Notebook

Show me the Money!

The government’s plan to lop three zeroes off Russian bills by introducing new bills (and reintroducing the kopek!) on January 1, 1998, as of press time, was not exactly coming off as planned. Not enough bills were available to consumers, so shops were posting both old and new prices. Many shops refused to take the new bills because they could not make change and because their cash registers had long since been readjusted to do away with the decimal point. Meanwhile, the “real” intent of the switch was being debated widely: was it merely a poorly organized attempt to limit inflation by constricting the money supply, or an attempt to spur inflation, as shops will round-up prices after lopping off the zeroes (i.e. from 13,800R to 13.80R, rounded to 14) because kopeks are so hard to find?

Inflation Up

According to Goskomstat, the State Statistics Committee, consumer prices in Russia rose 0.9% during the first 22 days of December – a sharp increase in comparison with previous months (average daily price increases doubled from November to December). Goskomstat predicts that, if the current rate continues, inflation will come to 1.2% for December and 11.3 percent for the year as a whole.

People Speak Out

A R10 trillion ($1.7 bn) project to expand the Rublyovsko-Usovskoye highway, which connects Moscow to an area of elite dachas, is causing plenty of controversy in the Odintsovo district (Moscow region). Opponents of the measure claim that its only purpose is to allow drivers of fancy cars to drive at speeds up to 150 km/h, while it ignores the interests of the people who live in the area. The project would close down the Moscow-Usovo railway line, destroy nearby apartments and chop down 236,000 trees in an official conservation area. However, in a recent referendum, local residents turned out in such large numbers to vote “nyet” that it looks as if the project has been thwarted — for now at least.

Yeltsin’s Death Sentence

At a rally in Grozny, Chechen field commander Salman Raduyev threatened to execute Russian President Boris Yeltsin during the latter’s announced January visit to Chechnya. The threat followed a similar demand expressed at a rally in Grozny five weeks previously, as well as a “death sentence” pronounced by the Supreme Caucasus Sharia Court on the Russian officials who made the decision to invade Chechnya in 1994. Rally participants also passed a vote of no confidence against Chechen President Aslan Maskhadov and the Chechen government and called on the latter to resign. Yeltsin’s press service fired back at Raduyev, accusing him of attempting to derail talks between Moscow and Grozny.

Art Museum Gets a Boost

St. Petersburg’s Russian Museum, which houses the country’s largest collection of Russian paintings, has found a new partner. In a ceremony held at the Mikhailovsky Palace and attended by Russia’s Culture Minister and St. Petersburg’s governor, the successful Inkombank signed an agreement for providing the museum with financial consultations and direct material assistance. The first R500 mn from the agreement will go to museum repairs, additions to the collection, the publishing of a general catalogue and a city-wide festival to celebrate the museum’s 100th anniversary.

New Soccer Star Recognized

The Russian Soccer Union has voted Dmitry Alenichev of Spartak Moscow – winner of this year’s Russian championships – the country’s best player. Alenichev, 25, from the northwestern Russian town of Pskov, was virtually unknown a couple of years ago. But his strong showing in the World Cup qualifying matches against Bulgaria and Italy helped to tip the scales in his favor. The midfielder easily beat out fellow countrymen Oleg Veretennikov (Rotor Volgograd) and Dmitry Khokhlov (Torpedo Moscow) in number of ballots for the MVP award.

Saudi Prince To Build Five-Star Hotel

Saudi Arabian Prince Al-Valid Ibn Talyal recently arrived in Moscow for a whirlwind one-day visit with Moscow mayor Luzhkov. By the end of the day, the Prince had decided to build a 5-star Four Seasons hotel in Moscow. The quickness of his decision may indicate that the details of the arrangement were worked out beforehand. In any case, the Moscow government has long been eyeing investors from Persian Gulf countries. The Prince, who is the grandson of King Fahd, has succeeded in becoming one of the world’s richest men before the age of 40. Although the time frame of the hotel’s construction is being kept secret, the Prince’s personal secretary told the Russian daily Sevodnya that his boss is determined to begin construction in 1998.

Never Cry Wolf

The full extent of Belarusan president Alexander Lukashenko’s ambitions have finally been revealed. “If the principle of equal rights is observed, a Belarusan can become president of the united government, just like a Russian,” the controversial Lukashenko announced, adding that, in the future union, Russia should not claim the upper hand simply because it takes up one-seventh of the world’s territory. “If you are afraid of wolves, you don’t go into the forest,” the president said in answer to whether he was prepared to personally head up the future Russian-Belarusan state. If Lukashenko is allowed to participate in the upcoming presidential elections, he could pose a serious threat to opposition leaders like Gennady Zyuganov and attract a large proportion of the communist and nationalist vote. But whether the Belarusan leader is a force to be reckoned with — or just the boy who cried wolf — remains to be seen.

New Year’s Astrological Predictions

At a recent news conference, well-known Russian astrologer Pavel Globa, who has written numerous books on the effect of constellations on peoples’ lives,  predicted that Prime Minister Viktor Chernomyrdin may fall from power in 1988 and that President Yeltsin will undergo yet another major health crisis. Pointing to the fact that the year 1998 is a multiple of the devilish number 666, Globa declared that “the forces of the Antichrist” will affect many parts of the planet next year in the form of floods, fires and Satanic sects. Russia, however, will escape these disasters, he said. Globa also predicted that Yeltsin will be succeeded by a tall, fair-haired man of about 40. Perhaps Chubais will bounce back after all?

Embalming Killers

Embalming Lenin’s body is not the cushy job it used to be. The Russian news agency Interfax has reported that many employees of the laboratory that takes care of Lenin’s body – which still resides in the mausoleum on Red Square – have been forced to take second jobs to make ends meet. The top moonlighting opportunity? Embalming the bodies of “new Russians” killed in car accidents or by gang violence.

During the recent New Year’s celebrations, Russians bought 3 mn yolkas (fir trees), drank 9 mn liters of champagne and 6 mn liters of wine. Meanwhile, they ate 90,000 tons of Stolichny salad. The average Russian child at 5 candies on New Years. And, in Moscow alone, 6 mn Father Frosts turned up for the New Year – 6,500 of them living, 3 mn toys and 3 mn chocolates. 

Just before year’s end, the average monthly wage was increased to R760,000, which, after monetary reform, puts it at R760, or about $130.

On 24 December, the Duma approved the terms of its normal, year-end amnesty. Under the amnestly, 35,000 convicts are to be released from prison – the majority of the convicts are over retirement age, pregnant women, veterans who saw military action, and prisoners with tuberculosis.

Over 60,000 tons of old ammunition has been found to be sitting at military bases in St. Petersburg and in the Leningrad Naval Base armory.

A news report in Nezavisimaya Gazeta reported that 12% of this year’s armed services recruits admitted to regular use of alcohol, 8% said they are drug users, and 6% have criminal records. This, plus the poor pay and living conditions has led to an appalling increase in deaths (27%) and suicides (25%) over the past year.

At year’s end, the Russian State Statistics Committee reported a growing gap in personal incomes. The top 10% of the population received 31.4% of all income, while the bottom 10% received just 2.5% of all income. Just 6.9% of the population had monthly incomes over 2 mn rubles ($350), while 20.6% of the population had incomes of under R400,000 ($70). Some 21.5% of the population was reported to live below the poverty level. Yet, on the whole, Russians’ real personal incomes (adjusted for inflation) ended the year up 0.8%. The unemployment rate was estimated at 8.9%.

In January-September 1997, 46,499 Jews emigrated from Russia, of which 35,250 went to Israel and 11,249 came to the US. This compares with 56,809 who emigrated in the same period of 1996.

Economics Minister Yakov Urinson reported last month that of Russia’s 200+ coal mines, 86 will be shut down in 1998. Urinson said the government is promising social payments to miners who will be put out of work.

SOURCES: ITAR-TASS, BISNIS, Roskomstat, Komsomolskaya Pravda, Radio Free Europe Daily Reports, Jewish Currents, Nezavisimaya Gazeta 

THIS MONTH’S TOP NEW MARKETING IDEA

“Well, I think this pizza commercial should have been done this way: show Gorbachev cutting the pizza into 15 pieces representing the 15 break-away Soviet republics, and then show him trying to put these 15 pieces together again.”

– Anatoly Lukyanov, Communist Duma deputy, former Chairman of the USSR Supreme Soviet, former classmate of Gorbachev at MGU and participant in the 1991 coup attempt. (See page 48 for more about the pizza spot.)

“IT’S THE ECONOMY (NOT PIZZAS), STUPID”

“I have a feeling we are on the brink of tough changes. They may be carried out within the democratic system ... but if things come to the worst, the changes may be far tougher..”

– Mikhail Gorbachev 

FIRST, THE GOOD NEWS

“I am convinced it [1998] will be better than 1997.”

– Boris Yeltsin

... NEXT, THE BAD NEWS

“One must not and should not even think about the time when it will be easier.”

– Victor Chernomyrdin

... AND FINALLY, THE BAD NEWS

“What will be the impact of the crisis on them? God only knows. Many of them have somehow managed to live without money altogether.”

– Yevgeny Yasin, former Minister of Economics, talking about Russian enterprises.

SOURCES: Komsomolskaya Pravda, ORT TV, Itogi Weekly