Liberty! Liberty! What crimes are committed in thy name!”

The person who said that was Marie Jeanne Roland. They were her last words. She was four months short of her 40th birthday when, sharp at half-past three on a dull November afternoon in Paris, the guillotine cut her head off. The charge for which she was executed was trumped up. Her trial was a mockery. Her real crime was that, as one of the most eloquent and fearless women then participating in the factional politics of the French Revolution, she threatened Georges Danton and Maximilien Robespierre, who were in power that year of 1793. (more…)

by John Helmer - Friday, February 21st, 2003
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Last week, when we last visited Mikhail Fridman and Viktor Vekselberg, the controlling shareholders of Tyumen Oil Co. (TNK), we found them in the shrubbery desperately trying to sell off their loot.

For more than a year, they had been offering minority-sized stakes in the oil company. But, after doing their due diligence, Chevron-Texaco and other international majors had said no. (more…)

by John Helmer - Friday, February 14th, 2003
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It was during the brief period of the New Economic Policy (NEP), which began in 1921, that Lenin and the Soviet authorities had the thought that, in order to improve the redistribution of wealth, it was necessary to generate some wealth to start with.

This hilarious idea produced a dazzling display of satirical writing by the Russian talents of the day. (By contrast, in our brief period, the current crop of Russian writers tell their stories with such hyperrealistic attention to detail that not even a snigger, let alone a belly laugh, is a possibility.)

In one of Mikhail Zoshchenko’s stories of 1923, called “The Thief,” Vaska Tyapkin, a pickpocket who specializes in city trams, decides that, because the passengers have become so mean, he should move his business to the more invigorating air and improved pickings of the dacha belt. So he goes to case out a cottage owned by a prosperous gynecologist. (more…)

by John Helmer - Friday, February 7th, 2003
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For the first time ever, Russian workers are threatening to strike in a dispute union leaders directly blame on the tactics of the oligarch who controls the shareholding of Norilsk Nickel. Also for the first time, the unions are demanding that corporate transparency include the disclosure of the oligarch’s perquisites, including the salaries paid to senior management, stock options, bonuses tacked to movements in share prices, and other forms of compensation.

As the French novelist Gustave Flaubert once said, wealth is a “substitute for everything, even reputation.” But even Vladimir Potanin and Mikhail Prokhorov, the dominant shareholders of Norilsk Nickel, have started to understand that, for the share value and the creditworthiness of Norilsk Nickel to appreciate, their personal reputations or the briefings they provide selected international bankers and analysts are not enough. (more…)

by John Helmer - Friday, January 24th, 2003
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The Kremlin has decided to curtail its support for a new pipeline proposed for oil shipments to China after six months of appearing in public to want to accelerate the project. According to Moscow industry sources and a blitz of Japanese media leaks ahead of Prime Minister Junichiro Koizumi’s visit to Moscow last week, some officials in the Russian government are now quietly in favor of a more expensive pipeline option backed by the Japanese government. Other Russian officials warn, however, that in exchange for financing the pipeline, Japan may demand exclusive access to the oil, a condition that the Kremlin is unlikely to accept.

At present, Russian law gives the state strict control over every ton of exported crude oil and petroleum products through regulation over access to oil pipelines, tariff pricing for pipeline and rail transportation, port control, customs inspection and export taxation. (more…)

by John Helmer - Friday, January 17th, 2003
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The four Russian oil producers, which signed an agreement a few days ago to build a new oil terminal at Mur-mansk, Russia’s Arctic port, are taking on not only the state pipe-line operator Transneft, but also the Russian government’s power to regulate and limit the volume of oil exports. If you believe what you read in the papers, you couldn’t help thinking the oil producers have won without a fight.

“If the oil companies have the money for the project, let them build it,” Sergei Grigoriev, vice-president of Transneft, has responded with less hoopla, and more irony. “However, we doubt that they would build a pipeline cheaper and better than Transneft can.” (more…)

by John Helmer - Monday, December 16th, 2002
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Russian insurers and Moscow-based international insurance analysts are critical of a recent report by Moscow-based United Financial Group (UFG) suggesting that fiction is larger than fact in the share valuations, balance-sheets and premium revenue reports of the leading Russian insurance companies.

UFG is one of a handful of Russian investment banks and brokerages with an established reputation in the capital. Its 40-page report by Ilan Rubin is the first attempt to survey the domestic insurance industry. (more…)

by John Helmer - Friday, December 6th, 2002
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There is a scam among taxi drivers working at Moscow’s Domodedovo Airport.

With his passenger on board and after taking the fare into the city, the taxi driver starts his engine. But he hasn’t gone beyond the airport boundary when he simulates a technical failure and announces the car can’t go any further. He then gets the passenger out of the car with the promise he will find another vehicle quickly. The driver pays the second driver a fraction of what he has received, bundles the passenger into the new car and pockets the difference in fares. Why should he drive into the city when he can make a nice profit over a few meters? (more…)

by John Helmer - Friday, November 22nd, 2002
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It is rare for a local investment bank to expose an entire commercial market as a compound of tax-avoidance schemes, phony revenue statements, paper transfers and intentionally misleading valuations. But that is what the United Financial Group (UFG) manages to do for the Russian insurance market with a new report titled “Russia’s Insurance Industry: Enter the Man from Ru.”

Starting with an initial estimate of $9.5 billion in insurance premiums officially reported as paid in Russia in 2001, roughly half – $4.7 billion – should be disregarded as insurance at all, UFG concludes, because it represents one- to five-year policies paid out as tax-free annuities that are, in reality, tax-free income. This pseudo-life insurance is a well-known feature of the Russian market that is expected to dwindle from next year, when the annuities will be taxed as income for the first time. (more…)

by John Helmer - Friday, November 15th, 2002
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With grain exports likely to reach 8 million metric tons this year, Russia’s ports admit they are having trouble coping.

This is forcing the government in Moscow into opting between the policy of favoring Russian over Ukrainian and Baltic ports, or letting the surplus of grain eat into farm prices, farmer’s incomes, and farm planting for next year. Watch carefully and you will see how agile the Russian government can be in trading favors with powerful constituencies at the start of an election year.

The strongest pressure from Russia’s current grain boom is being felt at Novorossiisk, on the Black Sea – the traditional hub of Russia’s grain trade – because most of the export grain is produced in the Krasnodar and Rostov regions to the west of the port. Novorossiisk usually ships half or more of Russia’s grain exports. (more…)

by John Helmer - Friday, November 1st, 2002
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