Russia′s oligarchs act quietly in the background | Europe| News and current affairs from around the continent | DW | 26.11.2011
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Russia's oligarchs act quietly in the background

The number of billionaires is on the rise in Russia. But gone are the times when oligarchs wielded considerable influence in the country's politics. The Khodorkovsky case has left its mark on Russia's rich.

View of the Moscow Kremlin from the Bolshoi Kamenny Most

Oligarchs have lost their might, despite their money

Ever heard of Vladimir Lisin? He's known as Russia's richest man; US magazine Forbes has estimated his wealth at $24 billion (18 billion euros).

But the 55-year-old head of steel giant NLMK is unlikely to be recognized in the street, neither at home nor abroad. Lisin shuns the media and prefers to act in the background. Like most Russian oligarchs today, he seems to have very little political ambition.

There is, however, one exception: Mikhail Prokhorov. With $18 billion in the bank, he is number three on Forbes' list of the richest Russians. In the summer, he caused controversy when he joined the liberal-conservative party Right Cause as leader, so he could take part in the December election.

By mid-September, he had resigned after an internal dispute and called the party a "puppet" of the Kremlin. He has since disappeared from the political stage.

The Khodorkovsky lesson

Mikhail Khodorkovsky behind bars

Khodorkovsky felt the full force of Russian law

Rich businessmen like Lisin or Prokhorov are known as oligarchs in Russia. In the last two years, their number has increased threefold. According to Forbes, Russia boasts 101 US-dollar billionaires. But while they had considerable influence in the 1990s, those times are well and truly in the past.

Russia's richest men have learned their lessons thanks to the Khodorkovsky case, according to Sergey Alexashenko, the former vice president of the Russian Central Bank. He is now a lecturer at Moscow State University of Economics.

Mikhail Khodorkovsky, who a decade ago was Russia's richest man, fell out with then President Vladimir Putin. He openly criticized the Kremlin for the country's widespread corruption. Shortly after that, he was arrested and convicted of tax fraud. His oil company Yukos was dismantled and he remains in prison, despite protests from Western governments.

Boris Berezovsky and Vladimir Gussinsky, who were among the most powerful men in Russia in the 1990s, have long lost their influence. Both owned media empires, both criticized Putin and both now live abroad. Those oligarchs that remained in Russia have understood that trying to challenge the Kremlin is an exercise in futility, according to Alexashenko.

"These days, the oligarchs work with the government and do their lobbying quietly in the background," he said.

Secret service warning

But although the oligarchs wield less influence than they did in the 1990s, they should not be underestimated, says Russian opposition politician Boris Nemtsov, who was deputy prime minister during Boris Yeltsin's administration.

Vladimir Lisin

Steel magnate Vladimir Lisin is worth some $24 billion

"If oligarchs give Putin's party United Russia money, is that not having influence?," he said.

"These days, it's those that served with Putin when he was stationed in Germany or those that have worked with him when he was deputy mayor in St. Petersburg who become influential billionaires," said Nemtsov.

He claims it's mainly secret service agents who "become rich people." The names he mentions - Timchenko, Rotenberg or Chemezov - are not well known.

Scapegoats no more

Mikhail Vinogradov, head of the St. Petersburg Politics foundation, agrees the relationship between the government and the oligarchs has changed since the 1990s. State-owned companies like Gazprom have muscled in on private firms and are now calling the shots, according to Vinogradov.

The oligarchs, he says, have no impact on Prime Minister Putin and President Dmitry Medvedev, nor do they hold much sway in the strategically important regions in Russia.

But although the Kremlin has clipped the oligarchs' wings, it no longer uses them as whipping boys. Most recently, Putin tried to woo billionaires and send them into schools to tell the students of their success stories.

Authors: Roman Goncharenko, Jegor Vonogradov / ng
Editor: Martin Kuebler

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