Tough Times Are Getting Worse for NGOs

Vladimir Slivyak, a leading environmentalist, has a lot more to worry about these days than mounting campaigns to prevent nuclear theft and to protect forests from loggers in Kaliningrad.

With the country caught in the grip of the global financial crisis, he has been unable to raise even half of the funding that he had planned for his environmental group, Ecodefense.

"The situation is very bad," Slivyak said in a recent interview. "All Russian money that went to NGOs here is being frozen."

Slivyak is intensifying his fundraising efforts with Western donors, but he fears that financing from abroad will also dry up.

Ecodefense and other nongovernmental organizations operating in this country are used to tough times. Amid fears that Western money might be funneled to Russian NGOs to incite unrest, the government enacted a stringent law in 2006 that led to the closure of many NGOs and greatly increased the bureaucratic burden on those that remained.

The future is looking even bleaker now. The scarcity of funding combined with continued uncertainty about the authorities' actions is shaping into a perfect storm for NGOs.

A top concern for many activists in recent weeks has been the government's failure to publish a vital list of which organizations can issue grants without having to pay taxes on them. Many donor organizations make tax-exemption an essential requirement for releasing the money.

"I am very worried about that list," said Sergei Lukashevsky, director of the Demos Center, an independent civil liberties watchdog.

In June, Prime Minister Vladimir Putin signed a decree that listed just 12 organizations that were allowed tax-free grants, down from 101. The government said at the time that the list only contained intergovernmental organizations and that a list including all the other organizations would be issued by the end of the year. It remained unclear Monday when Putin would sign the second decree.

Daria Miloslavskaya, a Moscow-based program director at the International Center for Not-for-Profit Law, an NGO promoting a legal environment for civil society and public participation, said the decree was still being discussed among various government ministries but should come out this month.

Uncertainty about the future will hang over NGOs as long as there is no new list, said Sergei Tsyplyonkov, director of Greenpeace Russia, the environmental group. "What happens with grants that extend [from 2008 into 2009]?" he said in late December. "What happens with money not used last year?"

This year will not be easy, but 2010 might actually be worse, said Lukashevsky, of the Demos Center. Most grants for 2009 were paid out before the crisis escalated in the last part of 2008, he said.

Other NGOs argued that finances did not matter as much as a crisis -affecting domestic politics.

"Yes, there is less money now, and that means that some of our projects will not be realized," said Arseny Roginsky, director of Memorial, a leading human rights group. But "money is not the main thing," he said.

The issue now is that the authorities feel threatened by possible public unrest linked to the crisis, he said. "We can expect that they will tighten the screws," he said.

Incidentally, the police raided Memorial's offices on Dec. 4, combing through the room for six hours in what the group believes was an attempt to intimidate it. Memorial has linked the raid to its work to expose and publicize terror during Josef Stalin's rule — a period in Russia's history that the government has tried to whitewash and justify.

Tsyplyonkov, director of Greenpeace Russia, said he has experienced a tightening of the screws. Last fall, he said in an interview, his organization was forced to change its status from a national organization to an office of Greenpeace International. The reason given by authorities, he said, was that the legal statutes of Greenpeace Russia, founded in 1992, were out of date.

"We received letters from the Federal Registration Service and the Justice Ministry that effectively gave us a deadline to reregister as a division of our international organization. Otherwise, we could have been dissolved," he said.

Tsyplyonkov said this was an effective way to increase state control over NGOs because the law sets more stringent restrictions on subsidiaries of foreign NGOs than on national NGOs.

He said he was also worried about changes to the Criminal Code announced late last year that would widen the definition of treason and spying. "Now speaking to members of foreign organizations could be an act of treason," he said.

Greenpeace is also finding it increasingly difficult to conduct fundraising in the country. The reason is that red tape at banks makes it cumbersome for people to give money to an organization, Tsyplyonko said. "Direct debit is impossible and standing orders are tedious, forcing donors to stand in line at Sberbank," he said.