Sunday, 26 September 2021

Russia has charged its economy minister with corruption

MOSCOW: They came for him in the middle of the night. “He was caught red-handed,” said Svetlana Petrenko of Russia’s Investigative Committee, as she announced corruption charges against Russia’s economy minister, Alexey Ulyukayev, the highest-ranked sitting minister to be arrested in the history of post-Soviet Russia. Investigators claim that Mr Ulyukayev extorted a $2m bribe from the vast state oil company Rosneft, in exchange for approving its controversial purchase last month of the government’s controlling stake in Bashneft, a mid-sized oil producer. Mr Ulyukayev was placed under house arrest; he pleaded not guilty. The minister’s precipitous fall sent shockwaves through the Russian elite on November 15th. Power struggles inside the Kremlin have been intensifying as Russia’s economy stagnates and warring clans argue over the country’s direction. Mr Putin has reshuffled a handful of high-level officials in recent months, including his long-time chief of staff, Sergei Ivanov. Several governors have been taken down on corruption charges, most recently the governor of the Kirov region, Nikita Belykh, who was shown receiving wads of cash in an upscale Moscow restaurant. Major businessmen have also been put under house arrest, including Vladimir Yevtushenkov, a billionaire whose stake in Bashneft was seized by the state in 2014.

But none of those moves was as shocking as the economy minister’s arrest. Mr Ulyukayev is a technocrat who got his start during the perestroika era as an aide to Yegor Gaidar, the economist who ran Russia’s “shock therapy” reforms. He has worked in government since the start of Mr Putin’s rule. The effort to charge him with accepting a bribe appears to have been a government-run sting operation, and the late-night arrest evoked memories of Stalinist purges. “It’s a new level,” says Kirill Rogov, an independent political analyst. “The repressive system is gaining strength and becoming a means of management.” Allies and acquaintances were dumbfounded by the charges. “It would’ve looked more believable if they said he’d hit an old woman while speeding through Moscow at night,” said Alexander Shokhin, head of the Russian Union of Industrialists and Entrepreneurs. Mr Rogov met Mr Ulyukayev the day before his arrest and says the minister betrayed no signs that he saw it coming. State-run news agencies reported that the Federal Security Service (FSB) had been surveying Mr Ulyukayev for more than a year, tapping his phones and tracking his electronic communications. Mr Putin’s spokesman said the president had been informed of the ongoing operation. In Russia’s centralised governing system, the decision to arrest Mr Ulyukayev would almost certainly have needed the president’s approval.

The arrest comes as a blow to the government’s economic bloc and to Prime Minister Dmitry Medvedev. Mr Ulyukayev has spoken out against the increasing dominance of the state over Russia’s economy. He initially opposed selling the government’s stake in Bashneft to Rosneft, as the sale was supposed to be part of a privatisation plan. But after Mr Putin announced his support for the deal, Mr Ulyukayev and his colleagues came around. The Investigative Committee says Rosneft co-operated in the investigation of the minister. Some see the move against him as a victory for Igor Sechin, the head of Rosneft and a longtime confidant of Mr Putin. But if anything, the arrest only demonstrates how insecure even the most senior members of the Russian ruling class have become. Anyone can fall foul of the powers-that-be “at any moment”, says Mr Rogov. Mr Ulyukayev, who is also a prolific poet, may have put it best in one of his verses: “God is a long way off. The bosses are close.”

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