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Derek Brower: Do svidaniia

The 10th Russian Economic Forum in London could be the last By Derek Brower, journalist IT ENDED as it began: not with a bang, but a whimper. And it could be the last time London hosts a Russia Economic Forum (REF), predicted some of the delegates attending the event earlier this week. That it was overshadowed by the death of Boris Yeltsin was, perhaps, fitting. A legacy of the Yeltsin era, the REF, with its reputation for frank speaking and political controversy, was beginning to look like a misfit in the Putin period. The list of those who withdrew under pressure from Moscow was impressive. No Sergei Bogdanchikov, head of Rosneft. No Alexander Medvedev, of Gazprom. No German Gref, trade minister of Russia. And so on. The list even included foreign businessmen, like Fulvio Conti, of Italy’s Enel. This year’s REF became an event not to be seen at. Alexander Lebedev, one of the only major politicians to turn up, wondered aloud whether he’d be allowed to return home afterwards. Many of those did attend also seemed keen to ensure it wouldn’t be held against them. A host of bankers reiterated a common line, that “stability” under Putin had become key to Russia’s remarkable economic growth and the rapid growth in mergers and acquisitions activity in the country last year (worth some $70bn, according to Ernst & Young). But the fluff bored some listeners. “Too many investors talking up their portfolios,” said one delegate about the forum’s first day. “They would say that, wouldn’t they.” Amid the banality of the opening session, the greatest controversy came when a Dow Jones reporter took exception to the repeated inference that journalists were somehow to blame for the negative image of Putin’s Russia. “Did journalists cut off the oil to German refineries earlier this year?” he asked. “Did journalists kill Alexander Litvinenko?” To applause in the auditorium – and admiration in the press room – he concluded by asking how the Kremlin could expect reporters’ cooperation when “journalists continue to be killed with impunity”. His question was directed to Hans-Joerg Rudloff, chairman of Barclays Capital and one of Putin’s most dogged cheer leaders. Rudloff had earlier warned Russia that its economic boom could be unsustainable. But put on the spot, he praised Putin’s government further, dodged the awkward questions, and advised simply that journalists “be fair”. More applause. How to lose friends and influence fewer people That journalists are to blame for Russia’s ills was a refrain repeated many times at the forum. Ironically, given such concerns among its supporters, the Kremlin decision to boycott the event – and probably sink it for good – hardly helps to redress the image problem. Not even Rudloff or the enthusiasm of Renaissance Capital and other heavyweights from the Russian investment scene could prevent the REF from becoming another PR blunder. Russia’s political risks were the elephant-in-the-sitting-room of the forum. Everyone knows it is the main issue, but no-one wants to talk about it. Few speakers strayed far from statistics about Russia’s growth and economic potential. Lots of talk about mega-salaries and new headquarters in Moscow; not much talk about human rights or press freedom; and only veiled references to economic nationalism and corruption. The closest many of the key-note speakers got to voicing criticism of the direction of Putin’s Russia was a plea from Alexei Gurin, chief executive of tyre maker Amtel-Vredestein, that the country diversify its economy. Real criticism was left to a handful of Russia’s remaining prominent critics, who enlivened the forum’s last afternoon with a heated discussion of the 2008 “succession question”. The absence of the Kremlin’s heavy-hitters surrendered some of the rhetorical ground to these speakers, which included Boris Nemtsov, a former prime minister and close ally of Boris Yeltsin, Lilya Shevtsova, from the Moscow Carnegie Centre, and Andrei Vasiliev, editor-in-chief of Kommersant. Nemtsov told a crowd gathered to hear a discussion about the presidential elections in 2008 that Putin had systematically rolled back all of the reforms of the Yeltsin era. Censorship has replaced liberty, he said, and nationalisation has replaced privatisation. And in international relations, the Kremlin had squandered all of the good will that Yeltsin’s presidency had gained. “His physical death comes after the destruction of everything that he achieved.” “Yeltsin will be remembered in history as an outstanding figure who tried to liberate Russia. I don’t know what Putin’s legacy will be,” he said. Such enthusiasm for Yeltsin is hardly widespread in Russia, where the image of the Yeltsin years for many remains one of chaos and corruption. But, said Shevtsova, the apparent stability of the Putin regime could soon be undermined, too. That is because it remains in the President’s interests to ensure that no clarity over the succession issue emerges, she said. “Putin cannot allow certainty because he would become a lame duck president.” That logic remains behind the cultivating of “horizontal” competition – such as the apparent race between the two presidential hopefuls Dmitry Medvedev and Sergei Ivanov; or the balancing of factions in the Duma – as a means of retaining his own “vertical” power. Such uncertainty is one of the paradoxes of Putinism, said Shevtsova. Business likes stability, but Putin’s own strategy could undermine it. And she predicted that after 2008, a new regime could unleash its own fundamental changes, just as Putin had done after Yeltsin. Eventica, the REF’s organisers, will hope that such uncertainty means next year’s forum, scheduled to take place after the presidential elections, remains in demand. But in the fog of Russian cigarette smoke outside the conference rooms, others lamented the passing of an era. “The forum is finished,” said one delegate. “Next year it will be in Petersburg or nowhere.”