Russia Now #3

8
NEWS IN BRIEF IN THIS ISSUE The 18th Golden Mask Festival of Perform- ing Arts has opened in Moscow. The event will run until April 15, with a gala awards ceremony scheduled for the main stage of the Bolshoi Theatre on April 16. The Fes- tival features drama, ballet, opera and con- temporary dance performances from around Russia. Highlights includes Harlekin by St Petersburg’s Derevo Theatre, which also performed at the Edinburgh Fringe Festi- val in 2010, as well as theatre performanc- es from Omsk, Ekaterinburg, Altai and a puppet theatre from Chelyabinsk. Hamleys, one of the world’s largest toy- shop chains with a flagship store in Lon- don, is to open in Moscow, RIA Novosti re- ports. The first store under the Hamleys brand name in Russia will open in May in the Evropeisky shopping centre and will occupy about 1,700 sq m. The licence for the brand in Russia was given to the Ideas4retail firm, owned by businessmen Alexander Mamut, co-owner of Russia’s largest mobile phone retailer Evroset, and Yevgeny Butman, former co-owner of the re:Store Retail Group.The Russian toy mar- ket grew 17pc from 2010 to 2011 to nearly $3.3bn (£2bn). Other major Hamleys stores are in Dublin, Dubai, Amman, Glasgow, Mumbai, Chennai and Riyadh. Performers flock to Moscow Mask OPINION Election aftermath ‘Snow revolution’ melts away as reality sets in The State Duma has passed a bill that makes it easier for political groups to reg- ister as official parties. The groups will now need to collect only 500 signatures in their support in order to become a registered po- litical party instead of 50,000 signatures, as is currently the case. Critics of the bill had hoped for an amendment that would allow small political parties to form blocks so that they would have sufficient numbers to stand in the elections. Currently, politi- cal parties need 5pc of the vote to partici- pate in the elections. However, deputy speak- er and United Russia faction head Andrei Vorobyov saw “no necessity” to make this amendment, arguing that such mergers would lead to “a threat of feud and ten- sion.” The bill will come into effect imme- diately once it is signed by the president. Political minnows get party started TURN TO PAGE 6 Material difference: white ribbons were a symbol of protest “Dry food for an animal shel- ter urgently needed,”read an announcement on the Rus- sian social network siteVKon- takte. This wasn’t an appeal by an animal welfare organ- isation: it came from the 170,000-strong “Against Putin and United Russia Party” group. In recent weeks, calls to take to the streets have been interspersed with calls to give blood or raise money for surgery. The civic activism that fuelled the protests is taking other forms, while rallies are staged by a few activists from political parties. “After Bolotnaya Square, I attended other actions and, each time, my combative mood diminished,”says Sofia Protests had an impact Activism Demonstrations will have lasting influence on Putin Shaidullina, a young protest- er. “As the elections drew closer, the word ‘futile’ was bandied about more and more in conversations with my friends.” The opposition protests on March 17 and 18 in Moscow were smaller than those be- fore the presidential election. Against this background, the Rallies are losing their appeal because protesters feel they are unable to change the political situation. But this doesn’t mean the authorities can be complacent. VIKTOR DYATLIKOVICH SPECIAL TO RUSSIA NOW Meeting of minds: President Medvedev is taking advice on his roadmap to drive out corruption Less than two months before coming to the end of his term of office, President Dmitry Medvedev last week met with a team of experts to discuss Russia’s Open Government initiative, which is aimed at stemming corruption. Among the steps Mr Medvedev took after assum- ing office in 2008 were found- ing the Anti-Corruption Council and instituting a law requiring government offi- cials and their family mem- bers to disclose their hold- ings. More recently, his crusade featured a law that oversees government officials’ purchases, requiring that an- ything with a cost of more than triple the family income be subject to scrutiny. Preliminary results show the changes have yielded some improvement – Russia went up seven places in the Transparency International rankings, from 154 in 2010 to 143 in 2011. However, Rus- sia still scores below Sierra Leone and Niger, where GDP per capita is a staggering $800 (£500) – 20 times less than Russia’s. The president said the anti-corruption strategy would rest on new corner- stones. The first – outlined by Sergei Guriev, rector of the New Economic School in Moscow– included deregu- lation and privatisation. “Government interference in the economy through state ownership and excessive reg- ulation is the main way a cor- rupt official increases his control over society and busi- ness,” Mr Guriev argued. He MASHA CHARNAY SPECIAL TO RUSSIA NOW Dmitry Medvedev is drawing up a new policy roadmap in the continuing fight against corruption within the state bureaucracy. Targeting those on the take Government reform Outgoing president leads a new assault on the old problem of corruption CONTINUED ON PAGE 2 planned “march of the mil- lions” scheduled for May 6 may be a little overambitious. At best, it will be a “march of tens of thousands” and draw the line under the pe- riod of protest in Moscow. “People have realised that white balloons and ribbons Whatever the opponents of Vladimir Putin say about him, he is definitely a prag- matic and predictable lead- er. Unlike his rivals who sit on the side of revolutionary romanticism, Mr Putin knew exactly where he would lead his country in the world. “Even before the elections, he drew the red lines in for- eign policy that Russia would never cross,”says Alexander Rahr, director of the Berthold Beitz Centre at the German Council on Foreign Rela- tions. “The president’s proposed foreign policy strategy for Russia in the third millennium consists of de- Foreign policy What’s next for the president elect? Upholding the rule of international law and defending Russia’s interests are as crucial to Vladimir Putin’s foreign policy today as they were 12 years ago. human rights at the inter- national level. None of these items has lost any relevance today. Since Mr Putin’s first in- auguration, Russia has learnt to assess western initiatives soberly and impartially – and to say“no”to those that con- tradict its strategic interests. Not a trace of hope remains from Mr Putin’s first presi- dential term for a joint se- curity framework in the North Atlantic space and faith in the effectiveness of the Russia-EU Permanent Partnership Council has now vanished. During his second term in 2006, addressing Russian am- bassadors at a meeting at the Foreign Ministry, Mr Putin warned his western partners: “Russia will not participate in any holy alliances. It will not participate in an ultima- tum which would drive the Putin looks to reprise his familiar role on world stage YEVGENY SHESTAKOV SPECIAL TO RUSSIA NOW among the“highest echelons of authority” . Mr Medvedev, though, preferred the idea of an agency that would oper- ate under the aegis of the Prosecutor General’s office. He claimed that Russians couldn’t be paid to blow the whistle because decades of informing on each other dur- ing the Soviet era had made them averse to it. Enhancing transparency in state procurement and im- proving corporate govern- ance in state-owned compa- nies was proposed as the third cornerstone of the strat- egy. Mr Medvedev suggested that, as part of his existing task of overhauling the management of state-run companies, government of- ficials should be removed from the board of directors. Increasing scrutiny of state procurement and creating a website to monitor state con- tracts were two approaches approved by Mr Medvedev. But experts say that the leg- islation and tools put in place to monitor state contracts still have loopholes, which result in kickbacks worth 2pc of the GDP. The sheer scale of Russia’s government apparatus makes implementing these reforms much harder than in other countries. “You can’t possi- bly compare the scale of what sharks,” Aris adds. Mr Gu- riev proposed that the gov- ernment provide a roadmap for privatising selected com- panies by December 1. Al- ready, Mr Medvedev is re- ported to have asked some companies to downsize their government-held stakes, in- cluding Sberbank – 57.6pc of which is currently owned by the government. Fighting high-level corrup- tion is the second pillar of the strategy. Sergei Aleksash- enko, director of macroeco- nomic research at the High- er School of Economics, proposed the establishment of an independent body that would monitor corruption said corruption was the greatest challenge for busi- ness, because it has caused such massive capital flight (about $84.2bn in 2011). “The big issue with cor- ruption is how it affects SMEs,”says Ben Aris, editor- in-chief of Business New Eu- rope. He argues that while the privatisation process would be fairly easy, authorities should throw their weight behind reduc- ing ubiquitous bureaucracy, where the bulk of corruption really dwells. “If you are a small business [in Russia] with no money or connec- tions, the bureaucrats come after you like a pack of Russia has to do with what, say, Georgia or Norway have done,” says Aris. The chairman of the Anti- corruption Council, Anatoly Golubev, insisted that all of the suggested measures would only serve to exacer- bate the problem because “the stakes of accepting a bribe grow... as does the price of the bribe and the network of accomplices.”Last July, the average bribe paid to a gov- ernment official was said to be up to 293,000 roubles (£6,300). Mr Golubev suggested that the authorities should facil- itate public control through independent institutions and media. However, he said that, in the absence of public of- ficials’ accountability, it too would be ill-fated, as penal- ties for corruption rarely en- tail anything beyond fines and administrative liability, with most jail terms being suspended. Experts at the Open Gov- ernment initiative meeting did have faith in the idea of public-government partner- ships. They proposed raising awareness and shifting pub- lic opinion. Household cor- ruption pervades all of the public services sectors in Russia, a survey conducted by the Fund for Public Opin- ion showed. Corruption in the education sector – select- ed by the panellists as one of the target areas – accounts for $5.5bn (£3.5bn) a year. “The algorithm for tack- ling the problem is skewed,” said Mr Golubev, referring to the efforts to implement new policies without first en- suring that public officials are held accountable. “I don’t know why, but we tend to start making dinner by turning on the stove in- stead of going grocery shop- ping first,” he added. Hamleys to open toy store in Moscow CONTINUED ON PAGE 3 fending our national inter- ests, rather than pandering to the interests of other coun- tries,”explains Mikhail Mar- gelov, chairman of the Fed- eration Council’s Committee on Foreign Affairs. The Foreign Policy Con- cept of the Russian Federa- tion, adopted 12 years ago during Mr Putin’s first pres- idential term, identified four main national priorities. First was strengthening in- ternational security based on the creation of a pan-Eu- ropean security and co-op- eration system. Second was forming a new world order in which the partnership be- tween the world’s major powers is based exclusively on equality and mutual re- spect.Third, the Russian For- eign Ministry was tasked with creating favourable conditions for Russia in terms of international eco- nomic relations. Fourth, Rus- sia would seek respect for Distributed with www.rbth.ru This eight-page pull-out is produced and published by Rossiyskaya Gazeta (Russia), which takes sole responsibility for the contents Travel Access for all: the wheelchair revolution in tourism P.02 Technology Hi-tech investors back the latest start-ups at Skolkovo P.04 Espionage Double agent Kim Philby’s escape to the USSR revealed P.07 Saturday, March 31, 2012 A product by RUSSIA BEYOND THE HEADLINES REUTERS/VOSTOCK-PHOTO PHOTOSHOT/VOSTOCK-PHOTO FLICKR.COM PRESS PHOTO ITAR-TASS NIYAZ KARIM

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Russia Now supplement distributed with the Daily Telegraph in London

Transcript of Russia Now #3

Page 1: Russia Now #3

News iN Brief

In thIs issue

The 18th Golden Mask Festival of Perform-ing Arts has opened in Moscow. The event will run until April 15, with a gala awards ceremony scheduled for the main stage of the Bolshoi Theatre on April 16. The Fes-tival features drama, ballet, opera and con-temporary dance performances from around Russia. Highlights includes Harlekin by St Petersburg’s Derevo Theatre, which also performed at the Edinburgh Fringe Festi-val in 2010, as well as theatre performanc-es from Omsk, Ekaterinburg, Altai and a puppet theatre from Chelyabinsk.

Hamleys, one of the world’s largest toy-shop chains with a flagship store in Lon-don, is to open in Moscow, RIA Novosti re-ports. The first store under the Hamleys brand name in Russia will open in May in the Evropeisky shopping centre and will occupy about 1,700 sq m. The licence for the brand in Russia was given to the Ideas4retail firm, owned by businessmen Alexander Mamut, co-owner of Russia’s largest mobile phone retailer Evroset, and Yevgeny Butman, former co-owner of the re:Store Retail Group. The Russian toy mar-ket grew 17pc from 2010 to 2011 to nearly $3.3bn (£2bn). Other major Hamleys stores are in Dublin, Dubai, Amman, Glasgow, Mumbai, Chennai and Riyadh.

Performers flock to Moscow Mask

opiNioN

election aftermath‘Snow revolution’ melts away as reality sets in

The State Duma has passed a bill that makes it easier for political groups to reg-ister as official parties. The groups will now need to collect only 500 signatures in their support in order to become a registered po-litical party instead of 50,000 signatures, as is currently the case. Critics of the bill had hoped for an amendment that would allow small political parties to form blocks so that they would have sufficient numbers to stand in the elections. Currently, politi-cal parties need 5pc of the vote to partici-pate in the elections. However, deputy speak-er and United Russia faction head Andrei Vorobyov saw “no necessity” to make this amendment, arguing that such mergers would lead to “a threat of feud and ten-sion.” The bill will come into effect imme-diately once it is signed by the president.

Political minnows get party started

TurN To pAGe 6

Material difference: white ribbons were a symbol of protest

“Dry food for an animal shel-ter urgently needed,” read an announcement on the Rus-sian social network site VKon-takte. This wasn’t an appeal by an animal welfare organ-isation: it came from the 170,000-strong “Against Putin and United Russia Party” group. In recent weeks, calls to take to the streets have been interspersed with calls to give blood or raise money for surgery.

The civic activism that fuelled the protests is taking other forms, while rallies are staged by a few activists from political parties.

“After Bolotnaya Square, I attended other actions and, each time, my combative mood diminished,” says Sofia

Protests had an impactActivism Demonstrations will have lasting influence on Putin

Shaidullina, a young protest-er. “As the elections drew closer, the word ‘futile’ was bandied about more and more in conversations with my friends.”

The opposition protests on March 17 and 18 in Moscow were smaller than those be-fore the presidential election. Against this background, the

rallies are losing their appeal because protesters feel they are unable to change the political situation. But this doesn’t mean the authorities can be complacent.

VikTor DyATlikoVichsPecial to russia now

Meeting of minds: president Medvedev is taking advice on his roadmap to drive out corruption

Less than two months before coming to the end of his term of office, President Dmitry Medvedev last week met with a team of experts to discuss Russia’s Open Government initiative, which is aimed at stemming corruption.

Among the steps Mr Medvedev took after assum-ing office in 2008 were found-ing the Anti-Corruption Council and instituting a law requiring government offi-cials and their family mem-bers to disclose their hold-ings. More recently, his crusade featured a law that oversees government officials’ purchases, requiring that an-ything with a cost of more than triple the family income be subject to scrutiny.

Preliminary results show the changes have yielded some improvement – Russia went up seven places in the Transparency International rankings, from 154 in 2010 to 143 in 2011. However, Rus-sia still scores below Sierra Leone and Niger, where GDP per capita is a staggering $800 (£500) – 20 times less than Russia’s.

The president said the anti-corruption strategy would rest on new corner-stones. The first – outlined by Sergei Guriev, rector of the New Economic School in Moscow– included deregu-lation and privatisation. “Government interference in the economy through state ownership and excessive reg-ulation is the main way a cor-rupt official increases his control over society and busi-ness,” Mr Guriev argued. He

MAshA chArNAysPecial to russia now

Dmitry Medvedev is drawing up a new policy roadmap in the continuing fight against corruption within the state bureaucracy.

Targeting those on the takeGovernment reform outgoing president leads a new assault on the old problem of corruption

coNTiNueD oN pAGe 2

planned “march of the mil-lions” scheduled for May 6 may be a little overambitious. At best, it will be a “march of tens of thousands” and draw the line under the pe-riod of protest in Moscow.

“People have realised that white balloons and ribbons

Whatever the opponents of Vladimir Putin say about him, he is definitely a prag-matic and predictable lead-er. Unlike his rivals who sit on the side of revolutionary romanticism, Mr Putin knew exactly where he would lead his country in the world. “Even before the elections, he drew the red lines in for-eign policy that Russia would never cross,” says Alexander Rahr, director of the Berthold Beitz Centre at the German Council on Foreign Rela-tions.

“The president’s proposed foreign policy strategy for Russia in the third millennium consists of de-

foreign policy what’s next for the president elect?

upholding the rule of international law and defending russia’s interests are as crucial to Vladimir putin’s foreign policy today as they were 12 years ago.

human rights at the inter-national level. None of these items has lost any relevance today.

Since Mr Putin’s first in-auguration, Russia has learnt to assess western initiatives soberly and impartially – and to say “no” to those that con-tradict its strategic interests. Not a trace of hope remains from Mr Putin’s first presi-dential term for a joint se-curity framework in the North Atlantic space and faith in the effectiveness of the Russia-EU Permanent Partnership Council has now vanished.

During his second term in 2006, addressing Russian am-bassadors at a meeting at the Foreign Ministry, Mr Putin warned his western partners: “Russia will not participate in any holy alliances. It will not participate in an ultima-tum which would drive the

Putin looks to reprise his familiar role on world stage

yeVGeNy shesTAkoVsPecial to russia now

among the “highest echelons of authority”. Mr Medvedev, though, preferred the idea of an agency that would oper-ate under the aegis of the Prosecutor General’s office.He claimed that Russians couldn’t be paid to blow the whistle because decades of informing on each other dur-ing the Soviet era had made them averse to it.

Enhancing transparency in state procurement and im-proving corporate govern-ance in state-owned compa-nies was proposed as the third cornerstone of the strat-egy. Mr Medvedev suggested that, as part of his existing task of overhauling the

management of state-run companies, government of-ficials should be removed from the board of directors.

Increasing scrutiny of state procurement and creating a website to monitor state con-tracts were two approaches approved by Mr Medvedev. But experts say that the leg-islation and tools put in place to monitor state contracts still have loopholes, which result in kickbacks worth 2pc of the GDP.

The sheer scale of Russia’s government apparatus makes implementing these reforms much harder than in other countries. “You can’t possi-bly compare the scale of what

sharks,” Aris adds. Mr Gu-riev proposed that the gov-ernment provide a roadmap for privatising selected com-panies by December 1. Al-ready, Mr Medvedev is re-ported to have asked some companies to downsize their government-held stakes, in-cluding Sberbank – 57.6pc of which is currently owned by the government.

Fighting high-level corrup-tion is the second pillar of the strategy. Sergei Aleksash-enko, director of macroeco-nomic research at the High-er School of Economics, proposed the establishment of an independent body that would monitor corruption

said corruption was the greatest challenge for busi-ness, because it has caused such massive capital flight (about $84.2bn in 2011).

“The big issue with cor-ruption is how it affects SMEs,” says Ben Aris, editor-in-chief of Business New Eu-rope. He argues that while the privatisation process would be fairly easy, authorities should throw their weight behind reduc-ing ubiquitous bureaucracy, where the bulk of corruption really dwells. “If you are a small business [in Russia] with no money or connec-tions, the bureaucrats come after you like a pack of

Russia has to do with what, say, Georgia or Norway have done,” says Aris.

The chairman of the Anti-corruption Council, Anatoly Golubev, insisted that all of the suggested measures would only serve to exacer-bate the problem because “the stakes of accepting a bribe grow... as does the price of the bribe and the network of accomplices.” Last July, the average bribe paid to a gov-ernment official was said to be up to 293,000 roubles (£6,300).

Mr Golubev suggested that the authorities should facil-itate public control through independent institutions and media. However, he said that, in the absence of public of-ficials’ accountability, it too would be ill-fated, as penal-ties for corruption rarely en-tail anything beyond fines and administrative liability, with most jail terms being suspended.

Experts at the Open Gov-ernment initiative meeting did have faith in the idea of public-government partner-ships. They proposed raising awareness and shifting pub-lic opinion. Household cor-ruption pervades all of the public services sectors in Russia, a survey conducted by the Fund for Public Opin-ion showed. Corruption in the education sector – select-ed by the panellists as one of the target areas – accounts for $5.5bn (£3.5bn) a year.

“The algorithm for tack-ling the problem is skewed,” said Mr Golubev, referring to the efforts to implement new policies without first en-suring that public officials are held accountable.

“I don’t know why, but we tend to start making dinner by turning on the stove in-stead of going grocery shop-ping first,” he added.

Hamleys to open toy store in Moscow

coNTiNueD oN pAGe 3

fending our national inter-ests, rather than pandering to the interests of other coun-tries,” explains Mikhail Mar-gelov, chairman of the Fed-eration Council’s Committee on Foreign Affairs.

The Foreign Policy Con-cept of the Russian Federa-tion, adopted 12 years ago during Mr Putin’s first pres-idential term, identified four main national priorities. First was strengthening in-ternational security based on the creation of a pan-Eu-ropean security and co-op-eration system. Second was forming a new world order in which the partnership be-tween the world’s major powers is based exclusively on equality and mutual re-spect. Third, the Russian For-eign Ministry was tasked with creating favourable conditions for Russia in terms of international eco-nomic relations. Fourth, Rus-sia would seek respect for

Distributed with

www.rbth.ru

this eight-page pull-out is produced and published by rossiyskaya Gazeta (russia), which takes sole responsibility for the contents

Travel Access for all: the wheelchair revolution in tourismp.02

TechnologyHi-tech investors back the latest start-ups at Skolkovop.04

espionageDouble agent Kim Philby’s escape to the USSR revealed p.07

saturday, March 31, 2012

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A space for dialogue: where do Russia’s protesters go from here?rbth.ru/15017 Politics & Society

was hardly anyone left who truly believed that Mr Putin would be forced into a sec-ond round of elections – not after an election campaign in which images of him � ashed across TV screens all day, every day. That’s one of the reasons why Mr Katz de-cided to run for a seat on the municipal council. “It’s the beginning of something new, starting from the ground up,” he says.

After the polls closed at 8pm, Max Katz returned to polling station 2997. In ad-dition to the six independ-ent election monitoring of-ficials, all of whom were young, baby-faced Russians, there were now six imposing � gures dressed in matching black suits, purporting to be election monitoring officials, but they looked more like nightclub bouncers.

Mr Katz says they tried to provoke him by � lming him, making rude hand gestures, and screaming hysterically. He kept his cool, but they did

For those Russians who had hoped that the March 4 pres-idential election would bring about a real change in Rus-sian politics, spirits were low on March 5. That is, with the exception of Max Katz, who was celebrating his victory as an independent candidate in the Shchukino municipal council elections.

Local elections After a campaign funded by gambling winnings, 27-year-old Max Katz was elected to the the municipal council chambers of a Moscow district

Max Katz took a gamble by standing as an independent in the March 4 local elections. It paid off, and he is now councillor Katz.

At around 8am on March 5, when Mr Putin’s victory seemed to be official, a fa-tigued and elated Mr Katz, 27, staggered out of the of-� ces of the municipal elec-toral commission and tweet-ed: “I’m 90pc positive that I did it.”

Most of his friends had long since gone to bed . At around 6pm, an announcer on state TV read the � rst re-sults of that day’s presiden-tial election, con� rming the news that many people found difficult to believe, that 64pc of Russians had voted in fa-vour of Vladimir Putin, keep-

ing him in office until 2018.It was some time after the

� rst demonstrations for fair elections in December that Mr Katz decided to stand as a candidate after reading an appeal by the opposition party Yabloko for candidates for the municipal council elections.

“I want to become mayor in a small Russian town when I am 35, and test my urban development plans,” Mr Katz says.

He claims he is not one of the “frustrated city dwellers” and does not want to be la-belled by the media as one

ish corrupt politicians, re-duce the costs of gas and water, and so on. But I chose to be honest,” he says, as he drives his black Opel through the jam-packed backstreets. The district is known as a prosperous, middle-class neighbourhood, full of young people with new apartment complexes surrounded by hordes of cars.

Election day tensions The polling stations here on March 4 were full of older, well-dressed women with conservative hairstyles, many of whom were former school principals, while the men tended to have serious faces and wear stiff grey suits. Then there were the 20-year-olds, in jeans and trainers sitting on couches next to fake plastic trees and dusty red curtains, posting their ob-servations on Twitter and Facebook. For many, it was their � rst time monitoring an election.

By mid-afternoon, there

Poker champ raises political stakes with victory at the polls

No bluffing: an unusual election manifesto won Mr Katz votes

MORITZ GATHMANNRUSSIA NOW

succeed in scaring off the only independent member of the election commission.

Finally, the men in black left the polling station and drove off . “It could very well be that we just kept them from committing electoral fraud,” says Mr Katz .

At around 2am, the count of the votes for the presiden-tial candidates was an-nounced, with 52pc going to Mr Putin at this particular polling station .

Vladimir Putin was close to tears that night in front of the Kremlin. “We are vic-torious,” he declared from the stage, thanking the thou-sands of people fervently chanting his name.

There was no one chant-ing Max Katz’s name. Nev-ertheless, out of a total of 16 candidates, he received the third-highest number of votes, winning him a seat in the municipal council along with four other members.

He has taken his � rst step towards becoming a mayor.

of the protesters. “I’m actu-ally quite satis� ed,” he says.

Mr Katz funded his cam-paign with money he earned playing online poker – he is a Russian champion. His campaign flyers read: “My name is Max Katz. I am 27 years old. The election for the

Shchukino municipal coun-cil is being held on March 4. This body is completely use-less. It possesses no power whatsoever.”

“Everyone told me I should make the same promises other politicians were mak-ing, that I would vow to pun-

Disability access Travel entrepreneurs campaign to make museums, palaces and churches in St Petersburg and Moscow open to all

In creating a travel company specifically geared towards wheelchair users, two women have fulfilled their dream as well as those of their clients.

In Russia, there is no legal requirement for public plac-es to be accessible to wheel-chair users, making getting around impossible for some disabled people. But two en-trepreneurs have forced many tourist attractions to improve disabled access through their travel company, Liberty.

Maria Bondar and Nata-lia Gasparyan bonded as young girls as they had sim-ilar spine injuries. They acted in school plays together and, in their final year, dreamt about having their own busi-ness. They went to universi-ty and did casual work as tour guides for German tour-ists visiting St Petersburg.

They noticed that many foreign tour groups included tourists in wheelchairs and that the tour guides tended to avoid them. “Most tour guides were horri� ed to � nd wheelchair users in their group, because it meant 10 times as much work,” Maria said. “You had to make sure that a tourist like this didn’t get left behind, and it often

meant pushing the chair yourself.” But unlike their tour-guide colleagues, the friends were happy to help the wheelchair users and, in 2004, Maria and Natalia de-cided to build a business to help them see the city.

A normal tour consists of showing people the sights and organising meals, hotel accommodation and evening programmes. But organising the itinerary for a wheelchair user in St Petersburg was next to impossible. St Peters-burg had no hotels with doorways wide enough for wheelchairs, let alone rooms with special showers or ramps. So Maria and Nata-lia decided to limit them-selves to tourists visiting the city on Baltic Sea cruises be-cause their accommodation was on the ship.

To determine where they could take wheelchair users in St Petersburg, the friends did their own groundwork. “We got a wheelchair, sat each other in it and made our way round the city, try-ing to get into museums and churches so we could � nd out if disabled people would be able to negotiate them,” said Maria. Each visit was a test for museum staff. Although a museum might have wheel-chair lifts, in most cases, they

had never been used. Most of the museum staff were sympathetic to the young en-trepreneurs and wanted to help, but there were some no-table exceptions. “Wheel-chairs? Over my dead body! I’ve got 18th-century parquet � ooring,” one museum direc-tor told the women.

In other cases, it was only thanks to the entrepreneurs’

stubbornness that some sites became accessible to disa-bled people. In the case of one of St Petersburg’s famous palaces, it was necessary to give a week’s notice of arriv-al in order to use the lift, and visitors were required to ar-rive at the lift at the exact time scheduled. “If we were just a little bit late, the staff member would shout,” Maria

said. “They had to come from a neighbouring building just for a pair of wheelchair users, while the palace was expe-riencing a � ood of visitors.”

The process was so un-pleasant and complicated that Maria was ready to give up and cross the palace off the itinerary. But Natalia was uncompromising. Now, the entrepreneurs take pride in

the fact that there is a lift for their clients and they are met by a concierge service.

It took the women a year to research and plan the itin-erary. The � rst destinations were the Russian Museum and the Hermitage, which were more or less equipped, technically; then they added the Museum of the History of Religion.

Ravilya and Pyotr Moro-zov and Yury Kuznetsov, founders of We’re Together, a St Petersburg-based organ-isation for disabled people, began helping inspect prop-erties for wheelchair acces-sibility. They joined forces with Maria and Natalia and together founded Liberty.

Natalia and Maria began promoting the company through similar tourist agen-cies in other countries and via social networks.

The friends led the � rst ex-cursions. There were some hitches, of course. For exam-ple, Maria was unable to get a woman in a heavy wheel-chair up three steps into the Cathedral of the Saviour on the Spilled Blood. But her husband developed a solu-tion and built a portable alu-minium ramp so that she could avoid situations like this in the future.

In 2007, the joint owners

of Liberty took out a loan of 750,000 roubles (about £16,000) from Sberbank. They used the money to buy a truck that had been used for transporting fruit, and Maria’s husband, a car me-chanic, converted it for pas-senger transport. He cut out windows, fitted sound and heat insulation, lined the sides, put in single seats by the windows and left a space between them big enough for a wheelchair to get through. He was particularly proud of the lift – a platform that could lift a wheelchair to the level of the bus. “Our vehicle was incredible for Russia – even foreigners were delight-ed that we, novices in the market, had such advanced equipment,” said Maria.

Liberty wanted to offer tours to disabled Russians too, but most Russian wheel-chair users have very low in-comes. The � rm decided to charge foreigners more in order to provide discounted tours for Russians. The group has hosted tourists from Ger-many, Austria, Switzerland, the US, Canada and Israel. In addition to St Petersburg, Liberty now organises tours of Moscow, the Moscow re-gion and Novgorod. The cost of the tour (excluding en-trance tickets) is around

Tourism transformed: the wheelchair revolution

Art for all: Liberty has opened up museums and other tourist attractions to wheelchair users

YULIA GORDIENKO SECRET FIRMY MAGAZINE

£83-£330 per person for a two-day tour and £830-£1,600 for one-week trips.

Winning the Vagit Alekper-ov Foundation’s Our Future competition enabled Liberty to obtain an interest-free loan of a further 1.72m rou-bles (around £36,900) for four years. The company used this money to buy air condition-ing for the minibus and to develop itineraries for more cities, such as Kiev. The � rm’s future plans include purchas-ing a modern bus equipped for wheelchair users, which will cost about £53,500. A major international pharma-ceutical company has ap-proached the foundation, ex-pressing its interest in helping buy the new trans-port for Liberty.

This year, the company is planning to expand its offer-ings to tourists who are deaf or very hard of hearing. For this, the friends need to in-vest in equipment for sign-ing. “We’re ready to create a whole empire,” said Maria. Her ideas include a hostel and a chain of night clubs accessible to everyone, in-cluding people with disabil-ities; a fleet of specialised buses; a magazine about wheelchair journeys; and a guide to St Petersburg for people with disabilities.

are no weapons against Omon special security units. A period of social torpor lies ahead”, says author Boris Akunin, an organiser of the winter rallies.

One of the reasons that the wave of protests has subsid-ed is the sheer weariness of ordinary people. Unlike po-litical activists, they are not used to going to rallies as if it were their work. Second, the authorities are now be-having more wisely. There were far fewer irregularities in the presidential elections (at least in Moscow) than were witnessed in the Duma elections in December. Many of the protesters have, deep down, resigned themselves to Mr Putin’s victory. Even an independent vote count gave him an overall majority of the votes. This did more to take people off the streets than anything else.

The key issue today is whether people who were po-litically awakened by the protests become disenchant-ed with politics. The future of new political parties that will spring up in the after-math of the protests and the liberalisation of the law on political parties depends on people remaining engaged. There will probably be too many new parties emerging. The authorities, nevertheless,

are unlikely to object to this. “Having many parties will split the opposition elector-ate, with the result that the opposition parties will � nd it hard to overcome the 5pc cut-off barrier to enter par-liament. That will play into United Russia’s hands”, says Mikhail Tulsky, President of the Politicheskaya Analitika think tank.

A divided electorate will make things more difficult for Mikhail Prokhorov (former leader of the liberal Right Cause party), who will be building a new liberal party, almost certainly in company with former � nance minister Alexei Kudrin. Mr Prokhorov’s showing in the presidential election provides a good springboard. Yet it is one thing to win 7pc of the votes when standing against � ve leaders who have become overfamiliar to the public over the past 20 years and quite another to win the hearts and minds of voters when confronted with dense ranks of the right-wing, left-wing, social democratic, monarchist and other parties that the Justice Ministry is registering by the dozen.

What happens in Russia now depends on how Mr Putin behaves on his third presidential watch. The con-troversial situation on the eve of the elections forced him to demonstrate a readiness

for dialogue. Mr Putin made it clear in articles published before the elections that he was ready to change and for a more meaningful dialogue with society. He promised to revive the system of referen-dums, to make it easier for citizens to initiate legislation and strengthen public scru-tiny of the executive. Wheth-er or not Mr Putin fulfils these promises will dictate what happens to him.

According to Alexei Mukhin, director of the Cen-tre for Political Information in Moscow: “The people around the President under-stand that if Putin fails to keep even part of his elec-toral pledges, this will pre-serve the protest potential.”

Mr Putin will have to work with both the protest elec-torate and with his support-ers. As Mikhail Dmitriyev, President of the Strategic Studies Centre (which pre-dicted the latest political ten-sions) points out, Mr Putin’s problem is not legitimacy, which he now has, but how long that perception of le-gitimacy will last against the backdrop of growing discon-

move from the lower to the middle and higher levels,” Mr Mukhin says. Otherwise, Mr Putin will be unable to keep the support of his followers, for he will not be able, as be-fore, to guarantee their sup-port by pursuing an active social policy.

According to Mr Dmitri-yev, from the point of view of the Russian hinterland, public spending must con-tinue to increase but the Rus-sian budget might have lim-ited resources to do this and any deterioration in the eco-nomic situation will proba-bly lead to a reduction in public spending. If this hap-pens, Mr Medvedev’s politi-cal future looks uncertain.

tent outside the big cities. “At the end of the day, it was the Russian hinterland that elected the President,” Mr Dmitriyev argues. “Now, the problem with the Russian hinterland is that it has fre-quent mood swings. It may happen that, in a year or 18 months, support for Putin among these social strata will change dramatically. It hap-pened in the Nneties. In 1996, Yeltsin was elected and, by the end of the Nineties, his approval rating had plum-meted to less than 10pc. These are very real risks for Mr Putin.”

Mr Putin’s supporters in the provinces do not care very much about political reform.

They are far more worried about the problems of hous-ing and utilities, which have not been addressed for more than 20 years, and also about corruption. Mr Putin has al-ways conducted a cautious personnel policy without sur-rendering members of his team and anti-corruption tri-als have seldom involved top officials. But if he does not want to see the anger of pro-vincials shift from local bu-reaucrats to himself, he will be obliged to change his pol-icy. “Putin will not stop at shaking up the ruling team, as witnessed by the sacking of Sergei Darkin, governor of the Primorye Territory. The � ght against corruption will

Will latest promises end the protests?

Speaking out: opposition leaders Sergei Udaltsov and Boris Nemtsov address a rally for fair elections in Pushkin Square

By not running for a second term, Mr Medvedev has con-� rmed his image as a politi-cian who is not independent. He will, of course, become prime minister, but not many political analysts give him any chance of holding on to the job throughout the six years of Vladimir Putin’s presidency.

He is sure to become a sac-rificial lamb following the unpopular decisions that the government will have to take. These include the inevitable increase in the retirement age and other measures aimed at reforming the pension sys-tem. In this case, only a major sacrifice will rescue his popularity rating.

If Putin fails to keep even part of his electoral pledges, this will preserve the protest potential

CONTINUED FROM PAGE 1

The Russian authorities and the opposition suffer from chronic afflictions. The author-ities suffer from afflictions of age – fretting about the op-position, accusing it of being naïve, inexperienced and un-patriotic. The opposition suf-fers from infantile disorders –

it sees every action as a cru-sade through eyes burning with moral indignation. The best way to treat these af-flictions is through dialogue. Talking can be difficult and it might involve political ma-noeuvring. This is the begin-ning of democracy and the modernisation of our politi-cal system. The Human Rights Commissioner’s Institution, for all its flaws, seeks to contrib-ute to such dialogue.

NOTES FROM THE EXPERT

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03most read Politics & societyRussia now www.rbth.rusection sPonsored by rossiyskaya gazeta, russia distributed with the daily telegraPh saturday_march 31_2012

Roscosmos takes on Nasarbth.ru/15096

I consider it important to share with readers the basic elements of Russia’s real position on the si-

tuation in Syria. Unfortu-nately, British public opi-nion has a distorted view of Russia’s approach to the po-litical crisis in a country with which we have long- standing bonds of friendship and whose fate is not a mat-ter of indifference to us on a state or human level.

First, I would like to make clear Russia categorically condemns any violence. The actions of President Bashar al-Assad’s government in the crisis can hardly be called exemplary and the percep-tion Russia is ‘‘blindly sup-porting’’ the Syrian autho-rities is mistaken.

However, it is worth re-membering that 25-30pc of those who have been killed in Syria were members of the security forces. It is wrong to say government tanks and artillery are confronting poorly armed civilians. Several dozen law enforcement personnel die in Syria every week in ter-rorist attacks. Seeking to stoke tensions, opposition fighters disrupt power and water supplies and the work of shops. In the recent showdown in Homs, civi-lians were in effect hosta-ges to the irreconcilable po-sitions of the two sides.

So we believe it is crucial that the international com-munity condemns not only the violence on the part of government forces, but also the armed actions of the op-position; that it demands the political opposition disso-ciate itself from extremists and that armed opposition groups leave population centres in conjunction with the withdrawal of govern-ment forces. This was the aim of the Russian amend-ments to the draft resolu-tions of the UN Security Council and the General As-sembly. Sadly, these ideas were not backed by many of our UN partners.

We are convinced that a one-sided condemnation of the Syrian government and its diplomatic isolation, coupled with unconditio-nal support for the opposi-tion, are not conducive to a peaceful settlement but instead encourage the op-position to continue armed struggle instead of turning to politics. Our western and some Arab partners are in effect taking one side in the confrontation, when the goal should be to help Sy-rians decide their future in-dependently through the political process.

It is well known how long it took for the political si-tuation in France to return to normal after the 1789 re-volution. Perhaps in En-gland it took less time – 50 years – to achieve a settle-ment in the form of the Glo-rious Revolution. Neither the Enlightenment nor the European revolutions could protect Europe and the world from the catastrophe of the First World War. Why not help others avoid such a bloody path and carry out transformational processes by evolutionary methods?

It is important to unders-tand that President Assad still has the support of a si-gnificant proportion of the Syrian population. The high turnout and the results of the vote on the referendum for the new constitution, for all the flaws of holding a re-ferendum during such an

oPinion

alexanderyakovenko

DIplomat

the Russian position on Syria: myths and reality

unstable period, have de-monstrated Syrians’ desire for a political solution. To conti-nue to inspire the opposition to overthrow the government militarily is irresponsible with regard to all the citizens of Syria, irrespective of their political views. Judging from reports in the British media, the opposition claims that western countries first pro-voked it to launch an armed struggle and have now ‘‘aban-doned’’ it.

Russia is working with Da-mascus on the diplomatic front in order to induce the Syrian authorities to hold a dialogue. It is not easy to achieve results because any government would find it hard to agree to negotiate with people who openly call for its overthrow. Neverthe-less, we have secured the Sy-rian government’s agreement to have such a dialogue. By contrast, the opposition, in-cluding the Syrian National Council, has rejected it.

The whole international community is interested in averting civil war in Syria. Russia knows only too well what civil war is from its own tragic experience. To that end, it is necessary to make every effort to launch an inclusive political process in Syria, in-volving both the authorities and opposition groups.

One of the key conditions for that is restoring confiden-ce, including between Russia and western partners. One has to admit that this was serious-ly undermined by Nato’s mi-litary operation in Libya. Some episodes in the Syrian crisis have also tended to erode confidence. They inclu-de the hasty vote on the draft UN Security Council resolu-tion, ignoring our mediation efforts while western journa-lists were evacuated from Homs, and so on.

However, we see that res-ponsible politicians and di-plomats, including in Britain, are leaning more and more towards the need for a poli-tical settlement. The appoint-ment of the former UN se-cretary general Kofi Annan as the representative of the UN and the Arab League, mandated to bring the par-ties to the negotiating table, is a welcome development. All the more so as his mis-sion has received unanimous support in the Security Council.

President Dmitry Medve-dev, at his meeting with Kofi Annan in Moscow on March 25, called Annan’s mission Sy-ria’s last chance to avoid a long and bloody civil war. That chance must not be missed. We are convinced that civil war can be avoided and that the Syrians can overcome the current crisis, if all the outside players act together. The main aim must be to help create conditions in which the Syrians themselves can sort things out. One may argue that we are advocating a ‘‘soft landing’’ for the regime, but in fact it is about a soft lan-ding for Syria and all Syrians, and for the whole of this explosive region.

Alexander Yakovenko is Ambassador of the Russian Federation to the United Kingdom. He was previously Deputy Minister of Foreign Affairs of the Russian Federa-tion. Follow him on Twitter: @Amb_Yakovenko

situation into a dead end and deal a blow to the authority of the UN Security Council.” The president came out for “principles for settling re-gional conflicts that must be universal and based on in-ternational law.”In 2012, Mr Putin has not budged an inch from his pre-vious policies. His position has become tougher and even more aggressive, not in terms of potential military threats to any neighbours, but in up-holding the fundamental principles of international law. He believes that west-ern attempts to arbitrarily replace undesirable rulers under the pretext of protect-ing human rights (as hap-pened in Libya), and to use humanitarian arguments to threaten foreign states (as is happening now in Syria), contradict the principles of international law. Address-ing the UN Security Coun-

find itself in conflict with Russia. What Moscow does want is to preserve its polit-ical influence in the post-So-viet territory and it is now making plans to form a Eur-asian Union based on shared economic interests.

Continuing to develop rela-tions with the Asia Pacific Region remains a priority for Russia. And it is also seek-ing ways to restore its posi-tion in the Arab world and Africa that it lost in the Nine-ties. The situation in the world has changed and, in

the opinion of German po-litical scientist Alexander Rahr: “Moscow has become strong enough to play its own role in world politics.”

“The main ideas Putin has tried to get across in his re-sponses to international questions are ideas of the country’s openness, its search for allies, and the rejection of Russia’s image as a bully,” says Nikolai Zlobin, director of Russian and Asian Pro-grammes at the Centre for Defence Information in America.

Western media often por-trays Russia as an intransi-gent bogeyman allegedly de-fending undemocratic, dictatorial regimes. But Mr Putin describes the West’s wish to remove the idea of state sovereignty from the agenda and replace it with the idea of human rights as demagoguery. Mr Putin will, therefore, continue to protect the principles and values that allow people to determine their own future without out-side interference.

The challenges and threats that lie ahead in the coming years will force Russia to de-fine its circle of allies and partners more clearly. Al-though Moscow has re-

nounced the concept of a po-tential enemy in assessing other states, we can predict an intensified rivalry between Russia and the West under Mr Putin. This will apply above all to its relationship with the US. Mr Putin will never be resigned to Wash-ington’s attempts to use anti-missile defence to mo-bilise members of Nato to advance America’s strategic interests. It sees such a uni-lateral approach as a threat to its security.

The dialogue between Rus-sia and the European Union will not be easy, either. If a united Europe continues to fearfully build border barri-ers to Russian business and delay the adoption of a visa-free regime, as well as per-ceive Moscow as a Trojan

horse allegedly seeking to de-stroy the prosperity and moral principles of Europe-ans, we can forget about rapprochement.

Mr Putin agrees to the idea of a common European home, mutatis mutandis, of course. But he does not intend to gatecrash his way into the European Union if these in-itiatives are met with no un-derstanding by European partners. All the more so if they refuse to respect Rus-sia’s concern over the Amer-ican missile defence systems being deployed in Europe.

For the next six years, the Russian president will devel-op a dialogue with China and other Asian countries. On the one hand, such co-operation allows Russia to avoid putting all its eggs in one basket and substantial-ly expands its foreign policy options. On the other hand, Russia having an ally like Be-ijing forces the West to heed what is said in Moscow.

This is a foreign policy sit-uation which could be char-acterised as “Whatever China thinks, Russia speaks out about.” That is particularly true of issues connected to compliance with the princi-ples of international law.

strong man: Putin will flex his political muscles to protect his country’s vital interests

cil in March, Russian Foreign Minister Sergei Lavrov de-scribed such actions as “risky recipes of geopolitical engi-neering” that threaten global stability. Russia’s confronta-tion with the West on these issues will remain.

Russian political scientists believe that the future head of state will continue to dem-onstrate to the West that his international policy is guid-ed solely by the interests of an independent Russia that intends to remain an inde-pendent player in the foreign policy field. Mr Putin will re-nounce participation in any international alliances in which Russia might be per-ceived as a junior partner.

Over the past decades, Russia has outlined its range of interests and it will con-sistently protect them against any foreign intervention. Any country should under-stand that in wilfully invad-ing Russia’s geopolitical space, it will automatically

mr putin believes that western attempts to replace undesirable rulers, under the pretext of protecting human rights, contradict the principles of international law

Continuing to develop relations with the asia pacific region remains a priority for Russia, as does restoring its position in the arab world and africa that it lost in the Nineties

Apart from a 17-month sim-ulated voyage to Mars, which ended last November, over the past decade there has been little news of any ex-citing Russian space mis-sions. So when Roscosmos general director Vladimir Popovkin recently announced plans to return man to the

space exploration Roscosmos has its sights set on delivering a manned lunar mission by 2020

the moon could become a useful source of helium-3 for thermonuclear energy as well as a useful station for space launches to mars.

Moon by 2020, it caused a bit of a sensation.

The programme for send-ing a mission to the Moon will cost an estimated 500bn roubles (£10.7bn) over the next decade. Given that the current annual budget of Ro-scosmos is 120bn roubles (£2.6bn), the financing of the space agency will have to be increased by almost 50pc to implement it. If Roscosmos is hoping to build a perma-nent base on the Moon, its budget will have to be raised more than six-fold.

But why should Russia

send an astronaut back to the Moon at all? Does anyone need a manned Moon land-ing 50 years after it was achieved successfully by the Americans? The scientific Moon exploration pro-gramme uses unmanned spacecraft launched by var-ious countries. Russia plans to send Luna-Glob and Lu-na-Resurs to the Moon in the next few years and is expect-ing them to return with a case of wet Moon soil from the polar regions.

The thinking behind Ros-cosmos’s new plan is that large polar ice masses present on the Moon will make po-tential deployment of a lunar base much easier. The Moon, having no atmosphere, will still be able to provide the base with oxygen – about 40pc of the lunar soil is bound oxygen. A Moon base could act as a springboard for exploring Mars.

The lower force of gravity on the Moon makes it easier to launch a heavy spacecraft from there, one capable of delivering a relatively large crew of six or seven to Mars, along with the required

equipment. A “space ship-yard” could be set up at the Moon base for assembling a vehicle bound for Mars on the Moon from components delivered from Earth. The Mars mission may also return to the Moon, as a staging post en route back to the Earth.

Another reason for devel-oping a Moon base would be to extract the isotope heli-um-3 from the Moon rock.

Helium-3 could potentially be used to create greener form of nuclear power. If so, the Moon would become a valuable business asset, rath-er than an abstract scientif-ic challenge, and would in-volve the biggest energy corporations.

To make its plans a reali-ty, Roscosmos is developing a new-generation manned craft, the New Generation Piloted Transport Ship (PTK

NP) under the banner of the Prospective Piloted Transport System (PPTS).

The system is being devel-oped by Russian aerospace corporation RKK Energia. It hopes to have its unmanned ship ready by 2015 and the manned version by 2018. But if the recent track record of Russian space efforts is any-thing to go by, there are doubts that Energia will meet its schedule.

Russia breaks the bank to land on the Moon

Pulling power: the moon’s lower gravity could make it easier to launch a spaceship to mars

ilya kramnikSpeCIal to RuSSIa Now

" We are now discuss-ing how to begin [the Moon’s] exploration

with Nasa and the European Space Agency. There are two options: either to set up a base on the Moon or to launch a sta-tion to orbit around it.”

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04 most readRussia now www.rbth.rusection sponsored by rossiyskaya gazeta, russia distributed with the daily telegraph saturday_march 31_2012innovation Skolkovo innovation centre

(Russian Silicon Valley in Skolkovo)rbth.ru/skolkovo

news in brief

Russia is preparing to build the world’s most powerful laser station, according to the news agency RIA Nov-osti. Called UFL-2M, it will cost $1.5bn (£940m) to build, and will be used for mili-tary and scientific purpos-es. In particular, it will be used in the research of laser thermonuclear fusion, which scientists believe will be the backbone of energy production in the future.

Rady Ilkayev, scientific di-rector of the Russian Fed-eral Nuclear Centre – the All-Russian Research Insti-tute of Experimental Phys-ics, said the design power of the laser was 2.8 mega-joules, higher than the sim-ilar facility in the US and one being built in France.

The Sarov Federal Nucle-ar Centre in Russia’s Nizh-ny Novgorod region may be chosen as the sight for the 10-storey laser station. Mr Ilkayev said it would take 10 years to build, but no date has yet been set for construction to begin.

boffins beam over huge laser

Russia has built a space an-droid to work in orbit, its first space robot in more than two decades, accord-ing to Izvestia Daily. The S-400 can perform simple tasks, such as screwing bolts and searching the space-craft for damage. It will be sent to the International Space Station (ISS) within two years, and will join future missions to the Moon and Mars.

Oleg Saprykin, a senior of-ficial at Russia’s space agen-cy, Roscosmos, said that the S-400 was its “first step to-wards a robot cosmonaut”.

Andrei Nosov, an engineer at the firm which made the S-400, said the robot would be able to send tactile sen-sations to an operator on Earth which would allow the operator to virtually touch its surface.

The US has launched an android robonaut to the ISS and Japan and Germany are also planning to send an-droids to space.

android ‘first step to robot cosmonaut’

global russia business calendar global russia business meeting April 22-23,City of luxembourg, luxembourgThe Global Russia Business Meeting offers a means to gain insight from and access to business leaders and key government officials. Around 300 business and govern-ment decision-makers from both Russia and the rest of the world will convene at the meeting in Luxembourg. Russia will play a pivotal role in reviving the glob-al economy and the meet-ing is a unique opportunity for leaders from Russia and beyond to provide input on the priorities for the glob-al economy going forward. Participants will discuss and propose holistic strategies to increase global corporations’ presence in Russia. Global Russia Business Meeting is hosted by the Global Vision Community Horasis in co-operation with the gov-ernment of Luxembourg and supported by Moscow In-vestment & Export Promo-tion Agency (Miepa) and other Russian organisations.

www.miepA.org/en/

find more in the globAl CAlendAr

at www.rbth.ru

Russian start-ups and busi-ness incubators are thriving and attracting the attention of foreign technology inves-tors. Tiger Global Manage-ment, a New York-based in-ternational investment management firm has recent-ly invested twice in the Rus-sian e-commerce platform Wikimart.ru – $5m (£3.1m) in 2010 and another $7m in 2011. It has also contributed $10m in a round of financ-ing for online travel sales site Anywayanyday.ru. Tiger also has shares in Russian search giant Yandex, which began trading on the Nasdaq in May 2011, and once held a stake in Mail.ru, a leading email service and portal.

Other examples include the whopping $55m that was in-vested into private shopping club KupiVip.ru last April, in which US venture fund Bessemer Venture Partners played a notable part. And, Ostrovok.ru, a clone of Book-ing.com, received $13.6m last July from western funds and business angels such as Zynga founder Mark Pincus, early Facebook investor Peter Thiel and Skype founder Niklas Zennström, among others.

Russia’s new appeal comes as a logical consequence of the fast growth of its inno-vation-led markets. One in two Russians now uses the internet and last September the country overtook Germa-ny as Europe’s largest inter-net market. “There has been

Venture capital Subsidies and tax cuts for foreign investors in hi-tech hubs such as Skolkovo are helping to attract funding for new businesses

as russian scientific and technical industries flourish, foreign technology investors are increasingly opting to back start-ups in these fields.

a lot of enthusiasm among US funds for taking elements of successful e-commerce and social networking companies in one geography and trans-planting them to another – first China, now increasingly in Russia,” said Mac Elatab, an investment analyst at TrueBridge Capital Partners. “With a GDP-per-capita growth of around 13pc an-nually from 1999 through 2010, Russian consumers have money to spend.”

Another appealing factor for investors is the reputation of Russia’s science and tech-nology industries. “In compu-

ter science and materials sci-ence, the Russians are as good or better than anyone in the world,” said Bill Reichert, managing director of Garage Technology Ventures, a major US venture fund chasing Rus-sian start-ups.

Progress in entrepreneur-ship has been remarkable over the past 10 years – with a more than a scent of north-ern California in the Moscow air. “Both Silicon Valley and Russia have extremely smart people who are working to create innovative opportuni-ties globally,” said Court Coursey, managing partner at Eric Schmidt’s Tomorrow Ventures.

Labour costs are another reason for hi-tech investors to come to Russia. Salaries are high in Moscow start-ups, but in a city like Tomsk, in

Siberia – where every fourth resident is a student, a re-searcher, a university teach-er or an employee of the Rus-sian Academy of Sciences – a modest $2,500 (£1,580) a month can be enough to at-tract the best local talent.

Another factor favouring investment in start-ups is the level of government support for foreign and domestic in-vestment in private equity: at the federal and regional lev-els, the Russian state is in-vesting tens of billions of dol-lars in innovation. With its huge subsidies and tax cuts for innovative projects, Skolk-ovo, the giant technology hub outside Moscow now near-ing completion, has attracted dozens of global venture funds and hi-tech firms.

IT Park, near Kazan, is one of the largest technoparks in Eastern Europe, while the Tomsk special economic zone has attracted a number of do-mestic and international technology companies, in-cluding Nokia Siemens Net-works, Korea’s Darim Inter-national and the US-based firms Monsoon Multimedia and Rovi Corporation.

Direct state financing is also provided through the Russian Venture Company, which has launched 12 hi-tech funds in Russia and abroad. Three years ago, fewer than two dozen funds were operating in the coun-try, but now there is more money in Moscow than in many other innovation hotspots.

Avi Hersh, a US private eq-uity investor who began in-vesting in Russia in the Nine-ties, said: “As more young Russian enterprises are fund-ed, then merged or acquired,

Valley 30 years ago, there was never a discussion of such things. Russia has to fix this critical government issue. Otherwise, the brightest sec-tion of Russian entrepreneurs and engineers will leave the country.”

Other investors have not found corruption a problem. Esther Dyson, a US invest-ment angel who has invested in 15 Russian start-ups as well as in Yandex, said she had not witnessed any seri-ous threat from aggressive Russian businessmen or cor-rupt Russian courts.

Gleb Davidyuk of the Rus-sian venture fund iTech Cap-ital agreed: “In the digital sphere, greedy civil servants don’t know what to look for – or where. This helps the in-dustry stay below various radar screens.”

Adrien Henni is editor-in-chief for East-West Digital News. This article is pub-lished in partnership with East-West Digital News, the international resource on Russian IT industries (www.ewdn.com).

it will produce more success stories, which in turn will provide more funding for the next round of start-ups.”

obstacles to investmentBut there are still some obstacles to investing in Rus-sian start-ups. Russia doesn’t have a long history of entre-preneurship and some Rus-sian businessmen do not always present mature projects. “We sometimes see very raw start-ups, lacking sound business models or business plans or with weak management teams,” said Marina Kuznetsova of BV Capital, a venture fund op-erating from San Francisco and Hamburg.

Russia is considered less attractive by many venture capitalists than other Bric countries because of its small-er population compared with China or India, and because of its location – Moscow has a 12-hour time difference from California. Language can also be a barrier, as rel-atively few Russians speak fluent business-level English. Russia still has a serious

image problem too. “Media coverage from Russia is al-most uniformly negative in the US,” said Mr Elatab. “That is not to say that only nega-tive things are happening in Russia – the truth is some-where in the middle. I think the Cold War still has an ef-fect on how Russians and Americans view each other.”

Corruption and frequent breaches of the rule of law, whether real or imagined, are the greatest deterrent in the eyes of many foreigners. Ac-cording to Silicon Valley vet-eran Steve Blank: “So many entrepreneurs have told me they have no guarantee that what they are starting is what they will keep... How can Russia have an innovation fu-ture in such conditions? When a new wave of start-ups began developing in Silicon

technology start-up boom goes global

talent pool: a skilled workforce with relatively modest regional labour costs is part of russia’s appeal to investors

adrien henniruSSiA now/eASt-weSt digitAl newS

percent of start-ups’ costs when launching are spent on surveys and research, according to the Expert-RA rating agency.

billion dollars is the amount the Russian IT market will be worth by the end of 2013, according to a Ministry of Eco-nomic Development forecast.

thousand people now work in the Russian Information Tech-nology Industry, according to the Russian Ministry of Economic Development.

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giant technology hub Skolkovo has attracted dozens of global venture funds and hi-tech firms

At the federal and regional levels, the russian state is investing billions of dollars in innovation

the centre is finding new markets for radiation technology outside the energy sector. it’s attracting foreign partners, too.

One year after Japan’s Fuku-shima disaster heightened the controversy over nuclear power, Russia Now caught up with Denis Kovalevich, head of the nuclear technol-ogies cluster at the Skolko-vo Innovation Centre, to talk about the many potential uses of nuclear energy and to find out whether the Rus-sian nuclear industry is de-veloping them.

prior to skolkovo you worked on strategic development at rosatom corporation. was it there that you learnt about alternative areas and markets for nuclear energy?I suppose the idea was shaped even earlier. If we take a look at the strategic documents of the nuclear industry of the late Eighties, we’ll see that many of the new directions were outlined there.

It is important that we do pursue diversification of the nuclear sector. The markets for allied technologies are now growing much faster than the energy market, and their volumes are already comparable.

The range of nuclear in-dustry know-how that can be applied outside the ener-gy market is estimated to in-clude at least 500 products and solutions. Many of the applications constitute part of the new technology plat-form Radiation Technologies which was adopted by a spe-cial commission with the Russian government and given priority status.

analysis of global progress and this country’s capabili-ties, including the potential of its workforce.

I won’t go into detail, but simply enumerate them. They include radiation technolo-gies (radiation-based solu-tions); development of new properties of materials; tech-nologies to design, construct, model and engineer complex technological facilities and systems; engineering; instru-

ment-making and new elec-tronics solutions. These are spin-offs of the nuclear programme, to a greater or lesser extent.

why was skolkovo given au-thorisation to co-ordinate the “radiation technologies” plat-form, and not rosatom?There are more than 70 or-ganisations currently en-gaged in radiation technolo-gies within the scope of this platform, and Rosatom is just one of them. As far as its competencies are concerned, it is, potentially, the most powerful investor and a play-er capable of assembling end products. But, because of its sheer scope, Rosatom cannot support companies worth, say, $1m (£630,000). A nucle-ar power plant is a tangible facility, but when it comes

to what we are going to search for and nurture, the state corporation won’t even notice such things.

We pave the way. We sup-port the creation and devel-opment of new projects and companies, that will later be included in the technologi-cal chains of global tech cor-porations by acquiring them, working with them in any way possible. We believe it is crucial that as many people and companies as possible choose this direction in which to move and this platform to rely on when building their long-term strategies. This is the essence of my job.

The main challenge is to start the wave of develop-ment, and not just to sup-port two or three projects, however promising they might seem.

how much time will you re-quire and what steps need to be made? are there instru-ments for measuring and as-sessing the wave you initiate?I have a model in my head that looks roughly as follows. Essentially, we are talking about making a decision to launch a new industry. Judg-ing from international prac-tice, a decision of this kind requires five to 10 years to materialise, depending on the country involved.

For instance, Singapore launches a new industry once every seven years. They take seven years to think, analyse, check and double-check. I interpret Skolkovo’s poten-tial in this context as “action research”.

When our grants commit-tee decides to support a pro-posed project or invest in a

start-up, it is a chance to as-sess the viability of the appli-cant company. We cannot check it by way of analysis, using a piece of paper and a pencil. We need to give peo-ple a real opportunity, let them try, face certain obstacles – when you have worked with them, you see their strengths and weaknesses. We need to organise this process.

what about recent develop-ments in Japan? do you be-lieve that they are thinking about diversifying the nucle-ar industry and giving priori-ty status to sectors other than nuclear power?I’m sure that, following Fuku-shima, this has become a much more relevant issue in Japan. They must think about ways to diversify.

in brief, what does skolko-vo’s resident status offer your foreign partners?To be very brief, I’ll mention just two benefits. First, this will enable foreign compa-nies to create their own re-search and development cen-tres in Russia. In Skolkovo, they will be able to establish them without red tape and on a very tight schedule. Sec-ond, foreign companies, as soon as they partner up with some of the Skolkovo start-ups, will enjoy the status of being an exclusive innova-tion partner of Russia. This means that when a foreign company joins the centre, it gets special status to posi-tion itself in Russia.

The Skolkovo team has ex-perience of dealing with ad-ministrative obstacles and knows how to tackle customs problems. The centre was set up with the intention of shaking up the existing bu-reaucratic model.

The future is bright for nuclear spin-offs

alexander yemelyanenkoVSpeCiAl to rn

interView deniS kovAleviCh

Skolkovo iS working with 70 CompAnieS to CreAte produCtS uSing rAdiAtion teChnologieS

nationality: RuSSian

age: 32

education: management

Denis Kovalevich was born in 1979 in the Moscow Region town of Troitsk. After graduat-ing from the management fac-ulty of the Higher School of Economics in 2002, he trained in the field of managing in-novations and regional devel-opment. He then managed a number of consulting projects in Russia’s Volga River regions before working on long-term strategy planning for Russia’s state atomic power monopoly, Rosatom. Mr Kovalevich is now executive director of the Nuclear Technologies Cluster at Skolkovo and has been a mem-ber of the President’s Commis-sion for Modernisation.

profilein power: denis kovalevich, and a magnetic separator at the Joint institute for nuclear research in dubna.

$25bnis the current esti-mated size of the global market for radiation manage-ment solutions.

10pcannual growth has been seen in the alternative nuclear technologies seg-ment in recent years.

200 proposals for alternative uses of nuclear power were made by the Soviet union in 1958.

in figures

currently you supervise this platform as director of the nuclear technologies cluster at the skolkovo innovation centre?Yes. This platform is official-ly co-ordinated by the Skolk-ovo Centre and our cluster. Overall, four strategic direc-tions have been identified for the nuclear technologies cluster, based upon general development trends in the nuclear power sector, an

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Page 5: Russia Now #3

05most read Russia now www.rbth.rusection sponsored by rossiyskaya gazeta, russia distributed with the daily telegraph saturday_march 31_2012 business & FinanceBusiness goes where the rules are clear:

report from Vladivostokrbth.ru/15087

alexei moiseev

specIAl to rn

A change in Russian law easing requi-rements for forei-gners seeking to

invest in government treasu-ries has resulted in high de-mand for domestic bonds.

A revolution is under way in Russia’s domestic capi-tal market. In the first week of February, demand for Russian government bonds outstripped supply more than fivefold as traders in London and New York snapped up the high-yiel-ding 10-year bonds.

“It was pretty spectacu-lar demand, and the stran-ge thing was that 70 to 80pc of the bids came from fo-reign investors,” said a tra-der at Deutsche Bank.

The auction raised 35bn roubles, (£755m), more than twice as much as original-ly targeted. It was the first sale of Russian government bonds since a new policy came into effect on Janua-ry 1 that has opened up the local market to foreign in-vestors without accounts or branches in Russia.

Next month, the Russian bond market will be hoo-ked up to Clearstream and other international settle-ment systems, making it even easier for foreign tra-ders to tap into it. These changes in the bond mar-ket are just the latest step in the ongoing reform of Russia’s financial system.

“Russia’s financial infras-tructure is undergoing its greatest transformation since the beginning of the Nineties, when the country made the switch to a mar-ket economy,” said Chris Weafer, chief strategist with Troika Dialog. “These

industrial economy with higher-value knowledge-based industries and servic-es. To achieve this, the gov-ernment needs to ensure that all sectors have an equal chance to thrive. This involves introducing a natural re-sources tax, reducing subsi-dies and trade protection for weaker sectors, and reduc-ing regulatory and tax bar-riers to new businesses. Other vital reforms include accel-erating privatisation and fur-ther deregulation.

The government also needs to ensure that investors can deploy their capital without fear of future arbitrary con-fiscations or regulations. Pri-vate property rights must be taken seriously and upheld by the judiciary. The legal system needs to be fair, trans-parent and independent, so decisions are apolitical and consistent. These moves would help reverse the cor-

ruption that has been holding back the economy.

Added to this, the labour force needs to upgrade its skills to compete in the knowledge economy of the 21st century.

If the policy mix is correct, Russian businesses and in-vestors should be able to modernise the economy themselves from the bottom up, with strategic help and investment from the govern-ment where appropriate.

The government has made a good start, for example by creating a new Silicon Val-ley (Skolkovo) and investing significant sums in modern transport and communica-tions infrastructure.

In 2012, it should build on these initiatives and con-tinue the path towards mod-ernisation.

Alexei Moiseev is head of macroeconomic analysis at VTB Capital, based in London.

In order to follow through on its election promises, the Russian government now needs to make the

changes that are necessary for sustainable, long-term economic growth.

As a middle-income country with a large pub-lic sector to support, nei-ther labour costs nor taxes are low in Russia. Although Chinese labour costs are rising, they’re still a third of those in Russia, giving the Chinese a huge advan-tage in the global market for manufactured goods.

The government has at-tempted to erode the Chi-nese advantage by subsidis-ing industries and erecting high tariff barriers. Ulti-mately it simply delays the necessary productivity and management reforms that would help Russian indus-try become more competi-tive. Subsidies and protec-tionism actively works against increasing manu-facturing productivity.

The government has at-tempted to overcome its structural problems with fiscal and monetary tools to stimulate domestic de-mand, a tactic used in many developed countries. But this has only worked to boost inflation and increase reliance on imports. It has not addressed the funda-mental problems: labour in Russia is too expensive to produce cheap goods com-petitively, while being un-able to compete in higher-end manufacturing.

Some have called for a wholesale reindustrialisa-tion of the country so it can compete with China, much as it did during the Soviet era. This would involve major macroeconomic and institutional reforms, in-cluding greater levels of government intervention. However, current rates of capital flight show that Russian investors are nerv-ous about such prospects.

All this is not inherently discouraging. The real prize lies in developing a post-

Working towards a post-industrial revolution

london blog

moscow blog

ben aris

specIAl to rn

traders form new bonds with high-yield treasuries

changes could result in a re-evaluation of assets and re-moval of any risk premium associated with Russian equi-ty valuations versus other emerging markets in the next two to three years.”

While higher-than-expec-ted oil prices meant that Rus-sia ended 2011 with a small surplus of 0.8pc, in January a deputy economics minister told reporters that Russia’s federal budget deficit in 2012 may amount to 1pc of GDP.

To finance this gap, the state is turning to the domes-tic market, where domestic borrowing overtook foreign issue of Eurobonds for the first time in 2011. According to the Finance Ministry, the Russian government’s domes-tic debt jumped 42.5pc in 2011 to 4.2 trillion roubles (£90.5 billion), including go-vernment guarantees, half of which is in fixed coupon bonds. This is slightly more

than the total outstanding Eurobond market, which was worth $115bn (£72bn) at the end of January.

According to Mr Weafer, these changes are more proof of an ongoing shift in the cen-tre of gravity of the global financial system. With Mos-cow’s geographic location lying between two important financial centres – London and Hong Kong – it is per-ferctly placed to emerge as a major regional player.

Ben Aris is the editor and publisher of Business New Europe.

changes in the bond market are the latest step in the ongoing reform of russia's financial system

the real prize lies in developing higher-value knowledge-based industries and services

exports As agricultural production increases, foodstuffs manufacturers aim to export more of their products abroad

Russia is one of the major exporters of raw materials to the West but its share of the world’s food imports is less than 1pc. Nevertheless, Russian food manufacturers have grand ambitions to in-troduce Western customers to their goods. And with the rapid rise in food production in Russia, the potential to ex-pand the market is huge, say experts from the Ministry of Agriculture and the Nation-al Union of Exporters.

Irina married Paul and moved to Britain from Rus-sia several years ago. She en-joys life in London, but miss-es her favourite Russian foods such as ryazhenka, tv-orog, kolbasa and pelmeni – everyday foods for most Rus-sians, but in England they are available in only a few specialist stores in London.

“Even my husband fell in love with syrki (a sort of iced milk dessert), when we were in Russia,” she says. “But it’s unlikely that syrki will be on offer here – it is very sweet and I guess could be consid-ered an unhealthy food.”

There are many other foods that are widely consumed in Russia that are very hard to come by outside the former Soviet Union.

“There is a strong demand for our grain and we have consistent marketing outlets in many foreign countries,” says Dmitry Bulatov, the president of the Russian Na-tional Union of Exporters. “However, the situation with the supplies of pre-packaged foods abroad is pretty dire. The activities to promote our domestic food products to the external markets leave much to be desired.”

Although the export of Russian food has been stead-ily growing over the last dec-ade up from $1.5bn (£950m) in 2001 to $7.1bn (£4.5bn) last year, the statistics don’t tell the whole story. The lion’s share of Russian food prod-ucts are traditionally pur-chased by the former Soviet republics and only around a third or a quarter of these goods are imported by EU and other foreign states.

It’s not surprising that ex-Soviet countries are the main buyers of Russian food as, for many decades, they were a part of the homogenous mar-ket. The stable trade relation-ship between these countries

can be explained partly by inertia and shared history.

When it comes to export-ing food and drink products to the EU member-states, the US and other countries, only a few Russian producers have managed to do so. Manufac-turers of alcoholic drinks have had considerable suc-cess exporting from Russia. Russian Standard Vodka, available in 70 countries, is one of the more popular drinks sold abroad. Some Russian wines, such as those produced by Fanagoria and Abrau-Dyurso, are sold in Britain, while Baltika beer is exported to Denmark. Al-coholic drinks raise $116.6bn from exports outside the former Soviet republics.

Similarly, confectionery is making its way abroad. Prod-ucts from the Udarnitsa fac-tory are eaten in Norway, and sweets and chocolates made by Belogor’e go to Finland.

But manufacturers of other foods may start exporting soon. “We have many outlets in Russia that produce inno-vative food items, that aren’t produced anywhere else in the world and could compete outside of the domestic mar-ket,” says Mr Bulatov.

“Among them is a type of wheat named Zhitnitsa which is produced by Pava. It has a unique nutritional composition and Pava has big export plans. Another ex-clusive producer is Wimm-Bill-Dann, a major producer of non-alcoholic drinks and milk products. The company

intends to distribute its infant food abroad.”

adapting to regulationsThe recent survey of Russian food manufacturers and food exporters conducted by the Ministry of Economic Devel-opment sheds light on the problems they experience when trying to market their products abroad.

Many Russian producers said they experienced diffi-culties in finding out the regulations for imported goods, such as sanitary and technical requirements. Most

of the manufacturers com-plained that the rules set by foreign markets were very demanding.

The EU imposes a wide range of restrictions on food imports, covering wrapping, sustainability, contents, ad-ditives and more. US regu-lations on imports go much further and its regulators often insist on inspecting the production site to check the conditions in which the goods are manufactured. If they are not satisfied with the condi-tions they may not allow the product to be imported. Many

Russian food manufacturers are not properly equipped to meet the restrictions and reg-ulations for exporting out-side of the former Soviet Union. “The Russian compa-nies should not consider the requirements of western countries for imported goods a discrimination or sabotage,” says Mr Bulatov.

“The food products of domestic European manu-facturers meet these stand-ards and fully correspond to them. Therefore, it seems fair that they set the same rules for import as well. The main

task here is to assist Russian manufacturers in their attempts to understand for-eign markets and their regulations.

“We should also strive to negotiate with our existing and potential importers about bringing compatibil-ity to our mutual food regulations and their import rules.”

promoting russian foodAnother obstacle preventing Russian manufacturers sell-ing to western markets is that foreign customers are not fa-miliar with many Russian foods and even the names of these products are usually hard to spell, such as pryan-ik or ryazhenka. This is be-cause, for many decades, the Russian market has been iso-lated from the West, cultur-ally and politically. As a re-sult, people in the West are unfamiliar with the nation-al food of Russia.

Mr Bulatov says promot-ing Russian foods at exhibi-tions and trade fairs could help them gain wider recog-nition. But he says manufac-turers should also pay atten-tion to advertising materials. Brochures, booklets and media kits must be produced in different languages, with clear explanations for each of the countries at which they are targeted.

Another fundamental ob-stacle that both the export-ers and the experts point to is the insufficient level of support from the state. “A list of various fields of manufac-turing that are eligible for state subsidies has recently been published, but the food industry, unfortunately, was not mentioned there,” says Mr Bulatov.

Other measures that could help the food industry ex-pand include business priv-ilege taxation, promotional bank loans and other forms of financial support.

Dmitry Bobkov, press at-taché at the Ministry of Ag-riculture, says the role of the national agricultural sector is vital in terms of Russia’s export potential. “We are about to reach the estimated targets for wheat, potatoes, sugar, sunflower oil and poul-try production,” he says. “But targets for meat production will take another three to five years to be achieved.”

As agricultural production expands, exporting it will be a priority, according to the experts. But for now, Russian food remains the preserve of those living within its bor-ders or those in the former Soviet republics.

From russia with food

a question of taste: producers and exporters are seeking to increase the profile of russian speciality foods

russian specialities like ryazhenka, tvorog and kolbasa are little known and hard to find in the eu. but that could change soon.

elena krivovyazrussIA noW

Feeding the world: the figures

Russia’s population is no longer dwindling, as the birth rate has been steadily rising since 2009. So much so, that in 2011 Russia became the largest market in Europe for children’s goods as parents splash out on the cute cloth-ing and toys they never had when they were growing up in the former Soviet Union.

The political stability of the past decade has helped inspire more couples to start families, resulting in a tidal wave of post-Soviet babies. This has fed through to the children’s goods sector and sales of baby clothes, baby food, toys and accessories have rocketed, allowing chains like Detsky Mir (Chil-dren’s World) to benefit.

The toys sub-sector is one of the fastest growing of all non-food product groups, with the market expanding by 76pc in the past five years, according to market infor-mation service PMR. Indeed, legendary UK toy store

retail Burgeoning birth rate helps fuel huge growth in the children’s goods sector

having babies is back in fashion for russians, resulting in rocketing sales for makers and retailers of children’s products.

Hamleys is cashing in on the growth, and has just opened a new store in Moscow.

In Soviet days, it was the dream of every child to visit Detsky Mir and queues en-circled the huge building. Founded in 1957, the com-pany has transformed itself into a modern retailer and is expanding fast. Vladimir Yev-tushenkov, the owner of par-ent company Sistema, said in December at the Russia

Forum: “I believe that the turnover will amount to nearly $1bn (£631m).” He plans to add another 25 stores to the existing 146 out-lets operating in 73 cities around the country.

There were 22 million chil-dren under the age of 14 in Russia last year, and sales in Moscow accounted for one quarter of the total demand for toys, says PMR retail mar-ket analyst Katarzna Twardzik. That represents a market worth $11.3bn,

against the $7bn made on toys in 2006, according to RBC Market Research, mak-ing Russia Europe’s biggest toy market.

By contrast Germany post-ed $10.5bn of sales in toys in 2009 but is only growing at an annual rate of 1.5pc. Most other major European toy markets are in decline.

Despite the increase in births, this growth in sales of children’s products is in line with other aspects of Russia’s consumer market. For instance, Russia became the largest European milk market in 2011. By 2018, Rus-sia is predicted to become the largest consumer market in Europe for all goods.

With a population of some 11.5 million registered inhab-itants, most consumer spend-ing growth is concentrated in Moscow, the largest city in Europe. But as Russia re-covers from the economic cri-sis, its burgeoning prosper-ity is spreading slowly to the 11 regional cities with more than a million residents – known as the Millionniki – turning Russia into a retail-er’s paradise. Russia’s per capita incomes may be half of those in Europe, but as Russians have no debt to

speak of they have the same spending power as Europe-ans – and they love to shop.

Russia has already become the 11th-largest consumer market in the world and the second or third largest in Europe in many product categories, according to market research company Euromonitor.

“Rising wealth levels over the past decade have turned Russia into a middle-class country arguably for the first time in its history,” says Cit-igroup’s chief Russian strat-egist Kingsmill Bond.

Russia is quickly closing the gap on Germany – cur-rently Europe’s largest retail market. Russia’s total annu-al retail turnover was $470.3 bn (£296.9bn) in 2009, ac-cording to state statistics agency Rosstat. In 2010, this figure rose to $543.5bn, and grew by 5.4pc in the first half of 2011. While Germany’s total retail sales are still higher than Russia’s, its growth rate was not as sharp, increasing by 1.1pc and 1.3pc in real terms in 2010 and 2011 respectively, according to provisional figures from the federal statistics office.

With the increase in con-sumer spending power, Rus-

Baby boom drives plot for latest toy story

spoilt for choice: the children’s goods sector surges ahead

anna krachenko and ben arisspecIAl to rn

sians are looking to buy bet-ter quality and more sophisticated products. “Food is the fastest-growing seg-ment in Russian retail,” says Ms Twardzik. “It can already compete with leading west-ern European countries.”

More generally, Russia’s clothing, footwear and acces-sories market is the fastest growing in Europe and was already worth $56.8bn (£35.9bn) in 2010. “If it main-tains its current 10pc-a-year expansion, then it will over-take Germany to become the biggest market in this seg-ment within the next two years,” says Ms Twardzik.

the toy market is one of the fastest growing and has expanded by 76pc in the past five years

billion dollars were made on toy sales in Russia last year, up from $7bn in 2006.

Is the year when Russia is pre-dicted to become the largest consumer market in Europe.

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06 most readRussia now www.rbth.rusection sponsored by rossiyskaya gazeta, russia distributed with the daily telegraph saturday_march 31_2012comment & analysis Once again, the question: “Who is Mr Putin?”

rbth.ru/15098

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dmitry babich special to rn

the Western media’s re-action to the events surrounding the pres-idential election in

Russia seems to have been somewhat misguided. Head-lines such as “Putin’s pyrrhic victory” and “The end of Puti-nism?” were rampant, but was there ever any real chance of the so-called “snow revolution” toppling Putin?

It’s hardly surprising that Senator John McCain tweet-ed that the Arab revolution was coming to Vladimir Pu-tin’s door, as McCain also be-lieves the American opera-tion in Afghanistan to be a “sustainable success” (ac-cording to his recent opinion piece in The Washington Post). McCain’s tweets can safely be reserved for opti-mistic fantasists.

What is more worrying is that the same revolutionary tune was adopted by Amer-ican, British and other west European media giants, some of them even with their own correspondents in Russia. How could the modern media leviathan be so blind to the reality of the situation?

It is arguable whether a

putin 3.0: what can we expect?

end the syrian crisis our way

second fiddle calls new tune

What will Putin’s new presidenti-al term – offi-cially the third,

but actually the fourth – be like? Will we see Putin 2.0 reloaded or will the regime collapse and the world wi-tness a third Russian revol-ution in 100 years?

Watching television re-ports about the rallies call-ing for fair elections, the Western audience might get the impression that Russia is on the threshold of an Arab Spring, as Senator John McCain wrote to Putin, and that there might still be a rerun of the presidential elections under pressure from the street.

Yet inside Russia, everyo-ne – from Putin to his fier-cest opponents – knows this is not the case. The game is over and the results are not subject to revision. Under the new law, Vladimir Putin has been elected for six years. His power is absolutely le-gitimate, impeachment by the Russian parliament is impossible because Putin’s party holds more than 50pc of the seats, and there is no other way that Putin can be removed.

As for revolution, this is extremely unlikely in today’s Russia. The shock of 1917, which upset the course of Russian history, has yet to wear off, so even the most rabid members of the oppo-sition repeat the mantra “anything but revolution”. As for Russian pro-Western li-berals, they are terrified of revolution because they have little doubt that the libera-ted people would give them as rough a deal as in 1917.

No matter how scathing the liberals might be of Putin, they are even more

Western public opinion is out-raged that Mos-cow and Beijing

are refusing to accept a reso-lution condemning the Assad regime’s war crimes. The west-ern media, citing unnamed se-curity service sources, claim the Russian elite has commer-cial interests in Syria, but this has been denied by the Rus-sian Foreign Ministry and there is no evidence of any. So, before condemning Rus-sia’s position, consider its real reasons for taking this line.

Russia has repeatedly de-clared that it is not specifi-cally defending Syrian presi-dent Bashar al-Assad. But talk about Syrian civilians taking up arms is a myth cre-ated by the Syrian opposition. Addressing the US Congress recently, Secretary of State Hillary Clinton expressed doubt about supplying US arms to Syrian rebels, as they have groups close to al-Qae-da in their ranks.

According to repeated leaks from intelligence services, mil-itants from Libya and Yemen are fighting Assad. Russia’s permanent ambassador to the UN, Vitaly Churkin, told the Security Council that Syrian opposition groups were being trained in Libya. Significant-ly, the Libyan leadership did not deny this. So claims that the Syrian army has shot un-armed civilians are not cred-ible. As Western leaders right-ly point out, the aim of

contrary to rumours that the Medvedev-Putin tandem will fall apart because it

will no longer be needed once Vladimir Putin regains the presidency, it looks like Dmitry Medvedev will re-main in government.

Several high-ranking sources in the government and the Kremlin have con-firmed that Medvedev will be prime minister until the end of Putin’s presidential term. “The White House will not be without Medvedev – that is inconceivable,” said one. Although the talk about change will remain largely just talk, there will be some changes in the new regime and some departures.

The old-timers will be among the first to be sent packing. The list of candi-dates for dismissal is topped by Minister for Emergencies Sergei Shoigu and Transport Minister Igor Levitin. There will also be major changes in the fuel and energy de-partment.

Sources have indicated that Deputy Prime Minister Igor Sechin, dubbed Putin’s most loyal deputy, is likely to quit. A high-ranking gov-ernment source says this is the key condition set by Medvedev, who has had a long-running feud with him. He is likely to be followed by his protégé, Energy Min-ister Sergei Shmatko.

The acrimonious relation-ship between former finance minister Alexei Kudrin Kudrin and Medvedev will prevent Kudrin, who left the government late last year after a very public spat with Medvedev, from returning. Kudrin is likely to continue to engage in right-wing po-litical projects and will probably find a common language with ex-presiden-tial Right Cause candidate

leonid radzikhovsky

special to rn

yevgeny shestakov

special to rn

ilya zhegulev Forbes

international intervention is to stop the bloodshed in Syria. Russia fully supports this goal. But it does not consider it helpful to include in the res-olution the question of who started the bloodshed in Syria, since that discussion will not help end the violence. In re-cent months, Syrian cities under Assad’s control have seen a series of suicide bomb-ings, which have the hall-marks of al-Qaeda and the Afghan Taliban. These explo-sions have claimed dozens of civilian lives. Russia suggests the future UN Security Coun-cil resolution condemns the violence and calls for a cease-

fire from both sides – Damas-cus and the opposition. Mos-cow and Beijing want sanctions imposed if the ceasefire is violated.

During the Russian foreign minister’s visit to the head-quarters of the Arab League in Egypt, five main provisions were formulated that could form the basis of a future Syria resolution. They are an end to violence by all sides; an impartial monitoring mechanism; no military inter-ference; free access to humanitarian relief for all Syrians; and firm support for the mission of the UN-Arab

and ol igarch Mikhail Prokhorov.

Of the current key minis-ters, only Igor Shuvalov – the senior deputy prime minister in charge of the economy – looks set to stay. And he will be partnered by his one-time Kremlin col-league, presidential aide Arkady Dvorkovich, says a cabinet source.

According to a high-rank-ing source, the government will become more “project-based”. Medvedev will have several deputies who will not be in charge of depart-ments, as is the case today, but responsible for various projects. For example, he might have a deputy prime minister responsible for reform of the housing and

utilities sector. However, former deputy chief of staff Alexei Volin says the prob-lem with this project-based approach is that there is too much overlap between de-partments. “It would be wrong to say that the hous-ing and utilities complex is linked exclusively with the Ministry for Regional De-velopment. It also includes the Energy Ministry, the Tar-iff Service, the Ministry for the Economy, the Transport Ministry and the Commu-nications Ministry. Who will settle the differences be-tween them?” he asks.

The new plan is reminis-cent of one that was imple-mented during Putin’s sec-ond presidential term, in which none other than

League envoy Kofi Annan. These provisions could pro-vide a platform for a clear road map to a settlement in Syria.

Damascus must implement reforms that will help reveal the Syrian people’s opinion as to who should rule the coun-try. The Syrian opposition should take an active part in these reforms.

Russia maintains that any attempt to sideline the UN Se-curity Council and intervene in Syria runs counter to in-ternational law. Such actions threaten the post-Second World War international in-stitutions designed to ensure global stability. Russia is not against introducing changes in the system of internation-al laws and developing new ones that would allow the in-tervention of the internation-al community if some coun-tries violate fundamental human rights. But these terms need to be established in ad-vance.

When Israel publicly de-clares that it is planning to attack Iran’s nuclear facilities, the world must recognise that a future war can be stopped only through the collective ef-forts of the UN Security Council. Any steps that by-pass the Security Council di-minish its authority, under-mine its credibility and reduce the confidence of its members. This will seriously harm its ability to make decisions in the future.

Yevgeny Shestakov is editor of the international politics desk at Rossiyskaya Gazeta.

as a deputy prime minister, Medvedev was ruthlessly devoured by apparatchiks from different departments who sabotaged his work

no arab spring in russian winter

the myth about Vladimir putin as a cold-blooded and cynical individual is far from the truth

steps that bypass the security council diminish its authority and undermine its credibility

Medvedev was made depu-ty prime minister in charge of national projects.

At that time, Medvedev was No 2 to then prime min-ister Mikhail Fradkov, but nevertheless he was ruth-lessly devoured by appa-ratchiks (loyal servants) from different departments who sabotaged his work, ac-cording to a member of that administration who did not want to be identified.

A once high-ranking pres-idential administration mem-ber recalls how, two days be-fore one of Medvedev’s foreign trips, the premier failed to sign a document needed for the trip because his aide had latched on to some formality. Also, those familiar with the goings on of the White House recall how ministers would fre-quently fail to show up for meetings with Medvedev because the apparatchiks had deliberately scheduled them for another meeting with the prime minister at the same time.

Similarly, ministers can sabotage the work of dep-uty prime ministers. “When deputy prime ministers su-pervise specific ministries, they are the bosses”, anoth-er source close to the gov-ernment reasons: “If both Shuvalov and Kozak (also a deputy prime minister) issue orders, the ministers may fulfil the orders of one and not the other.

“And let us not forget that the budgets are still in the hands of the ministries. It is a scheme that patently cannot work.”

Evgeny Minchenko of the International Political Ex-pert Institute believes that there is a more effective way to reform the cabinet struc-ture: “The best way would be to get rid of the minis-tries with complex struc-tures,” he says.

first published in

afraid of the people. Such revolutionaries will obvious-ly never stage a revolution.

So, after being legitimate-ly elected, Putin will remain in office until 2018, during which time no one will be able to overthrow him. Un-less, of course, he decides to quit himself.

Now let us take a look be-yond the propaganda myths at what Vladimir Putin is

really like. The myth about Putin as a cold-blooded and cynical individual is far from the truth. In reality, he is emotional, sensitive and even touchy. At a rally after his resounding victory in the presidential election, he was crying. Even if one assumes the tearfulness was planned, there can be no doubt that he was very emotional.

The view that Putin is a dictator concerned only with personal enrichment does not stand up to criticism ei-ther. Putin is 59 years old and has been leading Russia for 12 of them. If he were con-cerned only about personal gain, he had a wonderful chance to leave the post of president after negotiating

firm guarantees for his safe-ty – which is what Yeltsin did in 2000. The fact that he stayed, despite realising that lean years probably lie ahead, shows he is not guided by his selfish personal interests but by a sense of mission – Russia’s mission.

Putin has a profound faith in Russia’s great mission, just like the US, Britain, China or any other great country believes in its own great mis-sion. Having worked in the wild Nineties, he felt Rus-sia’s disgrace deeply when it was weak. As a former KGB officer, he believes the root of Russia’s woes is un-fair competition, above all from the West, which tradi-tionally dislikes and is afraid

of Russia.On all these issues, Putin has solid popular sup-port, as many Russians think along the same lines.

Putin values personal de-cency and loyalty and consi-ders himself to be a man of his word. He promised to ap-point Medvedev as prime mi-nister and he will keep that promise. Putin, who made a dizzying career within a few months (1998-1999), cannot but believe in his star. I think the successful years of his presidency (up to 2008) fur-ther reinforced his confiden-ce. Perhaps that is why he reacts in such a morbid way to what he regards as a chal-lenge to his power. Having enjoyed genuine popular love, Putin is sensitive to changes in society’s mood. The demonstrations appa-rently hurt him deeply.

What policies can we ex-pect in the foreseeable fu-ture? Putin will try to divide and rule: part of the oppo-sition has already been re-cognised; they have been al-lowed to register their own political party and will take part in elections. Will Putin allow greater freedom of ex-pression? During the elec-tions, it became clear that he had no reason to be afraid of such freedom. Putin has been criticised a lot, but that has only helped him. If he controls the overall situation, criticism can even do him good as people begin to sym-pathise with him and feel angry at his critics. It’s a sim-ple recipe: keep overall control and allow freedom to criticise within limits.

Putin will not share real power but will appoint top officials. He will turn a sen-sitive ear to public sentiment, especially on social and eco-nomic policy. For example, he will do everything possi-ble to avoid raising the re-tirement age.

Thus, Putin vintage 2012 will be a president who keeps real power firmly in his own hands, expands public poli-tical freedom, puts his faith in patriotic propaganda and judicious social policy.

Leonid Radzikhovsky is a columnist at Rossiyskaya Gazeta. An expert in politi-cal technologies, he has ad-vised many senior politicians in their election campaigns.

revolution in Russia, espe-cially one modelled on the Libyan or Egyptian upris-ings, would be good for the West. Why the Western media tends to believe stories about Vladimir Putin’s hostility to the West, quoting only Pu-tin’s bitterest enemies as re-liable experts, is a mystery to me. Putin’s record in power (agreeing to American bases in Central Asia and an In-ternational Security Assist-ance Force transportation hub in Central Russia; ac-quiescing to Nato’s and the EU’s expansion into the Bal-tic; encouraging mergers with western companies) is not anti-western.

But even if we agree that Putin being removed from power by the snow revolu-tion would have been a good thing, it clearly wasn’t going to happen, though dramatic pictures of bored Moscow clerks and the likes of Ksen-ya Sobchak (Russia’s Paris Hilton) demonstrating against the regime produced heightened expectations.

The first reality check should have registered in January, when Sobchak (now in fashionable protest garb) and most other protesters happily went abroad for the New Year vacation. Revolu-

tionaries don’t go on vaca-tion. It is also worth men-tioning that the much-praised middle class (in fact the city’s rich residents), who were be-hind the protests, never threatened Putin with strikes. The reason was simple – the city could happily live with these people striking. It doesn’t look like the 1917 Bolshevik revolution or even Paris in 1968. And it certain-ly doesn’t look like the Arab Spring, especially in the mid-dle of Russia’s winter.

Luckily, Russia is not Egypt – its people are not so desperately poor that a $1 rise in the price of a kilo-gram of bread would leave millions of its citizens with little food. Russia is also not Yemen – most Russians are unconcerned about religion

and have a distinctly Euro-pean culture, with only mild overtones of Orthodox Chris-tianity. Hotbeds of Islamist extremism are limited to the North Caucasus, and radical Islam has no mass support in the country. Russia is also not Georgia – even the most pro-western president of Mikheil Saakashvili’s kind will not be able to squeeze out of the West enough eco-nomic aid to make 142 mil-lion people happy (Saakash-vili had only limited success with his four million).

Criticism of Putin’s Rus-sia (in fact, any kind of Rus-sia) and a certain anti-mi-nority element were strong in the recent protests. Na-tionalists, including Alexei Navalny, suggested leaving the mostly Muslim North Caucasus to its own devices and sealing off the border with Central Asia; Russo-phobes like Viktor Shen-derovich sang the old song about Putin’s supporters (saying that most Russians are sheep or idiots). But that doesn’t mean that a Russian revolution is about to

overthrow the government. Parts of Russia may experi-ence similar uprisings be-cause of economic difficul-t ies or the spread of extremist ideologies as a result of the Arab revolu-tions. Strings of local crises may indeed destabilise the country, but there is only a very slim possibility that poverty and extremism will help the western-backed lib-eral revolutionaries.

Poverty and extremism tend to help demagogues and extremists, the modern Mid-dle East being an excellent illustration of this. But the victory of demagogues and extremists in Russia would not be good for anyone, ex-cept the two previously men-tioned groups of actors.

The West will, sooner or later, suffer from such a rev-olution, too – just like it did in the 20th century after the victory of Russian extrem-ists in 1917, with their seem-ingly progressive ideology.

Dmitry Babich is a political analyst for the Voice of Russia radio station.

the middle class, who were behind the protests, never threatened putin with strikes

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07MOST READ RUSSIA NOW WWW.RBTH.RUSECTION SPONSORED BY ROSSIYSKAYA GAZETA, RUSSIA DISTRIBUTED WITH THE DAILY TELEGRAPH SATURDAY_MARCH 31_2012 FeatureVeteran BBC journalist Martin Sixsmith discusses his

book on Russiarbth.ru/14967

Englishman abroad: spy Kim Philby’s Moscow exile

Espionage A book on the double agent, released on what would have been his 100th birthday, sheds new light on his escape from Beirut and his life in the USSR

Philby’s supervisor until recently served as head of a department in the Russian Foreign Intelligence Service. He has great respect for Philby, perhaps revealing the spy’s talent for winning peo-ple over, and a high regard for his exceptional profes-sionalism.

Did you see Philby and his wife much?No, it was mostly on impor-tant occasions such as the anniversaries and profession-al holidays of our service, some important dates for Kim and George [Blake, who also worked for the KGB and escaped to the USSR], organ-ising their trips around the country and solving various problems. The time I worked with him coincided with a rather interesting period for our country. Perestroika and glasnost also affected our � eld, forcing committee and � rst chief directorate lead-ership to lift the veil of se-crecy around all of those peo-ple and allowing them to go on air.

The journalist Phillip Knight-ley, who interviewed Philby in 1988, asked some tricky ques-tions, but he was able to avoid them skilfully. For Philby, Knightley was just a tool, a channel to trans-mit the information he want-ed to transmit. Indeed, Philby was himself a journalist, an intelligence officer and a high-ranking manager.

We did not want Knight-ley to guess where Philby lived. Why are you surprised? How could we know what the consequences could be?

were granted to them back in the war years when they were all working in Britain, although later, in Moscow, they all received good money.But those things are all rel-ative. Anyway, Kim received a much larger pension than the average Soviet army gen-eral. Philby was held in high regard. Even his opponents cannot reproach him in this respect. Instead, they try to downplay Philby’s role.

Did you help bring things for Philby from abroad? Tweed trousers, sweaters, and other things he liked helped Philby feel more at home or at least comfortable and sur-rounded by familiar things. The Times, English mustard and other small things mat-tered to him. Soviet intelli-gence officers would buy those things for him when they visited Britain.

Which English people in his circle did he keep company with? I know from others that Philby was very close to Ma-clean (one of the Cambridge Five) at one time. He was also friends with Blake.

You know, it isn’t so much his private life that interests me, but something else. I re-member his awards. If, from today’s historical perspective, we look at what Philby did for the victory in the Second World War, we see that his personal contribution was huge. Among other things, Philby and his colleagues contributed to the success-ful outcome of the Battle of Kursk (Kurskaya Duga).

This is acknowledged

Double identity: Kim Philby is considered a hero in Russia for helping the country defeat Nazi Germany

Abandoned: Philby's third wife Eleanor with her Siamese cat in 1968, five years after Philby left her to escape to the USSR to avoid being arrested. Below right, Dolgopolov’s book

We had our own serious task: ensuring Philby’s safety.

Our approach was to ex-clude the possibility of get-ting any information about Philby. He lived not far from Gorky Street. However, when bringing Knightley to Kim, we drove around the city for quite some time to make him think that Philby lived far from the city centre. We drove him to the building and he went up in an elevator.

When you visited Philby, did you discuss any urgent is-sues?Generally, no. What we dis-cussed was interviews, pre-paring for them and meeting journalists. I never received any detailed instructions for Philby from my superiors. They proceeded from the as-sumption that Philby him-self knew best how to do things. It was left to his dis-cretion. The Knightley inter-view was unedited.

Did he still work for the intelli-gence service?Yes, he briefed intelligence officers before they went on missions to Britain and other English-speaking countries. They were arranged in groups of three. He took it very se-riously, preparing and mak-ing notes for use during those training sessions. He closely monitored events around the globe, and especially in his region. He saw it as his con-tribution to the training of young intelligence officers.

Even if it wasn’t the main thing in his life, the profes-sion was an important part of it... the students would come to his place about once

a week. And let’s remember how old he was: in the mid-Eighties he was over 70. And he did continue his pedagog-ical activity. When Philby’s advice was needed they would contact me, and I would call and discuss a timetable.

Did Philby speak Russian well? Not really. It was different with George Blake, who em-braced Russian life more fully, but he was a very dif-ferent kind of person. Blake speaks Russian, though he does have an accent.

Did Philby associate with any other of your colleagues aside from the young officers he trained for trips to England? No, I can’t remember him coming to our service and visiting different depart-ments. It isn’t accepted here. Instead, he would come on formal occasions.

In Moscow, he lived the same life as us Russians, carefully monitoring all po-litical events. The fate of peo-ple like Philby, who switch sides, is always determined by that step, once and for all. As a rule, they get squeezed like sponges, after which they are given half a million or whatever, and are set free to go and live as they please.

It all depends on their rea-sons for switching sides. If it was all for money or some personal reasons, the out-come is clear. But it was dif-ferent with Kim and his Cambridge friends. They were all idealists. This is what really matters. They even waived their pensions, which

by everyone, including Philby’s enemies. He provid-ed some extremely valuable information.

I started to talk about his contribution in the victory over Nazi Germany. When I examined the materials care-fully, I felt a sense of injus-tice. How could it be that he did so much but was not a Hero of the Soviet Union? I began to bring this idea to our leadership. They ex-plained that it was not the best time, the year being 1987: maybe Gorbachev didn’t want tensions with Britain. So my idea did not win support. Then, suddenly, a document comes from the office of KGB chief Vladimir Kryuchkov, where it arrived from the office of Mikhail Yasnov, then chairman of the Presidium of the Supreme Council of the Russian So-viet Federative Socialist Re-public, with a note saying: “Mr Kryuchkov, please con-sider the letter attached.”

In the letter, three students from Kharkov expressed their surprise that a man who did so much for the victory was not made a hero. It was shortly after Philby’s inter-view with Genrikh Borovik was shown on television that the Kharkov students wrote their letter. Orders were given to prepare the necessary doc-uments. We began, but Philby died in May 1988.

You attended Philby’s funer-al. Was it unexpected? Media reports spoke of a sudden death. It was, there’s no mystery there. Philby was undergo-ing a medical examination

On January 23, my wife and I had a dinner engagement with the Balfour-Pauls [Glen Balfour-Paul, � rst secretary at the British Embassy and wife], at which the Copelands [Miles Copeland, CIA officer, and wife] were also to be present. At 3pm I received a signal from our friend indi-cating a rendezvous at 6pm for the purpose of consulta-tion. I therefore left our � at shortly after 5.30pm inform-ing my wife that if I were detained she should go to the Balfour-Pauls’ without me and await me there.

On meeting our friend, I was informed that the ar-rangements had been speed-ed up and that I should have

Kim Philby fled Beirut to avoid arrest when his cover was blown. His notes detail the impact his departure had on his wife, Eleanor.

but that I would be rejoin-ing her for dinner at the Bal-four-Pauls’ and that he would be able to reach me there.

During dinner my wife be-came increasingly anxious. The Copelands tried to soothe her by arguing that I was ob-viously out on some journal-istic scoop. Their arguments did not succeed in calming her down because I had al-ways previously kept her punctually informed about my movements. My wife left the Balfour-Pauls’ very soon after dinner and got back home at about 10.30pm. She waited until after midnight and then called back to Peter Lunn. He was out but his wife was able to locate him. Lunn then telephoned Elean-or who asked him if he knew of my whereabouts. He an-swered that he did not, but that he was ready to visit her to discuss this situation. He

arrived at the � at at about 2am. (My wife’s anxiety at that stage was that I had had some serious accident).

My wife was unable to de-tect any particular signs of agitation in Lunn’s behav-iour, but that is hardly sur-prising because he is a par-ticularly cool fish, and my wife had only met him on a few occasions. It was a very stormy night and Lunn said the Lebanese police would probably decline to take im-mediate action and they might therefore just as well wait until morning before starting inquiries (which was Lunn’s big mistake).

Early the following morn-ing, Lunn told Eleanor that, acting in concert with Pier-otti, the British consul, they were asking the Lebanese police to check all hospitals for accidents that may have occurred the previous night. (The story in The Observer that Copeland and Eleanor spent £100 on taxis search-ing for me is completely un-true). The position of my wife was also complicated by a note which I had left in a drawer. Two or three days later Pierotti turned up with

two Lebanese police officers, who interrogated Eleanor about what I was wearing when I disappeared.

The next event was the ar-rival of my � rst letter telling Eleanor where to � nd 3,000 Lebanese pounds which I had left behind for her and my instructions for her to tell everybody that I was on a long tour of the area. This letter Eleanor showed to Lunn. Late in January, Lunn asked Eleanor to lunch and asked her detailed questions about my health, financial position, and other possible sources of worry. Eleanor said she thought I had been wor-ried for some time, but at-tributed it to a rundown state of health along with worries of the previous year.

Early in February, Eleanor decided to contact Miles Copeland whom she had known for 12 years; an ad-ditional reason for her doing this was that she could not � nd much con� dence in Peter Lunn. Copeland offered to get in touch with Nicholas Elliott [MI6] who was some-where in the area at the time and asked him to come urgently to Beirut. Eleanor

Signal from ‘our friend’ meant I had to flee Lebanon – without my wife

History man: Philby, centre, inspects Cold War photographs at the KGB museum in Moscow

Extract from Kim Philby

PROFILE

Kim PhilbyBorn in India in 1912, Harold Adrian Russell “Kim” Philby was the son of a British high-ranking official. Philby was raised by his grandmother in England and studied at Trinity College Cambridge, where he became treasurer of the uni-versity Socialist Society. After

being recruited by a Soviet intelligence agent he worked as a journalist, combining press assignments with spy work for the Soviet Secret Intelligence Service. He was also recruited by MI6. Philby married four times and had five children. He died in 1988.

See the full version atwww.rbth.ru/14132

See the full version atwww.rbth.ru/14132

Branded a traitor in Britain but hailed as a hero in Russia, Kim Philby OBE was a high-ranking member of the British Secret intelligence Service and one of the Cambridge Five who passed British intelligence infor-mation to the KGB. When his cover was blown in 1963, he fled Beirut, where he was working as a journalist, and escaped to the USSR where he spent the rest of his days until his death in 1988. He was bur-ied with full military honours and later depicted on a stamp by the Russian postal service.To commemorate what would have been Philby's 100th birth-day on January 1, a new book by the award-winning journalist

and writer Nikolai Dolgopolov, was published. Dolgopolov’s book, Kim Philby, one of more than 200 about the Camdridge spy to have been published, fo-cuses on the Moscow period of Philby’s life. He loved wandering around the city, his Russian wife Rufina re-calls, and he knew the city cen-tre very well. He even made a map of the lavatories there – partly for a joke, although it was actually quite useful, since there were not many toilets in Moscow back in those days.A number of documents were declassified by the Russian Foreign Intelligence Service specially for Dolgopolov’s book. They include Philby’s notes

about his work for the British Secret Intelligence Service, his reports to Moscow and con-fidential messages. “Some of them were translated into Russian for the first time,” says Dolgopolov. The author was given a rare opportunity to interview Philby’s fourth wife Rufina, as well as Philby’s students and Soviet intelligence officers, who did not reveal their names. Below are two extracts from the book, including the inter-view with Philby’s supervisor and the spy’s notes about the circumstances in which he left his then wife Eleanor when he fled from Beirut for the USSR in 1963.

in our hospital. He had a sep-arate room, because of his status. He fainted and fell to the floor. Had there been someone else in his room, a doctor would have been sum-moned immediately.

That’s not to say that he was in a critical condition before. No, it was a regular check-up. Everything was going � ne. He was expected to stay in the hospital for a few more days and then go home.

After talking to you I am even more convinced that the most important things Kim Philby did were far away from here. Philby completed his intel-ligence mission before he left Beirut. Even when he was in Beirut, working and helping

as much as he could, he was in what he called his quies-cent mode. Just compare it to his mission in the US, where he was a representa-tive of the Secret Intelligence Service from 1949 to 1951.

But then he was recalled to London, which was a sign of mistrust. By that time, most of his work had been accomplished.

Is it the fate of an intelligence officer to do two or three cases? It may even be one case. In-deed, many intelligence cases are completed and archived, and buried, and no one knows about them.

With Philby, it was 15 years of real blazing commitment

and sacrifice followed, of course, not by a quiet life, not by demise, but just by anoth-er, completely different life.You touch upon a very in-teresting philosophical point. It’s important to show that first of all, even in such a specific sphere, there is a place for blazing and sacri-� ce, and noble tasks.

And there is one more im-portant thing about Kim Philby: no one, even in the West, can claim that he worked for the money. He had such a pure, romantic at-titude toward the country for which he worked for decades, in which he believed…

agreed with the suggestion and Elliott arrived within 24 hours.

Elliot’s conversations with Eleanor were of a general character. They consisted to a considerable extent on my whereabouts, state of health, state of mind, etc. At times Elliott seemed to give the impression that I had been double-crossed and had left against my will. Round about this time the Lebanese police began to show inter-est in the contents of my strongbox.

Throughout this period, my wife was subjected to routine persecution from press correspondents and photographers. She also says that agents of the Sûreté moved into an empty flat overlooking ours to keep the place under observation. Other normal security pre-cautions were taken, such as bribing the porter and tap-ping our telephone.

to leave [Beirut] at once. I therefore telephoned our � at and told my son who an-swered the call to tell

Eleanor I should probably be very late. Some time between 6pm and 7pm, Peter Lunn [MI6] telephoned my wife

and asked to speak to me. He did not give any particu-lar indications of urgency. My wife answered that I was out

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08 most readRussia now www.rbth.rusection sponsored by rossiyskaya gazeta, russia distributed with the daily telegraph saturday_march 31_2012london book Fair The writers’ factory: young authors in Russia

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The Lives and work oF Two oF russia’s BesT-seLLing auThors, who are aLso weLL-known For Their poLiTicaL commiTmenT

russian literature

In 1970, a geography teach-er in a Moscow school gave an assignment to his stu-dents: they had to collect newspaper clippings about specific countries. Some of the students got Tunisia, Ec-uador and Japan. Soviet newspapers regularly wrote about the first two, mostly about the heroic struggle of the working class against capitalist exploitation, but they wrote virtually nothing about Japan. But one day the student read that a Japanese writer had attempted a coup, which sparked an interest in Grigory Chkhartishvili and helped shape his journey.

Since then, Chkhartishvi-li has been through several metamorphoses. He studied languages at Moscow State University in the Institute of Asian and African Countries and worked as a translator from Japanese and English. His most famous translations were of the work of Yukio Mishima, whose failed coup had such an impact on him. In the Eighties and Nineties, Russia saw a surge of inter-est in Japan, largely thanks to Chkhartishvili and other Japanese studies experts. However, Chkhartishvili later

a childhood fascination with an attempted coup in Japan put grigory chkhartishvili, aka boris akunin, on an extraordinary career path.

realised that he didn’t want to continue to work as a translator. “I wanted to find an occupation that better corresponded to my inner self,” he told Russky Report-er magazine. And in 1998, the translator became an aston-ishingly popular fiction writ-er. He began writing histor-ical novels under the pen name B Akunin. Readers later dubbed him “Boris”.

He attributes his success to a format that appears in

all his work. There is a char-ismatic protagonist, a serial narrative and a literary game with the reader.

Chkhartishvili’s protago-nist is Erast Petrovich Fan-dorin, a Russian Sherlock Holmes with German roots, an intellectual and athlete who is infinitely noble and honest. Chkhartishvili has written 14 books about Fan-dorin, whose character de-velops throughout the series: it is filled with literary games and allusions and the over-all experience is multilay-ered. On one level, readers can s imply enjoy the adventure but some will try to identify the classic Rus-sian novels from which

Chkhartishvili has borrowed particular episodes.

There are spin-offs to the Fandorin books, including a series about Fandorin’s an-cestors and descendants. There is also the separate Sis-ter Pelagia series, about a nun who is a detective.

As the author previously moved on from translating, he now wants to move on from writing novels. Since late last year, Chkhartishvi-li has been writing a Live-Journal blog in which he fo-cuses on historical topics.

Like most Russians, before December 2011 Chkhartish-vili could not imagine be-coming involved in politics. But then came the parlia-mentary elections, followed by the rallies in December. Chkhartishvili turned from a writer and blogger into a public political figure almost overnight.

The story of Chkhartish-vili’s involvement in the pro-test movement is the stuff of legend. The writer was in his house in St Malo, France, writing a new book as events unfolded in Russia. He got in his car and drove 250 miles to Paris, took a flight to Mos-cow and found himself at the Bolotnaya Square rally, where more than 50,000 people lis-tened to him with enthusi-asm. Many thought Chkhart-ishvili delivered the best speech of the day.

“I never thought I would speak at a rally. It’s hard to

imagine anything more alien to my whole temperament,” he wrote in his blog after his Bolotnaya appearance.

During the presidential election of March 4, the writ-er and other public figures organised the Voters’ League to act as a watchdog for poll-ing procedures. Throughout election day, representatives of the League witnessed and recorded irregularities that took place at polling stations in Moscow.

Chkhartishvili and mem-bers of the Voters’ League have subsequently refused to recognise the results of the presidential elections and are continuing to fight to have them annulled.

Translator learns the language of protest

words and action: grigory chkhartishvili surprised himself by becoming a political figure

konstantin milchinspeciaL To rn

The tsar-era thrillers about Erast Fandorin have been a hit since 1998, when the first book was introduced. Eng-lish translations of the last two in the series, He Lover of Death and The Diamond Chariot, were released at the end of 2011. The “he lover” in question could be any number of characters – from a bandit prince to a rags-to-riches underdog/hero.

The adventures of the hero Senka in the 19th-century

book review

dickensian visions and the villain exposedtitle : He LoveRoF DeaTH, THe DiaMonD CHaRioTauthor : boRiS akuninpublisher : oRion bookS

slums of Khitrovka remind readers of Oliver Twist and Treasure Island. But this gruesome tale, a familiar mixture of action and in-trigue, has a distinctly moral

chkhartisvili began writing novels under the name B akunin. readers later dubbed him ‘Boris’

i never thought i would speak at a rally. it’s hard to imagine anything more alien

zakhar prilepin’s work draws on his experience as a police officer. he fights for social change through his writing and political campaigning.

Zakhar Prilepin has experi-enced a meteoric rise, both as a literary phenomenon and as a political activist. At 36, he is one of Russia’s most ac-claimed authors, and his novel Sin was voted one of the most important books to come out of Russia in the past decade. Prilepin’s new work, Vosmerka or “Eight”, is the most anticipated Russian book of 2012. Prilepin says the story shows how friend-ships fall apart for no good reason. A film of the book is already being filmed by the director Alexei Uchitel.

It is hard to imagine that 10 years ago Zakhar Prilepin, then Yevgeny Prilepin, veter-an of two wars in Chechnya, was a poorly paid officer with the special police unit Omon. His salary of 830 roubles (now about £18) a week could not cover the expenses of his first baby. To help keep food on the table, Prilepin took shifts where he checked

trucks coming from the Northern Caucasus. “The drivers never had proper transit documents,” he says. “I let them pass and they gave me bananas, apples and sometimes 50-rouble bills – I was not ashamed.”

From officer to writerThe daily pressure to find money and food for his growing family eventually pushed him to reinvent him-self. In 1999, when Prilepin

on the front line: a modern Tolstoy

anna nemtsovaspeciaL To rn

graduated from university, one of his college friends sug-gested he apply for a job at the newspaper Delo. He did and quickly rose to become the chief editor. At the same time he wrote his debut novel, Pathologies, which was awarded the National Best-seller prize.

Pathologies portrays Yegor, an immature and frightened Omon commander in Chech-nya. “War does not make people any different, but it

exaggerates the traits the person already has,” Prilepin explains. “If you like people, you are a humanist; if you have maniacal thoughts, you are a total maniac.”

He adds that, while his books are not autobiograph-ical, he relates to his protag-onists: Sankya, a National Bolshevik revolution leader in Sankya; and Zakhar, a bar bouncer in Sin.

Today, Prilepin is the edi-tor of the Nizhny Novgorod bureau of Russia’s investiga-tive newspaper, Novaya Gazeta. He lives with his wife, Masha, and their four children in a remote village on the Kerzhenets river with two dogs and three cats. “If only they paid us well in Omon, I would still be a po-lice officer today,” he says.

Critics have compared Pr-ilepin to Leo Tolstoy. Tolstoy’s great-grandneice Tatyana Tolstaya, author of Pushkin’s Children and Sleepwalker in a Fog, says Prilepin “is the biggest event in today’s Rus-sian literature; his language reminds us of Tolstoy”.

Prilepin acknowledges that Tolstoy is his idol: “Of course I am a typical follower. If only I could feel safe about the

future of my family in Rus-sia, I would have 12 children and never leave my village,” he says.

arrested 150 timesLast month, Prilepin, a prom-inent figure in the National Bolshevik movement, stood with opposition leader Boris N e m t s o v o n N i z h ny Novgorod’s Freedom Square. “I have been arrested more than 150 times... my photo-graph is number one on the list for detentions of radical opposition activists. Now Omon grab me, beat me in my stomach, drag me with my face on the ground.”

“What I love about [Pri-lepin] is that he never leaves the front line,” says fellow war veteran Arkady Ba-bchenko, the author of One Soldier’s War. “He is an ac-tive participant expressing his social and political pro-test both in his books, and physically on the streets.”

The acclaimed poet and novelist Dmitry Bykov says that for the past decade, Russian had suffered from a lack of writers who were in-volved in the process of so-cial change. “And then Pri-lepin’s books appeared.”

proFile

zakhar prilepin

Born in 1975, he was drafted into the Russian army in 1994. His work as an Omon (special police) officer from 1996 to 1999 provided rich material for his writing. After graduating from college in 1999, Prilepin moved to Nizhny Novgorod, where he has worked as a journalist and a novelist for the past decade.

nationality: RuSSian

age: 36

studied: LanguageS

undertone. The protagonists discover criminal gangs and murders, but also come to understand the world better. Disguised as Jews, they en-counter anti-Semitism;

dressed as a girl, Senka learns about sexual harassment.

Set during the Russo-Jap-anese war, The Diamond Chariot involves bombs, spies and murder on the Trans-Si-berian Express. Each chap-ter ends with a haiku, which must have been a challenge for translator Andrew Bro-mfield. Akunin elegantly combines the Russian spirit with Japanese exoticism. The narrative is writhing with concubines, opium addicts, gambling dens and haunted Shinto shrines.

Many mysteries are laid bare, among them the secret of the author’s pen-name. Akunin, readers learn, is the Japanese word for “villain”.

events

read russia! at the London Book Fair

young women’s writing From russiamonday apriL 16, 10am, weLLingTon room, earLs courT 1Olga Slavnikova, an interna-tionally renowned author and winner of the Russian Booker, and four female winners of the acclaimed Debut Prize (Yarosl-ava Pulinovich, Irina Bogatere-va, Anna Lavrinenko and Anna Leonidova) will present a new female voice from diverse ar-eas of Russia, inviting a discus-sion on present day attitudes.

›www.academia-rossica.org ›russian literature Face-to-FaceTuesday apriL 17, 11am–4pm, The read russia! sTand (y255) aT earLs courT 2 Four of Russia’s best writers – Boris Akunin (featured above), Alexander Kabakov, Zakhar Prilepin (featured left) and Olga Slavnikova – will be visiting the Read Russia! stand to discuss their work and meet publishers, journalists and readers.› www.academia-rossica.org

nashi/ne-nashi: being young in russiawednesday, apriL 18, 7pm, waTersTones, piccadiLLy Rising star of Russian literature Zakhar Prilepin discusses the role of young people in poli-tics with documentary maker James Jones.› www.waterstones.com

From classic to contemporary russiawednesday apriL 18, 12pm, The read russia! sTand (y255) aT earLs courT 2A discussion on translation as both an art and a trade, and its future prospects, particular-ly in light of the establishment of the Institute of Translation in Moscow. › www.academia-rossica.org

the power oF mysteries and the mysteries oF powerTuesday, apriL 17, 7pm, waTersTones, piccadiLLy Join bestselling author-turned-activist Boris Akunin when he discusses his career, his writing and his interests. Book signings will be available. ›www.waterstones.com

uk Film premieremonday apriL 16, 8.30pm, apoLLo cinema, piccadiLLyBoris Akunin will present the new screen adaptation of his book The Spy Thriller, for which he wrote the script. Set in Moscow in the run up to the outbreak of war in 1941, the film chronicles the intrigues between the elusive spies of the Soviet Union and Germany.

www.apollocinemas.com ›

literature promotionmonday apriL 16, 1pm, Thames room, earLs courT 1The Read Russia! 2012 pro-gramme is sponsored by the Russian Federal Agency for Press and Mass Communica-tion and Media under the di-rection of Vladimir Grigoriev. It will feature translation grants for the publication of contem-porary and classic Russian lit-erature in English, author tours for leading Russian writers and their publishers, a major exhi-bition on children’s book art, a travelling film series and a new documentary project about Russian literature.› www.academia-rossica.org

contemporary russian litera-ture is celebrated with read russia! as part of the london book Fair april 16-20, at venues across london.

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