Publication: Monitor Volume: 6 Issue: 148

President Vladimir Putin has reiterated his previously stated promise that the controversial privatization deals of the previous decade, which helped create Russia’s class of powerful “oligarchs,” will not be overturned. Speaking yesterday, the head of state declared that the most important outcome of his July 28 meeting in the Kremlin with twenty-one leading business tycoons was that it had “removed all speculation” about the possibility of a “redistribution of property” or an “attack on business.” The state, he said, was “vitally interested in the development of the economy” and business; both the state and business representatives “must act strictly according to the rules.” Meeting participants, for their part, released a joint statement calling the “common opinion that privatization, with all of its complications and flaws, was a natural and necessary step on the path to creating an effective and competitive economy” one of its most important outcomes. Government representatives at the meeting (besides Putin, these included Prime Minister Mikhail Kasyanov and Trade and Economics Minister German Gref) said that they would not engage in “political campaigns” either to redistribute property or revise the results of privatization. At the same time, Putin had underscored that it was unacceptable for competing companies to use the state apparatus, “including the power structures,” as the “main argument in the competitive struggle.” For their part, the business representatives had agreed that the “most important condition for the effective development of the economy” is that the authorities keep equally distant from competing businesses (Russian agencies, July 30).

Afterward, Boris Nemtsov, head of the Union of Right-Wing Forces’ faction in the State Duma and the initiator of the meeting, declared triumphantly that there were no longer oligarchs in Russia, and that the country had entered a “new epoch” in which “business is not looking for privileges” (Agence France Presse, July 28). For his part, Moscow Mayor Yuri Luzhkov said that the “oligarchs” had been “put in their place” (Russian agencies, July 29). Another participant, Interros financial-industrial group head Vladimir Potanin, said that the meeting had alleviated his “worry” and “uncertainty” and had shown that the tycoons will be listened to. Earlier this month, the Prosecutor General’s Office threatened Putin with criminal prosecution if he failed to pay the state US$140 million–compensation for allegedly conspiring to acquire the Norilsk Nickel plant for an artificially low price in 1995.