Anna Politkovskaya Murdered

According to Russian TV-news Vesti24, the famous Russian journalist and author, Anna Politkovskaya was shot down half an hour ago in her home in Moscow by a lone assailant. Politkovskaya was hit by four shots in the elevator of her Moscow apartment building and evidently died at once. The murderer has so far not been arrested.

Anna Politkovskaya was Russia's internationally most well-known journalist and was revered for her great courage in crititically reporting on developments in Russia. Her books on Russia's war in Chechnya were spread in various translations throughout the globe, but never published in Russia. Her last book, "Putin's Russia", attacks the societal climate that the Putin era has brought to the Russian people. Working as a journalist for the independent newspaper Novaya Gazeta, Politkovskya stood on the forefront of regime critique. For years, Politkovskaya has had death-threats hanging over her head. Tragically, her brave posture and deeds have now resulted in her own death. Inevitably, she will stand out as a beacon of light in the history of journalism.

Kazakh Crimes or Borat's Chimes?

As Kazakhstan's president Nursultan Nazarbayev visited Washington last week, his meetings with top US officials - including president Bush - was overshadowed by the launch of British comedian Sacha Baron Cohen's upcoming movie: "Borat: Cultural Learnings of America for Make Benefit Glorious Nation of Kazakhstan."

The British comedian - depicting the fictional Kazakh journalist Borat - has long been a nail in the eye for Kazakhstan's efforts to create a positive international image for the country. Cohen's character instead produces an image of a backward country on the verge of civilisation run by a comic dictator. Over the past years, Kazakh authorities have gone to great lengths to counter the "Borat image" of the country, and its foreign minister has even threatened to sue Cohen in Britain for smearing Kazakhstan. Also, Borat's official website in Kazakhstan has been closed down by authorities, provoking widespread protests internationally, from among others Reporters Without Borders. The issue has grown to such proportions that Kazakhstan chose to publish a four page ad in both The New York Times and Washington Post for Nazarbayev's visit in the US. The only problem was that the ads only served to emphasise the comic image of Kazakhstan by attributing the country's successes to Nazarbayev himself.

Still, the question is if Borat's image of Kazakhstan is the one that an initiated Western audience would like to get across to the general public. It would seem that greater issues are at stake such as human rights and democracy. Several critical voices were raised before Nazarbayev's visit to the US, but they were later largely overshadowed by on the one hand the message the Bush administration wanted to send and on the other by Sascha "Borat" Cohen's media coup. Critical issues were thus largely left out.

One leading analyst, S. Frederick Starr of Johns Hopkins, though succeded in getting access to the media by a column in the Washington Post. The only problem was that Starr joined the crowd of those paying tribute to Kazakhstan's progress in recent years, thus furhter defusing a potentially embarassing situation for the White House wanting to avoid questions on the human rights and democracy situation. It is true that Starr was right in pointing to improvements on many levels, in contrast to a generally dark depiction in the West of post-soviet republics. However, this does not warrant leaving the difficult issues out. Also, Starr's article in the post stands in contrast to the negative story the Post published but little over a month ago.

Kazakhstan is, essentially, a country run as a corrupt company by one family, namely that of president Nazarbayev himself. In June, Nazarbayev's son-in-law became chief of the country's gas and oil company, whereas the presidential daughter is a key stake-holder in one of Kazakstan's largest banks. Another daughter is party leader and MP, with a husband serving as deputy foreign minister. It is in this autocratic climate that little room is left for democracy and human rights, and magnanimous ideas - such as turning the flow of Siberian rivers - are increasingly coming into vogue. This is perhaps no wonder as Nursultan Nazarbayev received 91% of votes in the rigged December 2005 presidential elections.

Human Rights Watch has repeatedly criticised Kazakhstan for severe human rights violations, lack of democracy and persecution of political opposition groups and independent media. Furthermore, authorities keep a close check on all NGOs and registration is mandatory. The freedom of organisation is thus legally circumscribed. Moreover, Kazakshtan was rated one of the most corrupt countries in the world by Transparency International in its 2004 report. It is with such a country that the US has so cordial relations.

Then, what is the White House position on these issues? Meeting Nazarbayev last Friday, president Bush praised Kazakhstan for its "commitment to institutions that will enable liberty to flourish." Also, during his visit to Astana in May, vice-president Dick Cheney declared the country a "key strategic partner of the United States” in its war on terror. Besides the war on terror, oil is the main reason for the Bush administration's cordial relations with Kazakhstan. The Baku-Tbilisi-Ceyhan pipeline (BTC) is a key strategic asset for the West in the future access to oil from Central Asia and the Caucasus, and the BTC is dependent on the inflow of Kazakh oil for long-term profitability.

Therefore, a new Great Game between Russia and the West over the energy resources of Central Asia is played by mighty international commercial interests, in which US companies have a high stake. Earlier this year, Russia won a small victory in this new Great Game over Central Asian resources by being promised increased oil exports by Nazarbayev. This poses a threat to the BTC pipeline, as the very same oil that was intended to flow westwards now instead may go to Russia. With increasingly scarce international oil reserves in the future, now is the time of determination of who will control what resources are left. Here, Kazakhstan plays a key role in Central Asia in view of political stability combined with relative accessability to resources. Consequently, it is very important for the Bush administration to get relations between the US and Kazakhstan back on track.

Then, does Kazakhstan matter? Is it not yet another far away country of which we know nothing? For now, the paradox remains that Kazakhstan matters greatly to the US provided that it stays such a far away country, which the US public cares little about in terms of the basic values forming the basis of American society. In the long run though, the question is if it is in the best interest of the US to end up on the side of the rats of international politics in contrast to supporting the people in its strive for democracy and human rights? As the story goes, "Qui vivra verra" - Who lives shall see. In the meantime, the comedian Sascha "Borat" Cohen may paradoxically be doing Nazarbayev a favour by distracting the American public from the real issues at stake. Following Borat's chimes hides Kazakh crimes.

EU Discord on Armenian Genocide

Turkey will not have to recognize the Armenian genocide to become an EU member, EU Commissioner for Enlargement, Olli Rehn, said on Tuesday thus contradicting French president Jacques Chirac, who only this weekend set recognition as a sine qua non for Turkish accession.

Celebrating the first anniversary of Turkish membership talks with the EU, Olli Rehn is on a visit to Ankara trying to encourage further progress in Turkish pre-accession preparations. The visit comes only days after French President's, Jacques Chirac, visit to Armenia, where he again stressed that Turkey's recognition of guilt for the Armenian genocide was a condition for EU membership. France remains hesitant to Turkish accession and also faces an influential Armenian diaspora at home. Many influential public figures in France are of Armenian descent and Chirac for example was accompanied by Varenagh Aznavourian - more commonly known as Charles Aznavour - France's most famous singer - on his visit to Yerevan.

For Turkey, admitting the Armenian genocide is a difficult process involving a reevaluation of the country's own history and its transformation from the multiethnic Ottoman empire to Turkey as a nation state. Ankara claims that 300,000 Armenians were killed as part of civil war during the dissolution of the Ottoman Empire, concurrently stating that at least as many Turks were killed in the same conflict, occuring prior to Turkish statehood. Armenians, to the contrary, point to a death toll of 1.5 million people slain by the Turks during 1915-17, and argue that Turkey sooner or later must assume responsibility for its crimes against the Armenian people.

Although the Armenian issue has presented a regional and international deadlock for decades, some progress has been made as of late, even though there still is a long way to go before the issue is resolved. Recently, Turkey has proposed a joint Turkish-Armenian historical commission to investigate "atrocities against Armenians." So far, Olli Rehn has been the only EU-representative to support the proposal, but more may follow. Defusing the Armenian issue is, however, not in France's best interest due to its negative stance on Turkish EU-accession and large Armenian minority.

That some half-wit EU Commissioner should spoil the glorius aftermath of Chirac's grand visit to Armenia, supporting France's illusory self-image as a great power is also simply too much of an insult for the palais de l'Elysée to be accepted. Therefore, Commissioner Rehn is in for a scolding by France - concurrently also weakening positions of Turkish membership proponents. What Armenia stands to gain from this remains unclear.

Death of a Russian Hero?

Yesterday, deputy head of the Russian Central Bank, Andrei Kozlov, died from gunhot wounds protracted when shot down by armed assailants in central Moscow Wednesday evening. Kozlov is the highest ranking official murdered during president Putin's reign and his assassination now sparks indignation and raises doubts about Russia's fight against organised crime.

Kozlov was responsible for cleaning up the Russian banking sector and closed down several banks involved in money laundering schemes and violations of Central Bank regulations. In 2004, Kozlov closed down Sodbiznesbank and this year Neftyanoi bank in high-profile cases against organised crime in Russia. In 2006, the Central Bank has stepped up efforts in the fight against the financial activities of the Russian mafia and banking licenses have been revoked almost on a weekly basis. Therefore, Kozlov was an obvious target for retaliation from criminal elements. That Kozlov refused having bodyguards regretfully facilitated his murder.

Kozlov's death is a tragic blow against Russia's efforts to clean up criminality within the financial sector. The importance of his work cannot be overestimated, while it targeted the core interests of Russian organised crime, restoring a sound Russian economy by legal means. Such efforts by grey bureaucrats are exactly what hit hardest at the mafia as has been demonstrated by both US and Italian efforts to fight organised crime. However dull Kozlov's work might have appeared, his efforts were of great importance in restoring the legality and transparency so much needed in contemporary Russia. His eulogy might therefore read "death of a Russian hero."

Ukrainian Lighthouses & Landmarks

Little more than a month after becoming Ukrainian Prime Minister, Viktor Yanukovich, seems poised to break his pledge to president Viktor Yushchenko of Ukraine's continued western integration. Visiting Brussels on Thursday, Yanukovich put a moratorium on Ukraine's plans to join Nato, saying that: "Because of the political situation in Ukraine, we will now have to take a pause," according to International Herald Tribune.

However, what should be clear by now is that NATO and EU accession has become a parallel process in the integration of former Eastern bloc countries. Therefore, Yanukovich "pause" effectively means a halt - or at least a severe delay - for Ukraine's western integration.

That NATO and the EU are different organisations and deal with different issues should not disguise the fact that a majority of EU-members are also members of NATO. Combined with the backlash of the Orange revolution, Yanukovich statement is likely to further put off western leaders from any real association with Ukraine. Trust in Ukraine is at a low and the only real motivation for western efforts is to keep the country out of Moscow's orbit.

Still, Yanukovich's decision on NATO is logical. Popular support for NATO-membership has never reached any substantial levels, so his excuse to "play it safe" rather than to rush into something that Ukrainians will not accept is natural. This has tacitly been accepted by NATO-officials as a statement of facts rather than intent. At the same time, questions are raised what role Russia might have had in the decision. Yanukovich has previously declared that he would like Ukraine to be a "reliable bridge" between Europe and Russia, and NATO-membership seems incompatible with such a role. Russia has adamanttly opposed Ukrainian rapprochement to the Atlantic alliance.

Relations with Russia continue to be strained. Only yesterday, a Ukrainian court ordered that authorities should take control over 22 lighthouses in the Crimea that have been leased to Russia's Black Sea Fleet, BBC reports. As late as in June, Russia and Ukraine failed to reach agreement on settling the Kerch strait border dispute, which has been going on since 2003, according to RIA Novosti.

Ukraine's relations with Russia on the one hand and the West on the other have often been simplistically depicted as balancing between East and West. A similar balance accordingly applies to Ukraine's domestic scene - between Russian and Ukrainian speakers. As anyone who has dealt with Ukraine knows, realities are much more complex.

Still, the image of a Ukraine split between East and West lingers on in the minds of international leaders and is also exploited by a variety of actors. At a time when there are great doubts in the West as for Ukraine's willingness and ability to integrate, there is little room for a more straightforward public policy.

Yanukovich might have pursued a declaratory policy on NATO and EU membership at the same time as deepening relations with Russia. As long as no real steps towards NATO-integration were to be taken, such a situation might have been acceptable both to Russia and the West. That would have kept doors open for Kiev - both towards Brussels and Moscow.

Now, Yanukovich is closing the NATO-door and thereby - in a longer perspective - also the EU-door. This might however not open the door to Russia any wider, simply because the Kremlin has never accepted its loss of influence over Ukraine. A loss that one has not accepted is not regarded a real victory once it is regained.

Public postponement of NATO-integration is thus simply not a good idea at a time like this, when Ukraine needs the best of both worlds. The paradox is that what would probably serve Kiev's interests best at this point would be to say one thing and do the other, that is pledge western integration and cooperate more closely with Russia. In that way, Ukraine might have maintained safeguarded by the West at the same time as it could have remained part of the East. Now instead, Yanukovich has set a landmark in Ukraine's modern political history by giving away an important foreign policy instrument for no obvious reason. Cui bono? What does Ukraine or Yanukovich stand to gain from self-imposed alienation when one needs all the help one can get?

Putin's Presidential Pseudo-News

Putin will not run for a third presidential term in 2008. This is a message that he has been repeating every other month over the past years. Still, it was one of the top stories of international media today. Why is it that this is considered so important news as to reach the headlines of respected news sources throughout the globe next to every time that Putin says he will step down from power in 2008? The answer might be that this is the effect of a well-orchestrated media-coup by Putin's political spin-doctors - the political technologists.

News should always be considered critically by those who receive it. What essentially constitutes news should also be filtered by those whose profession it is - journalists and editors. As the mere term indicates, news should also present something new to its audience. How is it then that something which is news to nobody is repeatedly treated as such?

Should not any journalist in his sound mind defer from reporting what everyone already knows: That Putin does not want to remain Russia's president after 2008. On the contrary, if Putin would declare that he will run for a third presidential term and thus change the constitution, then it would be news of great significance. Until then, this is not the case.

Putin's repeated denial of furher presidential ambitions is perhaps - paradoxically - the main reason why journalists are so susceptible to this message. A climate has been created in which Putin's statement of facts becomes a crescendo of denials in anticipation of the orgiastic eruption when he finally comes out of the closet: "Yes, I will run for a third term! Yes, I will change the constitution! Yes, I cannot live without power! Yes, I am dizzy with success!" Putin's "No" becomes a resounding "Yes!!!" in the ears of media and the public.

That journalists and political analysts alike miss to comprehend Putin's "No" is partly explained by all the rumours that have reverberated throughout Moscow over the years. The question whether Putin will stay in power after 2008 has been a recurrent theme in all political discussions. Still, the answer has been the same all along, namely that the president respects the constitution and thus has no ambtion to change the fact that his tenure of power will end once his term runs out. So, rumours to the opposite must originate from somewhere else. One source might be the president himself by proxy of his "political technologists."

Why might this be the case? Putin has set before himself three tasks: to create and maintain political stability, produce economic growth, and gain control over strategic resources. Here, political stability is perceived a prerequisite for the latter two. In the political area, it is in the best interest of power that a climate of uncertainty prevails on whether Putin will continue in power. As long as this is the case, potential contenders will keep a low profile and nobody of significance will challenge Putin as long as he retains apparent popular support. Thus, Putin avoids running the risk of becoming a lame duck, and his political succession may be handled in an orderly manner by the Kremlin entourage that forms his basis of power. A measure of uncertainty for the public thus becomes an instrument of certainty for power, and thus the political tools for developing economic growth and gaining control over strategic resources is maintained.

Personally, it actually appears that Putin is weary with power and the constant obligations it involves. Associates at times describe him as disinterested with the chores of his office, allocating an increasing amount of time to activities normally not associated with the exercise of power. Also, Putin does not seem to be the sort of politician that thrives on power - to the opposite of what is often claimed in view of his extremely power-oriented policies.

Here also his KGB-background is regarded a reason why Putin would cling on to power, because KGB by essence epitomises power. To assume so may however be to miscomprehend the Chekist culture from which Putin originates. Chekist power tradition sets the system before the individual, and if Putin is true to these ideals he will also be loyal to the constitution as long as power to the system is ensured. His lack of ethics might also be construed in a Chekist context and not as evidence of self-perpetuating personalised authoritarian power.

Finally, why would Putin want to risk another period in office? His presidency has been more successful than what he himself might have imagined. Putin has restored the Russian state as an important actor both domestically and internationally. The country's economy thrives on the enormous incomes from oil, and a measure of stability has been restored to society. Why should Putin risk jeopardising an apparently favourable judgement as the great restorer of the Russian nation that the Russian people and history might pass on him, when the future is uncertain?

So, the question should perhaps be rephrased: "Why should Putin not step down from power in 2008?" So far, few substantial reasons have been presented why he should stay in power, so the assumption must naturally be that he will leave office.

Still, international media continues to report that Putin will leave power in 2008, in the anticipation that somewhere along the line he will change his mind. This does not only mean that the press runs the risk of a gigantic anticlimax once Putin actually leaves office. It above all serves the interests of Kremlin's perpetuation of authoritarian power while preventing democratic debate on the future of Russia. Wherever you turn, it seems that laughs will be on Putin in 2008, if he continues to pull off this game of ambiguities.



Comment: The full text of Putin's appearance is available at Financial Times.

Kazakhstan: Diverted Mind Diverts Rivers?

Kazakh president Nursultan Nazarbayev is considering reviving old plans of diverting Siberian rivers to the Central Asian region, according to Interfax. Thus, Kazakhstan would get a greater inflow of fresh water for agricultural production, as was the intent with similar projects historically.

During a meeting with his Uzbek colleague Islam Karimov in Astana the other week, Nazarbayev claimed that "diverting Siberian rivers will not have a negative impact on the environment" and that "populist statements that this is dangerous were wrong."

Plans for diverting the flow of Siberian rivers have been long-lived. In the 1960s, there were even plans to do so by using atomic bombs. River diversion has however shown catastrophic consequences when employed. A Soviet decision to divert river water to cotton farming hastened the dispersion of the Aral Sea, causing social, economic and environmental disaster.

During Perestroika, Mikhail Gorbachev permanently put a stop to similar plans. However, the megalomanic idea of turning rivers have remained popular among some people. As late as in 2004, Russia appeared to be reviving its old river diversion plans, but thankfully enthusiasm seems to have petered out. Let us hope that this will also be the case with Nazarbayev's folly.

Russia Between Oligarchs & Tycoons

Who were the oligarchs? The question may seem premature, while Russia's economic élite still exerts disproportionate influence over Russian society. Moscow actually has more dollar billionaires than New York. However, a drastic change has occurred during the Putin presidency. Whereas Boris Yeltsin's second presidential term was dominated by the oligarchs, Putin has largely succeeded in breaking away from their influence. Thus, the heydays of Russian business oligarchy seem to have passed, turning oligarchs into mere tycoons.

As Vladimir Putin seized power in Russia in 1999-2000, it was much thanks to the support of a few influential Russian businessmen. Their relations to the Kremlin, and above all president Yeltsin, were so close that Russians referred to them as the "family" - signifying a merger between the Yeltsin clan and the major Russian business tycoons of the 1990s. At the time, the tycoons wielded such influence and power over Russia that the country stood on the verge of oligarchy.

In contrast to Yeltsin, Putin at an early stage signalled that things were about to change. Such signals were initially incomprehensible for most oligarchs, as they were used to easy access to the president. However, access was soon denied with Putin in power - much to the fault of the oligarchs themselves. People like Berezovsky and Gusinsky had major fallouts with Putin already in early 1999, much because they treated him as a puppet on a chain. Hopes that they could control the new and inexperienced president were soon lost.

Instead, Putin formalised relations with major business by channeling contacts through the Russian Union of Industrialists and Entrepreneurs and by regular and more official meetings with leading businessmen. The message that gradually evolved during Putin's first presidency was becoming increasingly clear: Hands off politics! As long as business did not meddle into politics, the oligarchs were to be left alone in generating profits. However, if business ventured into threatening state interests, there would be hell to pay. So, who were the winners and losers of this transition?

The losers
The first victim of Putin's new policy was Russia's "capo di tutti capi" - Boris Berezovsky. His influence over Russia was so great by the end of the 1990s, that he was often called the "Grey Cardinal" of the Kremlin. With six major bank owners, Berezovsky in 1996 formed the "Big Seven" who were instrumental for the reelection of Boris Yeltsin. Seeing himself as a "kingmaker" Berezovsky was rewarded by Yeltsin in becoming first deputy secretary of the National Security Council, then secretary of the Commonwealth of Independent States (CIS). Winning a parliamentary seat in 1999, Berezovsky's luck started to turn. Having first brought Putin to power and then severely aggravated him, the methods of Berezovsky's business conquests - Aeroflot, Sibneft, aluminium industry, the ORT TV-channel etc - were turned against him. Only six months after the 1999 parliamentary elections, Berezovsky was forced to go into exile, on charges of fraud, money laundering and other financial crimes. After several demands for his extradition to Russia, Berezovsky was finally given political asylum in Great Britain.

Putin's second victim was media tycoon Vladimir Gusinsky - Russia's equivalent to Rupert Murdoch. Through his holding company Media Most, Gusinsky had great influence over Russian media, not least through the TV-channel NTV and the newspaper Segodnya. NTV and Segodnya were long regarded the nucleus of new independent media in Russia, even though it is obvious that Gusinsky at times used his media power for political purposes. The most flagrant example was the massive endorsement for Yeltin's reelection campaign in 1996. However, with Putin in power, Gusinsky's overinflated ego, a flamboyant lifestyle, and a propensity for unsound investment were factors that soon put him at loggerheads with the new master of the Kremlin. This all led to his eventual downfall. After a series of police raids and legal actions against himself and his companies, Gusinsky went into exile in Israel in 2001. In his absence, Gazprom and other companies seized the remainder of his business empire, and it its unlikely that the media tycoon will return to Russia, not least because legal authorities have long sought his extradition on fraud and embezzlement charges from several European countries.

The case that has perhaps been given most attention internationally is that of Mikhail Khodorkovsky. Regarded as a banking genius, Khodorkovsky in 2003 was Russia's wealthiest man. Back in 1990, he formed the Menatep bank, which provided credit to state enterprises, and participated in dealing with privatisation vouchers, thus gaining control of several large companies. He entered into chemical and textile industries, construction, mining and oil enterprises. In 1995, Khodorkovsky gained a controlling share of the oil giant Yukos, which soon became the jewel in the crown of his business empire. In the early 1990s, Khodorkovsky was known for his murky business deals in the privatisation of Russian economy. However, at the turn of the millenium he had transformed his public image to that of a protagonist of economic transparency, publicly crusading for stockholder and investor rights. Thus, Yukos was the first major Russian company to publish reliable quarterly reports. Still, economic influence was not enough for Khodorkovsky. He wanted political power as well. In supporting parties opposing Putin and the Kremlin, Khodorkovsky soon became the target of Kremlin's anti-oligarch crackdown. He not only posed a political threat. He also planned the construction of several strategic pipelines, which - if realised - would have given him a disproportionate influence over Russian business making him independent of political pressure. In addition to a political threat, Khodorkovsky thus also posed an economic threat to major interest groups within business and politics. It should therefore have come as little of a surprise when Khodorkovsky was arrested in October 2003. After a lengthy trial, displaying the Russian legal system as a travesty of justice, Khodorkovsky was sentenced to nine years imprisonment and his financial assets were gradually dismembered by his enemies within state and private business. At the time of his arrest, he was considered the most powerful of the Russian oligarchs. Now he has been passed to the sidelines serving his sentence in a Siberian prison camp.

The winners
Among the winners of Russia's business oligarchs, Roman Abramovich must be counted as the one who got away scots free. A disciple of Boris Berezovsky, Abramovich benefitted from his patronage in making his way to the top of Russian business. As the Kremlin moved in on Berezovsky in 1999, Abramovich took over Sibneft - one of Russia's largest oil companies - from his patron along with Russia's largest television network. He then went on to expand his nascent business empire by going into aluminium production by forming Russian Aluminium - the world's second largest aluminium producer. He also went into politics, representing the impoverished Chukotka region of the Russian far east, first as Duma deputy and then as governor, making development of the region his pet project. In 2005, Abramovich sold off 72% of his shares in Sibneft to Gazprom - the Russian state energy company. He has also apparently been able to remain good relations with the Kremlin - both the Yeltsin and Putin administrations. Abramovich has, however, increasingly transferred his assets abroad, buying and investing in western business, most notably the purchase of the English soccer team Chelsea. Today, he spends most of his time in Britain, only occasionally visiting Chukotka, where he remains governor. In March this year, Abramovich was listed by Forbes Magazine as Russia's richest man and the 11th richest in the world.

Vladimir Potanin is the golden boy of the post-soviet establishment. The son of a Ministry of Foreign Trade official, Potanin attended the prestigious Foreign Ministry institute, the MGIMO, before going into business. He started out with trading in nonferrous metals with his Interros company in 1991, to be followed by two banks - Oneximbank and MFK. Being an architect of the loans for shares program, he benefitted greatly from being able to buy Russian companies much beneath market value. In 1996, Potanin was one the "Big Seven" who assured Yeltsin's reelection. As a token of appreciation, he was then appointed first deputy prime minister by Yeltsin. The August 1998 economic crisis took a heavy toll on Potanin's business empire, but he succeeded in securing crucial assets. His financial conglomerate holds major assets in Russian business such as Norilsk Nickel - the world's largest platinum and paladium producer - as well as media holdings such as Izvestiya and Komsomolskaya Pravda.

As many other successful Russian businessmen, Mikhail Fridman has kept a low profile throughout his career. Starting out with a plethora of various businesses in the late 1980s, he subsequently managed to finance the establishment of AlfaBank - now one of Russia's biggest banks. He then went into the lucrative oil business and acquired Tyumen Oil. Cooperating with British Petroleum, Tyumen Oil was transformed into TNK-BP, today the world's tenth largest private oil and gas company. Also Fridman belonged to the "Big Seven" endorsing Yeltsin in 1996. The pinnacle of his business empire is the AlfaGroup holding company.

Oleg Deripaska is one of Russia's youngest billionaires (only Abramovich is younger). As so many others, he started out with trading in metals. Together with Abramovich, he formed the Russian Aluminium (RusAl) - the world's second largest aluminium producer - in 2000, and now owns 75% of company shares. He has also major interests in power and car industries and he also owns Russia's largest insurance company. Although Deripaska has been careful to keep off the political arena, he is considered one of president Putin's major business allies. Along with his business partner - Abramovich - Deripaska is by some currently considered Russia's richest man.

Born in Baku, Vagit Alekperov was fostered into the oil business, landing his first job in the sector at 18 years' age. By his growing expertise, Alekperov in 1991 became first deputy minister of fuel and energy and then acting minister. His main political accomplishment was bringing Russia's three biggest oil companies together to form LukOil. Not surprisingly, Deripaska then became president of Lukoil, a position he has retained ever since. Today, Lukoil is one of the world's mightiest oil companies with energy reserves only equalled by Exxon. He is considered Russia's tenth richest and the 38th worldwide.

From managed democracy to managed oligarchy?
Russia during the 1990s has often been compared to the United States during the early 20th century, when Rockefeller, J.P. Morgan and other business tycoons succeeded in forming next to total monopolies in various areas of business. Thus, the Wild West of this era should be equalled to the Wild East of Russia during its first post-soviet decade. Those who seek similarities may today also compare US President Woodrow Wilson's measures to bring down Standard Oil and other monopolistic companies. Thus, today Putin would allegedly be trying to regulate the market after the necessary turmoil of the liberalisation of the 1990s. The Russian state would consequently be trying to regain its position as a macroecnomic arbitrator in order to regulate the market and set the rules of the game.

However, this argument falls flat as the Putin administration displays such a blatant disregard of basic property rights - the very nucleus of a working market economy. That the oligarchs may have done the same in the early 1990s is no excuse for a state to follow such conduct. Moreover, one may argue that one oligarchy today is replaced by another, while the spoils of state action against the oligarchs partly end up in the hands of Putin's entourage, thus effectively redistributing assets from private to private hands instead of to government control. Consequently, Putin's people enrich themselves by forcing parts of Russian business into their own hands. Of course, such behaviour is but a parallel to Putin's political agenda, gaining control over all relevant areas of society. Seeing similarities between Russia of the 1990s and the US of the 1910s becomes laughable if turning to president Wilson's credo of "making the world safe for democracy." It is quite apparent that Putin neither makes Russia safe for democracy nor makes Russia safe for market economy.

Russian Cathedral in Flames

Yesterday, the St. Petersburg Troitsky (Trinity) Cathedral was rampaged by a violent fire, destroying its main dome and severely damaging the entire church. Apparently, the blaze started in renovation scaffolding encircling the dome, and firefighters were helpless in their attempts to fight the raging fire due to lack of proper equipment. At least, the bulk of invaluable religious icons and artefacts was saved.

St. Petersburg has now been robbed of the landmark of the Troitsky Cathedral's blue dome. Overlooking one of St. Petersburg's central canals, the Troitsky Cathedral, since its constuction in 1835, was the church of the famous imperial Izmailovsky regiment. The church was renowned for its fine collection of icons, but after the revolution most of its treasures disappeared through looting, until Troitsky was finally closed in 1938.

For long the Cathedral was threatened by demolition by soviet authorities, but in the end it came to use as a warehouse. It was not until 1990 that Troitsky Cathedral was returned to the Russian Orthodox Church. Since then renovation has slowly been underway, which so tragically has now resulted in its partial destruction.

St. Petersburg authorities have already promised that Troitsky Cathedral will be reconstructed within 18 months. Official proclamations that Troitsky will be rebuilt in record time now provoke fears that such haste will put its important cultural and historical values in peril. Therefore, this is perhaps an opportunity for president Putin to show his true devotion to his native city of St. Petersburg by guaranting that Troitsky will really retain its role as a carrier of Russia's national heritage.

Ukraine: Lazarenko Gets 9 Years Jail

Former Ukrainian Prime Minister Pavel Lazarenko was sentenced to nine years' imprisonment by a Federal Court in San Fransisco on Friday, Washington Post reports. Lazarenko was found guilty of corruption, money laundering, fraud and extortion, and also received a $10 million fine in addition to the jail sentence.

Pavel Lazarenko was Prime Minister of Ukraine from 1996 to 1997 and became infamous for using his office to serve his own economic interests. The bulk of his multimillion corruption proceeds ended up in Swiss, US and offshore bank accounts. The victim of Lazarenko's crimes was the Ukrainian people, who at the time struggled for daily survival after the post-soviet economic collapse.

Lazarenko was appointed Prime Minister of Ukraine in May 1996, although his appointment was never considered by the Ukrainian parliament - the Verkhovna Rada. Controlling decisions on many lucrative business projects, Lazarenko is said to have demanded 50% of profits from businesses favoured by him. Lazarenko at the time had close political and economic ties with current Ukrainian politicians of prominence such as Yulia Timoshenko and Socialist leader Oleksandr Moroz.

In 1999, Lazarenko fled the Ukraine, awaiting a parliamentary decision to waive his parliamentary immunity. Within days of his escape, he was arrested in the United States and spent four years in custody pending trial, until his release on a $68 million bail in 2003. A year later he was found guilty on 29 out of 53 charges concerning money laundering, fraud and extortion, but the judge eventually dropped a majority of them, reducing the list to 14 offences. Despite being released on bail, Lazarenko was subject to house arrest until his final verdict on Friday. The former Ukrainian PM has already declared that he intends to appeal the verdict.

Throughout the trial, Lazarenko's defence has maintained his innocence and challenged US legal authority to alleged crimes not committed in the United States. Lazarenko has argued that his business transactions were normal to the prevailing conditions in the Ukraine in the 1990s. He thus claims that it was generally accepted for a Ukrainian politician to earn millions on the side in these years, and that such business formed a natural part of the transformation from soviet command economy to a liberal market economy.

In 2000, Ukraine sought Lazarenko's extradition. The charges brought against him by the Ukrainain Prosecutor General included, beside economic crimes, the instigation of two murders and several assassination attempts on high-ranking officials. The US, however, denied extradition on the grounds that Lazarenko was tried for crimes in the United States.

US federal prosecutors are far from satisfied with Friday's verdict. They had initially sought an 18 year prison term and confiscation of and fines to a total of $66 million. US authorities have claimed that Lazarenko transferred $118 million to US banks alone. Still, the sentence constitutes a milestone in the US battle against international crime. Lazarenko becomes the first former state leader to receive a US prison sentence after Manuel Noriega of Panama. Also, the Ukrainian people may give up a sigh of relief that at least one of their corrupt leaders now is punished for his crimes although by the United States and not by Ukraine itself.