Publication: Monitor Volume: 5 Issue: 96

A number of observers have already noted that Stepashin, if confirmed, is not likely to carry out radical economic reforms, but instead a policy which largely continues those carried out–or, at any rate, given lip service–by the Primakov cabinet. Like Primakov, Stepashin, in his current role as acting premier, has already been sounding off about “economic crime”–promising to strip banking licenses from a group of banks (whom he has not yet named), which he accuses of illegally moving capital out of Russia while defaulting on depositors and creditors. More substantively, Stepashin has stressed both the need to push laws through the Duma which would meet the International Monetary Fund (IMF)’s conditions for its latest promised multibillion-dollar credit. Such laws include raising gasoline and alcohol taxes, postponing a reduction of the valued-added tax and bankrupting insolvent large banks. The rumored nomination of State Duma budget committee chairman as economics tsar would suggest that Stepashin, if confirmed, will view getting these and other laws demanded by the IMF through the parliament’s lower house as a priority.

Anatoly Chubais, meanwhile, now on a visit to the United States, was quoted today as saying that Russia may end up receiving the IMF’s latest promised credit without having to fulfill the Fund’s conditions–specifically, without having to get various revenue-enhancing measures through the Duma (Russian agencies, May 18). Chubais may be hinting that his close relationship with Lawrence Summers, the new U.S. Treasury secretary, will make such leniency possible. Summers reportedly played a key role in pushing the IMF to disburse funds to Russia just prior to the collapse of Russia’s financial system last August. Just before he made that decision, Summers was visited in Washington by Chubais, who was then Yeltsin’s special emissary to international financial institutions. Chubais may also be angling to get named to that post again.

Meanwhile, Aleksandr Shokhin, an independent Duma deputy and former economics minister, said today that Russia may have an easier time getting the IMF money if the Duma is disbursed. Shokhin argued, first of all, that the required legislation will never pass the Duma, but that the Fund could refuse to send the money if the laws are enacted by presidential decrees or government orders, given that taxpayers could legally challenge them. Once Stepashin is confirmed, Shokhin continued, he could demand that the Duma pass the IMF-related legislation and resign if it refuses, after which–according to Shokhin–the president will have the right to dismiss the Duma if it continues to refuse to pass these laws. Thus with the Duma disbursed, Shokhin argued, the IMF may very well decide to hand over the money (Russian agencies, May 18).