's strategic importance
"cannot be over-emphasised."

A technology-driven India is likely to be Asia's next economic success story,
US economist Jeffrey Sachs, director of the Centre for International
Development at Harvard University, said in a lecture here in August.

While massive poverty remains a problem, the country of about one billion
people has a pool of world-class scientists and engineers who could provide
the cutting edge, Sachs said.

Russian leader Putin offered his country as an "integration junction linking
Asia, Europe and America," through which transport routes could be shortened.

"Sea containers despatched to Europe by the Trans-Siberian railroad reach
their destinations in less than half the time," he said.

Moscow was moving to modernise the railway to ease bottlenecks, he said, and
offered cooperation in the fields of mining, energy, and satellite technology.

"The region will always need Russia, both to maintain stability and security
and to ensure a balance of interests," Putin said.

Russia and China are moving toward closer alliance, he said, describing this
as a "weighty factor in preserving global stability."

Russia was also expanding economic ties with Japan and was looking at
enhancing relations with the Association of Southeast Asian Nations (ASEAN),
which groups 10 countries.

"New oriental vistas are opening for Russia," he said.


The Russia Journal
November 11-17, 2000
Union of Red Directors unites the oligarchs
Arkady Volsky, chairman of the Russian Union of Industrialists and
Entrepreneurs (RSPP), has announced reforms for his rather conservative
organization, popularly referred to as the "Union of Red Directors."

The union's managing board, which brings together 150 businessmen, met Nov.
10 and decided to replace some of the old members with new ones - mostly
former and current oligarchs. The new guard includes Anatoly Chubais,
Vladimir Potanin, Mikhail Fridman, Oleg Deripaska, Mikhail Khodorkovsky,
Kakha Bendukidze and Vladimir Mordashev.

As well as diluting the RSPP's conservative management, the reformers have
also entered the holy of holies - the union's bureau, where they are now in
the majority, having gained more than half of the 27 seats. It's quite
probable that they will soon gain even more of an advantage over the Red

The RSPP will become something more like an oligarch trade union - an
organization that will try to keep a balance of interests on the market
during the transition period. The members won't just work with each other,
but will also work with the authorities. The new members of the RSPP say
that this is the ideology of their move to reform.

But though proclaimed by Volsky, the reform idea is not his - it comes from
the new guard. Some of them were already members of the union, in
particular Oleg Deripaska, Vladimir Potanin and Kakha Bendukidze. The
oligarchs had never shown much interest in the amorphous union, getting
together only when Volsky organized some presentation or other for whoever
the new prime minister was and making threatening speeches about government
policy and the pace of reform.

The oligarchs' slogans were for greater liberalism and less bureaucracy,
and for tax reform. The problem was that it wasn't the oligarchs who played
first fiddle in the organization, but the above mentioned Red directors and
members of the old Soviet nomenklatura. With the patriarch of the
nomenklatura, Volsky, at its head, they turned the RSPP into a pure
lobbyist organization.

But they didn't lobby so much their business interests as their personal
interests. As a result, the RSPP ended up on the margins of public life.
People remembered Volsky's union only when some Russian politician or other
had to publicly announce somewhere that Russia had its entrepreneurs and
that they even had their own organization.

The RSPP most likely would have died a natural death if the oligarchs
hadn't decided to use it to unite themselves. Of course, they could have
created an entirely new organization, but perhaps because the oligarchs are
busy people, they decided it would be easier to reform the old union. Also,
there was no sense in creating a bunch of parallel structures.

But reforming Volsky's union has turned out to be just as complicated as
putting together a new organization. The reformers' ideas on the role and
functions of the RSPP differed greatly from those of the Red directors.
Volsky, who is ready to change his image in order to keep his job, hasn't
fully understood, it seems, the point of the reforms.

The reformers proposed giving the union the name "Solidarity" and plan to
use it if necessary to defend their business interests, especially from the
encroachments of the state. But just before Nov. 10, Volsky made a
statement that smacked distinctly of primitive lobbying. He said that
having Chubais and Khodorkovsky in the RSPP would "enable us to have a
mutual influence on each other." Together with the energy, oil and
transport bosses "we can conclude a cartel agreement on tariffs," Volsky

It's not clear who Volsky had in mind - the prime minister, or Railways
Minister Nikolai Aksyonenko, the main supporter of a cartel agreement, but
the reformers' ideology definitely didn't sink in, or he didn't want to let
it sink in. This suggests either the end of Volsky's career as head of the
union, or the end of the oligarchic reform before it has even got off the

But not all representatives of the new guard are thirsting for radical
reform of the RSPP. Some of them, such as Deripaska and Potanin are happy
with the way things are today. (Both have virtually "privatized" Volsky in
that they've co-opted him as an asset). But they are happy for different
reasons. Potanin doesn't need change because he won't be able to get his
own man into the chairman's post, and new people would be neutral and
therefore unacceptable.

Deripaska has an even broader agenda. He represents in the RSPP not just
his own interests, but also those of Roman Abramovich and the "Family"
(which some have forgotten, though it still exists), and even, strange as
it may sound, the Kremlin. In any case, the presidential administration,
which had only just resolved, it seemed, the oligarch problem in Russia by
making the businessmen get into line behind Putin, is not very happy to see
the oligarchs again raising their heads.

The deputy head of the administration Vladislav Surkov, responsible for
relations with public organizations, spoke favorably about not meddling in
the oligarchic process, but nonetheless hinted that any independent games
played by the oligarchs aren't to the Kremlin's liking.

But if there's no stopping the movement, the Kremlin can, at least, either
try to head it or make it collapse from within. That's why Deripaska is
putting a brake on the radical oligarchic reform within the RSPP. Deripaska
now represents the reins of power.

The Observer (UK)
November 12, 2000
Was reporter killed by Putin's secret service?
Antonio Russo, found dead near a Caucasian mountain pass, may have discovered
too much about atrocities in Chechnya
Amelia Gentleman in Moscow and Rory Carroll in Rome

Slumped by the side of the road, a speck amid the fields yawning into the
horizon, there was something odd about the contorted, frozen corpse. Antonio
Russo had been murdered, and his killers made sure they left not a mark, not
a scratch on his body.

On the other side of the Gombori Pass in the republic of Georgia friends were
waiting at the village of Mirzaani. Russo was to join in the anniversary
celebrations of Nico Pirosmani, a nineteenth-century local artist. They did
not know a large, blunt object was being applied to Russo's chest until four
ribs cracked and internal bleeding caused him to die of shock.

They did not know his satellite telephone, digital camera, laptop computer
and video cassettes were vanishing. An Italian journalist who spent a
lifetime chasing secrets was leaving behind some of his own. Who killed him,
and why?

Snaking from the roadside, 30 miles north east of the Georgian capital,
Tbilisi, is a trail of fact and suspicion that some claim leads to the
Kremlin and its onslaught in Chechnya. Russo's friends believe he was
assassinated by the Russian secret service after discovering unconventional
weapons were being used against children. It would have been a scoop in
keeping with a reporter who risked his life countless times in Africa, Bosnia
and Kosovo.

Employed by the Rome-based Radio Radicale, an affiliate of Italy's Radical
Party, he stayed in Pristina when all other Western journalists pulled out
during Nato's bombing. It brought him an award and fame, but Russo, 40, was
never flashy. Glory he left to others. A shoestring budget and avoiding the
pack was his style.

Last November he moved to Tbilisi. Criss-crossing the mountains into
Chechnya, he befriended the rebel leader, Aslan Maskhadov, who was waging war
against Russian troops. Both sides were committing atrocities.

Last month Russo phoned his mother, Beatrice, a pharmacist in Tuscany. He had
obtained a videotape. Dead children, unimaginable horror, war crimes. The
world would see when he returned to Italy on 18 October.

His body was discovered on 16 October. Nearby was a sheet police suspect was
used to tie him up. Friends found the door to his city centre apartment
unlocked. Belongings were in disarray, documents and car gone. The coroner
said the injuries were almost certainly not the result of a road accident. It
is not known whether his chest was crushed by a rock, a piece of metal or
human pressure.

Mamuka Areshidze, an ex-parliamentary deputy who helped Russo in Georgia,
said he did not know which side might have instigated the murder, but was
convinced it was not simply a criminal attack. He said: 'I think he was
killed because someone wanted to conceal the material he had gathered - this
is why the videos disappeared. I understand security forces know how to apply
pressure to crush people to death without leaving any trace of violence.'

That is one of several the-ories the murder inquiry is examining, said
police. An environmental organisation in Tbilisi, and colleagues in Rome,
alleged Russo had evidence of a new Russian weapon that killed people slowly.

There is no proof and sceptics point out higher-profile journalists were
filing reports of atrocities. The Radical Party says the timing was
significant. For a year President Putin had been lobbying the United Nations
to end its status as a non-governmental organisation. He accused the Radicals
of paedophilia, terrorism and drug-trafficking. The final UN vote, which
rejected the request, was scheduled for 18 October.

Breezing through the studios of Radio Radicale is another theory. Russo was
killed because he had a videotaped interview with a Georgian woman claiming
to be the President's mother, refuting his claim she was dead. As a murder
motive that seems fanciful. The story emerged last spring and was followed up
by the international media before being discredited.

Others say the journalist, who on the day of his death was seen with Chechen
acquaintances, was killed for money. 'But why would they have left his
passport and golden crucifix? And why kill him in such a strange way? It
makes no sense,' said a colleague, who asked not to be named.

Human rights groups want the West to query Putin over Russo and two other
journalists who wrote about Chechnya: Alexander Yefremov, killed by a
remote-controlled explosion in the separatist region in May, and Iskander
Khationi, who focused on human rights abuses in Chechnya, found battered to
death in September.

Within hours of the news of Russo's death colleagues in Rome were flooded
messages. The ponytailed activist had made many friends on his travels.

'We never knew the half of it. Stories of him taking 30 kids to a burger
restaurant, saving people's lives,' said a colleague. The liberal,
freethinking Radicals promised neither fame nor decent salary, but Russo
signed up because 'they're crazy, just like me', he used to say.

The party's attacks on Left and Right alike may explain the minimal coverage
in Italy's partisan press. 'They're snobs. It has received more attention
abroad,' said the colleague.

Little fanfare accompanied Russo's burial in the family tomb in Francavilla,
deep in the Abruzzo countryside. Beatrice Russo, 75, believes her son's
killers will never be identified. ' It's all so murky. The only thing that
consoles me is it was a death consistent with his life.'

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