Publication: Fortnight in Review Volume: 6 Issue: 2

The fortnight saw Acting President Vladimir Putin proceed cautiously to consolidate his position in the walk-up to the March 26 presidential election. Having already removed Tatyana Dyachenko, former President Boris Yeltsin’s daughter, from the post of Kremlin “image” adviser, Putin also moved against another controversial figure within the power elite–First Deputy Prime Minister Nikolai Aksenenko–a reputed ally of the tycoon Boris Berezovsky. The acting head of state, apparently, was getting back at Aksenenko for having removed the head of the Transneft state oil pipeline monopoly last year without first consulting Putin, who was then prime minister. Aksenenko, however, will remain Russia’s railways minister.

More significant, Putin removed long-time Yeltsin crony Pavel Borodin as head of the so-called Kremlin “property” department, which oversees a multibillion-dollar property empire inherited from the Soviet Communist party. Borodin’s position was weakened last year when Russian and foreign media reported that he was a target of a Swiss investigation into alleged bribery and money laundering involving Mabetex. The Swiss construction firm had won lucrative contracts from Borodin’s department to refurbish various Russian government installations, including the Kremlin. In removing Borodin, Putin, who once worked as Borodin’s assistant, was trying to distance himself from the corruption scandals which plagued the Yeltsin administration during its last year.

Perhaps even more important, Putin brought in a long-time associate, Vladimir Kozhin, as Borodin’s replacement. Kozhin had been head of the Federal Service for Currency and Export Control–a post he assumed last September, just after Putin became prime minister. The significance of Kozhin’s new job cannot be underestimated: The Kremlin property manager provides the state’s top 12,000 officials with housing, medical and other services. The post gives the executive branch a powerful lever over judges, governors and legislators.