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. Last Updated: 07/27/2016

INSIDE RUSSIA: Berezovsky Can Use CIS For 2000 Vote




The long-awaited news last week of who would make up the new Cabinet of Ministers was overshadowed by two other news items -- the appointment of Boris Berezovsky as secretary of the Commonwealth of Independent States and of Anatoly Chubais as chairman of the board of Unified Energy Systems of Russia, or UES.


The consequences of Berezovsky's nomination were immediately visible. Uzbekistan, which had never shown much interest in the CIS, suddenly changed its attitude toward it when the owner of a huge share of Uzbek Daewoo became the commonwealth's secretary.


Of course, the walking corpse of the CIS is in no condition to resurrect anyone, including Berezovsky. But the post provides Berezovsky with a unique opportunity to apply his trademark method of using power as a profitable financial instrument.


The level of corruption in other CIS countries is even higher than in long-suffering Russia. Why, indeed, should anyone buy Rosneft for $2 billion if there is the chance to participate in cheap Ukrainian privatization schemes?


What is significant, however, is that the new appointment has drawn definite lines between the two gigantic industrial-financial blocs that were formed during the recent government crisis. In one bloc we have: Alexander Smolensky of SBS-Agro; Mikhail Khodorkovsky of Menatep-Rosprom; Berezovsky; and Vladimir Gusinsky of MOST Media. In the other bloc are found: Uneximbank and Interros; LUKoil (which from all appearances is drawing closer to Unexim); and Chubais' UES.


As economic entities, these super-holdings are pointless. The main principle behind the Russian economy -- control over the financial flows of enterprises -- requires individual authority and not collective management. People who do not want to share a ruble with the state will hardly share a single kopek with one another.


In short, from the point of view of investment in production, such monsters make no sense. They are being created for something else -- an investment in future election campaigns. In essence, these are not financial holdings but parties of a new kind. These parties do not need ideology, which is an opiate for mass consumption, but need only leaders, money and election technologies.


During the 1996 elections, those at the top in Russia put up a united front. But as soon as the elections made certain that the privatization results would not be reversed, there was dissension.


There won't be a united party for the elections in 2000. Moreover, one can predict right away that the winners, if they gain an absolute victory, will also fall out with one another.


In this sense, Berezovsky's nomination to run the CIS is very dangerous. It opens the way for financing the future presidential elections not only through corporations but through entire states with very poor people and very wealthy governments that have the capacity to throw unlimited sums of money into Russia. In exchange, they will receive future concessions, which amount to subsidizing corrupt economies at the expense of the Russian budget, but that could be extremely easy to present to the Russian people as a success in the business of reviving Russia's great-power status.


Yulia Latynina is a staff writer for Expert magazine.