Russian Market Gives No Guarantees

In 1998, Russian banks said goodbye to their depositors

Mikhail Delyagin, Doctor of Economic Sciences, Director of the Institute for Globalization Problems, talks about the economic and political situation in Russia.

The prime minister has approved Russia's energetic strategy that embraces the period until 2020. The document has already provoked discussions. Someone supports the strategy, someone criticizes it.

The energetic strategy is an unlucky document, it took it long to be developed. As far as I remember, the government approved the latest editing of the document in spring. It was signed only in the beginning of autumn, which testified to a very low efficiency of the government's work. To crown it all, the document does not contain substantial things - it is more of the declarative character. There was a good idea at first, but then it was lost in never-ending discussions. The present form of the Russian energetic strategy contains the following idea: one has to export the crude, the crude should not be processed in Russia, one has to build oil pipelines. A big part of the American energetic strategy, for example, is devoted to the Caspian Oil Pipeline Consortium. The consortium is scarcely mentioned in the Russian strategy. In other words, there is no strategy there. The document was approved in spring and signed in autumn - this is a shocking fact indeed. It means that the state is unable of doing something that has no meaning at all.

There are a lot of strange things there. For example, the document seriously runs that the tariff growth leads to energy-saving. One has to have investments for it, but we have none - there are no investments in an inefficient economic sector. The tariff growth should be enormous to make it result in the energy saving. In addition, there is a general idea: coal should oust gas from the energetic balance. In fact, it is an impossible thing to do, because one will have to introduce the state regulation of coal prices for it. The Russian economy will not stand a considerable rise of gas prices, there is no economy in the world that would be capable of handling it.

A special committee to select the companies for managing the pension money has recently held the final session. Sixty companies participated in the contest and 55 of them passed. Members of the would-be market say, the competition will be very tough, so nonmarket methods will be used to struggle for 1.5 billion rubles of pension savings.

In other words, it means, the money is not going to be distributed honestly because of the importance of this or that company. I am deeply concerned about the control over the companies that will be managing the pension money. It goes without saying, the market will be unable to control it. All Russian banks were controlling the market "perfectly" until August 1998, when they all said goodbye to their depositors. The state simply takes the pension money and gives it away to someone else - end of story. The pension reform is very insecure against such a background.

The IMF suggested a program of reforms to Belarus in order to conduct negotiations about loans. The program stipulates structural economic reforms, the toughening of the financial, budgetary and tax policies. The fund will be ready to negotiate only after the program is implemented.

It is clear, what the IMF is. It is clear, what it means for a country, especially if a country has a developed machine-building industry. Unlike Russia, Belarus has managed to preserve its machine-building industry. Such suggestions do not happen all by themselves, though. If the IMF made a suggestion to Belarussian President Alexander Lukashenko, it means that the latter had done something for the IMF's favor before. In this case, Belarus might stop being Russia's ally - it might become an ally of Russia's competitors. If Russia cannot offer anything to Belarus in the future, it means that the Belarussian economy is more successful than the Russian economy, despite all troubles. Of course, there are a lot of political problems in Belarus, one may not run large and midsize businesses there without the direct control on the part of the administration.

One of the most important recent events in Russia is the launching of the pre-election campaign. A lot of newspapers write, it will be the dirtiest campaign of all previous Russian campaigns.

The Russian law prohibits the pre-election agitation except for the agitation run by the party of power. During the elections in 1999, the whole country was inundated with posters saying "Putin and Shoygu Make the Unity." Now our interior minister is the leader of one of the parties - the police may easily search a competitor's office. Union of Rightist Forces and Yabloko are accusing each other of all deadly sins now. If the law prohibits legal forms of propaganda and agitation, there will be illegal forms used instead.

Yegor Gaidar has been recently invited to restore the economy of Iraq. Russia did not defend Iraq either diplomatically or politically. Iraq is now ruled by the US-led administration. Everything that Iraqi officials say is approved by American officials first. George W. Bush asked the Congress for $87 billion for the additional military contingent in Iraq, for the anti-terrorist struggle and for the restoration of Iraq. It virtually proves that nothing is working in Iraq. The USA needs to develop a consolidated position with large corporations regarding Iraq's future. It seems, they cannot share Iraq with each other. Corporations attract exterior experts - Yegor Gaidar may not discuss the future of Iraq with American corporations. Gaidar is simply America's cover up in Iraq, like Polish, French and Ukrainian soldiers, although in the economic policy. He will simply be doing the office work.

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Author`s name Olga Savka