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Oligarchs as Nation's Saviors? Berezovsky Justifies Himself

Published: October 20, 2000 (Issue # 613)


A GROUP of House Republicans in the United States has assailed the Clinton administration for supporting Russia's former president, Boris Yeltsin, whom they accuse of fostering corruption and allowing undue influence to big business during his time in office. Similar views are expressed by some reviewers of Yeltsin's memoirs, just published.

Unfortunately, these people neglect the context of Russian history. As a participant in a major business privatization deal of that period - for which I have been labeled an "oligarch" - I would like to put what happened in Russia in historical perspective.

When the Bolsheviks abolished private property in 1917, they put all expropriated wealth under the management of two organizations that were to become pillars of Soviet totalitarianism: the Communist Party and the secret police (eventually known as the KGB). To accomplish this end, the new managers physically eliminated the previous owners - tens of millions of them.

Three-quarters of a century later, in just a few years, Yeltsin carried out the reverse of the Bolshevik Revolution - and he did so bloodlessly and efficiently. By 1998, 75 percent of the property had been transferred to private hands.

Critics say that privatization was unfair - that the "oligarchs" got major assets for a fraction of their real value. To put this claim in context, I recall the events of the pivotal year 1996, which began with Communists having a majority in the State Duma and Yeltsin's popularity slipping below 3 percent while that of his Communist rival, Gennady Zyuganov, rose to nearly 30 percent.

It was at that time that Yeltsin and Anatoly Chubais decided to sell off a great many state assets quickly so that it would be difficult for the Communists to renationalize private property after Zyuganov's expected victory in the race for president. This was the background for my decision to bid for the oil company Sibneft.

For the auction, my partners and I needed at least $100 million but had only $60 million on hand. So we invited foreign investors - in the United States, Western Europe and Japan - to participate in our bid. No one gave us a penny, and George Soros, who always understood Russia better than others, told me: "The risk is too high. The Communists will take everything back. Russia is slipping into a black hole, Boris. Don't be a fool, take your family and get out, before it's too late."

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ALL ABOUT TOWN

Saturday, Nov. 22


Russian Premier League-leaders Zenit St. Petersburg return from the international break to take on Kuban Krasnodar at Petrovsky Stadium this evening at 7 p.m. Tickets for the game can still be purchased on the club’s website, at the Petrovsky Stadium box office or in any of the club’s merchandise stores.



Sunday, Nov. 23


Get in the holiday spirit at today’s Winter Bazzar at the Astoria Hotel. Featuring gifts from around the world such as French eclairs, Dutch cheeses and Indian jewelry, the annual event organized by the International Women’s Club will feature 18 international stands and raise money for charity through the sales of a diversity of products that further illustrate the city’s international connections.



Monday, Nov. 24


Dr. Axel Schulte, Department Head at Fraunhofer Institute for Material Flow and Logistics in Dortmund, Germany, is the featured speaker at the SPIBA Industrial Committee lecture on “The Fourth Industrial Revolution: Digitalization of the Supply Chain.” The event begins at 4 p.m. at the Graduate School of Management at 3 Volkohvsky Pereulok and registration is required by Nov. 21 either by emailing office@spiba.ru or calling 325 9091.



Tuesday, Nov. 25


Tag along with AmCham during their “Industrial St. Petersburg” Tour program today. This incarnation of the ongoing series will visit Philip Morris Izhora and include an Environmental Health and Safety Committee meeting.


Find out how to expand your business east during the “Business With China” forum beginning today and concluding tomorrow at the Lenexpo convention center. The largest Russian forum dedicated to business with the Asian giant, topics that will be discussed include logistics, customs clearance, trade financing and many more.



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