Revision as of 20:47, 8 February 2024

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Travis Lee Bailey, Esq. American Lawyer and Think Tank Consultant in Moscow, Russia Трэвис Ли Бейли - Американский юрист: Аналитический центр Консультант в Москве, Россия Email: MoscowAmerican at Gmail Com Skype: TravBailey Facebook: Moscowamerican3 VK.com: MoscowAmerican Twitter: Moscowamerican LinkedIn: MoscowAmerican Instagram: MoscowAmerican Published in July 2021. (1st edition). Earlier draft and newer information not included in the first edition is found below. Best viewed on a home PC using Google Chrome. Authors: Travis Lee Bailey, Michael Murrie, Olga Diamant, Irina Manakina, Anna Merkulova, Akhauri Nitish Kumar.

Why Don't Russians Smile

Prologue: Violently beaten by a Muscovite in 2021

Travis Lee Bailey was violently assaulted and is now physically handicapped, for 2 long years he has tried to get the American www.Gofundme.com a US based charity site, to help him. www.Gofundme.com will NOT support anyone living in Russia or Syria. If you want to help him, please contact him at MoscowAmerican @ Gmail . com.

Stanislav Igorevich Zaluzhsky, Станислав Игоревич Зальужский (04.09.1981). Moscow Address: Донская улица, 6c2, kb 140 подъезд 7, на 6 этаже Metro Station Oktyabrskaya

Title Page

Russia is a riddle wrapped in a mystery inside an enigma

— Winston Churchill, October 1939.

I have never met anyone who understood Russians.

—Grand Duke Aleksandr Mikhailovich Romanov (1866–1933)^[1]

Introduction - “I have never met anyone who understood Russians.” - Collectivism versus Individualism.

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Chapter 1: Russian Coconuts & American Peaches - Why don’t Russians Smile?

Why are Americans like peaches and Russians are like Coconuts?

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Laughing for no reason is a sign of stupidity (Смех без причины - признак дурачины) – Common Russian proverb.[10] If you are a peach person traveling in a coconut culture, be aware of the Russian saying, “If we pass a stranger on the street who is smiling, we know with certainty that that person is crazy . . . or else American.”[9] The best and most memorable way to think of the differences between Russian and America is that America is a “peach” culture and Russia is a “coconut” one. This analogy was created by two culture experts.[11] In peach cultures like the United States or Brazil people tend to be friendly (“soft”) with new acquaintances and strangers. They smile frequently at strangers, move quickly to first-name usage, share information about themselves, and ask personal questions of those they hardly know. Americans tend to be specific and emotional, which translates as enjoying other people, whereas Russians are diffuse and neutral, which translates into respect (esteem) of other people. Culturally speaking, America is like a peach with lots of easily accessible flesh or “public domain” on the outside but a tough, almost impenetrable stone at the core. In contrast, Russians are difficult to penetrate at first but all yours if and when you manage to drill your way through to their core. By the way, a little alcohol helps to lubricate the drill.[12] For a Russian, after a little friendly interaction with a peach, they may suddenly get to the hard shell of the pit where the peach protects his real self and the relationship suddenly stops. In coconut cultures such as Russia and Germany, people are initially more closed off from those they do not have friendships with. They rarely smile at strangers, ask casual acquaintances personal questions, or offer personal information to those they don’t know intimately. But over time, as coconuts get to know you, they become gradually warmer and friendlier. And while relationships are built up slowly, they also tend to last longer.[13] Coconuts may react to peaches in a couple of ways. Some interpret the friendliness as an offer of friendship and when people don’t follow through on the unintended offer, they conclude that the peaches are disingenuous or hypocritical. Many Russians see the American Smile as disingenuous and fake. As an American, what should you do if you’re a peach fallen amongst coconuts? Be authentic; if you try to be someone you are not, it won’t work. Smile as much as you want and share as much information about your family as you wish. Just don’t ask personal questions of your counterparts until they bring up the subject themselves. Advice for Russian coconuts 1. If an American: a. asks you how you are doing, b. shows you photos of their family or c. even invites you over for a barbecue 2. Do not interpret American friendliness as an: a. overture to develop a deep friendship or a b. cloak for some hidden agenda, 3. American friendliness is a different cultural norm expression which you need to adjust to.[13] Cultures such as America, Brazil and Japan[13][14] Cultures such as Russia, Germany, Poland and France[15] 1. They smile frequently at strangers, 2. move quickly to first-name usage, 3. openly share information about themselves, 4. ask personal questions of those they hardly know. 5. After a little friendly interaction with a peach person, you may suddenly get to the hard shell of the pit where the peach protects his real self. 1. Are initially more closed off from those they don’t have friendships with. 2. They rarely smile at strangers, 3. rarely ask casual acquaintances personal questions, or 4. do not offer personal information to those they don’t know intimately. 5. Over time, as coconuts get to know you, they become gradually warmer and friendlier. 6. While relationships are built up slowly, they also tend to last longer...[9]

Beyond Fruit - Why don’t Russians smile?

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Guess which astronaut is Russian? Russians don’t smile much, but that doesn’t mean they don’t like you. In preparation for the 2018 World Cup in Russia, Russian workers were taught how to properly smile at the foreign soccer fans who would soon be visiting their country. In 1990, when McDonalds opened its first franchise in Moscow, workers had to be trained to be polite and smile. Russians will be quick to tell you that in Russia, randomly smiling at strangers is often viewed as a sign of mental illness or inferior intellect. To Americans, it might be easy to assume that this says something about Russians — that they are an unfriendly, callous people. But that’s not true at all. Instead, it may be worth looking at why certain expressions, such as smiling, become a key part of social exchanges in some cultures and not others.[16][17][18] Some authors have quipped that Russia is a "Bitchy Resting Face Nation". Resting bitch face is a facial expression that makes a person unintentionally appear to be angry, annoyed, irritated, or feeling contempt, especially when the individual is relaxed.[19] So why are Russians like “coconuts” and Americans like “peaches”? Why do Russians often think Americans are either idiots and insincere? Why do Americans feel that Russians are unfriendly and cold? Thankfully there are many social science theories that have explored this topic. These include immigration and collectivism vs. individualism.

Immigration

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America is the most individualistic nation in the world, whereas Russia has no word for privacy

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American culture tends to be more extraverted. Americans are more likely to seek contact with strangers and outsiders as a way of building success. They are more extraverted and adventurous as a nation. Americans, especially in the western states, tend to embrace their connection to their frontier past and idealize the individual exploring their limits and seeking their own fortune. There is a sense that one can rise and fall on their own merits. In a culture that prizes individualism so highly, there are no predetermined social links. In addition 24 percent of Americans move every 5 years, making it one of the most geographically mobile countries.[21] Americans must always be ready to invest in new social ties. In contrast, Russians have a tendency to function in tight social units. Think of a large family living in close quarters and working together. There is a close association with the welfare of the group and individual well-being. Ethics are largely seen as expressions of loyalty to your family and social network and not to individual ideals (For example, Russians are more likely to cheat or lie for a friend). In close living and cooperation the sense of privacy disappears. In fact, a word for privacy doesn’t even exist in Russian "Untranslatable ideas" section. There is a sense of a shared existence and no need to emphasize a positive attitude or ornament your facial expressions and interactions because much is taken to be understood. There is less of a sense that a smile is needed. However, that does not mean that Russians don’t have a need for individual privacy or protection from unwanted scrutiny. Given that Russians have no expectation of privacy in their homes, apartments, workplace, or in public spaces, their sense of privacy lies closer to their own skin. They feel less obligated to share their personal feelings and may have seemingly impenetrable expressions on their faces. A century before the virus Covid-19 made the term “social distance” popular, sociologists used the term in a completely different way. Sociologists call a county’s individualist versus collective characteristics as “social distance”.[22][23] Social distance is measured by the expectation of privacy in a country. The lower the social distance, the less privacy in a country. Studies have found that in Russia, social distance is lower relative to the U.S. Russians rely on more mutual understanding and longer shared national history to a much greater extent than Americans. Thus, there’s less pressure to display a positive emotion like smiling to signal friendliness or openness, because it’s generally assumed a fellow Russian is already on the same wavelength.[24][25] Social Distance Not to be confused by the Covid-19 term. United States Russia High Social Distance <<< >>> Low Social Distance More privacy <<< >>> Less privacy Less shared history because a younger country and more immigrants with their own different histories. <<< >>> Longer shared history that creates more mutual understanding between more homogenous (similar) Slavs Immigrants have different values and views of the world. <<< >>> On the same wavelength with fellow Russians (Slavs) When there’s greater social distance there is a greater sense that it is up to the individual to seek their own fortune as opposed to the collective group in a nation. There’s more of a live and let live mentality. Americans expect a certain amount of privacy, even in public places; “one needs to mind their own business”. This can also lead to a sense of social anxiety and isolation and strangers can seem more strange or foreign than they are in reality. There may be more wiggle room to get into trouble during a chance new encounter with a stranger. When it does happen, it can be anxiety-inducing. Therefore, the common wisdom when approaching strangers is to smile and express warmth in a way that can help the other person feel at ease.[26] The American smile is habitual. Americans are commonly required to smile at work. More smiles means more comfortable transactions and happier customers, which translates to more money for the owner. Nonetheless, when interacting with other cultures, your American smile may be misinterpreted as arrogance. In countries with greater cultural uniformity, people sometimes smile, not to show cooperation, but that they don’t take the other person seriously or that they are superior. If you live in Russia very long you start hearing that American smiles are “fake”. Russians may wonder what is hidden behind a smile. But for the average American, there is nothing behind the American smile. It is a habitual form of communication. However, even in America there are some regional differences in regards to the smile. People from “American heartland” may see a smile differently than a big city urban smile.[27] Americans have a term called "PASSIVE AGGRESSIVE" Пассивно-агрессивное поведение – people from the capital of America – where one of the authors worked for 8 years – are very Пассивно-агрессивное. They will smile as they stab you in the back. Russians and Americans: A smile on being introduced signals the following: Americans Russians 1. Pleasure at making a new acquaintance 1. Not serious about the upcoming talk, or 2. Willingness to engage in conversation 2. smiler has a hidden agenda under a superficial and hypocritical smile 3. Have deadpan or frozen expressions on their faces because: ...Use an unsmiling face is a barrier between themselves and the outside world Russians lack personal space at: home in their apartments, on public transportation or on the job ...this causes them to erect their personal space boundaries. When Carol, an American, first introduced her Russian husband Pasha to scientists who could be professionally helpful, his face was locked in a scowl. Carol explained to Pasha that his refusal to smile made colleagues think he was being cold and unfriendly. "Why should I smile at someone I don't know? I'm not a clown. If I'm ready for a serious conversation I have to look serious."[28]

Soviet Propaganda - Americans’ smile hides deceit

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Your American smile may be misinterpreted as arrogance

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Chapter 2: Russians and Americans

Westernizers and Slavophiles

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Chapter 3: Russians’ Unique Culture and Character (Social Etiquette and Expectations)

The Russian is a delightful person till he tucks in his shirt. As an oriental he is charming. It is only when he insists upon being treated as the most easterly of western peoples instead of the most westerly of easterns that he becomes a racial anomaly and extremely difficult to handle. The host never knows which side of his nature is going to turn up next. — Rudyard Kipling, The Man Who Was. (1900).

The Russian Soul

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The famous “Russian soul” was to no small extent the product of this agonizing uncertainty regarding Russia’s proper geographical, social, and spiritual position in the world, the awareness of a national personality that was split between East and West. —Tibor Szamuely, The Russian Tradition (1974). Just because Russians “don't smile” does not mean that inwardly they are soulless drones or secretly conniving. Russians smile when they have a genuine reason. Russian smiles are authentic. Furthermore, although they deeply value intellectualism and education (erudition), they are leery of (antithetical towards) being ruled by logic. In fact, Russians value the ability to fully experience and act on their passions and emotions. The Russkaya dusha (Russian soul) is well known in the arts, where it manifests itself as emotion, sentimentality, exuberance, energy, the theatre and flamboyant skill. But Russian soul is much more than just the arts. It is the very essence of Russian behavior. The Russian soul can turn up suddenly in the most unexpected places—and just as suddenly disappear. Just when foreigners believe that Russians are about to get down to serious business, they can become decidedly emotional and unbusinesslike. The Russian soul is a romantic ethos which: 1. appeals to feeling rather than fact, 2. sentiment over certainty, 3. suffering instead of satisfaction, and 4. nostalgia for the past as opposed to the reality of the present. In a broader sense the Russian Soul is how Russians reaffirm to themselves the purity of proud traditional Russian values against the encroachment of Western enlightenment, nationalism, and secularism, especially in cultural things. Today, the Russian soul is still deeply felt. Old traditional positive virtues still endure: 1. the importance of hospitality, 2. the importance of true friendship, 3. being more emotional and open with ones true friends, 4. helping other people when they need it, 5. taking hardship and suffering with a pinch of salt, 6. respect for parents, 7. deference to elderly, and 8. regard for learning. A belief in village virtues is also still strong: 1. self-sacrifice, 2. a sense of duty, 3. compassion, 4. importance of family, 5. a love of nature. These aspects of the Russian soul are again the themes of “village writers,” as they are known, who glorify peasant life and encourage a renaissance of traditional Russian values. 1. Students hang on the words of their professors. 2. Grateful audiences present flowers to musical and theatrical performers. 3. Before vacating a home where they have lived for some time, Russians will sit quietly for a minute or two, reflecting on the events they have experienced there. The Russian soul is often derided in the West as a fantasy of artists, composers, and writers. If the Russian soul ever really existed, this argument goes, it was the product of a traditional agricultural society that had very little in material goods to offer. In a modern industrial society the Russian soul is quickly forgotten and Russians become as realistic, practical, materialistic, and unromantic as Westerners.[34][35] As in many aspects of Russia, the truth is more complex and lies somewhere in between. Russians do have a rich spirituality that does indeed contrast with Western rationalism, materialism, and pragmatism. Russians suffer but based on the amount their popular literature discusses suffering, Russians seem to enjoy this suffering. Obsessed with ideas, their conversations are weighty and lengthy. Russians often reject the American’s rational and pragmatic approach. Instead personal relations, feelings, and traditional values determine their course of action. In contrast, Westerners tend to view themselves as pragmatic, relying on the cold facts.[36][37] That Slavic soul has many aspects that Westerners can respect and admire. As Northwestern University professor Irwin Weil explains: Russians maintain their integrity in a way that conforms to their inner notion of what a human being should be, in a manner they consider proper, and with an honesty and decency that I have seldom seen anywhere else in the world. Above all, they have an appreciation for tselnost (wholeness, complete commitment) and faith, no matter what that faith may be related to. To be a real human being, one must maintain that full commitment, and respect it in other people as well.[38] Tatyana Tolstaya, one of Russia’s leading contemporary writers, says: Russian writers and thinkers have often called the "Russian soul" female, contrasting it to the rational, clear, dry, active, well-defined soul of the Western man….Logic [is] inapplicable to the soul. But Russian sensitivity, permeating the whole culture, doesn’t want to use logic—logic is seen as dry and evil, logic comes from the devil— the most important thing is sensation, smell, emotion, tears, mist, dreams, and enigma. In Russian culture, emotion is assigned an entirely positive value. The more a person expresses his emotions, the better, more sincere, and more ‘open’ he is. The Russian mentality has penetrated to some degree all corners of the country - often not for the best. Tolstaya continues that the Russian soul is described as: sensitivity, reverie, imagination, an inclination to tears, compassion, submission mingled with stubbornness, patience that permits survival in what would seem to be unbearable circumstances, poetry, mysticism, fatalism, a penchant for walking the dark, humid back streets of consciousness, introspection, sudden, unmotivated cruelty, mistrust of rational thought, fascination with the word—the list could go on and on—all these qualities that have frequently been attributed to the “Slavic soul.”[39] Americans are more depressed than Russians, even though Russians are more self-reflective. Two University of Michigan psychological scientists found that: 1. Russians were much more likely to be self-reflective: they think more about their fundamental nature and essence than Americans. But this Russian character trait was not linked to depression. 2. Less analytical Americans had more symptoms of depression than Russians, 3. Russians are more detached than while recalling a bad experience. a. Russians thought about the bad event in a healthier way: i. keeping more psychological distance from the emotional details. ii. analyzed their feelings, but with detachment, and this detachment buffered Russians from depression. 4. Like Eastern cultures, Russians embrace sadness and pity instead of trying to block it like Americans tend to do. 5. Russians tend to be more communal, more focused on interpersonal harmony a. This allows them to see their own personal needs in larger context, from an outsider perspective. 6. Americans come from a tradition of rugged individualism, and tend to focus on the personal. a. With less of a community perspective, they immerse themselves in the emotional details of negative events, and this self focus leads to distress and depression. The lesson is clear: If you're going to brood, then brood like a Russian. Just remember to go easy on the vodka.[40][41][42][43][44][45] Even today emotions and personal feelings still matter to Russians. The future of the Russian soul brother Russians. It has survived centuries of church and state domination and 70 years of communism. Will it also survive, they wonder, the transition to the free market and democracy, and the call of Western culture?[46] The Russian soul is a way to glorifying an aspect of one's culture that is otherwise actually quite negative[47][48] Obviously there’s nothing magical about the Russian soul. However, all nationalities do have specific characteristics that set them apart from all other nationalities. The term “Russian soul” is just a way of expressing how very different Russians are from other Europeans. The Russian Soul is a concept similar in function as British 'Stiff Upper Lip' or 'The American Dream' (to a lesser extent). The stiff upper lift - is a quality of remaining calm and not letting other people see what they are really feeling in a difficult or unpleasant situation The Russian soul is a way Russians glorify an aspect of their culture that is otherwise actually quite negative. The British are incredibly reserved, and have difficulty expressing themselves emotionally. They have the emotional range of a shoe. Rather than look at this emotional reservation as bad, they explain that it helped to build a massive Empire. The 'American Dream' is a wonderful thing. It propagates the idea that you could overcome the massive social inequality, bigotry, racism and failings if you dream and work hard enough. If you don't make it, it's because you didn't work hard enough or dream hard enough, it has nothing to do with the system being massively unequal and favouring only the very few. The American system is like a casino. The house always wins, but it gives the normal person just enough chance to make them think they might succeed. And then we come to the 'Russian Soul'. Dostoyevsky explained, "the most basic, most rudimentary spiritual need of the Russian people is the need for suffering, ever-present and unquenchable, everywhere and in everything" And he is right, Russians are addicted to suffering. Why? Russians spend most of their life getting f****d in some way. Rather than see it as a bad thing, they, like the British and Americans, glorify it. This suffering makes them better than anyone else! As Li Mu explains: Many, many times, I've heard Russians have 'suffering competitions'. They'll brag about how they've suffered more than anyone else. Have a look for the Monty Python 'Yorkshireman Sketch' to get an idea. I once mentioned a time when I had a bad birthday. My two Russian colleagues just couldn't let it lie. They had to beat me and proceeded to explain the myriad of ways that their birthdays were worse than anything I had ever experienced. In all cases, the glorification of one's inadequacies and failings is a coping mechanism. Brits: I don't know how to show my emotions. But it's OK because it's the British Stiff Upper Lip. Americans: I work my ass off with two jobs and still can't afford rent. But it's OK because if I suffer and work even harder I can live the American Dream. Russians: My life is a tragic mess and I've somehow found myself living in Norlisk (an industrial city located above the Arctic Circle). But it's OK. I have a Russian soul and I eat suffering for breakfast. There is definitely a set of characteristics, often referred to as “the Russian soul”, that make Russians unique. Expats who say there isn’t, as well as Russians who say foreigners will never be able to understand it (умом Россию не понять), are both wrong.[49] The mind cannot understand Russia (умом Россию не понять) The Great russian poet Fyodor Tyutchev (Фёдор Иванович Тютчев) wrote a beautiful poem, which is very popular in Russia: You will not grasp her with your mind Or cover with a common label, For Russia is one of a kind - Believe in her, if you are able...

Collective vs. Individualist

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Russian pessimism - A pessimist is an informed optimist

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Russians Lie

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Verification - Trust but Verify

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Cheating in Universities

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Friends - the key to getting anything done in Russia

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The importance of trust in Russia

Excerpt from The Culture Map, by Erin Meyer:

As you look at the Trusting scale you see the United States positioned far to the left while all BRIC countries (Brazil, Russia, India, and China) fall far to the right. When it comes to building trust, the center of gravity in the global business world has fundamentally shifted over the past fifteen years. Previously, managers working in global business may have felt themselves pulled toward working in a more American manner, because the United States dominated most world markets. Building trust in a task-based fashion was therefore one of the keys to international success. But in today’s business environment, the BRIC cultures are rising and expanding their reach. At the same time, countries in the southern hemisphere such as Indonesia and Saudi Arabia are growing in global weight. All of these countries lie markedly toward the relationship-based end of the Trusting scale.

Today if you are a manager aiming for success at an international level and your work brings you to the BRIC cultures or really anywhere in the southern hemisphere, you must learn how to build relationship-based trust with your clients and colleagues in order to be successful.

On the other hand, for those who work frequently in North America, you may be skeptical about the accuracy of the United States on the left-hand side of the Trusting scale. Are Americans really so task-based? What about the client breakfasts, the golf outings, and the team-building activities and icebreaker exercises featured at so many American-style training programs or conferences? Don’t these suggest that Americans are just as relationship-based as the Brazilians or the Chinese?

Not really. Think back to those icebreaker activities—those two-to-three-minute exchanges designed to “build a relationship” between complete strangers. What happens when the exercise is completed? Once the relationship is built, the participants check it off the list and get down to business—and at the end of the program, the relationships that were so quickly built are usually just as quickly dropped.

What’s true in the training or conference center is true outside of it. In task-based societies like the United States, the United Kingdom, and Australia, relationships are defined by functionality and practicality. It is relatively easy to move in and out of networks, and if a business relationship proves to be unsatisfactory to either party, it’s a simple matter to close the door on that relationship and move into another.

By contrast, icebreaker exercises in relationship-based societies are rare. Relationships are built up slowly, founded not just on professional credibility but also on deeper emotional connections—and after the relationship is built, it is not dropped easily.

As an example, consider what happens when the boss fires someone on your team. Will you continue your relationship with the person who has been fired even though he is no longer part of your company? Responses to this question vary dramatically from one culture to another. A Spanish executive working in an American firm stated:

"I couldn’t believe the way my American colleagues reacted when one of our team members lost his job. That guy was our friend one day and out of our lives the next. I asked my teammates—all of whom I respect deeply—“When are we going to have a party for him, meet him for drinks, tell him he is on our minds?” They looked at me as if I was a little crazy. They seemed to feel, since he was underperforming, we could just push him off the boat and pretend we never cared about him. For a Spaniard, this is not an easy thing to accept."

But in America, coworkers aare often quickly forgotten. There is a clear difference between work friends and personal friends, whereas in Russia these two spheres are less distinct.^[9]

The Importance of Equality

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Russia’s “American Dream”

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Russians are cautious and deeply conservative

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Russians Extremes and Contradictions

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11 Time Zones - The largest country on Earth

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Russians superiority complex (Messianism)

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Russians’ rebellious spirit

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Alcoholism - Russia’s Scourge

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Russian’s Deep Distrust of Government

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Time and Patience

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Communication Differences

Russians interpret the question of “How are you?” and strangers asking personal questions very differently than Americans

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Language - different shades of meaning

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Untranslatable ideas

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Russians are long winded

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Intimate touch between friends

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American’s infatuation with mental health

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Americans find Russian rude because they hardly ever say please or thank you

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Body Language: Russians tend to gesture more

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Chapter 4 - Visiting a Russian’s home

Visiting a Russian’s home

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The Toast

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Chapter 5 - Sex and dating

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Dating rules

The man is in charge

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Gift giving

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Talking about money

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Sex

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Chapter 6 - Marrying and Divorcing a Russian – Why do Russians cheat on their spouses so much?

A warning

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Women—the Stronger Sex

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Oh, Russian women, draft horses of the nation! — Andrei Sinyavsky, Goodnight! (1989) Some countries are called a fatherland, others a motherland. Russia is clearly a motherland. Rodina, the Russian word for “homeland,” is feminine, and Mother Russia is the symbol of the nation. In this motherland, women are strong, hardworking, nurturing, long suffering, and the true heroes of Russia. They hold the country together. There is a paradox with Russian women, that of the beautiful, feminine creature who turns out to be psychologically stronger than her husband. Once her man is hooked, a sweet young thing begins to show her claws, and an American husband may only then realize what a strong woman he has acquired. The stereotype of the feminine, romantic Russian girl makes the strong, dominant nature of so many of these women come as a shock to a foreign husband. The Russian femininity which so captivates American men is coupled with a toughness American feminists could envy. Although Russian culture is very male-chauvinistic, usually the women of the society are the responsible ones. Research done by Co-Mission in 1994 indicated that there was a tendency for Russian men to feel an inner guilt for being irresponsible, in both family and social roles. Russian women contribute to the situation by be excellent naggers. Rather than working through the problems, men often retreat to hanging around together smoking and drinking vodka late into the night, perpetuating the irresponsibility. Women are forced to take hold of the responsibilities, but not given the authority in family or society. Russian women have been obliged for so long to cope on all fronts that they have become rather cynical about Russian men, who, in turn, resent these domineering but capable females. This is because in Russia there is the cult of the mother who does everything for her son, attends to his every need and passes him on to a wife from whom he expects the same attention. This developed because nearly an entire postwar generation was raised without a man in the house. The demographic imbalance created in Russia by 70 years of purges, famines and war produced strong women used to fending for themselves at home and at work. Yet these same women were expected to retain their femininity and looks or have their spouse wander off to one of the many single women who would be only too happy to have him, even on a part-time basis. As the British scholar Ronald Hingley (1920-2010) observed, "The modern Russian woman seems both morally and physically equipped to stand up for herself. She often looks well capable of husband-beating if necessary; and, even if physically weaker than the male, is likely to possess greater stamina and force of character...Russia [has] evolved a corps of formidable...matrons. [Women] now constitute a bulwark of a system which might conceivably fall apart were it left in the exclusive custodianship of the relatively easy-going Russian male." Russian women can tolerate extremely difficult conditions, and empathize with and understand suffering.[147] Russian women simply assume that men are generally incompetent, and that when the chips are down they can only rely on other women. As two Swedish women journalists who interviewed a wide range of Russian women concluded, they "yearn for men who are strong, protective, and good fathers, and find instead men who drink heavily, refuse to share housework, and have limited interest in children."[148] Leningrad - Not a Paris - https://youtu.be/b2RHgyH-Nxo The long suffering patience of the Russian woman is comedically portrayed in this music video. The wife is a superhero, at the end of the video the bumbling husband, says "I did the dishes" and the wife responds, "Your my hero!".

Marriage

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Fidelity and Adultery - Russians cheat A LOT whereas Americans act like Puritans

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Soviet policies which encouraged adultery

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Soviet Khrushchev administration policies encourages infidelity

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Russians are willing to cheat on there spouses more than 24 other countries

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Americans expect total honesty in marriage

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Abortion

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Divorce

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Chapter 7 - Living with a Russian – Russian Home life

Housework

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Domestic Abuse

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Clothing and public appearance

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Walking barefoot and sitting on the floor

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Chapter 8 - Russians in business

Women in the workforce

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Negotiating with a Russian

NEW!

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Working in a Russian company

NEW!

Russia among the worst countries for expats

In 2021, Russia received some of the worst results for expats. Out of 59 countries in the "Expat Insider 2021" survey, Russia (56th) lands in the bottom 5 — only ahead of South Africa (57th), Italy (58th), and Kuwait (59th). It performs worst in the Working Abroad Index (52nd), with 24% of expats rating the state of the local economy negatively (vs. 19% globally). A quarter of respondents (25%) are also unhappy with their job security in Russia (vs. 20% globally), and just 63% are satisfied with their job in general (vs. 68% globally). A large share of working expats in Russia do so in the fields of education (20% vs. 12% globally) and construction (12% vs. 3% globally).

On average, expats with full-time employment in Russia work 43.0 hours per week, just about the same as the global average (43.2 hours per week). However, one in five respondents in Russia (20%) still rates their working hours negatively (vs. 16% globally). Additionally, more than a quarter (26%) are unsatisfied with their work-life balance (vs. 17% globally).

A Low Quality of Life

Narrowly escaping the bottom 10 in the Quality of Life Index (49th), Russia performs especially poorly in the Quality of the Environment subcategory (49th). Many expats are unhappy with the air quality (31% vs. 20% globally), the water and sanitation infrastructure (21% vs. 12% globally), and the natural environment (14% vs. 8% globally). “I do not like the lack of any meaningful efforts or policies to reduce environmental pollution and to support basic recycling,” shares a US American expat.

Another factor that lowers the quality of life for expats in Russia is the climate and weather (53rd), which 40% of expats rate negatively, compared to just 17% globally.

Challenging Culture

With Russia coming in 48th place in the "Ease of Settling In Index", 29% of respondents find it difficult to settle down in this country (vs. 22% globally). Just 57% feel at home in the local culture (vs. 63% globally), and 22% describe the population as generally unfriendly (vs. 16% globally). What is more, Russia ends up in the bottom 3 of the Language subcategory (58th), only ahead of Japan (59th). Nearly half the expats (48%) find it difficult to live in Russia’s cities without speaking the local language (vs. 29% globally), and two-thirds (67%) find it difficult to learn Russian (vs. 42% globally).

Low Income, Mediocre Cost of Living

The country also does poorly in the "Personal Finance Index" (47th), with 27% of expats dissatisfied with their financial situation (vs. 19% globally). Indeed, 34% of expats in Russia have a yearly income of less than 12,000 USD — more than twice the global average (15%). And just 21% earn between 25,000 and 75,000 USD a year (vs. 37% globally). More than a quarter of respondents (27%) say their disposable household income is not enough to cover expenses (vs. 23% globally). A Canadian expat shares, “I do not like the income discrepancies.” Nonetheless, Russia receives its best result in the Cost of Living Index (25th): 49% of expats rate the cost of living positively, which is, however, still just one percentage point above the global average (48%).^[193]

Working with a Russian coworker

Excerpts from "The Culture Map" by Erin Meyer:

The French, Spanish, and Russians are generally stereotyped as being indirect communicators because of their high-context, implicit communication style, despite the fact that they give negative feedback more directly. In fact, most European countries are direct, with Russians, Dutch, and Germans as particularly prone to offering frank criticism.

Americans are stereotyped as direct by most of the world, yet when they give negative feedback they are less direct than many European cultures.

Russia is a puzzlingly complex culture that have finessed the ability to speak and listen between the lines yet give negative feedback that is sharp and direct. Russians often pass messages between the lines, but when it comes to criticism they have a directness that can startle their international colleagues.

If you are walking through the street without a jacket, little old Russian ladies may stop and chastise you for poor judgment. . . . In Russia there is no reservations about expressing your negative criticism openly. For instance, if you are displeased with the service in a shop or restaurant you can tell the shop assistant or waiter exactly what you think of him, his relatives, his in-laws, his habits, and his sexual bias.^[194]

Erin Meyer thought about this observation a few weeks later when she received a call from a British colleague. She explained to Meyer that a young Russian woman named Anna Golov had recently joined her team and was upsetting a lot of people whose help she needed to get her job done.

"I’m calling you, Erin," Golov said, "because I wondered if the problem might be cultural. This is the fourth Russian coordinator we have had in the group, and with three of them there were similar types of complaints about harsh criticism or what has been perceived as speaking to others inconsiderately."

A few days later, Meyer had the opportunity to witness the problem in action. While Meyer prepared to teach one morning, Golov herself was in the room with Meyer setting up the classroom. Meyer was going through stacks of handouts, counting pages to make sure they had enough photocopies, while Golov was carefully checking the IT equipment, which, to their annoyance, was not working properly. Meyer appreciated the fact that Golov was handling the problem with such tenacity and that Meyer did not have to get involved.

But then Meyer heard Golov on the phone with someone in the IT department. "I’ve called IT three times this week, and every time you are slow to get here and the solution doesn’t last," she complained. "The solutions you have given me are entirely unacceptable." Golov went on scolding the IT manager, each sentence a bit harsher than the one before. Meyer held her breath.

Later, the British colleague asked Meyer, as the cross-cultural specialist, whether Meyer would accompany her when she spoke with Golov about the problem. Meyer was not thrilled at the request. She certainly did not look forward to witnessing Golov learn what her new colleagues were saying about her behind her back. But at Carlson’s insistence, Meyer agreed.

They met in the British colleague’s office, and the British woman person tried to explain the reputation that Golov had unknowingly developed across the campus, citing specific complaints not just from the IT department but also from the photocopying staff. Golov shifted uncomfortably in her chair while the British woman explained that she had wondered whether the problem was cultural.

At first Golov did not really understand the feedback. She protested, "But we Russians are very subtle communicators. We use irony and subtext. You British and Americans speak so transparently."

“Yes,” Meyer interjected. "But if a Russian has negative feedback to give, it seems that often that feedback is perceived to be harsh or direct to people from other cultures. Does that make sense?"

"Yes, well...that depends who we are speaking with, of course. One point is that we tend to be a very hierarchical culture. If you are a boss speaking to your subordinate, you may be very frank. And if you are a subordinate speaking to your boss, you had better be very diplomatic with criticism." The British woman smiled, perhaps realizing why she had never personally experienced any of Golov’s frankness.

Golov went on:

"If we are speaking with strangers, we often speak very forcefully. This is true. These IT guys, I don’t know them. They are the voices of strangers on the other end of the phone. Under Communism, the stranger was the enemy. We didn’t know who we could trust, who would turn us in to the authorities, who would betray us. So we kept strangers at a forceful distance. Maybe I brought a little too much of my Russian-ness into the job without realizing it."

Meyer noticed that Golov was now beginning to laugh a little as she continued to consider the situation. “We are also very direct with people we are close to. My British friends here complain that I voice my opinions so strongly, while I feel like I never know how they really feel about the situation. I am always saying: 'But how do you feel about it?' And they are always responding: 'Why are you always judging everything?'!"

“Now that I’m aware of this,” Golov concluded, “I’ll be more careful when I communicate dissatisfaction.”

The French have a saying, “Quand on connait sa maladie, on est à moitié guéri” — “When you know your sickness, you are halfway cured.” It applies to most cross-cultural confusions. Just building your own awareness and the awareness of your team goes a long way to improving collaboration. Now that British colleague is aware of the cultural tendencies impacting the situation, she can talk to Golov and her team about it, and Golov can take steps to give less direct criticism.

An explicit, low-context communication style gives Americans the reputation of lacking subtlety. Leave it to the Americans to point out the elephant in the room when the rest of us were working through our interpersonal issues nicely without calling attention to it. But foreigners are often surprised to find Americans softening negative criticism with positive messages.

Before moving to France, Meyer, having been raised, educated, and employed in the United States, believed that giving three positives for every negative and beginning a feedback session with the words of explicit appreciation before discussing what needs to be improved were universally effective techniques. If they worked well in America, then surely they should work just as well in France, Brazil, China and, well, everywhere.

But after living in Europe for a while Meyer learned to see this style from a completely different perspective. To the French, Spanish, Russians, Dutch, and Germans, the American mode of giving feedback comes across as false and confusing. Meyer's friend, who works frequently with Americans, said:

To a Dutchman, it is all a lot of hogwash. All that positive feedback just strikes us as fake and not in the least bit motivating. I was on a conference call with an American group yesterday, and the organizer began, “I am absolutely thrilled to be with you this morning.” Only an American would begin a meeting like this. Let’s face it, everyone in the room knows that she is not truly, honestly thrilled. Thrilled to win the lottery—yes. Thrilled to find out that you have won a free trip to the Caribbean—yes. Thrilled to be the leader of a conference call — highly doubtful. When my American colleagues begin a communication with all of their “excellents” and “greats,” it feels so exaggerated that I find it demeaning. We are adults, here to do our jobs and to do them well. We don’t need our colleagues to be cheerleaders.

The problem is that we can’t tell when the feedback is supposed to register to us as excellent, okay, or really poor. For a Dutchman, the word “excellent” is saved for a rare occasion and “okay” is . . . well, neutral. But with the Americans, the grid is different. “Excellent” is used all the time. “Okay” seems to mean “not okay.” “Good” is only a mild compliment. And when the message was intended to be bad, you can pretty much assume that, if an American is speaking and the listener is Dutch, the real meaning of the message will be lost all together.

Going to school or college in Russia

Meyer explains:

The same difference is reflected in the ways children are treated in schools. My children are in the French school system during the academic year and spend the summer in American academic programs in the Minneapolis area. In the United States, my eight-year-old son, Ethan, gets his homework assignments back covered with gold stars and comments like “Keep it up!” “Excellent work!” and, at worst, “Almost there...give it another try!”

But studying in Madame Durand’s class requires thicker skin. After a recent Monday morning spelling test, Ethan’s notebook page was covered sorrowfully in red lines and fat Xs, along with seven simple words from Madame Durand: “8 errors. Skills not acquired. Apply yourself!”

Working as an English teacher in Russia

In Russia, learning starts with understanding the grammatical principles underpinning the language structure. Once a person has a solid initial grasp of the grammar and vocabulary, you begin to practice using the language. Ironically, Russians knowledge of English grammar is far superior to that of many Americans. The disadvantage is that students spend less time practicing the language, which may mean they write it better than they speak it. As a result, potential teachers are often judged solely on their ability to understand grammar.

In principles-first cultures such as Russia, France and Belgium, people want to understand the why behind their boss’s request before they move to action. Meanwhile, applications-first learners tend to focus less on the why and more on the how.

One of the most common frustrations among Russian employees with American bosses, and students of American teachers' is that the American tells them what to do without explaining why they need to do it. From the Russian perspective, this can feel demotivating, even disrespectful. By contrast, American bosses may feel that Russian workers are uncooperative because, instead of acting quickly, they always ask “Why?” and are not ready to act until they have received a suitable response.

Why do so few Russians speak good English?

Few Russians travel abroad.

Living in Russia without knowing English isn’t much of a problem. All foreign films shown in the country are dubbed, and most books are translated. For most Russians, the matter of speaking English only comes up if they travel abroad. But this doesn't even apply to many people since 72 percent of Russians don't even have a passport for foreign travel, and 59 percent of them have never traveled beyond the borders of the former Soviet Union.

Soviet school.

Historical reasons.

Difficult and terrifying language.

Domestic market.^[195]

Supervising Russians

Meyer explains, the fifth promotion put Jepsen in charge of the company’s recently acquired Russian operation, his first international leadership position.

Relocated to a small town outside of Saint Petersburg, Jepsen was surprised by the difficulties he encountered in managing his team. After four months in his new job, he e-mailed me this list of complaints about his Russian staff:

1. They call me Mr. President
2. They defer to my opinions
3. They are reluctant to take initiative
4. They ask for my constant approval
5. They treat me like I am king

Jepsen explained:

“Week two into the job, our IT director e-mailed me to outline in detail a problem we were having with the e-mail process and describing various solutions. He ended his e-mail, ‘Mr. President, kindly explain how you would like me to handle this.’ This was the first of many such e-mails from various directors to fill my inbox. All problems are pushed up, up, up, and I do my best to nudge them way back down.” After all, as Jepsen told the IT manager, “You know the situation better than I do. You are the expert, not me.”

Meanwhile, the members of Jepsen’s Russian management team were equally annoyed at Jepsen’s apparent lack of competence as a leader. Here are some of the complaints they offered during focus group interviews:

1. He is a weak, ineffective leader
2. He doesn’t know how to manage
3. He gave up his corner office on the top floor, suggesting to the company that our team is of no importance
4. He is incompetent

While Jepsen was groaning that his team members took no initiative, they were wringing their hands about Jepsen’s lack of leadership: “We are just waiting for a little bit of direction!”

Chapter 9: Muscovites are Shit

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Chapter 10: Soviet Mentality and Russian Leadership Today

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Chapter 11 - Conclusion

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New Chapter 12 - The Values Americans Live By

THE VALUES AMERICANS LIVE BY

BY L. ROBERT KOHLS

_Shared by Olga Diamant & Russian values were summarized by Oleg Bogomolov._

Introduction

Most Americans would have a difficult time telling you, specifically, what the values are which Americans live by. They have never given the matter any thought.

Even if Americans had considered this question, they would probably, in the end, decide not to answer in terms of a definitive list of values. The reason for this decision is itself one very American value -- their belief that every individual is so unique that the same list of values could never be applied to all, or even most, of their fellow citizens.

Although Americans may think of themselves as being more varied and unpredictable than they actually are, it is significant that they think they are. Americans tend to think they have been only slightly influenced by family, church or schools. In the end, each believes, “I personally chose which values I want to live my own life by.”

Despite this self-evaluation, a foreign anthropologist could observe Americans and produce a list of common values which would fit most Americans. The list of typically American values would stand in sharp contrast to the values commonly held by the people of many other countries.

We, the staff of the Washington International Center, have been introducing thousands of international visitors to life in the United States for more than a third of a century. This has caused us to try to look at Americans through the eyes of our visitors. We feel confident that the values listed in this booklet describe most (but not all) Americans.

Furthermore, we can say that if the foreign visitor really understood how deeply ingrained these 13 values are in Americans, he or she would then be able to understand 95% of American actions -- actions which might otherwise appear strange, confusing, or unbelievable when evaluated from the perspective of the foreigner’s own society and its values.

The different behaviors of a people or a culture make sense only when seen through the basic beliefs, assumptions and values of that particular group. When you encounter an action, or hear a statement in the United States which surprises you, try to see it as an expression of one or more of the values listed in this booklet. For example, when you askAmericans for directions to get to a particular address in their own city, they may explain, in great detail, how you can get there on your own, but may never even consider walking two city blocks with you to lead you to the place. Some foreign visitors have interpreted this sort of action as showing Americans’ “unfriendliness”. We would suggest, instead, that the self-help concept (value number 6 on our list), is so strong in Americans that they firmly believe that no adult would ever want, even temporarily, to be dependent on another. Also, their future orientation (value 8) makes Americans think it is better to prepare you to find other addresses on your own in the future.

Before proceeding to the list itself, we should also point out that Americans see all of these values as very positive ones. They are not aware, for example, that the people of many Third World countries view change (value 2) negative or threatening. In fact, all of these American values are judged by many of the world’s citizens as negative and undesirable. Therefore, it is not enough simply to familiarize yourself with these values. You must also, so far as possible, consider them without the negative or derogatory connotation which they might have for you, based on your own experience and cultural identity.

It is important to state emphatically that our purpose in providing you with this list of the most important American values is not to convert you, the foreign visitor, to our values. We couldn’t achieve that goal even if we wanted to, and we don’t want to. We simply want to help you understand the Americans with whom you will be relating – from their own value system rather than from yours.^[199]

THE VALUES AMERICANS LIVE BY

American Civil Religion is the theory developed by sociologist Robert Bellah in 1967 in the article, "Civil Religion in America". According to Bellah, Americans embrace a common civil religion with certain fundamental beliefs, values, holidays, and rituals in parallel to, or independent of, their chosen religion.^[200] This belief includes Manifest destiny, which was a cultural belief in the 19th-century United States that White American settlers were destined to expand across North America, which, since the 1898 Spanish–American War, expanded internationally and still continues presently in the minds of most Americans.

1. Personal Control over the Environment

Americans no longer believe in the power of Fate, and they have come to look at people who do as being backward, primitive, or hopelessly naive.To be called“fatalistic” is one of the worst criticisms one can receive in the American context; to an American, it means one is superstitious and lazy, unwilling to take any initiative in bringing about improvements.

In the United States people consider it normal and right that Man should control Nature, rather than the other way around. More Americans find it impossible to accept that there are some things which lie beyond the power of humans to achieve. And Americans have literally gone to the moon, because they refused to accept earthly limitations.

Americans seem to be challenged, even compelled, to do, by one means or another (and often at great cost) what seven-eighths of the world is certain cannot be done.

2. Change Seen as Natural and Positive

In the American mind, change is seen as an indisputably good condition. Change is strongly linked to development, improvement, progress, and growth.

Many older, more traditional cultures consider change as a disruptive, destructive force, to be avoided if at all possible. Instead of change, such societies value stability, continuity, tradition, and a rich and ancient heritage -- none of which are valued very much in the United States.

These first two values -- the belief that we can do anything and the belief that any change is good -- together with an American belief in the virtue of hard work and the belief that each individual has a responsibility to do the best he or she can do have helped Americans achieve some great accomplishments. So whether these beliefs are “true” is really irrelevant; what is important is that Americans have considered them to be true and have acted as if they were, thus, in effect, causing them to happen.

3. Time and Its Control

Time is, for the average American, of utmost importance. To the foreign visitor, Americans seem to be more concerned with getting things accomplished on time (according to a predetermined schedule) than they are with developing deep interpersonal relations. Schedules, for the American, are meant to be planned and then followed in the smallest detail.

It may seem to you that most Americans are completely controlled by the little machines they wear on their wrists, cutting their discussions off abruptly to make it to their next appointment on time.

Americans’ language is filled with references to time, giving a clear indication of how much it is valued. Time is something to be “on,” to be “kept,” “filled,” “saved,” “used,” “spent,” “wasted,” “lost,” “gained,” “planned,” “given,” “made the most of,” even “killed.”

The international visitor soon learns that it is considered very rude to be late -- even by 10 minutes -- for an appointment in the United States. (Whenever it is absolutely impossible to be on time, you should phone ahead and tell the person you have been unavoidably detained and will be a half hour -- or whatever -- late.) Time is so valued in America, because by considering time to be important one can clearly accomplish more than if one “wastes” time and does not keep busy.This philosophy has proven its worth. It has enabled Americans to be extremely productive, and productivity itself is highly valued in the United States. Many American proverbs stress the value in guarding our time, using it wisely, setting and working toward specific goals, and even expending our time and energy today so that the fruits of our labor may be enjoyed at a later time.(This latter concept is called “delayed gratification.”)

4. Equality and Fairness

Equality is, for Americans, one of their most cherished values. This concept is so important for Americans that they have even given it a religious basis. They say all people have been “created equal.” Most Americans believe that God views all humans alike without regard to intelligence, physical condition or economic status. In secular terms this belief is translated into the assertion that all people have an equal opportunity to succeed in life. Americans differ in opinion about how to make this ideal into a reality. Yet virtually all agree that equality is an important civic and social goal.

The equality concept often makes Americans seem strange to foreign visitors. Seven-eighths of the world feels quite differently. To them, rank and status and authority are seen as much more desirable considerations -- even if they personally happen to find themselves near the bottom of the social order. Class and authority seem to give people in those other societies a sense of security and certainty. People outside the United States consider it reassuring to know, from birth, who they are and where they fit into the complex system called “society.”

Many highly-placed foreign visitors to the United States are insulted by the way they are treated by service personnel (such as waiters in restaurants, clerks in stores, taxi drivers, etc.) Americans have an aversion to treating people of high position in a deferential manner, and conversely, often treat lower class people as if they were very important. Newcomers to the United States should realize that no insult or personal indignity is intended by this lack of deference to rank or position in society. A foreigner should be prepared to be considered “just like anybody else” while in the country.

5. Individualism and Privacy

The individualism that has been developed in the Western world since the Renaissance, beginning in the late 15th century, has taken its most exaggerated form in 20th century United States. Here, each individual is seen as completely and marvelously unique, that is, totally different from all other individuals and, therefore, particularly precious and wonderful.

Americans think they are more individualist in their thoughts and actions than, in fact, they are. They resist being thought of as representatives of a homogenous group, whatever the group. They may, and do, join groups—in fact many groups—but somehow believe they’re just a little different, just a little unique, just a little special, from other members of the same group. And they tend to leave groups as easily as they enter them.

Privacy, the ultimate result of individualism is perhaps even more difficult for the foreigner to comprehend. The word "privacy" does not even exist in many languages. If it does, it is likely to have a strongly negative connotation, suggesting loneliness or isolation from the group. In the United States, privacy is not only seen as a very positive condition, but it is also viewed as a requirement that all humans would find equally necessary, desirable and satisfying. It is not uncommon for Americans to say—and believe—such statements as "If I don’t have at least half an hour a day to myself, I will go stark raving mad."

Individualism, as it exists in the United States, does mean that you will find a much greater variety of opinions (along with the absolute freedom to express them anywhere and anytime) here. Yet, in spite of this wide range of personal opinion, almost all Americans will ultimately vote for one of the two major political parties. That is what was meant by the statement made earlier that Americans take pride in crediting themselves with claiming more individualism than, in fact, they really have.

6. Self-Help/Initiative

In the United States, a person can take credit only for what he or she has accomplished by himself or herself. Americans get no credit whatsoever for having been born into a rich family. (In the United States, that would be considered "an accident of birth.") Americans pride themselves in having been born poor and, through their own sacrifice and hard work, having climbed the difficult ladder of success to whatever level they have achieved—all by themselves. The American social system has, of course, made it possible for Americans to move, relatively easily, up the social ladder.

Take a look in an English-language dictionary at the composite words that have "self" as a prefix. In the average desk dictionary, there will be more than 100 such words, words like self-confidence, self-conscious, self-control, self-criticism, self-deception, self-defeating, self-denial, self-discipline, self-esteem, self-expression, self-importance, self-improvement, self-interest, self-reliance, self-respect, self-restraint, self-sacrifice—the list goes on and on. The equivalent of these words cannot be found in most other languages. The list is perhaps the best indication of how seriously Americans take doing things for one’s self. The "self-made man or women" is still very much the ideal in 20th-century America.

7. Competition and Free Enterprise

Americans believe that competition brings out the best in any individual. They assert that it challenges or forces each person to produce the very best that is humanly possible. Consequently, the foreign visitor will see competition being fostered in the American home and in the American classroom, even on the youngest age level. Very young children, for instance, are encouraged to answer questions for which their classmates do not know the answer.

You may find the competitive value disagreeable, especially if you come from a society that promotes cooperation rather than competition. But many U.S. Peace Corps volunteers teaching in Third World countries found the lack of competitiveness in a classroom situation equally distressing. They soon learned that what they thought to be one of the universal human characteristics represented only a peculiarly American (or Western) value.

Americans, valuing competition, have devised an economic system to go with it—free enterprise. Americans feel strongly that a highly competitive economy will bring out the best in its people and, ultimately, that the society that fosters competition will progress most rapidly. If you look for it, you will see evidence in all areas—even in fields as diverse as medicine, the arts, education, and sports—that free enterprise is the approach most often preferred in America.

8. Future Orientation

Valuing the future and the improvements Americans are sure the future will bring means that they devalue that past and are, to a large extent, unconscious of the present. Even a happy present goes largely unnoticed because, happy as it may be, Americans have traditionally been hopeful that the future would bring even greater happiness. Almost all energy is directed toward realizing that better future. At best, the present condition is seen as preparatory to a latter and greater event, which will eventually culminate in something even more worthwhile.

Since Americans have been taught (in value 1) to believe that Man, and not Fate, can and should be the one who controls the environment, this has made them very good at planning and executing short-term projects. This ability, in turn, has caused Americans to be invited to all corners of the earth to plan and achieve the miracles that their goal-setting can produce.

If you come from a culture such as those in the traditional Moslem world, where talking about or actively planning the future is felt to be a futile, even sinful, activity, you will have not only philosophical problems with this very American characteristic but religious objections as well. Yet it is something you will have to learn to live with, for all around you Americans will be looking toward the future and what it will bring.

9. Action/Work Orientation

"Don’t just stand there," goes a typical bit of American advice, "do something!" This expression is normally used in a crisis situation, yet, in a sense, it describes most American’s entire waking life, where action—any action—is seen to be superior to inaction.

Americans routinely plan and schedule an extremely active day. Any relaxation must be limited in time, pre-planned, and aimed at "recreating" their ability to work harder and more productively once the recreation is over. Americans believe leisure activities should assume a relatively small portion of one’s total life. People think that it is "sinful" to "waste one’s time," "to sit around doing nothing," or just to "daydream."

Such a "no nonsense" attitude toward life has created many people who have come to be known as "workaholics," or people who are addicted to their work, who think constantly about their jobs and who are frustrated if they are kept away from them, even during their evening hours and weekends.

The workaholic syndrome, in turn, causes Americans to identify themselves wholly with their professions. The first question one American will ask another American when meeting for the first time is related to his or her work: "Where do you work?," or "Who (what company) are you with?"

And when such a person finally goes on vacation, even the vacation will be carefully planned, very busy and active.

America may be one of the few countries in the world where it seems reasonable to speak about the "dignity of human labor," meaning by that, hard, physical labor. In America, even corporation presidents will engage in physical labor from time to time and gain, rather than lose, respect from others for such action.

10. Informality

If you come from a more formal society, you will likely find Americans to be extremely informal, and will probably feel that they are even disrespectful of those in authority. Americans are one of the most informal and casual people in the world, even when compared to their near relative—the Western European.

As one example of this informality, American bosses often urge their employees to call them by their first names and even feel uncomfortable if they are called by the title "Mr." or "Mrs."

Dress is another area where American informality will be most noticeable, perhaps even shocking. One can go to a symphony performance, for example, in any large American city nowadays and find some people in the audience dressed in blue jeans and tieless, short-sleeved shirts.

Informality is also apparent in American’s greetings. The more formal "How are you?" has largely been replaced with an informal "Hi." This is as likely to be used to one’s superior as to one’s best friend.

If you are a highly placed official in your own country, you will probably, at first, find such informality to be very unsettling. American, on the other hand, would consider such informality as a compliment! Certainly it is not intended as an insult and should not be taken as such.

11. Directness/Openness/Honesty

Many other countries have developed subtle, sometimes highly ritualistic, ways of informing other people of unpleasant information. Americans, however, have always preferred the first approach. They are likely to be completely honest in delivering their negative evaluations. If you come from a society that uses the indirect manner of conveying bad news or uncomplimentary evaluations, you will be shocked at Americans’ bluntness.

If you come from a country where saving face is important, be assured that Americans are not trying to make you lose face with their directness. It is important to realize that an American would not, in such case, lose face. The burden of adjustment, in all cases while you are in this country, will be on you. There is no way to soften the blow of such directness and openness if you are not used to it except to tell you that the rules have changed while you are here. Indeed, Americans are trying to urge their fellow countrymen to become even more open and direct. The large number of "assertiveness" training courses that appeared in the United States in the late 1970s reflects such a commitment.

Americans consider anything other than the most direct and open approach to be dishonest and insincere and will quickly lose confidence in and distrust anyone who hints at what is intended rather than saying it outright. Anyone who, in the United States, chooses to use an intermediary to deliver that message will also be considered manipulative and untrustworthy.

12. Practicality/Efficiency

Americans have a reputation of being an extremely realistic, practical and efficient people. The practical consideration is likely to be given highest priority in making any important decision in the United States. Americans pride themselves in not being very philosophically or theoretically oriented. If Americans would even admit to having a philosophy, it would probably be that of pragmatism.

Will it make any money? Will it "pay its own way?" What can I gain from this activity? These are the kinds of questions that Americans are likely to ask in their practical pursuit, not such questions as: Is it aesthetically pleasing? Will it be enjoyable?, or Will it advance the cause of knowledge?

This practical, pragmatic orientation has caused Americans to contribute more inventions to the world than any other country in human history. The love of "practicality" has also caused Americans to view some professions more favorably than others. Management and economics, for example, are much more popular in the United States than philosophy or anthropology, law and medicine more valued than the arts.

Another way in which this favoring of the practical makes itself felt in the United States, is a belittling of "emotional" and "subjective" evaluations in favor of "rational" and "objective" assessments. Americans try to avoid being too sentimental in making their decisions. They judge every situation "on its merits." The popular American "trial-and-error" approach to problem solving also reflects the practical. The approach suggests listing several possible solutions to any given problem, then trying them out, one-by-one, to see which is most effective.

13. Materialism/Acquisitiveness

Foreigners generally consider Americans much more materialistic than Americans are likely to consider themselves. Americans would like to think that their material objects are just the natural benefits that always result from hard work and serious intent—a reward, they think, that all people could enjoy were they as industrious and hard-working as Americans.

But by any standard, Americans are materialistic. This means that they value and collect more material objects than most people would ever dream of owning. It also means they give higher priority to obtaining, maintaining and protecting their material objects than they do in developing and enjoying interpersonal relationships.

The modern American typically owns:

1. one or more color television sets,

2. an electric hair dryer,

3. an electronic calculator,

4. a tape recorder and a record player,

5. a clothes-washer and dryer,

6. a vacuum cleaner,

7. a powered lawn mower (for cutting grass),

8. a refrigerator, a stove, and a dishwasher,

9. one or more automobiles,

10. and a telephone.

11. Many also own a personal computer.

Since Americans value newness and innovation, they sell or throw away their possessions frequently and replace them with newer ones. A car may be kept for only two or three years, a house for five or six before trading it in for another one.

Summary

Now that we have discussed each of these 13 values separately, if all too briefly, let us look at them in list form (on the left) and then consider them paired with the counterpart values from a more traditional country (on the right):

Which list more nearly represents the values of your native country?

Application

Before leaving this discussion of the values Americans live by, consider how knowledge of these values explains many things about Americans.

One can, for example, see America’s impressive record of scientific and technological achievement as a natural result of these 13 values.

First of all, it was necessary to believe:

(1) these things could be achieved, that Man does not have to simply sit and wait for Fate to bestow them or not to bestow them, and that Man does have control over his own environment, if he is willing to take it. Other values that have contributed to this record of achievement include

(2) an expectation of positive results to come from change (and the acceptance of an ever-faster rate of change as "normal");

(3) the necessity to schedule and plan ones’ time;

(6) the self-help concept;

(7) competition;

(8) future orientation;

(9) action work orientation;

(12) practicality; and

(13) materialism.

You can do the same sort of exercise as you consider other aspects of American society and analyze them to see which of the 13 values described here apply. By using this approach, you will soon begin to understand Americans and their actions. And as you come to understand them, they will seem less "strange" than they did at first.

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<pdf>File:THE VALUES AMERICANS LIVE BY L. Robert Kohls AmericanValues.pdf</pdf>

Further Reading and Links

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Russian English Vocabulary

Chapter one

- Stark differences – жесткие разграничения …stark discipline…stark realities of life

- Enlightenment – просвещение

- Blunt American way of speaking – грубоватый, резкий, тупой…blunt angle – тупой угол, scissors with blunt ends – ножницы с тупыми

- Callous – грубый, бессердечный, нечувственный, мозолистый, огрубевший (о коже)

- концами, a blunt answer – прямой ответ, the blunt facts – упрямые фактб rude and blunt people – грубые и резкие люди

- A trait Russians share with Americans – характерная черта, особенность. The chief traits of a person’s character – главные черты характера

- Life is compartmentalized – жизнь делится на отсеки/ячейки

- Impenetrable – непробиваемый. Impenetrable armor. Cloth impenetrable to water - не пропускающая воду.

- Impenetrable jungle – непроходимые джунгли.

- Russians are difficult to penetrate at first – просочиться, прорываться, постигать-понимать.

- To penetrate into secrets of nature – постигать тайны природы.

- American smile is disingenuous – неискренняя

- A counterpart – двойник (a double, a twin). She is a counterpart of her twin sister.

- To quip – саркастически подмечать

- Alacrity – готовность. He accepted an invitation with alacrity.

- Willingness- готовность

- Scowl (аu) – to look at somebody with a scowl – грозно посмотреть на кого-то, to scowl at somebody – грозно смотреть на кого-то

- Sinister – дурной, мрачный, темный. Sinister face, sinister influence, intentions

- Agitrop – пропаганда, агитация

Appendices

Appendix 1

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Mark Hollingsworth and Stewart Lansley

‘There are no barriers to a rich man’ - Russian proverb

CHAPTER 1

The Man Who Knew Too Much

‘I have dug myself into a hole and I am in too deep. I am not sure that I can dig myself out’ - STEPHEN CURTIS, January 2004

6.56 P.M., WEDNESDAY, 3 MARCH 2004. A brand-new white six-seater £.5-million Agusta A109E helicopter lands under an overcast sky at Battersea heliport in south-west London. Waiting impatiently on the tarmac and clutching his two unregistered mobile phones is a broad-shouldered 45-year-old British lawyer named Stephen Curtis. He is not in the best of moods. Three minutes earlier he had called Nigel Brown, Managing Director of ISC Global Ltd, which provided security for him, regarding disputed invoices sent to a Russian client. ‘This is causing problems!’ he shouted and then paused. ‘Look, I have to go now. The helicopter is here.’

Curtis climbs aboard the helicopter and maneuvers his bulky frame into the passenger cabin’s left rear seat. A member of the ground staff places his three pieces of hand luggage on the seat in front of him and the pilot is given departure clearance. At 6.59 p.m. the chopper lifts off into the gloomy London sky. It is cold and misty with broken cloud at 3,800 feet, but conditions are reasonable for flying with visibility of 7 kilometers.

The lawyer turns off his mobile phones and sits back. After a day of endless and stressful phone calls from his £4 million luxury penthouse apartment at Waterside Point in nearby Battersea, he is looking forward to a relaxing evening at home at Pennsylvania Castle, his eighteenth- century retreat on the island of Portland off the Dorset coast. By the time the helicopter approaches Bournemouth Airport, after a flight of less than one hour, it is raining lightly and the runway is obscured by cloud. The Agusta is cleared to land and descends via Stoney Cross to the north- east where, despite the gloom, the lights of the cars on the A27 are now visible in the early evening darkness. The pilot, Captain Max Radford, an experienced 34-year-old local man who regularly flies Curtis to and from London, radios air traffic control for permission to land on runway twenty-six. ‘Echo Romeo,’ replies Kirsty Holtan, the air traffic controller. ‘Just check that you are visual with the field.’ ‘Er, negative. Not this time. Echo Romeo.’ The air traffic controller can only see the helicopter on her remote radar monitor. Concerned, she increases the runway lighting to maximum intensity. This has the required effect and a mile from the airport the pilot radios: ‘Just becoming visual this time.’ ‘Golf Echo Romeo. Do you require radar?’ asks Holtan. ‘Yes, yes,’ replies Radford, his voice now strained; he repeats the word no less than eleven times in quick succession. Suddenly, the chopper descends sharply to the left. It then swings around almost out of control. Within seconds it has fallen 400 feet. ‘Golf Echo Romeo. Is everything O.K.?’ asks a concerned Holtan. ‘Negative, negative,’ replies Radford.

They are just 1.5 kilometres east of the threshold of runway twenty-six when the height readout is lost on the radar. For the next fifty-six seconds the pilot confirms that he has power but then suddenly, frantically, radios: ‘We have a problem, we have a problem.’ As the chopper loses power, at 7.41 p.m. Radford shouts down the open mike: ‘O.K., I need a climb, I need a climb.’ Radford hears a low horn, warning that the speed of the main rotor blades has dropped. He keeps his finger on the radio button and can be heard struggling to turn out of a dive, but he has lost control. ‘No. No!’ he shouts in a panic. They are his last words. The helicopter, now in free fall, nose dives into a field at high speed and explodes on impact, sending a fireball 30 feet into the air. The aircraft is engulfed in flames, with the debris of the wreckage strewn across a quarter of a mile. ‘I heard a massive bang and rushed up to the window and just saw this big firewall in front of me,’ recalled Sarah Price, who lives beneath the flight path. ‘The whole field appeared to be on fire. It was horrific.’ Some thirty-five firefighters rush to the scene, but the two men aboard – Stephen Curtis and Max Radford – die instantly. Later that night their charred bodies are taken to the mortuary at Boscombe, Dorset, where an autopsy is performed the following day. Their corpses are so badly burnt that they can only be identified using DNA samples taken by Wing Commander Maidment at the RAF Centre of Aviation Medicine at Henlow in Bedfordshire.

The news of Curtis’s dramatic death was not only deeply traumatic to his wife and daughter, it also sent shock waves through the sinister world of the Russian oligarchs, the Kremlin, and a group of bankers and accountants working in the murky offshore world where billions of pounds are

regularly moved and hidden across multiple continents. That was not all. Alarm bells were also ringing in the offices of Britain’s intelligence and law enforcement agencies, for Stephen Curtis was no ordinary lawyer. Since the 1990s he had been the covert custodian of some of the vast personal fortunes made from the controversial privatization of the country’s giant state enterprises. Two of his billionaire clients – Mikhail Khodorkovsky and Boris Berezovsky – had entrusted Curtis to protect and firewall their wealth from scrutiny by the Russian authorities. The Russians liked and trusted the highly intelligent, gregarious Curtis. Generous, a heavy drinker, loyal, amusing, and extravagant, he slipped naturally into their world. Also impatient, ruthless, and aggressive when required, he restructured their companies, moved their funds between a bewildering series of bank accounts lodged in obscure island tax havens, established complex trusts, and set up an elaborate offshore ownership of their assets. On their arrival in London he found them properties, introduced them to the most powerful bankers, entertained them late into the night, and recommended private schools for their children and even Savile Row tailors for their suits. By early 2004, Curtis had not only introduced his wealthy new Russian clients to many aspects of British life, but he was also the guardian of many of their secrets. He was the only person who could identify and unravel the opaque ownership of their assets – property, yachts, art, cars, jewellery, and private jets as well as their bank accounts, shareholdings, companies, and trusts. ‘Stephen knew everything because he set up their whole infrastructure,’ said a close friend. He salted away billions of pounds in an intricate, sophisticated financial maze, which the Russian government later tried, mostly unsuccessfully, to unravel.

Operating from his office in a narrow, four-storey Mayfair house at 94 Park Lane, Curtis found that working for oligarchs was also lucrative. The product of a relatively modest upbringing himself, Curtis amassed a sizeable personal fortune from his new clients, enough to enable him to acquire his own helicopter, a private aircraft, and a penthouse apartment in London, as well as Pennsylvania Castle. He donated substantial sums to charity, entertained his friends at the castle, and hosted expensive holidays in the Caribbean. But Stephen Curtis was a lawyer who knew too much. Although he loved flirting with risk and thrived on the pressure and excitement of working with the Russians, he also became increasingly nervous about his own vulnerability and the safety of his family. At the time of his death he was caught in the middle of an epic power struggle, one of the highest-stakes contests between state and business ascendancy in the world – between the most powerful man in Russia, President Vladimir Putin, and its wealthiest businessman, Mikhail Khodorkovsky. By October 2003, Curtis had been working for Khodorkovsky for six years when his billionaire client was arrested at gunpoint in central Siberia for alleged massive tax evasion and fraud. A month later the Mayfair lawyer found himself further embroiled in the conflict when he was appointed chairman of the Gibraltar-based Menatep, the bank that controlled Yukos, Khodorkovsky’s $15 billion oil company. Russian newspapers suddenly began referring to a ‘mystery man’ in Gibraltar who controlled Russia’s second-biggest oil producer. Billions of pounds were at stake, the political survival of Putin was in the balance, and Curtis was billed to play a pivotal role in the forthcoming court drama. In March 2004 the trial of Khodorkovsky was imminent and the pressure on Curtis was intense. On the morning after his death on 3 March, the offices of two Swiss

companies connected to Yukos were raided by Swiss police at the request of the Russian prosecutors. Documents were seized, suspects were interviewed in Geneva, Zurich, and Freiberg, and Swiss bank accounts containing $5 billion were frozen. Moreover, just a few weeks earlier Curtis had taken another critical and high-risk decision: to cooperate covertly with British police officials. Until only recently a back-room lawyer (secretive, low profile, discreet), he found himself suddenly thrust into the spotlight as chairman of a highly controversial Russian company. Sensitive and highly strung at the best of times, he felt increasingly exposed in this new role. Sooner or later he feared the Russian authorities would come knocking on his door asking questions about his own role in alleged tax avoidance and the filtering of cash out of the country. As he was legally obliged, Curtis had been scrupulous in reporting ‘suspicious transactions’, or the merest hint of criminal activity, to the National Criminal Intelligence Service (NCIS) at Scotland Yard, which investigates money laundering and organized crime. In May 2003, for example, he had filed a suspicious transaction report about one of his Russian clients. Now he needed protection for another reason: he feared that he might become the target of commercial enemies – rival oil companies and minority investors of Yukos who claimed that they were being defrauded. He also knew that contract killings in Russia were commonplace. ‘I have dug myself into a hole and I am in too deep,’ he told a colleague. ‘I am not sure that I can dig myself out.’ In the last few weeks of his life Curtis was under constant surveillance by commercial and Russian state investigators and was considering moving offices. His telephones were tapped and in early 2004 his security consultants discovered a small magnet used to secure a listening device at his country home in Dorset. According to

Eric Jenkins, an uncle who often visited him in Gibraltar, where his nephew lived for most of the year, Curtis received numerous anonymous threats and intimidating phone calls. He took them seriously enough to hire a bodyguard. ‘There certainly were death threats against Stephen,’ confirmed Nigel Brown, whose company also provided security for Curtis’s clients Berezovsky and Khodorkovsky. ‘The timing of his death was very suspicious and there were people out there who had a motive to kill him. He just knew too much.’ At first Curtis dismissed the threats, but when one phone call mentioned his wife and 13-year-old daughter, he decided to act. In mid-February 2004, deeply worried, he approached the Foreign Office and NCIS and offered full but covert cooperation. He would provide information about Russian commercial activities in Britain and the oligarchs’ assets, in return for protection for himself and his family. Up to that point his relationship with NCIS had been a limited, almost standard form of cooperation, a role many solicitors play. For NCIS Curtis was a potentially prized informant with insider knowledge of controversial Russian business activity in London. He was immediately assigned a controller, but after only two meetings the NCIS officer was transferred to another operation. Curtis asked to be assigned another controller but before this was done, he was dead. A week before the fatal crash Curtis had told a close friend at his apartment at Waterside Point, ‘If anything happens to me in the next few weeks, it will not be an accident.’ He had laughed nervously but he was not joking. He had played the messages left on his mobile phone to colleagues at his law firm. ‘Curtis, where are you?’ asked a voice with a Russian accent. ‘We are here. We are behind you. We follow you.’ At the inquest his uncle, Eric Jenkins, testified that his nephew had repeated the same words of warning to him.

The frequent threats convinced some of Curtis’s colleagues and relations that he was murdered. ‘Definitely’, one former employee of his law firm claimed. ‘It was done by remote control. They knew about his flight plans in advance because they were tapping his phones.’ Dennis Radford, the father of the pilot, told the subsequent inquest that he did not think that the Air Accidents Investigation Branch (AAIB) had properly investigated the possibility of foul play. ‘The lack of security at Bournemouth Airport is such that, had anybody wished to sabotage the aircraft, they would have unchallenged and unrestricted access for that purpose,’ he said. Witnesses say that they heard an unexplained and incredibly loud bang just before the crash. ‘I heard a kind of thump noise and the dog started barking, so I came outside and I heard another couple of bangs. It made a particularly harsh noise, as if the engine was malfunctioning,’ Jack Malt, who lives near the crash site, testified at the inquest. ‘There was a period of silence in the moments before the explosion so I guess the engines must have cut out,’ said Sarah Price, who lives 300 yards from the site of the crash. She also heard a massive bang just before the explosion. And Gavin Foxwell, another local resident, told the inquest that the helicopter made ‘a stuttering, unusual sound, as if it was struggling to stay aloft’. The death of Stephen Curtis remains a mystery to this day. However, no credible evidence of sabotage or murder has ever been discovered. The investigation by the AAIB concluded: The possibilities of unauthorised interference were considered. An improvised explosive device could have been positioned in the cabin or the baggage hold. All cabin doors at the undamaged skin of the baggage door were, however, recovered from the accident site. No

evidence of damage other than consistent with ground impact was found on any of them. In particular no high velocity particle impacts were noted in any of these door components. At the inquest Paul Hannant, the Senior Inspector of the AAIB, said, ‘If you are going to bring an aircraft like this down, you have either got to destroy the main rotor system or interfere with the main gearbox. The only other real way is to interfere with the controls. If you disconnect the controls, that would be immediately apparent to the pilot… Any attempt to use a corrosive device or a remote control device would also have been apparent to Captain Radford.’ Ultimately, deteriorating weather conditions and pilot inexperience were blamed for the crash. According to the AAIB inspector, ‘The most likely cause of the accident was that Captain Radford became disorientated during the final stages of the approach to Bournemouth Airport.’ Yet, while the weather on the fateful night of 3 March 2004 was poor – light drizzle, broken cloud, and overcast sky – flying conditions were not especially hazardous. As his father Dennis later claimed, ‘Max had flown many, many times in considerably worse conditions than that. And if he became disorientated, why was he on the radio describing the runway and talking to the control tower twenty-nine seconds before the crash?’ At the inquest assessments of Radford’s experience and competence were mixed. He had been a pilot since 1993, had recorded 3,500 flying hours, and had been flying Curtis regularly. During his operational training for flying the new, upgraded Agusta A109E, Radford consulted two flight instructors. ‘I felt his confidence exceeded his competence,’ testified Alan Davis, but Richard Poppy concluded that Radford was ‘competent’ to fly the Agusta A109E. While the AAIB found that he had not used instrument flying since 2000, they accepted that he was very familiar with

the route and had ‘already achieved seventy-eight hours’ over the previous two months. The inquest jury at Bournemouth Town Hall took just over one hour to reach a verdict of ‘accidental death’. Despite the verdict, however, some close relations remain sceptical to this day. They point out that Radford was a responsible, cautious pilot who had refused to fly Curtis in the past when the weather was poor, notably for a New Year’s Eve party at Pennsylvania Castle. Curtis’s former security advisers remain suspicious, too. Nigel Brown is adamant that it was an assassination and is highly critical of the police. ‘What I cannot understand is why there has never been a proper murder investigation’, he has said. ‘There was a just cause of suspicion because Stephen had received death threats, there was a motive because of what he knew, and there were suspicious circumstances. But the police did not interview me or my colleagues or Stephen’s clients or his employees. Usually, the police would interview the last person to speak to him and I was that person. We may not know for sure what happened to Stephen but I think there could have been a more thorough inquiry.’ While Curtis’s wife Sarah has never believed that her husband was murdered, she has reflected on why it was a Russian businessman who first informed her about the death of her husband. ‘I am sorry that Stephen is dead,’ he told her. The police did not telephone until an hour later to say that ‘there has been an accident’. It is a measure of the accuracy of the premonitions Curtis had about a premature death that he left detailed instructions for his funeral. This was partly influenced by his superstitious, almost fatalistic nature. He believed in ghosts and in the afterlife and always thought that he would die young. ‘I will never make old bones’, he once said, well before he met the Russians.

But Curtis had also been diagnosed with leukemia and a rare blood disease. This manifested itself in bizarre ways. During a sailing trip he once hit his head heavily on the boom of the boat and a friend was stunned to see his bloody flesh wound apparently heal before his very eyes. Curtis needed regular blood transfusions to stabilize him and took Warfarin to thin his blood and prevent clotting. He also wore surgical stockings to inhibit deep-vein thrombosis. After two operations at a private clinic, he was told that he could no longer travel by airplane because this would worsen his condition. But he could fly by helicopter, which was why, just three months before his death, he upgraded to the Agusta A109E. Typical of his flamboyant and irreverent personality, he requested that his funeral should not be a mournful event but a ‘celebration of his life’ and that mourners were ‘not obliged to wear traditional black’. On Wednesday, 7 April 2004 some 350 relations, friends, and business associates gathered inside All Saints Church in Easton on the Isle of Portland near the Curtis family home at Pennsylvania Castle. Such was the lawyer’s popularity that a further 100 stood outside and loudspeakers were installed to broadcast the proceedings. At 1.50 p.m. a glass carriage bearing Curtis’s coffin arrived, drawn by two blackplumed horses and adorned with flowers that spelt the word ‘Daddy’. The carriage was followed by a Rolls-Royce Phantom, carrying his widow Sarah and his daughter Louise, and two Bentleys and a Ferrari, ferrying other relations and close friends. Preceded by a Scottish piper who played the ‘Skye Boat Song’, the coffin was carried by six bearers into the church, followed by a tearful Sarah and Louise, both wearing pink coats and dresses. As they slowly walked down the aisle, Sarah noticed the intense, brooding figure of Boris Berezovsky, dressed in black, in the congregation with his girlfriend, two bodyguards, and a Russian entourage. Most of Curtis’s clients attended. Notable absentees were

representatives of his clients IKEA, which did not want to be associated with his controversial Russian clients, as well as most Yukos executives. Indeed, the only Yukos executive to attend was Vasily Alexanyan, a close friend of Curtis and the oil company’s former legal director. Alexanyan was furious that his colleagues had boycotted the funeral despite the risky operations Curtis had conducted for their company. At 2.00 p.m. the service began with traditional hymns, followed by a piano solo by Louise. It was evident that Curtis was well loved. One speaker described him as epitomizing a line from Rudyard Kipling’s poem If, which reads: ‘If you can talk with crowds and keep your virtue/or walk with kings – nor lose the common touch’. His closest friend, Rod Davidson, told the congregation, ‘In business he was in a league of his own. He would start off with an earthquake, build it up to a crescendo and [was] always setting his sights beyond the stars… He was the most generous of men and I think of him now at the pearly gates giving St Peter a red Ferrari and providing Playstations for the cherubs.’ But there was also palpable tension in the air because of the conspicuous and, to some, menacing presence of the Russian contingent, who attracted frequent nervous glances. When Berezovsky and his colleagues left their seats at the end of the service, the remainder of the congregation moved out of the way to let them pass first. The local mourners and Sarah’s friends were mostly conventional, middle-class English people who lived quiet, rural lives in the pristine Dorset village of Easton. They were hardly used to the hard Russian faces or the battery of television cameras, photographers, and police that greeted them as they left the church that bright spring afternoon. To the local villagers it must have looked like the cast of The Godfather or The Sopranos had arrived.

Sarah was devastated by her husband’s death, but she was also confused by and concerned about the media attention. ‘Why are there so many cameras here?’ she asked outside the church. ‘I don’t understand.’ A former secretary, Sarah’s life was family, music, friends, the castle, and the English countryside. Stephen had told her nothing about his secret life in London, Gibraltar, and Russia. A lover of James Bond films, Curtis revelled in this covert existence. He compartmentalized his life, mainly to protect Sarah. ‘I don’t want to know,’ she once remarked and would have recoiled from the dark, cut-throat world of the Russian super-rich. Sarah recognized none of the Russian mourners.‘Who’s this? Who’s that?’ she asked one of Stephen’s colleagues in a state of increasing bewilderment. ‘What on earth was my husband doing with those Russians?’ she asked another friend. Not wanting to worry her, they declined to answer. After the service the procession escorting Curtis’s body was accompanied by the song ‘You’ll Never Walk Alone’, with Sarah’s soprano voice ringing out the final words as she followed her husband’s coffin. The burial took place in the gardens of Pennsylvania Castle, attended only by family and close friends. Curtis was laid to rest to the strains of the bagpipe melody ‘Highland Cathedral’. As the guests mingled in the marquee after the burial the atmosphere was tense and apprehensive. Many former clients were anxious to know the identities of the other guests and whom they worked for. ‘It was a weird situation for a wake,’ said a former employee of Curtis’s law firm. ‘People were looking over their shoulders to see who was talking to who. The strange thing was that I knew some of our clients knew each other, but they would not acknowledge each other at the funeral in case they were photographed or associated with other clients. It was very bizarre, almost comical.’ At 9.45 p.m. a spectacular fireworks display erupted over the English Channel.

The funeral of Stephen Langford Curtis brought together an uneasy, unsettling gathering of two cultures: the conventional, light-hearted, understated English middle class and the dark, intense, stern-faced, focused Russian business elite. Little more than a decade earlier the Russian presence in Britain had been barely noticeable. It would have been rare to hear a Russian accent in a Knightsbridge boutique, a Mayfair restaurant, or even on the London underground, let alone at the funeral of a mysterious, even obscure, British lawyer. There was no sign then of what was to come: the arrival in Britain of a wave of middle-class, affluent Russians. The influx that followed the collapse of communism in 1991 started slowly but by the end of that decade the Russian desire to move to London had reached what one insider has described as ‘fever pitch’. Although there are no official figures for the size of the London-based Russian and former-Soviet community, it is widely accepted that by 2008 it numbered well in excess of 300,000. This was large enough to spawn four Russian- language newspapers, the glossy magazine New Style, a plethora of Russian networking clubs and internet sites, and a host of Russian social events. Although by then the Russian community was diverse, most of its members were ordinary professionals who had chosen to live, work, and settle in London. Many had British husbands or wives. It is this group, rather than the oligarchs, who jokingly referred to London as ‘Moscow-on- Thames’. Some worked for international organizations or Russian companies based in London while others had set up their own businesses. Some found jobs as estate agents, in the City, and in retail to target or cater for Russian clients. They mostly came to Britain to escape the crime, political uncertainty, and economic turbulence and were a

very select middle-class group compared with the wider Russian population. Some still commuted back and forth from Moscow, by commercial rather than by private jet. Flight SU247 from Moscow touched down at Heathrow on Friday evenings, carrying what its Aeroflot crew called ‘voskresnuy muzh’, which translates as ‘Sunday husbands’. These were transcontinental commuters, a mix of oil executives, bankers, and importers and exporters who had homes and families in London but who worked in Moscow. For them it was a weekly ritual: Friday and Sunday nights on a four- hour flight, weekends in London, and the week in their Moscow office. Dominating this steady stream of migrants was a tiny but much more high-profile group – the oligarchs, a tiny cadre of privileged insiders who had acquired Russia’s state-owned natural resources and, by the end of the 1990s, had come from nowhere to join the ranks of the world’s super-rich. While some of Russia’s nouveaux riches – billionaires and multi-million-aires – have remained in Russia, most have moved or built a base abroad, shifting their mountain of assets with them. While a few have selected Israel, New York, or Switzerland, most have chosen London. From the millennium, this group scattered its new-found wealth like confetti, helping to transform London into the world’s leading playground of the super- rich, contributing to runaway property prices, soaring profits for luxury goods retailers, and bringing displays of opulence not seen since the 1920s. Some of the Russian ultra-rich were, through fear of arrest, driven out of Russia and took up residence in London. Others became international super-nomads, living partly in London, partly in Russia, while travelling the globe in their private jets and luxury yachts. Many kept a discreet foot in both camps. Along with the next tier of the Russian rich, the oligarchs were lured by London’s

accommodating tax laws, compliant banking system, relaxed lifestyle, unobtrusive City regulations, elite schools, and independent judicial system.

This book tells the story of four Russian oligarchs: Boris Berezovsky, the intense, extrovert fugitive who has plotted against Putin’s Russia from his gilded London base; Roman Abramovich, the wily, reserved owner of Chelsea Football Club whose multi-billion-pound oil fortune came from outmanoeuvring his former friend and now bitter enemy Berezovsky; Mikhail Khodorkovsky, the intellectual who naively believed that he was more powerful than the state and ended up in a Siberian jail; and Oleg Deripaska, the ruthless young pretender and aluminium magnate who rose to become the richest of all of them, helped along by his cosy relationship with Vladimir Putin. During the course of the 1990s these four men built huge fortunes at electric speed by exploiting the flawed post-Soviet scramble to build a Western-style market economy. Though it was Russia itself that was the source of their personal wealth, it was London that provided the backdrop to the next phase in their meteoric climb up the global rich lists. For Abramovich, London has helped to satisfy his apparently insatiable appetite for conspicuous consumption. For Deripaska, banned from entering the United States, the capital has been a crucial base for building his diverse and colossal global business empire. Before his incarceration, Khodorkovsky used London to woo the British political and business establishment in his international campaign to transform his tarnished global reputation. For Berezovsky, who has been fighting extradition since 2001, London has provided a refuge from

Russian prosecutors who have accused him of alleged tax evasion and fraud, charges that he has strenuously denied. In contrast to the corrupt, politicized judiciary in Russia, London has also offered legal sanctuary and a fair due process of law. While indicted Russian businessmen have been arrested and detained in Spain, France, Italy, and the United States, Britain has refused to accept any of the dozens of extradition attempts by the Russian authorities, souring diplomatic relations in the process. ‘I think they [Russians] feel that this is a country of law,’ said Berezovsky. ‘They feel that they are well protected here.’[1] London has long attracted the extravagantly rich, but the post-millennium wave of foreign wealth was unprecedented. In the decade up to 2008, trillions of pounds of foreign capital settled in the UK. For those who make money out of money, it was a golden decade for tax lawyers, accountants, and bankers. ‘The British have found a new vocation,’ said William Cash, the well-connected publisher who founded Spear’s Wealth Management Survey, the glossy quarterly that chronicles the activities of the super-rich. ‘That is being the financial bag-carriers of the world. Britain’s ruling classes used to own the wealth. Now they’ve become the fee-earning servants, servicing the global financial elite.’[2] By 2007, before the devastating impact of the global economic meltdown of the following year, London had displaced New York as the financial capital of the world. It did so by providing an unrivalled tax avoidance industry and a much lighter regulatory touch. After 9/11 and a series of highprofile financial scandals on Wall Street, the US Government passed a new law – the Sarbanes-Oxley Act – which imposed much tougher corporate requirements on the disclosure of information, accountancy procedures, and the process of listing on the New York Stock Exchange. This made New York less attractive to the world’s business

rich and London seized its chance. The United States also introduced much tighter visa restrictions for foreign businessmen, which did not compare favourably with the more open UK border controls. For moneyed Russians London also provides logistical advantages: the flight from Moscow is just four hours, while south-east England enjoys a ring of airports with facilities for private jets. According to James Harding, editor of The Times, ‘From London it is possible to work a normal day and talk to Tokyo in the morning and Los Angeles in the afternoon. A businessman can get on a plane from Moscow and be in central London in five hours, from Bombay in seven, even from Beijing in nine. This is one of the reasons why over the past twenty-five years London has turned itself into an international marketplace while New York has remained essentially a domestic financial capital.’[3] However, tax remains the primary factor. ‘New York is obviously very stable, but most of the other big centres of wealth management would have questions over them’, said David Harvey of the Society of Trust and Estate Practitioners whose members unashamedly help wealthy families pay as little tax as is legally possible.‘Tokyo’s gone through a period of depression, Singapore is relatively new, and Germany was until recently a tax-heavy jurisdiction. If you’re looking to avoid tax legally, you’re as well going to London as anywhere else.’[4] The UK boasts an unrivalled tax-avoidance industry – and an abundance of highly paid accountants able to devise complex ways of hiding an individual’s wealth. In 2007 the International Monetary Fund ranked London alongside Switzerland, Bermuda, and the Cayman Islands as ‘an offshore financial centre’. Most countries have required their residents – including wealthy foreigners – to pay domestic taxes on their

worldwide income and capital gains. In the UK foreigners can claim they are ‘domiciled’ abroad even though they may have lived in Britain for years and have British passports. Under this rule, ‘non-domiciles’ would only pay tax on their UK income and not on overseas income, usually the bulk of their earnings. Furthermore, by purchasing property through offshore trusts, foreign buyers could avoid both capital gains tax when they sell and most of the stamp duty usually paid at the initial purchase. For a Russian billionaire living in London, his earnings from his homeland have been tax-free in the UK.‘There is one reason above all why these people are coming to London and that is the tax law,’ said Natasha Chouvaeva, a London-based Russian journalist. Although this advantage was partially reduced in 2008 when, following a mounting media and public outcry, the government introduced a £30,000 annual levy on non-domi-ciled residents, it was an inconsequential sum for the superrich. The origins of the oligarchical influx lie in the privatization of Russia’s vast and valuable state assets in the 1990s, an explosive process that enriched the few, opened up a huge gulf between rich and poor, and enraged the Russian people. A World Bank report in 2004 showed that, in effect, thirty individuals controlled 40 per cent of the $225 billion output of the Russian economy in its most important sectors, notably in natural resources and automotives. The study concluded: ‘Ownership concentration in modern Russia is much higher than in any country in continental Europe and higher than any country for which data is available.’[5] Little of this unprecedented accumulation of wealth has been invested in Russia in business or charity. Rather, most of the money has been secreted abroad, with billions of dollars hidden in a labyrinth of offshore bank accounts in an array of tax havens, from Switzerland and Jersey to the

British Virgin Islands and Gibraltar. Much has ended up being deposited in and managed by British banks. Stashed away, it has been almost impossible to trace. Despite attempts by Russian and British law enforcement agencies, little of it has been recovered and requisitioned back to Russia. Russia is where the money originated, but it has not been a comfortable place to spend it – too many people pointing fingers in Moscow restaurants, too much scrutiny by the tax police, and the constant fear of assassination. The Russian rich cannot go anywhere without bodyguards and bullet- and bomb-proof cars. Even wearing bespoke suits attracts attention. But in the UK or Europe they have been able to go mostly unrecognized and can relax, spending their gains without fear of censure or of being called to account. After buying their multi-million pound town houses and country estates, they have indulged their sybaritic lifestyles, cruising in St Barts, skiing in Gstaad, and shopping in Knightsbridge. For their wives it has been heaven. ‘London is a metropolis,’ said Olga Sirenko, who edits a website for Russian expatriates. ‘It is fashionable. It has all the boutiques and the culture. Moscow doesn’t have that kind of chic.’ Aliona Muchinskaya, who has lived in Britain since 1991 and runs her own PR company, says that Russians now dismiss Paris as being ‘too dowdy and villagey’. London, by contrast, is ‘bustling and busy with its restaurants and nightclubs. Russians can hire Rolls-Royces and private jets more easily here.’ On arrival in London the first port of call for the affluent, socially aspiring Russian was to the estate agent, notably Savills, Knight Frank, or Aylesford. Deals were cut at high speed: no mortgages, just cash. In 2006 one-fifth of all houses sold for over £8 million went to Russians. For properties over £12 million, the figure was higher still. But Russians have been extremely selective in location, not

merely restricting themselves to the golden postcodes – SW1, SW3, W1, and W8 – but only to certain streets and squares within them. Owning a British country property is also prestigious. Again, their choice of location has been very specific: St George’s Hill and Weybridge and Wentworth Park, both in Surrey. The next decision for the oligarch seeking to emulate the British aristocracy was which top boarding school to send their offspring to, for a British education is another motivating factor for moving to the UK. Public schools generally offer high academic standards and a secure, friendly environment. In Moscow, by contrast, kidnapping is a constant and real fear. While London’s elite estate agents set up offices in Moscow and St Petersburg to woo ultra-rich buyers, British public schools, colleges, and universities have also sent their senior teaching staff to Russia on recruitment drives. By 2008, it was no longer surprising to find Russian students at British schools and top universities, whether it was Abramovich’s teenage daughter at an independent all- girls’ school in London or foreign minister Sergei Lavrov’s daughter at the London School of Economics. School numbers soared from 2000 and some Russian parents started to seek schools where there were no other Russians. The fees – up to £30,000 a year – may not have been a problem, but old habits died hard. A headmistress of one top girls’ public school told the story of a Russian whose daughter had failed the entrance exam and who offered her a suitcase full of cash. He promised to pay for anything – a new gym, classrooms, a swimming pool. ‘Things don’t work like that over here,’ said the bemused headmistress. At another top school a parent asked permission to land his helicopter on the cricket field when visiting his child. While most Russian children eventually return home, an English education is regarded as a commercial benefit. ‘I

know that some oligarchs only hire students with a Western education,’ said Boris Yarishevsky, president of the Russian Society at the London School of Economics.[6] This also extends to politicians. ‘I know people whose fathers occupy really high positions in the Russian government and I know they study in London,’ he added. ‘I don’t think that they would want me to give out their names, though.’[7] It is quite possible that one day Russia – like many African and Middle Eastern states – will elect a President who has been educated at a British private school.

The UK has long been a haven for Russian exiles and dissidents. Anti-tsarist radicals flocked to London in the early twentieth century and Revolutionary Congresses were held here every two years. At the 1907 Social Democratic Congress the New York Times reported that an arrest warrant had been issued for one notable attendant, Vladimir Ilyich Lenin: ‘A Famous Rebel in London. Lenin Will Be Arrested if he Returns to Russia – Real Name Ulianoff ’ ran its headline. Lenin was not a permanent exile but visited the city six times between 1902 and 1911. At Seven Sisters Church in Holloway, north London, he met workers whom he described as ‘bursting with socialism’, while the area around Whitechapel and other parts of the East End swarmed with radicals. During one of his trips Lenin saw Hamlet at the Old Vic and visited Speaker’s Corner and the National Gallery. It was at the British Museum in 1902 that he first met Leon Trotsky, who had just escaped from Siberia. After the 1917 Revolution, relatively few affluent Russians fled to London – only 15,000 by 1919. Far more moved to the Slavic states, to Berlin, and to a lesser extent to France and China, particularly Shanghai. Those who did arrive in Britain were a mix of aristocrats and middle-class

liberal intellectuals, notably the family of the philosopher Isaiah Berlin who arrived in 1919 and settled in the Surrey town of Surbiton. ‘I am an Anglophile, I love England,’ Berlin once reflected. ‘I have been very well treated in this country, but I remain a Russian Jew.’[8] Other descendants of this first wave of Russian immigration include the actress Dame Helen Mirren (born Ileyna Vasilievna Mironov), winner of an Oscar for The Queen, and the Liberal Democrat leader Nick Clegg. During the Cold War there was always a sprinkling of new Russians coming to London. Some were dissidents fleeing the gulags; others were high-level KGB defectors who ended up rubbing shoulders in London with White Russians – mostly the offspring of those who had fled Russia after 1917. The latter lived mostly quiet lives, spoke good English, and were largely Anglicized. The 1991 Census recorded 27,011 residents living in the UK while claiming the former Soviet Union as their place of birth. Most of them would have been Russian. The collapse of the Eastern Bloc in the late 1980s had a dramatic impact on the pace of Russian arrivals, unleashing a new and unprecedented wave of migration from Russia and former Soviet and East European states. In 1991 the British Embassy in Moscow issued barely 100 visas – to a mixture of those working for Russian companies, students, and Russians who had married Britons – while only one Russian living in the UK was granted citizenship. Even by the mid-1990s, Londoners would have started to become aware of the occasional unrecognizable foreign accent in a shop or in the street – those Russians who did come congregated in a few favourite restaurants and nightclubs – but otherwise the early arrivals remained largely anonymous. Gradually that trickle turned into a flood. By 2006, the number of Russian visas issued had soared to 250,000, while the number granted citizenship in that same

year had risen to 1,830. Berezovsky has likened the twenty- first-century Russian wave to the influx of nineteenth- century Russians to Paris. ‘It used to be that Russian aristocrats spoke French and went to France,’ he said. ‘The modern Russian speaks English and feels more comfortable in England.’[9] The early Russian migrants – mostly professional middle class but by no means wealthy – were joined within two or three years by a quite different stratum of Russian society. These were what their countrymen dubbed ‘the new Russians’, and they started to arrive between 1993 and 1994. This is the group that was beginning to make money, though not on the same subsequent scale, out of Boris Yeltsin’s economic reforms, the easing of restrictions on private enterprise, and the first wave of privatization. They were a mix of state bureaucrats, entrepreneurial hustlers, Kremlin insiders, and former KGB officials; others were members of emerging Russian-based criminal gangs. This group of ‘new Russians’, who were always outnumbered by ‘ordinary’ Russian migrants, were by and large not coming to London to settle down. They came on short-term tourist or business visas, to attend a conference or a business meeting, or on shopping and spending trips. As one Russian already living here who knew some of them put it, ‘At this time there was no real dream to come and settle in London. It was difficult to get a permanent visa except illegally, work permits were scarce, and most of this group could make much more money in Moscow than in London. They had money and came here for a week or two at a time to burn it.’ During the 1990s, Britain gradually eased its entry regulations. Tourist and business visas became easier to acquire. Especially welcomed by the authorities were those with money. Anxious to encourage investment from abroad, the government bent the rules to encourage the arrival of

the super-rich. ‘Essentially, if you are coming to the country with money to spend, you’re very much welcomed with open arms,’ said John Tincey, Vice-Chairman of the Immigration Service Union, in 2007.[10]

In 1996 the Conservative government of John Major introduced a new ‘investor visa’ for those wanting to make the UK their main home and able to invest at least £1 million in the country. Of this at least £750,000 had to be invested in either government bonds or UK-registered companies. Those investing in this way were, after five years, allowed to apply for permanent residency and eventually UK citizenship. Only one other country in the world – the United States – operated such a scheme (though with a much lower entry fee) and a number of wealthy Russians took advantage of the rule. All they needed to do was meet the investment cash criterion. The process of seduction worked. The Russians, along with the super-rich of other nations, poured into Britain. As Forbes magazine described it in 2006: ‘London attracts the elite of the world’s rich and successful. It can lay claim unchallenged to one title: it is the magnet for the world’s billionaires.’[11] Once here, the newly enriched Russians were not shy about spending their way through the capital. They quickly became addicted to high living the British way. In London, history, culture, and the attractions of consumer spending often come together in classic British brands that seem to have a special appeal. The more traditional, the more alluring: shopping at Fortnum & Mason and Burberry, buying a £900 bottle of port at the St James’s wine merchant Berry Bros & Rudd, tea at Claridge’s, and dinner at Rules. The Russians also took to two other British institutions, London’s leading auctioneers Sotheby’s and Christie’s. Here, at the height of the art boom of the mid- noughties, they could be found outbidding other collectors and leading international dealers for the works of French Impressionists and contemporary British artists. But the staggering spending of Russians is not based just on a crude materialistic desire for luxury goods; it also

stems from a fatalistic mindset and generally pessimistic approach to life. For centuries the Russian people have suffered enormous hardship, poverty, starvation, and brutal repression: an estimated 20 million died during Stalin’s regime, and another 1.1 million perished during the siege of Stalingrad alone during 1942-3. Even after the collapse of the Soviet empire, millions continued to live in a state of permanent insecurity and anxiety exacerbated by a harsh winter climate, economic instability, and a corrupt rule of law. Even the new billionaires and their families believe that they could lose everything tomorrow. A favourite Russian saying goes: ‘Never say never to poverty or prison. Both could happen tomorrow.’ This is why they spend. And they also believe in another Russian adage: ‘That which does not grow and expand will expire and will then die.’ For the Russian male the addiction to spending has manifested itself in the acquisition of yachts, jets, and cars. ‘We have a positive attitude towards the English car culture,’ said Alexander Pikulenko, motoring correspondent for the Moscow radio station Ekho Moskvy.[12] In 2007 an estimated 40 per cent of Mercedes-Benz sold at their central London showroom went to Russians. The Russians also brought the good times to the UK’s fledgling private aviation industry and helped turn scores of Britain’s own home-grown entrepreneurs, such as the young property tycoons Candy and Candy, into multi-millionaires almost overnight. For Russian women London’s luxury shops became the magnet for this ‘rouble revolution’, with Harrods the favourite. Many Russian wives – and probably their daughters as well – would no doubt love their husbands to buy it. There is a joke that Russian émigrés like to tell. On his deathbed a wealthy Russian summons his wife to his side. ‘Olga, when I die, will you promise that you will do something for me? Promise that you will bury me in

Harrods.’ Shocked, his tearful wife begs him to reconsider, telling him that he is rich enough to build his own mausoleum in Moscow. ‘No, no, no,’ he interrupts. ‘Don’t you see, if I am buried in Harrods, at least I know you will visit me at least once a week.’ A close second to Harrods is Harvey Nichols, just up the road, where, at the height of the London boom, they employed six Russian-speaking assistants on its five shop floors. For specialized jewellery the oligarchs’ wives and mistresses would move closer to the West End. Almost every shop in Old Bond Street started to employ a Russian speaker, while top jewellers like Asprey and Theo Fennell attributed their increase in profits from the late 1990s to their expanding Russian client base and their taste for expensive one-off designer pieces. Russian wives would think nothing of buying a £5,000 alligatorskin bag and a £90,000 diamond ring. ‘They are like children in a sweet shop,’ observed one employee. After a morning being chauffeured around their favourite fashion stores, the wives and daughters would retreat for lunch to Roka in Charlotte Street, the Russian- style tearoom and restaurant, Troika, in Primrose Hill, or Harvey Nichols’ Fifth Floor Restaurant. Their husbands preferred the bars at the Dorchester and Lanesborough hotels for early evening drinks. Then it was dinner at the most expensive, exclusive restaurants, notably Le Gavroche and Cipriani in Mayfair. Even being halfway across the world was not a problem. Late one afternoon Roman Abramovich was in Baku in Azerbaijan and told his aide that he wanted sushi for dinner. The aide ordered £1,200 worth of sushi from Ubon in Canary Wharf, the sister restaurant of Nobu, the fashionable Japanese Park Lane restaurant. It was then collected by limousine, driven to Luton Airport, and flown 3,000 miles by private jet to Abramovich in Azerbaijan.[13] At an estimated total cost of

£40,000, it must rank as the most expensive takeaway in history. Behind the glitz, the glamour, and the wealth lies another side of the Russian invasion. Their arrival may have transformed London financially, but it has also turned Britain’s capital into a murky outpost of Moscow. While the tycoons have been applauded by the City, luxury goods manufacturers, and property magnates, they hardly represent a harmonious community. Behind the mass spending sprees lies a much more sinister world of bitter personal feuds. Many of the Russians are at war with each other as well as with the Russian state. As a result, former friends and business partners have become sworn public enemies. At issue is the ownership of billions of pounds’ worth of assets.‘They are ruthless,’ said one who has had regular business dealings with the wealthiest Russians. ‘Their word means nothing. They will shaft you if they are given half a chance. It is the law of the jungle. Many of them owe huge sums of money to others.’ Their presence, then, has also introduced to Britain some of the uglier elements of the Russian state. ‘As soon as the oligarchs arrived, so the politics followed them. That is why they all take such elaborate and expensive security precautions,’ another businessman explained. The cut-throat political and business battles being fought for control of the nation’s vast oil, gas, and mineral resources were once confined to Russia itself. Gradually, however, those bitter corporate and personal wars spilt over into Britain. For a while they went unnoticed, at least by the press and the public, if not by the security services. It was only in December 2006, after the former Russian state security officer turned dissident, Alexander Litvinenko, died a long, painful, and public death in a London hospital as a result of polonium-210 poisoning that the implications of Britain’s wooing of Russian billionaires

and dissidents became fully apparent. The British government wanted their money but only if they kept their acrimonious internal battles at the border. Litvinenko’s murder exposed the frailty of this strategy of benign tolerance. As one Russian who personally knows several oligarchs put it, ‘The UK government may not care how these guys made their money or what they get up to as long as they don’t bring their dubious activities into Britain. But we can’t have it both ways. We can’t let them in and expect the seedy elements to stop short of the English Channel.’ The country’s leading expert on Russian history, Professor Robert Service of St Antony’s College, Oxford, agrees: ‘The British government has collaborated with the City of London in offering a haven for businessmen from Russia who need to expatriate their money. More circumspect, New York and Stuttgart have failed to compete in pursuit of Russian capital. Britain asks few questions about the provenance of new Russian wealth. Hence the hitmen who keep on arriving on our shores to settle accounts by violent means.’[14]

CHAPTER 2

The Russian Billionaires’ Club

‘What is hard to dispute is that, while hundreds of people became seriously rich, 150 million Russians now live in a country which sold its mineral wealth for a mess of pottage’[1] - DOMINIC MIDGLEY and CHRIS HUTCHINS, 2005

IN 2002 THE RUSSIAN FILM Oligarkh was released. Its main character, Platon Makovsky (Platon is the Russian name for Plato), was a young, idealistic academic who abandoned his studies for the shady world of post-Soviet- era business. Platon devised a series of questionable deals by which he outfoxed his opponents: the Russian secret service. First, he rapidly became the richest man in Russia with financial and political power equal to the state. Then he ended up as the government’s rival and sworn enemy.

Set during the economic convulsions that followed the collapse of communism, Oligarkh was a graphic, if fictional, account of a small group of businessmen who acquired the nation’s wealth. But the film also presented the characters as visionaries who provided the lifeblood of a country paralyzed by fear of change. As the New Yorker noted: Once a freedom-loving idealist, Platon used his genius to become a monster, unhesitatingly sacrificing his ideals

and his closest friends. This is the tragedy of this super- talented individual who embodies all that is most creative in the new Russia and, at the same time, all which is worst for the country that he privatised for his own profit. [2]

Based on the novel Bolshaya Paika (The Lion’s Share) written by Yuli Dubov, who went on to work for Berezovsky, the film broke Russian box-office records and drew gasps from the audience at the scenes of obscene private opulence. It has been broadly compared to the early years of one of the country’s most notorious oligarchs: Boris Berezovsky. Played by Russian sex symbol Vladimir Mashkov, the leading character was portrayed sympathetically as a freedom-loving patriot who proclaimed at one point that he would rather go to jail than leave Russia. Although there were scenes of armed standoffs, the plot mostly glossed over the methods by which such a small clique made such huge fortunes so quickly. Berezovsky accepted that the film was based – if somewhat loosely – on his own early life. He invited the director to his London home for a viewing of the film and told the BBC, ‘As a work of art I think it is primitive. But I appreciate the effort to understand people like me. It is the first attempt in recent Russian cinema to understand the motivations of those at the peak of power, who drive reforms and make changes rather than cope with them.’[3] As they started to beat a path to London, and as their reputations grew, so the new breed of super-rich Russians began to intrigue the British public: ‘We like to follow them because we are astonished at how people who not that long ago were queuing for bread are now able to outbid the rest of the world’s super-rich for Britain’s finest houses,’ one Mayfair property agent told us.

In his early sixties, Berezovsky is old enough to remember the bread queues in his own country, but such a modest lifestyle did not extend into his adult years. The man once known as the ‘Grey Cardinal’ because of his dominating influence at the Kremlin was not shy when it came to spending his fortune. In 1995 he bought himself a palatial residence outside Moscow, complete with servants, and accumulated a fleet of sports cars. He acquired an interest in fine wine and smoked only the best cigars. His brazen lifestyle soon became the stuff of legend. Here was a man with a way of life that had once been the province only of the Russian aristocracy before the Revolution. With an estimated fortune of £1.5 billion at the time, he epitomized the term ‘Russian oligarch’. His power was such that by the autumn of 1996 he could boast that he and six other individuals controlled 50 per cent of the Russian economy.[4] Berezovsky was exaggerating, but from the early 1990s Russia was quickly transformed from a highly centralized economy to one in which some thirty or so individuals owned and controlled the commanding heights: its vast natural resources and manufacturing. Russia moved at high speed from being a political dictatorship to a society not just heavily owned by a tiny, super-wealthy elite, but one wielding, for a while, enormous political power.

The word ‘oligarch’ was first used in Russia on 13 October 1992, when Khodorkovsky’s Bank Menatep announced plans to provide banking services for what it called ‘the financial and industrial oligarchy’. This was for clients with private means of at least $10 million. By the mid-1990s, the word was common parlance across Russia. The origins of the word lie in Classical Greek political philosophy. Both Plato’s Republic and Aristotle’s Politics describe rule by an elite rather than by the democratic will of the people. Historically, ‘oligarch’ was a word used to describe active opponents of Athenian democracy during

the fifth century bc, when Greece was ruled on several occasions by brutal oligarch regimes that butchered their democratic opponents. Like their ancient Greek counterparts, few of the modern Russian oligarchs became mega-rich by creating new wealth but rather by insider political intrigue and by exploiting the weakness of the rule of law. Driven by a lust for money and power, they secured much of the country’s natural and historic wealth through the manipulation of the post-Soviet-era process of privatization. When Boris Yeltsin succeeded Mikhail Gorbachev as President in 1991, Russia had reached another precarious stage in its complex history. It had difficulty trading its vast resources and was short of food, while its banking system suffered from a severe lack of liquidity. Its former foe the United States – in Russia referred to as glavni vrag (the main enemy) – was watching events eagerly. Within weeks, advisers from the International Monetary Fund (IMF) and the World Bank teamed up with powerful Russian reformist economists close to the Kremlin to persuade Yeltsin to introduce an unbridled free-market economy involving the mass privatization of state assets. It was a dramatic process of ‘reverse Marxism’ implemented at speed.

This was to become Russia’s second full-scale revolution – though this time from communism to capitalism – in three generations. ‘Russia was broke. There was grave doubt in late 1991 that they could feed their population in the coming year,’ explained James Collins, former US Ambassador to Russia.’The government had lost control over its currency because people were printing it in other republics. The policy of what became known as “shock therapy” was discussed internally [in the US government] and nobody stood up and said “no, don’t do that”. The whole system was falling apart and was best summed up by my predecessor Ambassador Robert Strauss who said, “It’s

like two pissants on a big log in a middle of a river going downstream and arguing about who was steering”.’ The first wave of privatization came in the form of a mass voucher scheme launched in late 1992 – just nine months after Yeltsin assumed the presidency. All Russians were to be offered vouchers to the value of 10,000 roubles (then worth about $30, the equivalent of the average monthly wage). These could, over time, be exchanged for shares either in companies that employed them or in any other state enterprise that was being privatized. To acquire the vouchers, citizens had to pay a mere 25 roubles per voucher, at the time the equivalent of about 7 pence. In the four months from October 1992, a remarkable 144 million vouchers were bought, mainly in agricultural and service firms. The Kremlin presented this ambitious scheme as offering everyone a share in the nation’s wealth. Yeltsin promised it would produce ‘millions of owners rather than a handful of millionaires’. It may have been a great vision but it never materialized. Russia’s citizens were poor, often unpaid, and many had lost their savings as inflation soared and the rouble collapsed. Moreover, after seventy years of communism, most Russians had no concept of the idea of share ownership. There wasn’t even a Russian word for privatization. There were, however, plenty of people who understood only too well what privatization meant and the value of the vouchers. They started buying them up in blocks from workers. Among those cashing in was Mikhail Khodorkovsky – who would later become the richest man in Russia. Street kiosks selling vodka and cigarettes began doing a brisk trade in vouchers. Stalls began to appear outside farms and factories offering to buy them from workers. Hustlers started going from door to door. Even though holders were being offered far less than the vouchers were worth, most exchanged them for cash to pay for immediate necessities. Russia became a giant

unregulated stock exchange as purchasers were persuaded to trade their vouchers for prices that were nearly always well below their true value. They would exchange them for a bottle of vodka, a handful of US dollars, or a few more roubles than they had paid for them. It proved a mass bonanza for those prepared to prey on a country suffering from mass deprivation. Hundreds of thousands also lost their vouchers in ‘voucher saving funds’. Some funds were little more than covert attempts by companies to buy up their own shares for a song. Members of the old KGB power elite often laid claim to mines and enterprises in what became known as ‘smash-and-grab’ operations. For a nation ignorant of the concept of shares and unable to appreciate the potential value of their vouchers, people were easily encouraged to part with their stakes. For the winners it was easy and big money. Instead of a share-owning democracy, a newspaper poll in July 1994 revealed that only 8 per cent of Russians had exchanged their vouchers for shares in enterprises in which they worked. Moreover, because the assets being sold were massively undervalued, the successful purchasers obtained the companies for well below their real value. Indeed, the 144 million vouchers issued have been estimated to have valued the assets at a mere $12 billion. In other words, much of the country’s industrial and agricultural wealth was being sold for a sum equivalent to the value of a single British company such as Marks & Spencer. In just two years, by the beginning of 1995, around half the economy, mostly in the shape of small- and medium- sized businesses, had been privatized. The next crucial issue in the ‘second Russian Revolution’ was how to privatize the remaining giant state-owned oil, metallurgical, and telecommunications industries that were still operated by former Soviet managers – the ‘red

directors’, the Soviet-era bosses renowned for their corruption and incompetence who had managed the state firms – many of whom were laundering money and stashing away revenue abroad. Russia was still mired in a severe economic crisis with plunging share prices and rampant inflation. The indecisive and capricious Yeltsin was ill, often drunk and rarely in control, while the state was running out of money to pay pensions and salaries. Taking advantage of the growing crisis, a handful of businessmen dreamed up a clever ruse that appeared to offer a solution. This was a group that had already become rich by taking advantage of the early days of Mikhail Gorbachev’s perestroika (restructuring), which, for the first time in the Soviet Union, allowed small private enterprises to operate. Led by a leading insider, Vladimir Potanin, the cabal offered Yeltsin a backroom deal known in the West as ‘loans for shares’. This was an arrangement (coming at the end of the voucher privatization scheme) whereby they would lend the government the cash it so desperately needed in return for the right to buy shares in the remaining state enterprises. In effect, Yeltsin was auctioning off the state’s most desirable assets. If the government subsequently defaulted on repaying the loans – which the scheme’s architects knew was inevitable – the lenders would keep the shares by way of compensation. For Yeltsin, the plan provided much needed cash while on paper it did not look like the mass giveaway it turned out to be. Between 1995 and 1997, more than twenty giant state-owned enterprises, accounting for a huge share of the country’s national wealth, were offloaded in this way. In return, the government received a total of some 9.1 trillion roubles, about £1.2 billion at the time. One of the main beneficiaries of this deal was Boris Berezovsky. Boris Abramovich Berezovsky was born in Moscow in January 1946 to a Jewish family. An only child, his father was a construction engineer and his mother a paediatric

nurse. Berezovsky’s family were not members of the Communist Party and his upbringing was modest and for a time – when his father was unemployed for two years – he experienced poverty. ‘I wasn’t a member of the political elite,’ he later said. ‘I am a Jew. There were massive limitations. I understand that perfectly well,’ he told an audience of journalists at London’s Frontline Club in London in June 2007. A mathematics whizz kid, Berezovsky graduated with honours from Moscow State University. In early 1969 he joined the Institute of Control Sciences, where he gained a PhD and worked for more than twenty years. Intelligent, precocious, and energetic, he is also remembered for being intensely ambitious. ‘He always raised the bar to the highest notch and went for it,’ a close colleague recalled. ‘He was always in motion, always racing towards the goal, never knowing or fearing obstacles… His mind was always restless, his emotions ever changing, and he often lost interest in what he had started.’ Another friend from this period said, ‘He has this attitude which he has maintained all his life – never stop attacking.’ This was corroborated by a fellow student, ‘He was a compressed ball of energy… Constantly in motion, he was burning with plans and ideas and impatient to make them happen. He had an insistent charm and a fierce burning desire and he usually got what he wanted.’ As a scientist, Berezovsky wrote more than a hundred research papers on such subjects as optimization theory and decision-making. He was a director of a laboratory that researched automation and computer systems for industry. The young mathematician craved prestige and focused his energy on winning prizes to get it. He was awarded the prestigious Lenin Komsomol Prize (an annual Soviet award for the best works by young writers in science, engineering, literature, and the arts) and then tried but failed to win the even more illustrious State Prize.

According to Leonid Boguslavsky, a former colleague at the Institute, his dream was to win the Nobel Prize. In 1991 Berezovsky left academia and was appointed a member of the Russian Academy of Sciences, an achievement he remains proud of to this day. He later boasted that there were only eight hundred members of the Russian Academy of Sciences and that even Leonid Brezhnev had wanted to be among that number. Berezovsky married Nina Vassilievna when he was twenty-three. Within three years the couple had two daughters – Elizaveta and Ekaterina, both now in their thirties. Despite his academic achievements, Berezovsky initially had to scrimp to buy winter tights and school exercise books for his children. Perestroika offered him escape from his straitened circumstances. His first scheme involved selling software he had developed to the State Committee on Science and Technology. ‘We convinced them that it was a good product, and we sold tens of thousands of copies of this software. And those were the first millions of roubles that we earned, and a million roubles was a whole lot,’ he told his audience at the Frontline Club. In 1989 Berezovsky turned to the automobile industry. ‘They stopped paying my salary, so I started a business,’ he recalled. ‘Every Russian had two wishes – for an apartment and a car. The women generally had the last say on the apartment; so I went into cars.’[5] Initially, this involved selling second-hand Mercedes imported from East Germany. Then, taking advantage of the new freedom to travel, he went to West Germany. There he bought a used Mercedes, drove it back through almost non-existent customs, and sold it for three times what he had paid for it. But the real source of Berezovsky’s early wealth came from exploiting his connections, gained through his academic work, with the Soviet Union’s largest car manufacturer and producer of the Lada, the AvtoVaz

factory based in the industrial city of Togliatti. Off the back of his friendship with the factory’s Director, Vladimir Kadannikov, Berezovsky founded a company called LogoVaz, which took over responsibility for selling the Ladas. The effect was to separate production from sales in a way that maximized the profits from the business for Berezovsky and his partners. It was perfectly legal and it was a strategy widely deployed by directors of state companies and the new entrepreneurs at the time. Berezovsky also went on to establish the country’s first chain of dealerships for Mercedes, Fiat, and Volvo, which he later referred to as ‘a complete service, with workshops, showrooms, and credit facilities. Really, we created the country’s car market. There was no market then; people won cars in lotteries or for being “best worker” or they applied and stayed on a waiting list for years.’[6] In relation to that waiting list, Russians have a joke about the long delays of the period. Vladimir has been waiting for six years to buy his own car, when he is suddenly summoned to the local ministry office. ‘I have good news for you,’ says the clerk. ‘Your car will be delivered to you in five years from today.’ ‘Wonderful,’ says Vladimir. ‘Will it come in the morning or the afternoon?’ ‘Why, what difference does it make?’ responds the perplexed clerk. ‘Well,’ answers Vladimir, ‘I have already arranged for a plumber to come that morning.’ The dealership chain was created at a time when the automobile industry was rife with organized crime and protection rackets. Berezovsky’s Moscow dealership was targeted by Chechen gangs, which also controlled the production lines at AvtoVaz. Berezovsky, at times personally a target of the gangs, has always denied any mafia connection. In September 1993 his LogoVaz car parks were

attacked three times and his showrooms bombed with grenades. When his Mercedes 600 sedan was blown up nine months later, with Berezovsky in the back and his chauffeur killed, LogoVaz issued a statement blaming ‘forces in society that are actively trying, by barbarically criminal means, to keep civilian entrepreneurship from developing in this country.’ I can tell you right here and now that not a single oligarch has bowed to the Mafia. Oligarchs themselves are stronger than any mafia, and stronger than the government, to which they have also refused to bow. If we are talking of the visible tip of the iceberg, not the part of the iceberg concealed behind the surface or in the dark, I haven’t bowed to the government either.[7] By 1993 Berezovsky had already built an extensive business empire. One of his new enterprises was the All- Russian Automobile Alliance. Owned by various companies but headed by Berezovsky, ARAA promised the production of a ‘people’s car’, to be produced by AvtoVaz in collaboration with General Motors in the United States. On the back of a huge advertising campaign, it offered bonds in the scheme and the promise of cheaper cars, cash redemption, and a free lottery once the new production line was up and running. Wooed by the ‘get-rich-quick’ promise, more than 100,000 Russians bought $50 million of shares in the project. But when General Motors backed out of the scheme and it collapsed, thousands lost their money. By now Berezovsky had acquired a younger, second wife, Galina Becharova. They lived together for several years before being married at a civil ceremony in Russia in 1991. They had a son, Artem, and a daughter, Anastasia. Although they separated three years later, they never divorced. Berezovsky sent his two daughters from his first marriage – Elizaveta and Ekaterina – to Cambridge University.

By 1995 AvtoVaz had terminated the LogoVaz contract. The ambitious oligarch turned his attention from cars to planes, lobbying to install his business associates in key managerial positions in the state-owned airline, Aeroflot. Thanks to his growing influence at the Kremlin, he ensured that two of his intermediary companies based in Switzerland – Andava and Forus – provided Aeroflot with financial services. This gave Berezovsky huge influence over the company. Much of Berezovsky’s business ascendancy was based on his Kremlin connections and personal friendship with President Yeltsin. Since coming to power as Russia’s first democratically elected leader following his resistance against the hardliners’ putsch of 1991 (it had toppled Gorbachev and was bent on restoring a Soviet-style dictatorship), Yeltsin seemed to relax. But gradually he became increasingly impatient, drank more, and appeared ever vulnerable to the solicitations of sycophants and businessmen, especially as he distrusted the old KGB machine. Berezovsky’s relationship with Yeltsin was cemented by his shrewd offer to finance the publication of the President’s second volume of memoirs, Notes of a President, in 1994, arranging for royalties to be paid into a Barclays bank account in London. According to one account, before long, the President was complaining that the royalties were too low. ‘They [the ghostwriter, Valentin Yumashev, and Berezovsky] understood that they had to fix their mistake,’ claimed General Aleksandr Korzhakov, former KGB officer and Yeltsin’s closest friend and one-time bodyguard. ‘They started filling Yeltsin’s personal bank account in London, explaining that this was income from the book. By the end of 1994, Yeltsin’s account already had a balance of about $3 million.’[8]

A grateful Yeltsin ensured that Berezovsky became part of the Kremlin inner circle. Already a multi-millionaire, he was now well placed to benefit from the next wave of state sell-offs. In December 1994 Yeltsin signed a decree that handed over a 49 per cent stake in ORT, the main state- owned television station and broadcaster of Channel One, primarily to Berezovsky, without the auction required by law. The remaining 51 per cent remained in state hands. Berezovsky paid a mere $320,000 for the station. As most Russians get their news from the television, this also provided Berezovsky with a vital propaganda base for dealing with the Kremlin. But perhaps Berezovsky’s biggest prize was in oil. In December 1995 he acquired a claim, via the ‘loans for shares’ scheme, to the state-owned oil conglomerate Sibneft (Siberian Oil) – then Russia’s sixth-largest oil company – for a cut price of $100 million, a tiny fraction of its true value. The deal was done with two associates. One was his closest business partner, the ruthlessly sharp Arkady ‘Badri’ Patarkatsishvili, the other was the then unknown Roman Abramovich, twenty years younger than Berezovsky but canny enough to find $50 million for a 50 per cent stake. It was from this moment that Abramovich, at first under his mentor’s tutelage but then through his own business acumen, manipulated his way to a billion dollar fortune founded on cunning negotiating skills and political patronage. It was a relationship that Berezovsky would later bitterly regret.

If there is a key to Abramovich’s relentless drive, it is the orphan in him. He was born in 1966 to Irena and Arkady, Jewish Ukrainians living in Syktyvkar, the forbidding capital of the Komi republic in northern Siberia. He lost both parents before the age of three: his mother

died of blood poisoning following an abortion and his father was felled by an errant crane on a building site. Roman was adopted by his Uncle Leib and his wife Ludmilla, a former beauty queen. The family lived in the industrial city of Ukhta, where Leib was responsible for the supply of essentials to the state-owned timber business. Roman enjoyed a relatively comfortable upbringing and was, it is said, the first boy in his area to have a modern cassette player. In 1974 Roman moved to Moscow and lived with his uncle Abram, a construction boss, who would become his surrogate father. Although they lived in a tiny two-room apartment, it lay in the heart of the capital on Tsvetnoi Boulevard, just across from the Central Market and the Moscow Circus. The young Roman did not excel at school and in 1983 was called up for national service in the Red Army and posted to an artillery unit in Kirzach, 50 miles north-east of Moscow. On his return to the big city, Abramovich was guided and protected by his uncle in the ways of the grey market economy of perestroika. It was not unusual for ordinary Russians to indulge in smuggling and black marketeering and, despite his shyness, the young Abramovich did not hold back. He had honed his skill in the army. ‘Roman was head and shoulders above the rest when it comes to entrepreneurship,’ recalled Nikolai Panteleimonov, a former army friend. ‘He could make money out of thin air.’ When Abramovich was discharged from the army, he studied highway engineering and then returned to the secondary economy: transporting luxury consumer goods like Marlboro cigarettes, Chanel perfume, and Levi and Wrangler jeans from Moscow back to Ukhta. In 1987 the budding entrepreneur met his first wife, Olga Lysova, the daughter of a high-ranking government diplomat. The couple married that December in a Moscow registry office in the presence of fifteen family and friends.

The following year Abramovich established a company that made toys – including plastic ducks – and sold them in the Moscow markets. He also bought and sold retreaded tyres. An intuitive negotiator, he was able to put customers at ease. He was soon earning three to four thousand roubles a month – more than twenty times the salary of a state worker – and could afford to buy a Lada. In 1989 Abramovich and his first wife divorced. Olga says her husband persuaded her that they should divorce so that they could emigrate to Canada together, claiming that the immigration laws made it easier for him to go there if he was not married. Once he was a Canadian citizen, he would come back for Olga and her daughter from a previous relationship. Instead, Abramovich left Olga and gave her enough money to live on for two years, although she later claimed that all she got was the ‘crummy flat’.[9] A year later Abramovich married Irina Malandina, an air hostess with Aeroflot. They met on one of his business flights and in 1992 their first child, Anna, was born. When the Soviet Union collapsed, Abramovich, who had attended the Gubkin Institute of Oil and Gas in Moscow, established an oil-trading firm called ABK, based in Omsk, the centre of the Siberian oil business. In post-communist Russia it was possible to make enormous profits by buying oil at controlled domestic prices and selling it on in the unregulated international market. All that was needed was an export licence, which Abramovich acquired through his connection with a customs official. It was his friendship with Boris Berezovsky that transformed Abramovich from a hustler and mid-level oil trader into a billionaire. The two men first met at a New Year’s Eve party in 1994 on board the luxury yacht belonging to Petr Aven, a wealthy banker and former state minister. The select gathering of guests had been invited on

a cruise to the Caribbean island of St Barts. Berezovsky was impressed by Abramovich’s technical know-how and his unassuming manner that belied a calculating intelligence. Casually dressed and often with a few days’ growth of beard, his understated, gentle demeanour and apparently unthreatening manner often resulted in fellow businessmen underestimating him. In stark contrast to his mentor, with his hyperactive, restless personality, Abramovich comes across as a chess player, thinking deeply through all the possible permutations on the board. Berezovsky later acknowledged that, of all the businessmen he had met, Abramovich was the best at ‘person-to-person relations’.[10] Spotting the young oil trader’s commercial nous, Berezovsky recruited him as a key partner in the Sibneft deal. This conglomerate had been created from four state- owned enterprises: an oil and gas production plant, Noyabrskneftegas; an oil exploration arm, Noyabrskneftegas Geophysica; a marketing company called Omsknefteproduckt; and, most important of all, Russia’s largest and most modern oil refinery at Omsk. The three partners responsible for the acquisition of Sibneft all played different but key roles. Abramovich assessed Sibneft’s business potential, Berezovsky smoothed the privatization with the Yeltsin administration, and Badri Patarkatsishvili organized half the financing. In late 1995, 49 per cent of the company was sold at auction to the three men through their Petroleum Financial Company, known as NFK. The majority 51 per cent stake was to be held by the state for three years while the lenders were allowed to manage the assets. Under the plan, if the loan was not repaid within three years, legal ownership would transfer to the lenders. In the event, most of the remaining 49 per cent was auctioned a short while later, in January 1996, with control going to Berezovsky and his associates.

When ownership of Sibneft was secured, Berezovsky was already consumed by Kremlin politics and Patarkatsishvili was running ORT. It was thus agreed that Abramovich would manage the new company. According to Berezovsky Abramovich was in essence holding their shares in trust for both the other partners. October of 1998 saw the deadline for the state’s repayment of the loan; as expected, it was not met. Ownership of Sibneft therefore passed to NFK. By now, Abramovich held, on paper, the lion’s share of the oil giant through various companies. At thirty-two, he was well on his way to becoming one of Russia’s richest men. All decisions during the process of acquisition by the three partners in the deal – Abramovich, Berezovsky, and Patarkatsishvili – were made mostly at meetings at which only the three men were present and no minutes were taken. Nothing was ever formally put in writing and there was little or no documentation. The absence of a paper trail was deliberate – as was so often the way with many of the power-broking deals of the period – and it was partly for this reason that who actually owned what was later to become the subject of a bitter feud between Berezovsky and Abramovich. Many of the deals that forged the transfer of Russia’s wealth were concluded in this way – in shady rooms with no independent witnesses, tape recorders, or documentation, all done on the basis of a handshake. Unsurprisingly, many of these remarkable agreements started to unravel, as the former business allies later became bitter rivals and enemies.

Meanwhile, one of Berezovsky’s oligarchic rivals was an earnest, geeky former mathematician named Mikhail Khodorkovsky. As early as 1989, he was wealthy enough to found his own bank and would also become a billionaire

through the privatization of state assets. Mikhail (’Misha’) Borisovich Khodorkovsky, an only child, was born in Moscow in June 1963 to a lower-middle-class family with a Jewish father and a Christian mother. In his early years the family lived in cramped communal housing, though circumstances later improved when his father was promoted. Khodorkovsky’s nursery school was next door to the factory where his father worked and he remembers climbing the fence with his friends to steal pieces of metal. It was Misha’s dream from an early age to become a director of a factory and the other children at his nursery school accordingly nicknamed him ‘Director’. Khodorkovsky left school in 1981 and read chemistry at the Mendeleev Institute of Chemical Technology in Moscow, specializing in the study of rocket fuel. He supported his studies by working as a carpenter in a housing cooperative and it was at university that he met his first wife Elena, a fellow student. Their first son, Pavlik, was born in 1985 and the young scientist grimly recalls going out at six o’clock every morning with ration coupons to buy baby food. Khodorkovsky graduated from the Mendeleev Institute at the top of his year in 1996. Although his earliest ambitions to work in defence were thwarted by the fact that he was a Jew, he became the Deputy Secretary of Moscow’s Frunze district Komsomol – the Young Communist League. Like many Komsomol leaders, he used the organization’s real- estate holdings and political connections to profit from perestroika. In 1986 Khodorkovsky met his second wife Inna and set up the Centre for Scientific and Technical Youth. Purportedly a youth group, the Centre was merely a front for their commercial activities. ‘He dealt in everything: blue jeans, brandy, and computers – whatever could make

money,’ recalled a former senior Yukos executive.[11] Khodorkovsky and his colleagues peddled new technologies to Soviet factories, imported personal computers, and sold French brandy. Leonid Nevzlin, who became his closest business associate, recalls that all this was done with the backing of the Communist Party: ‘To a certain extent, Khodorkovsky was sent by the Komsomol and the party [into the private sector].’[12] By 1987 Khodorkovsky’s enterprises boasted many Soviet ministries as clients, employed 5,000 people, and enjoyed annual revenue of eighty million roubles. Later that year the Komsomol’s central committee gave its organizations the authority to set up bank accounts and raise and spend their own money. Pouncing on this opportunity, the perspicacious Khodorkovsky set up Bank Menatep. The bank soon expanded and by 1990, a year before the fall of communism, it was even setting up offshore accounts, seven years before he hired the lawyer Stephen Curtis. After Yeltsin came to power, Khodorkovsky soon came to appreciate the value of connections. He started courting senior bureaucrats and politicians, holding lavish receptions for high-level guests at top clubs in Moscow as well as at smart dachas owned by Menatep on the Rublevskoye Highway, the exclusive residential area to the west of the capital. By 1991, he was an adviser to the Russian Prime Minister Ivan Silaev. For a brief spell, he was a deputy fuel and energy minister. One of Yeltsin’s early market reforms was to end the Central Bank’s monopoly of banking for government institutions. Those entrepreneurs who had already set up banks were well placed to take advantage of this relaxation of the rules. Russia then, as now, was a country where little happened unless a bribe was paid – vzyat or kapusta as it is called in Russian. In the case of the transfer of deposits, it

was widely alleged that the banks that paid the biggest bribes to high-level politicians and state officials would receive the wealthiest new clients. And the payments were often deposited offshore. According to Bill Browder, an American banker who set up Hermitage Capital Management, one of the largest funds investing in Russia, ‘These entrepreneurs would set up banks and in many cases would go to government ministers and say, you put the ministries on deposit in my bank and I’ll put five or ten million bucks in a Swiss bank account with your name on it.’[13] The paybacks offered entry into the highly lucrative business of handling state money. By 1994, Menatep was responsible for funds collected for the victims of the Chernobyl disaster of 1986 as well as the finances of Moscow’s city government and the Ministry of Finance itself. At thirty-one and by now a multi-national tycoon, Khodorkovsky hired the accountancy firm Arthur Andersen to audit his books and spent $1 million on advertisements in the New York Times and the Wall Street Journal. His office was an imposing Victorianstyle castle in central Moscow with huge bronze letters announcing its presence and surrounded by a tall wrought-iron fence with sharp spikes. The grounds swarmed with armed security guards, some in well-tailored suits, others in black uniforms and boots. Flush with cash, Khodorkovsky was now able to target the industrial enterprises next in line to be sold off. It was the sale of the vast Siberian oil company Yukos, in what was a remarkably profitable deal that was to turn Khodorkovsky into a super-rich international tycoon. The process of transfer of vast state industries via the ‘loans for shares’ scheme was supposed to be handled by open auctions. In reality they were nothing of the sort. Only select bidders were invited to tender, and in many cases

the auctions were actually controlled by the very people making the bids – sometimes using companies to disguise their identity. In the case of Yukos, it was Khodorkovsky’s Menatep that was in charge of processing the bids in the auction. In a hotly contested auction, higher bids were disqualified on ‘technical grounds’ and Khodorkovsky won the auction. In this way he and his partners acquired a 78 per cent stake in Yukos and 2 per cent of the world’s oil reserves for a mere $309 million. When the shares began trading two years later in 1997, Yukos’s market capitalization was worth thirty times that figure. One by one, the state’s industrial conglomerates were being sold off at ‘liquidation- sale prices’ according to Strobe Talbott, former US Assistant Secretary of State.[14] It was a pattern repeated in the other auctions. The Sibneft auction for example, was managed by NFK. In most cases there was ultimately only one bidder. In some instances the auction was not even won by the highest bidder. The ‘loans for shares’ scheme turned many of the buyers from rouble multi-millionaires into dollar billionaires almost overnight. Initially, the lenders acquired only a proportion of the assets, but over the next couple of years the government also sold off the remaining tranches of shares in a series of lots, again without the competitive bids and auctions promised, and with the original lenders securing the remaining shares for themselves. By now ordinary Russians had lost patience with the process of privatization. The economy was in tatters, few had benefited from the voucher fiasco, while many had ploughed their savings into schemes that had simply swallowed up their money. There was widespread disbelief that a few dozen political and business insiders were walking off with Russia’s industrial and mineral wealth at

cut prices. Disillusioned with the President and his policies, ordinary Russians began to exhibit a yearning for what they saw as the security and stability of communism. There was suddenly a real prospect that the shambolic, drunken Yeltsin would lose the forthcoming election in 1996 to the revitalized Communist Party candidate Gennady Zyuganov. Opinion polls recorded Yeltsin’s popularity at a derisory 6 per cent. ‘It’s all over,’ said one American diplomat in Moscow. ‘I’m getting ready for Yeltsin to go.’[15] Promising to stop the auctions for the remaining shares, Zyuganov fully intended to pursue the oligarchs. At the time the international investor and philanthropist George Soros, now one of the oligarchs’ greatest critics, warned Berezovsky somewhat acidly that if the communists were to win, ‘you are going to hang from a lamppost’.[16] Berezovsky was only too aware that he had enemies among the communists. At a secret meeting in Davos in the Swiss Alps during the World Economic Forum in February 1996, he galvanized the wealthiest businessmen known in Russia as ‘the Group of Seven’. They agreed to bankroll Yeltsin’s election campaign in return for the offer of shares and management positions in the state industries yet to be privatized. The seven parties privy to the ‘Davos Pact’ were mainly bankers – Mikhail Khodorkovsky, Vladimir Potanin, Alexander Smolensky, and Petr Aven, as well as media tycoon Vladimir Gusinsky, industrialist Mikhail Fridman, and, of course, Berezovsky himself. Television was the key to the election campaign. The campaign was bankrolled through a secret fund known as the Black Treasury. Money was spent cultivating journalists and local political bosses. But most was used to pay for flattering documentaries of Yeltsin shown on private TV stations, billboards put up by local mayors, and even on pro-Yeltsin rock concerts. And Berezovsky brazenly used

his ownership of Channel One, Russia’s most powerful television network, to lionize Yeltsin and attack his communist opponent. Central to the campaign were Western spin doctors. Tim (now Lord) Bell, the media guru who had helped Margaret Thatcher win three elections in Great Britain between 1979 and 1990, was hired. Bell had also worked closely with the campaign team responsible for California Governor Pete Wilson’s remarkable comeback election victory in 1994, just two years earlier. In conditions of secrecy likened to protecting nuclear secrets, the American image consultants Dresner-Wickers moved into Suite 120 of the President Hotel in Moscow. ‘Secrecy was paramount,’ recalled Felix Braynin, a Yeltsin aide. ‘Everyone realized that if the Communists knew about this before the election, they would attack Yeltsin as an American tool. We badly needed the team, but having them was a big risk.’[17] Working closely with Yeltsin’s influential daughter Tatyana (Tanya) Dyachenko, who was based next door in Room 119, the Americans were treated like royalty. They were paid $250,000 plus expenses and enjoyed an unlimited budget for polling, focus groups, and research. They were told that their rooms and phones were bugged and that they should leave the hotel as infrequently as possible. The Americans suggested employing dirty tricks such as trailing Zyuganov with ‘truth squads’, which would heckle him and provoke him into losing his temper, but mostly they campaigned in a politically orthodox style. Photo opportunities and TV appearances were organized so as to appear spontaneous. Focus groups, direct mailing, and opinion polls were also widely employed, and the election message was hammered home repeatedly: ‘Whatever it is that we are going to say and do, we have to repeat it

between eight and twelve times,’ said one of the American political consultants.[18] Yeltsin proved to be an adept, populist campaigner. He smiled more and was even inspired to get on stage at a rock concert and do a few moves. From facing the political abyss, Yeltsin was re-elected with a 13 per cent lead. It was a staggering result and with it the newly enriched oligarchs had protected their fortunes and their power base. ‘It was a battle for our blood interests,’ acknowledged Berezovsky. [19] The now all-powerful Berezovsky had proved a master manipulator. When asked about his influences, he rejected Machiavelli in preference to Lenin. ‘Not as an ideologue,’ he remarked, ‘but as a tactician in political struggle. Nobody had better perception of what was possible… Lenin understood the psychology of society.’[20] It was now payback time and Yeltsin kept his part of the deal: some oligarchs received huge new government accounts, bought more state assets on the cheap, and paid only minimal taxes. In his memoirs, Strobe Talbott described the deal in the run-up to the presidential elections as a ‘Faustian bargain in which Yeltsin sold the soul of reform’. But the Russians replied that the favour they were doing the oligarchs was nowhere near as bad as the communist victory it helped to avert. As they saw it, unlike Dr Faustus who made a pact with the Devil that guaranteed his damnation, Yeltsin had made an accommodation with what he was convinced was the lesser of two evils – a deal that would help Russia avoid the real damnation of a return to power by the communists.’[21] Some of the oligarchs, notably Abramovich and Berezovsky, formed a coterie around Yeltsin that became known as the ‘family’. The leading member of the ‘family’ – and the gatekeeper to the President – was Yeltsin’s youngest and much loved daughter, Tatyana. Despite

having no knowledge of business or political affairs, she was his most influential adviser, could secure special favours from the state, and became very rich in her own right. The friendship between the two oligarchs and the President’s daughter blossomed. According to Aleksandr Korzhakov, Berezovsky lavished Tatyana with presents of jewellery and cars, notably a Niva (a Russian version of a Jeep). ‘The vehicle was customized to include a special stereo system, air-conditioning and alarm system, and luxury interior. When the Niva broke down, Berezovsky immediately gave her a Chevrolet Blazer [a sports utility vehicle then worth $50,000].’[22]

According to Strobe Talbott, ‘Berezovsky’s close ties to Yeltsin’s daughter Tatyana earned him a reputation as a modern-day Rasputin… At the height of Berezovsky’s influence, when his name came up in people’s offices in Moscow – including near the Kremlin – my hosts would sometimes point to the walls and start whispering or even, in a couple of cases, scribble notes to me. This was a practice I had not seen since the Brezhnev era in furtive encounters with dissident intellectuals.’[23] If Berezovsky was the dominant uncle of the ‘family’, Abramovich was the quiet but precocious nephew who had a talent for charming the most important member – Tatyana. One TV executive, Igor Malashenko, was stunned by the young oil trader’s access: ‘I arrived one night at Tanya’s dacha and here was this young guy, unshaven and in jeans, unloading French wine, very good wine, from his car, stocking the fridge, making shashlik. I thought to myself, “They’ve got a new cook”. But when I asked Yumashev [Tanya’s husband], he laughed and said, “Oh no, that’s Roman”. He’s living with us while his dacha is being renovated.’[24] In October 1996 Berezovsky was at the height of his power and was made Deputy Secretary of the country’s National Security Council – with responsibility for resolving the Chechnya conflict. (The first Chechen war began in 1994 when Chechnya tried to break away from the Russian Federation. Yeltsin’s government argued forcibly that Chechnya had never been an independent entity within the Soviet Union. The ensuing bitter struggle was disastrous for both sides.) A whirlwind of energy, Berezovsky was a frequent visitor to the cabinet offices of the Kremlin, clutching a worn leather briefcase in one hand and a new huge grey Motorola mobile phone in the other. While he waited to see Yeltsin, his phone would constantly ring. ‘Cannot talk. In Kremlin’, he would respond in his rapid-fire

speech. Berezovsky wore officials down with his ceaseless networking and lobbying. When government ATS hotlines were installed in the guesthouse of his office at LogoVaz and his dacha at Alexandrovka, the telephone calls became even more frenzied. In many ways such crony capitalism had much in common with the worst features of the Soviet era. For a while Berezovsky and his colleagues functioned like a politburo: conducting backroom deals behind the scenes, secretly conspiring with and against each other, just as the senior apparatchiks had done under communism. As one prime minister was replaced with another, Berezovsky would hand the incoming leader pieces of paper bearing the names of the ministers he wanted in the new government. The oligarchs now viewed the world through the prism of their personal interests. ‘It is my fundamental belief that, leaving aside the abstract concept of the interests of the people, government should represent the interests of business,’ he admitted.[25] Nevertheless, Yeltsin’s circle was not immune from outside pressure. At one point the independent prosecutor- general, Yuri Skuratov, started an investigation within the Kremlin itself. Yeltsin promptly sacked him, but Skuratov refused to quit and the Russian Federation Council twice refused to ratify his dismissal. Some years later, in 1999, the FSB was tasked with discrediting him. In a classic KGB- style entrapment, ORT broadcast a short, grainy video of ‘a man resembling’ Skuratov apparently romping with two prostitutes. It was never clear if it was Skuratov or not but, nonetheless, that was the end of him.[26] By 1998, Russia was bankrupt. Shares nose dived, interest rates had reached 150 per cent, and bankruptcies soared. By August of that year, one analyst noted: ‘Russia’s credit rating is below Indonesia’s. The size of its economy

is smaller than Switzerland’s. And its stock market is worth less than the UK water industry.’[27] Throughout this turmoil, the genuine political influence of the business elite was forever being exaggerated, not least by themselves. They had become so rich so quickly that they were suffering from what Stalin used to call ‘dizziness with success’. Their influence quickly began to wane after 1997.[28] Berezovsky was dismissed from the Security Council, although a few months later he returned as the Executive Secretary of the Confederation of Independent States, which involved coordinating the individual parts of the Russian Federation. None of this either undermined his personal fortune or prevented him from continuing to plot the future of Russia. The oligarchs and their associates were not the only Russians making a killing out of the transition from communism to capitalism and who later started showering London with money. Among the other winners were the ‘red directors’. The property agent who ran the Russian desk at the London estate agents Savills, remembers an older Russian client, aged about sixty-five, who owned a chemicals factory. One of the ‘red directors’, he was looking to spend several million pounds on a property in London in 2002. Despite his wealth, he was still nostalgic for the communist system that had once served people like him so well. Having been shown around an apartment, he asked, quite out of the blue, where Karl Marx was buried. A short time later he visited Highgate Cemetery. He clearly had much to thank the intellectual father of the Soviet state for. During the 1990s, Russia was a place where shrewd business operators played fast and loose with the country’s fledgling market economy. With no regulatory infrastructure to ensure a smooth, efficient – and legal – transition, it was a goldmine for clever, aggressive operators.

Nothing illustrates the forces at work more graphically than the case of aluminium. The control for this lucrative mineral became the subject of a seven-year long bitter and deadly struggle that became known as the aluminium wars. It left a trail of bloodshed that gave Siberia its reputation as the ‘Wild East’. One of those to emerge triumphant in the battle for aluminium was Oleg Deripaska, although his route to wealth differed from that of the other oligarchs. He was a 23-year-old student when the Soviet Union collapsed in 1991, but by 1994 had made big money from trading in metal. Unlike the other oligarchs, Deripaska did not acquire his fortune through the privatization auctions or via political connections. His control of the aluminium industry was largely due to the way in which he outmuscled and outwitted his competitors and his prowess with the hostile takeover. Deripaska was a post-Soviet corporate raider, borrowing from techniques pioneered by American and British tycoons, notably Sir James Goldsmith. In person, Deripaska, tall with cropped blond hair and deep blue eyes, is deceptive, a man of few words. Negotiations were more like poker or chess than orthodox business deals. He shared many of the characteristics of his friend Roman Abramovich – externally reserved and even more boyish-looking. Despite appearances, however, Deripaska was a serious operator with nerves of steel. The editor of Russia’s Finans business magazine once described him as ‘A very harsh person. Without that quality it would have been impossible to build up so much wealth.’[29] Like Abramovich, Deripaska also became a member of the Yeltsin ‘family’ – but more directly. In 2001 he married Polina Yumashev, daughter of Yeltsin’s chief of staff, who was himself married to Yeltsin’s daughter, Tatyana. Deripaska first met Polina at Abramovich’s house. Their wedding was the social event of the year in Russia and they

soon had two children. Like Abramovich, Deripaska arranged for one of the children to be born in London and employed a British nanny. It was a smart, some say strategic, marriage because, after Yeltsin left office in 2000, President Putin’s first Presidential Decree granted immunity from criminal prosecution to Yeltsin and all his relatives, a move seen by many as a quid pro quo for his backing.

Oleg Vladimirovich Deripaska was born on 2 January 1968 in Dzerzhinsk, 400 kilometres east of Moscow and at the heart of the Russian chemicals industry (the city was named in honour of the first head of the Soviet secret police). His father died when he was only four and he was brought up by his grandparents on a traditional Cossack family farm in Krasnodar, south-western Russia. Although Deripaska’s parents were Jewish, he was more conscious of his Cossack heritage. ‘We are Cossacks of the Russian Federation,’ he later said. ‘We are always prepared for war. This is a question of being able to deal with problems and any situation. It is the case that difficulties are not a catastrophe.’[30] A serious and studious teenager, he was accepted, despite his humble origins, into Moscow State University to study quantum physics. However, before he started his course, he was called up to serve in the army and was stationed on a barren steppe on the border with China. Despite his raw intelligence, times were hard for the young student. Following national service, he returned home to find the country on the brink of collapse and he worked on building sites across Russia. There seemed to be little future in quantum physics and so he abandoned his studies. His first job was in 1992 as a director of a company that sold military hardware following the withdrawal of

Russian forces from East Germany. He then worked as a metals trader in Moscow, before deciding to concentrate on the aluminium industry. At the time the industry was dominated by the brothers Mikhail and Lev Cherney. Born in Tashkent, the brothers grew up in Uzbekistan and, through exploiting the opportunities created by the introduction of a free market, had, by the early 1990s, already built up a substantial business manufacturing and exporting coal and metal. By late 1993, the businessmen held majority stakes in Russia’s largest aluminium smelters, but then Mikhail Cherney’s name was tarnished by allegations in the Russian press of controversial business methods, claims that he strongly denied as smears peddled by his business and political enemies. Despite a series of allegations by international law enforcement agencies, Mikhail Cherney has never been convicted of any crime. By 1994, he had settled in Israel and ran his business empire from there. That year Mikhail Cherney – now calling himself Michael – gave the then 26-year-old Deripaska his first big break, hiring him to run one of his giant smelters – the Sayanogorsky aluminium plant, the largest in the republic of Khakassia. Dedicated and technically brilliant, Deripaska increased production and somehow persuaded the impoverished workforce not to strike. But he was also a neurotic, paranoid manager and trusted no one. He suffered from hypertension and his brain rarely switched off. He hardly slept and, when he did, would wake in the early hours and visit factories and work on some new technology or other. He loved concentrating on the tiny, often petty, technical details of the business and on commercial contracts. In the endless political and business power struggles of the time, Deripaska soon came into conflict with the local mafia. The Sayanogorsky plant was threatened by raids by armed gangs determined to seize control, and he received

constant death threats, on more than one occasion coming within a whisker of being a victim of the bloodshed himself. Sometimes he even slept by his furnaces on the factory floor to protect them from being taken over by mobsters. He survived, and saw off the criminal syndicates at work within the industry. During this period, Deripaska showed remarkable acumen, some say genius, in wresting control from the gangs of mercenary local officials and brutal competitors. This earned him a certain legitimacy and respect among his peers. By 1999 – in less than five years – he had risen from being one of Cherney’s lowly subordinates to being his business equal. Over the next three years, Deripaska bought out all his remaining rivals, including Cherney himself, to emerge as the sole owner of Rusal, the giant aluminium corporation. In less than a decade, Deripaska, the student of quantum physics and former manager of a smelting works, had risen to control the entire aluminium industry. Even by the standards of 1990s Russia, his was a meteoric rise, but one dogged by bitter division and dispute.

Russia in the 1990s witnessed a transfer of wealth of epic proportions. What happened there could be seen as the equivalent of Margaret Thatcher deciding to sell all Britain’s nationalized industries, from British Gas to British Telecom, for a fraction of their real value to a handful of her favourite tycoons who had donated money to the Conservative Party. Some of the beneficiaries liked to defend their activities by comparing themselves to the nineteenth-century industrial and financial tycoons such as John D. Rockefeller, J. P. Morgan, and Cornelius Vanderbilt, who built massive fortunes out of oil, finance, and the railroads in the United

States in the late nineteenth and early twentieth centuries. Rockefeller, Morgan, and Vanderbilt were dubbed the ‘robber barons’ for their ruthless and exploitative tactics. Khodorkovsky once described his hero, ‘if he had one’, as John D. Rockefeller, the founding father of the American oil industry and the world’s first billionaire. But Rockefeller’s business methods also became so unpopular that towards the end of his life he was known by his staff as the ‘most hated man in America’. Many of the oligarchs evoked similar reactions among the Russian people. Whatever their business records, the American robber barons devoted their lives to building their giant monopolies in oil, railroads, and steel from scratch. The modern Russian oligarchs have no such defence. Few of them laid the pipelines, built the factories, assembled the rigs, or even took the necessary financial and commercial risks. Few created new wealth. Few of them knew much about the industries that landed in their laps. When Khodorkovsky acquired Yukos and went to visit one of its main sites, his host was astonished to discover that he had never seen an oil field before. The oligarchs acquired their fortunes by manipulating the system with a mixture of bare-knuckle tactics and political patronage. While the robber barons reinvested their money at home, the oligarchs moved much of their acquired wealth out of the country. Successive studies have confirmed the impact of the scale of personal enrichment on the concentration of economic ownership in Russia. One found that in 2001 Russia’s top-twelve privatized companies had revenues that were the equivalent of the entire federal budget. Of Russia’s sixty-four largest private companies, just eight oligarch groups controlled 85 per cent of their revenues.[31] There were alternatives. It was Western leaders and financial institutions that rejected a Marshall Plan for

Russia, such as the one for a social cushion advocated by George Soros. Jeffrey Sachs, the influential American economist and one of the key architects of the push for the ‘big bang’ approach – the privatization of the economy at speed – later admitted that when he suggested such a plan to the White House, ‘there was absolutely no interest at all. None, and the IMF just stared me down like I was crazy.’[32] Instead, the Yeltsin government was pressed to move forward with ‘big bang’ regardless of its economic and human consequences. Those in power at the time argue that all the options for political and economic transition from communism carried high risks. But then the West’s top priority was to create a malleable and compliant country offering cheap oil and no return to its past Soviet system. Other considerations were secondary. The Western advisers knew that such a long-standing form of government based on corruption and authoritarianism could not be reformed overnight, not least in a country where the ownership of private property had been a crime for the past seventy-five years. But as Professor Michael Hudson, a Wall Street financial economist, observed: ‘Was there really not a middle ground? Did Russia have no choice between “wild capitalism” at one extreme and the old Soviet bureaucracy at the other? Both systems were beginning to look suspiciously similar. Both had their black-market economies and respective dynamics of economic polarization.’[33] Some commentators argue that the emergence of an oligarchic class was inevitable, others that the creation of an economic elite was necessary for a quick transition to capitalism. Yet others claim that in replacing the old corrupt and incompetent command and control system it was even desirable. Berezovsky later defended his own activities as the inevitable result of capitalism. ‘I don’t know any example where property is split in a fair way,’ he

said. ‘It doesn’t matter how property is split. Everyone will not be happy.’ But he also admitted making ‘billions’ out of privatization and that Yeltsin ‘gave us the chance to be rich’.[34] Inevitable or desirable, the social cost to Russia was immense. The broad consensus is that the privatization process was one of the most flawed economic reforms in modern history. Industrial production declined by some 60 per cent during the 1990s, vast swathes of the economy were wiped out, and much of the population was plunged into poverty. The vast amount of money that poured out of Russia to be hidden away in offshore bank accounts accentuated the dramatic economic crisis of 1998. During the 1990s, what was known as ‘capital flight’ became one of the country’s most debilitating economic problems. According to economists at Florida International University, ‘It erodes the country’s tax base, increases the public deficit, reduces domestic investment and destabilises financial markets.’[35] The investment fund Hermitage Capital has estimated that between 1998 and 2004, £56 billion in capital flowed out of Russia, most ending up offshore. Although some of this was legitimate, with investors looking for a safer home than a Russian bank, most was not. Russia’s Economic Development and Trade Ministry says that between $210 and $230 billion left Russia during the reforms, approximately half of which was ‘dirty’ money, linked to money laundering or organized crime. The IMF’s estimate is that $170 billion escaped the country in the seven years leading up to 2001. Other sources suggest that around $300 billion of assets in the West belong to Russian citizens, almost half from ‘uncertain’ sources.[36] This was money that could have been used to rebuild factories, start new businesses at home, and invest in infrastructure. In effect, Russia lost the equivalent of one-

third of its gross foreign debt in this way. Although there was legislation designed to prevent such capital flight, it was largely ignored. By 2000, privatization had rendered a once mighty country, which spans eleven time zones, rotten to the core, according to the New York Times columnist Thomas Friedman: ‘At every level, different ministries, department heads, agencies and mayoralties have gone into partnership with private businesses, local oligarchs or criminal elements, creating a kind of 21st-century Russian feudalism.’ Friedman quoted the Russian political analyst Sergei Markov: ‘The Russian state looks like a big Charles Atlas, full of muscles. But as you get closer you realize that this Atlas is actually dead. Inside, this huge body is full of worms who are eating the body and feeding off it.’[37] As well as the oligarchs and the ‘red directors’, others were moving their money abroad during the 1990s. Though some of them were small players who simply didn’t trust the banks, most were wealthy, criminal, or members of the KBG – renamed the FSB (the Federal Security Service) in 1992. Some of the proceeds of crime were laundered through purchasing buildings, bars, and restaurants in Eastern Europe, but much of it ended up swirling around London’s nightclubs and casinos. Some passed through British banks.[38] The money often arrived in the form of hard cash, and stories of recent émigrés turning up with suitcases full of banknotes in the 1990s are legion within the Russian community in London. One small-time British property agent who used to socialize in a nightclub frequented by the Russians told of how he had been introduced to a young woman who happened to be the daughter of a senior FSB official. When she discovered he dealt in property, she asked if she could come and see him the next day. When she arrived at his office, he noticed that the woman was carrying a revolver in her coat pocket. When he asked how

she would be paying, she explained that it would be by cash, literally. She opened up a large case stuffed with banknotes. The agent thanked her and politely asked her to take her business elsewhere. Whether they were buying property, jewellery, or cars, payment was often by cash. Mikhail Ignatief, who arrived in London in 1991 at the age of twenty-one with his English fiancée, set up a successful travel business and used to help and advise Russians on shopping or business trips. He remembered one client asking his help to buy a Range Rover and arranged for one of his team to take him to the nearest showrooms. The client was shown around and said he wanted three cars, all to be shipped back to Russia. He then opened up a large leather bag stuffed with banknotes. A somewhat concerned manager called the police and the matter was only settled when the man was persuaded to go to a bank, deposit the money, and then pay by cheque.

The privatization process of the 1990s that led to London being awash with Russian money had no shortage of critics in and outside of Russia. Chrystia Freeland, the former Moscow bureau chief of the Financial Times, described the events as ‘a cynical manipulation of a weakened state… Yet as I watched them plot and profit, I couldn’t help asking myself how different the Russians really were from our own hero-entrepreneurs… our society so fawningly lauds for producing an era of unprecedented prosperity… The future oligarchs did what any red-blooded businessman would do. The real problem was that the state allowed them to get away with it.’[39] In his influential book, Failed Crusade, Stephen F. Cohen, Professor of Russian Studies at New York University, called US policy towards Russia in the 1990s ‘the worst American foreign policy disaster since Vietnam’.[40]

One of the architects of privatization, Vladimir Potanin, later accepted its flawed nature: ‘Although I do not deny I was the author, I would like to point out that the concept was changed to a great extent as a result of political pressure on government from the red directors… The government allowed no access to foreign investors and other measures. This was later criticised and rightly so.’[41] In October 1993 a reflective Khodorkovsky told Frontline, the American news programme: ‘Russian law allowed us to do things that were unthinkable in the Western business world.’ Even at the time advocates of privatization accepted that huge mistakes were made. In 1998 Boris Nemtsov, one of the young reformers who was once seen as a potential successor to Yeltsin, said, ‘The country is built as a freakish, oligarchic capitalist state. Its characteristics are the concentration of property in the hands of a narrow group of financiers, the oligarchs. Many of them operate inefficiently, having a parasitic relationship to the industries they control.’[42] By 1999, the oligarchs’ priority was to protect their power and wealth and to ensure a successor to Yeltsin who would be as compliant as he had been. ‘The problem was that a lot of the people who had the potential to lead Russia were themselves up to their necks in relationships with these people,’ observed William Wechsler, a US National Security Council and Treasury official. ‘The fear was that Russia would become like a nuclear-armed Colombia. That prospect was terrifying but to me it was real… Then along comes Putin from the KGB, which was obviously not clean. In the subsequent fight between Putin and the oligarchs, everyone was saying it was a good-guy-bad-guy situation. To me, this was a bad-guy-bad-guy situation.’

CHAPTER 3

... IN 1722, IN ORDER to transform the country from a disparate medieval society into a centralized autocratic state, Peter the Great set about purging the corruption that was endemic in Russian society. This included the elimination of everyone who took bribes. One of those targeted was Aleksandr Menshikov, his most successful general and the most powerful man after the Tsar himself. Menshikov was horrified. ‘If you do, Your Majesty, you risk not having a single subject left’, he told his monarch.[2]

When Vladimir Putin became President in 2000, he had less latitude than Peter the Great, who simply executed his more recalcitrant subjects. Even modern Russia’s arbitrary judicial system would not sanction summary executions of avaricious businessmen. Putin, who knew his history, would therefore have to come up with a different strategy to deal with a group he viewed as a major obstacle to his ambitions for the reshaping of Russia.

While there were whispers of a clampdown, the oligarchs believed they would retain their power and luxurious lifestyles and remain a protected species. After all, theirs was a cabal of the business elite who had engineered the new President’s ascendancy. Just as the oligarchs had connived and conspired to re-elect Yeltsin in 1996, so a group of them manipulated Putin into the Kremlin. In return for their backing, they expected Putin to be as malleable as his predecessor, allowing them to continue to exert influence, accumulate wealth, and be immune from prosecution. They badly misjudged him.

While Putin was Acting President and Prime Minister in 1999, there were signs of trouble to come, when the Prosecutor-General reviewed the way in which Vladimir Potanin, one of the architects of privatization, had acquired Norilsk Nickel, the giant state-owned mining group. ‘They were certainly feeling uncomfortable,’ said one government official. And with good reason. Within two months of becoming President, on the baking hot day of 28 July 2000, Putin summoned twenty-one oligarchs to the Kremlin. ‘It was more like a gathering ordered by Don Corleone than a meeting summoned by a leader of the Western world,’ noted one who was present.[3]

Khodorkovsky and Deripaska were both at the gathering but Berezovsky, now himself under investigation by the prosecutors, was not invited.

Before those assembled in the cabinet room, Putin effectively read Russia’s richest and most powerful business clique the riot act. He would not review the privatizations but they would no longer enjoy special privileges inside the Kremlin. During the meeting, Putin insisted that Potanin pay the $140 million he was alleged to owe on the purchase of Norilsk Nickel. At times the meeting became heated and at one stage the President pointed at a well-known tycoon and accused him of being guilty of ‘oligophrenia’ (which means ‘mental retardation’). The plutocrats were stunned. It was not the script they had been expecting.

The new confrontational President concluded the meeting – which lasted two hours and forty minutes – by setting up a permanent mechanism for consultations between businessmen and the state. The days of cliques and coteries were gone, he warned. Now the relationship was to be institutionalized. Access to Putin would be restricted through quarterly meetings with the Russian Union of Industrialists and Entrepreneurs – in effect, the oligarchs’ trade union.

Putin’s message to the shocked gathering was simple: they could keep their ill-gotten gains provided they kept out of politics and paid their taxes. The details of the meeting were promptly leaked so that in a poll a week later 57 per cent of Russians said they already knew about it. Berezovsky, omitted from the gathering, accused those present of being cowardly. ‘They are as timid as rabbits,’ he sniffed after the meeting.[4]

This was a watershed moment in the story of the oligarchs and an event that was to prompt the steady exodus to London of one wave of super-rich Russians after another. Those present knew only too well that the tide had turned. In case they were in any doubt, Putin used his State of the Nation address on July 8 to condemn the ambitious tycoons and especially the way they controlled the media. ‘They want to influence the masses and show the political leadership that we need them, that they have us hooked, that we should be afraid of them,’ he declared. ‘Russia can no longer tolerate shadowy groups that divert money abroad and hire their own dubious security services.’ He later added, ‘We have a category of people who have become billionaires overnight. The state appointed them as billionaires. It simply gave out a huge amount of property, practically for free. They said it themselves: “I was appointed a billionaire.” They get the impression that the gods themselves slept on their heads, that everything is permitted to them.’[5]

The oligarchs, blinded by their own power and influence, had greatly underestimated the sardonic but humorless Putin. In public the new President was a cold, unsmiling bureaucrat. Apart from periodic outbursts of aggression, he rarely displayed emotion. Russian journalist Elena Tregubova says that when she first interviewed Putin in May 1997, she found him a ‘barely noticeable, boring little grey man… who seemed to disappear, artfully merging with the colors of his office’.[6] As is so often the case with autocrats, people seemed to be preoccupied with his eyes, ‘No one is born with a stare like Vladimir Putin’s,’ reported Time magazine. ‘The Russian President’s pale blue eyes are so cool, so devoid of emotion that the stare must have begun as an effect, the gesture of someone who understood that power might be achieved by the suppression of ordinary needs…’[7]

In private his aides say that the intense and brooding Putin is intelligent, honest, intensely loyal, and patriotic. ‘He smiled a lot, his body language was relaxed and informal, his eyes were soft, and his speech quiet,’ reflected British author John Laugh-land.[8] In stark contrast to his predecessor, he drinks Diet Coke and works out regularly. He is also able to relax, notably by listening to classical composers such as Brahms, Mozart, and Tchaikovsky. His favourite Beatles song is Yesterday. He has never sent an e-mail in his life, and, while he grew up in an officially atheist country, he believes in God.

When Vladimir Vladimirovich Putin was born in 1952, his 41-year-old mother Maria, a devout Orthodox Christian, defied the official state atheism and had him baptized. She had little education and did menial jobs – from a night- security guard to a glass washer in a laboratory. His father Vladimir fought in the Second World War and was badly wounded in one leg. After the war, he worked as a lathe operator in a car factory and was ferociously strict with his son. Putin’s only forebear of any note was his paternal grandfather, who had served as a cook to both Lenin and Stalin. The family lived in a fifth-floor communal apartment at 15 Baskov Lane in central St Petersburg, where the young Putin had to step over the rats in the entrance to the apartment block on his way to school. Universally known as ‘Volodya’, he was a serious, hard-working, but often angry child. His former school friends and teachers describe him as a frail but temperamental boy who never hesitated to challenge stronger kids. He has described himself as having been a poor student and a hooligan. ‘I was educated on the street,’ he told a biographer. ‘To live and be educated on the street is just like living in the jungle. I was disobedient and didn’t follow school rules.’[9]

Putin found discipline by learning ‘sambo’, a Soviet-era combination of judo and wrestling, at the age of twelve. It places a premium on quick moves, a calm demeanor, and an ability to not show any emotion or make a sound. A black belt, he won several inter-city competitions. Initially, he practiced the sport so as to build up his slender physique and to be able to stand up for himself in fights, but his developing obsession with the sport not only kept him out of trouble, it also made him somewhat reclusive.

Meanwhile, the teenage Putin dreamed of becoming a KGB spy like the Soviet heroes portrayed in books and films. His favorite television program was Seventeen Moments of Spring, a series about a Soviet spy operating in Nazi Germany. In his ninth year at school he visited the KGB headquarters in Leningrad. Told that the best way to get into the service was to obtain a law degree, in 1970 the aspiring agent enrolled at Leningrad State University, where he studied law and German and practiced judo.

In 1975, his final year at university, he was recruited by the KGB. Posted to Leningrad, he spent seven uneventful years in counter-intelligence. At the age of thirty, he married Lyudmila Aleksandrovna, then twenty-two, an outspoken, energetic air stewardess, and the couple had two daughters. He was next posted to Dresden in East Germany, where he worked closely with the Stasi, the secret police, in political intelligence and counter- espionage. It was an isolated life and not a prestigious posting. More favoured agents worked in Western capitals, or at least in East Berlin. But his perseverance brought him the nickname ‘Nachalnik’ (Russian for boss or chief). When the Berlin Wall came down in 1989, Putin and his KGB colleagues destroyed files in the KGB’s Dresden HQ. He remembers calling Moscow for orders. ‘Moscow kept silent,’ he said later. ‘It was as if the country no longer existed.’ In 1990 Lieutenant Colonel Putin retired from active KGB service and became Assistant Rector in charge of foreign relations at Leningrad State University, a significant reduction in status. ‘It was even less important than working for Intourist,’ said Oleg Kalugin, a former official in the Leningrad KGB. ‘This was a KGB cover rather than a career move. Putin was demobilized into the KGB reserve.’[10]

By this time, his former judo tutor Anatoly Sobchak had become the first democratically elected mayor of St Petersburg and he immediately recruited Putin as Chairman of the City Council’s International Relations Committee. By 1994, a year after his wife suffered a serious spinal injury in a car crash, Putin became First Deputy Mayor, gaining a reputation for probity and an ascetic lifestyle. Even his bitter enemy Berezovsky admits that his future nemesis was not corrupt: ‘He was the first bureaucrat that I met who did not ask for some money and he was absolutely professional.’[11]

In June 1996 Mayor Sobchak, having failed to address the economic crisis and rising levels of crime, lost his bid for reelection. His successor offered to keep Putin on but he declined and resigned out of loyalty to his former boss. Now unemployed in St Petersberg, he moved to Moscow where he became Deputy Chief of the presidential staff, overseeing the work of the provincial governments. Tough, aloof, and relentlessly focused, he was renowned for his industriousness and severity. In contrast to the wild, erratic Yeltsin, Putin was the solid, reliable apparatchik. Impressed by his honesty, diligence, and loyalty, by June 1998 Yeltsin was beginning to see him as a potential FSB Director. The following month the current incumbent Nikolai Kovalev was forced to resign over an internal scandal, whereupon Putin received a sudden summons to meet Prime Minister Kirienko at Moscow’s Sheremetyevo Airport. After they shook hands, Kirienko offered Putin his congratulations. When Putin asked why, he replied, ‘The decree is signed. You have been appointed director of the FSB.’[12]

Within days, Putin had purged the FSB of potential enemies, firing nearly a dozen senior officials and replacing them with loyal subordinates. Many of these came from the ‘Chekists’, the clan of agents based in St Petersburg when Putin was the director there, and named after the brutal early Soviet-era ‘Cheka’, or secret police. One man who welcomed his appointment was Berezovsky. At this point their interests coincided: Putin needed political allies and the oligarch was rid of at least one enemy, the spymaster Kovalev, who had been leaking damaging stories about his business methods. By 1998, Berezovsky had lost his post at the National Security Council and much of his former influence at the centre of power and saw the security apparatus – which mostly resented the rise of the oligarchs – as a real threat. To survive in the feral atmosphere of Russian politics, Berezovsky needed new, powerful allies and was delighted when Putin was appointed over more senior KGB figures. ‘I support him 100 per cent,’ he said. [13]

But within a few months, another cloud appeared on Berezovsky’s horizon: the appointment of a new hardline Prime Minister, Yevgeny Primakov, former head of foreign intelligence. The timing was especially bad for Berezovsky. Ordinary citizens blamed the oligarchs for bankrupting the economy, Yeltsin was mentally and physically in decline, and, amid the tensions and continuing jockeying for position that dominated Yeltsin’s second term, Berezovsky’s power base was slipping further away. When the calculating but now vulnerable Berezovsky realized that the Yeltsin ‘family’ was warming to Putin, he swung his own media empire behind the new FSB boss, later leading the cabal that backed him as Prime Minister. In return, he expected Putin to be both compliant and loyal.

Berezovsky now began courting Putin, once even inviting him on a five-day skiing holiday in Switzerland. The two became friends. On one occasion Putin called Berezovsky ‘the brother he never had’. On 22 February 1999 – by which point state investigations into his business empire had already been launched – Berezovsky threw a birthday party for his new partner, Yelena Gorbunova. The party was intended to be a small, private gathering, but Putin turned up uninvited with a huge bouquet of roses. This appeared to be a genuine act of solidarity towards Berezovsky because they shared a common enemy in the form of Prime Minister Primakov, a man who disliked Putin because he had been chosen to head the FSB over the Prime Minister’s far more senior colleagues.

In July 1999 Berezovsky flew to France, where Putin was staying in Biarritz with his wife and daughters. By this time, Primakov himself had been dismissed by Yeltsin and replaced with an interim Prime Minister, Sergei Stepashin. The two men met for lunch and Berezovsky, now sidelined but still well informed about Kremlin politicking, told Putin that Yeltsin was about to appoint him Prime Minister. The following month, as predicted, Yeltsin dismissed Stepashin and appointed Putin. He was Yeltsin’s fifth Prime Minister in seventeen months.

At first Putin was deeply unpopular, with an approval rating of only 5 per cent, mainly because of his association with the despised figures of Yeltsin and Berezovsky. What turned his fortunes was a series of devastating Moscow apartment bombings in September that led to 246 deaths...Putin responded aggressively, first bombing Chechnya and then initiating a land invasion. Militarism played well with the Russian people and the Prime Minister’s popularity soared.

Putin’s newly formed Unity Party took 23 per cent of the vote in the Duma elections in December 1999, compared with 13 per cent by Primakov’s Fatherland All-Russia Party. Yeltsin, now close to the end of his presidency, capitalized on the new popularity and offered the top post to Putin. When asked to take the reins, Putin initially declined, but Yeltsin was persistent. ‘Don’t say no,’ he pressed. Berezovsky also urged him to accept. In his New Year’s Eve address in 1999 Yeltsin famously announced his resignation and Putin’s appointment as interim President. This gave him the advantage of being able to campaign as an incumbent President. Three months later, in the 2000 presidential election, Putin took a remarkable 53 per cent of the vote. Kremlin watchers satirized his success, comparing it to Chauncey Gardiner’s unwitting rise to power as President of the United States in Jerzy Kosinski’s 1971 novel Being There. Berezovsky, who had continued to use the media to publicly declare his support for the way that he believed Putin would run Russia, expressed delight.

Putin’s dramatic decision to take on the oligarchs within weeks of coming to power had been carefully planned. He knew he had to stem the disastrous outflow of capital and quickly encouraged the authorities to toughen up on the collection of taxes. He had come to two conclusions about the oligarchs.

First, as Yeltsin had also discovered, the oligarchs had the potential to be as – if not more – powerful than the President himself.

Second, because the vast majority of ordinary Russians loathed them, Putin knew there would be a beneficial political dividend in being seen to take them on.

Some oligarchs certainly had no shortage of enemies, among them the senior ranks of the security apparatus whose power had ebbed away during the Yeltsin years. They resented the way that these tycoons had sapped their own political strength and reaped a vast financial windfall. They saw them as upstarts. Few of them had served as senior officials during the Soviet era and they were viewed as outsiders. When Putin, so recently the head of the FSB, came to power, the security and intelligence apparatchiks, especially the ‘Chekists’, returned to favor. Of the President’s first twenty-four high-level appointments, ten were drawn from the ranks of the old KGB. This group, known as the siloviki – individuals with backgrounds in the security and military services – now saw their chance for revenge. ‘A group of FSB operatives, dispatched undercover to work in the Russian government, is successfully fulfilling its task,’ said the new President. He was only half joking.[14]

Putin also had a powerful collective ally in the Russian people. While the oligarchs enriched themselves, by the end of the 1990s the government could claim that as many as 35 per cent of Russians lived below the official poverty line.[15] Many felt that the nation’s resources had been sucked dry by what Karl Marx had referred to as ‘Vampire Capitalism’, whereby ‘the vampire will not let go while there remains a single muscle, sinew, or drop of blood to be exploited’.

To show how they feel, Russians love to tell popular jokes to foreign visitors.

‘A group of “new Russian” businessmen were meeting in a posh Moscow restaurant where the décor was of a very high standard. A waiter showed them to their tables and pointed out that the table was made of very expensive marble and that they should put nothing heavy on it, such as a briefcase. He went away to get vodkas and when he returned he was horrified to see a bulging briefcase lying on the table. ‘I thought I told you not to put briefcases on the table,’ he said. The man replied, ‘That’s not my briefcase. It’s my wallet.’

The oligarchs were only too aware of the widespread resentment. As Anatoly Chubais, Yeltsin’s Privatization Minister and chief political architect of the giant giveaways in the mid-1990s, acknowledged, ‘Forty million Russians are convinced that I am a scoundrel, a thief, a criminal, or a CIA agent, who deserves to be shot, hanged, or drawn and quartered’.[16]

CHAPTER 4

Hiding the Money

‘It’s like the Wild West out there [in Russia]. A few businessmen own everything. It’s amazing’ - STEPHEN CURTIS

...

BIBLIOGRAPHY

Matthew Brzezinski, Casino Moscow: A Tale of Greed and Adventure on Capitalism’s Wildest Frontier (New York: Free Press, 2001)

Zita Dabars and Lilia Vokhmina, The Russian Way: Aspects of Behavior, Attitudes, and Customs of the Russians (New York: McGraw-Hill, 2002)

Chrystia Freeland, Sale of the Century: The Inside Story of the Second Russian Revolution (London: Little, Brown, 2000)

David E. Hoffman, The Oligarchs: Wealth and Power in the New Russia (New York: PublicAffairs, 2003)

Ian Jeffries, The New Russia: A Handbook of Economic and Political Development (London: Curzon Books, 2002)

Paul Klebnikov, Godfather of the Kremlin: Boris Berezovsky and the Looting of Russia (New York: Harcourt, 2000)

Nick Kochan, The Washing Machine (London: Duckworth, 2005)

David Satter, Darkness at Dawn: The Rise of the Russian Criminal State (London: Yale University Press, 2003)

Martin Sixsmith, The Litvinenko File: The Life and Death of a Russian Spy (New York: St Martin’s Press, 2007)

Elinor Slater and Robert Slater, Great Jewish Men (New York: Jonathan David Publishers, 1996)

Joseph Stiglitz, Globalisation and Its Discontents (London: Penguin Books, 2002)

Strobe Talbott, The Russia Hand: A Memoir of Presidential Diplomacy (London: Random House, 2003)

INDEX

The pagination of this electronic edition does not match the edition from which it was created.

NOTES

Chapter 1

1 Michael Freedman, Forbes, 23 May 2005.

2 Guy Adams, Independent on Sunday, 17 December 2006.

3 James Harding, The Times, 13 March 2007.

4 James Meek, Guardian, 17 April 2006.

5 Sergei Guriev and Andrei Rachinsky, Ownership Concentration in Russian Industry, mimeo, October 2004.

6 Moscow Times, 30 January 2008.

7 Ibid.

8 Elinor Slater and Robert Slater, Great Jewish Men, Jonathan David Publishers, 1996, p. 60.

9 The Times, 7 September 2002.

10 Jonathan Dee, New York Times, 9 September 2007.

11 Forbes, 16 November 2006.

12 Mark Milner and Luke Harding, Guardian, 1 May 2008.

13 Dominic Midgley, Spectator, 8 October 2005.

14 Robert Service, Observer, 22 July 2007.

Chapter 2

1 D. Midgeley and C. Hutchins, Abramovich: The Billionaire From Nowhere, HarperCollins, 2005, p. 55.

2 From www.newyorkerfilms.com, October 2002.

3 BBC News Online, October 2002.

4 Financial Times, 1 November 1996.

5 Speech to the Frontline Club, June 2007.

6 Ibid.

7 7WPS Monitoring Agency, July 2002.

8 Paul Klebnikov, Godfather of the Kremlin, Harcourt, 2000, p. 118.

9 Oliver Harvey and Nick Parker, Sun, 16 March 2007.

10 Dominic Midgley, Management Today, 28 October 2004.

11 P. Gumbel, Time, 2 November 2003.

12 Chrystia Freeland, Sale of the Century, Little Brown, 2000, p. 117.

13 Michael Gillard, ‘From the Kremlin to Knightsbridge’, BBC Radio 4, November 2006.

14 Strobe Talbott, The Russia Hand, Random House, 2003, p. 207.

15 M. Kramer, ‘Rescuing Boris’ Time, 15 July 1996.

16 A. Cowell, The Terminal Spy, Doubleday, 2008, p. 56.

17 Kramer, op. cit.

18 Ibid.

19 Klebnikov, op. cit., p. 218.

20 Financial Times, 26 April 2003.

21 Talbot, op. cit., p. 207.

22 Klebnikov, op. cit., p. 201.

23 Talbot, op. cit., p. 207.

24

D. Midgley and C. Hutchins, Abramovich: The Billionaire from Nowhere, HarperCollins, 2004, p. 56.

25 Kommersant, 16 November 1995.

26

Andrew Jack, Inside Putin’s Russia, Granta, 2005, p. 83.

27 John Thornhill, Financial Times, 28 August 1998.

28 See, for example O. Kryshtanovskaya and S. White, ‘The Rise of the Russian Business Elite’, Communist and Post- Communist Studies, 38 (2005), p. 298.

29 Quoted in A. Osborn, ‘The World’s Richest Russian Is Sued for $3 billion in London’, Independent on Sunday, 25 February 2007.

30 Interview with Financial Times, 13 July 2007.

31 P. Boone and D. Rodionov, ‘Rent Seeking in Russia and the CIS’, Brunswick UBS, Warburg, Moscow, 2002.

32 Naomi Klein, The Shock Doctrine: The Rise of Disaster Capitalism, Allen Lane, 2007, p. 249.

33 Interviewed in Counterpunch, 27 February 2004.

34 ‘Question Time’, BBC Television, 7 June 2007.

35 M. E. de Boyrie, S. J. Pak and J. S. Zdanowicz, ‘Estimating the Magnitude of Capital Flight Due to Abnormal Pricing in International Trade. The Russia-US Case’, CIBER Working Paper, Florida International University, 2004.

36 Michael Freedman, ‘Welcome to Londongrad’, Forbes Global, 23 May 2005; see R. Skidelsky, St Petersburg Times, 4 January 2003; David Satter, Darkness at Dawn: The Rise of the Russian Criminal State, Yale University Press, 2003, p. 55.

37 Thomas L. Friedman, New York Times, 19 April 2000.

38 Nick Kochan, The Washing Machine, Duckworth, 2005, p. 17.

39 C. Freeland, Sale of the Century, Abacus, 2005, p. 180.

40 S. F. Cohen, Failed Crusade, Norton, 2000, p. 122.

41 ‘Why I Became a Russian Oligarch’, Financial Times, 29 June 2000.

42 Quoted in Observer, 30 August 1998.

Chapter 3

1 A. Goldfarb with M. Litvinenko, Death of a Dissident, Simon & Schuster, 2007, p. 206.

2

Vladimir Voinovich, ‘Russia’s Blank Slate’, New York Times, 30 March 2000.

3 D. Midgley and C. Hutchins, Abramovich: The Billionaire from Nowhere, HarperCollins, 2004, p. 114.

4 East Constitutional Review, vol. 19, no. 4, Fall 2000.

5 Moscow Times, 7 October 2003.

6 Goldfarb with Litvinenko, op. cit., p. 183.

7 Adi Ignattius, ‘A Tsar is Born’, Time, vol. 170, no. 27, 31 December 2007.

8 J. Laughland, ‘Putin Has Been Vilified by the West – but He is Still a Great Leader’, Daily Mail, 22 September 2007.

9 Vladimir Isachenkov, ‘New Putin Biography on Shelves’, Associated Press, 17 January 2002.

10 R. Polonsky, ‘The Spy Who Came in from the Cold’, New Statesman, 15 March 2004.

11 Speaking to the Frontline Club, 6 June 2007.

12 Ignattius, op. cit.

13 Goldfarb with Litvinenko, op. cit., p. 135.

14 ‘Leaders: Putin’s People, Russia’s Government’, The Economist, 25 August 2007.

15 Labour Minister Sergey Kalashnikov, news conference, 27 October 1999.

16 Interview with Anatoly Chubais, Der Spiegel, 25 September 2007.

17 Speaking on ‘Rich in Russia’, Frontline, PBS, October 2003.

18 ‘Aeroflot, an Oligarch and a Complex Business Deal’, Financial Times, 28 July 2000.

19 P. Klebnikov, Godfather of the Kremlin, Harcourt, 2000, pp. 286-7.

20 Goldfarb with Litvinenko, op. cit., p. 181.

21 Ibid., p. 182.

22 David E. Hoffman, The Oligarchs, Public Affairs, 2002, p. 487.

23 Goldfarb with Litvinenko, op. cit., p. 206.

24 Klebnikov, op. cit., p. 16.

25 Simon Bell, ‘Russian Billionaires Beware’, Daily Telegraph, 27 July 2003.

26 ‘Particulars of Claim: Boris Berezovsky v Roman Abramovich’, Commercial Court, High Court, 8 January 2008.

27 G. York, ‘Kremlin Tightens Muzzle on Media’, Toronto Globe & Mail, 21 November 2000.

28 Vanity Fair, July 2000.

Chapter

1

Jamestown news service, Eurasian Monitor, vol. 6, issue 214, 15 November 2000.

2 A. Goldfarb with M. Litvinenko, Death of a Dissident, Simon & Schuster, 2007, p. 237.

3 R. Kay, Daily Mail, 4 September 2008.

4 Patrick E. Tyler, ‘Russian Says Kremlin Faked “Terror Attacks”’, New York Times, 1 February 2002.

5

Ibid.

1 Keith Dovkants, Evening Standard, 3 March 2008.

2 G. Tett, ‘Russian Money Aids a Bear Market’, Financial Times, 7 February 1994.

3 C. Freeland, Sale of the Century, Abacus, 2005, p. 158.

4 Quoted in P. Lashmar, et al., ‘Russians in London’, Independent on Sunday, 12 September 1999.

5 Evening Standard, 11 March 2002.

6 Blavatnik was born in Russia but is now an American citizen.

7

Knight Frank and Citi Bank, Annual Wealth Report, 2007; the rise in the relative prices in London compared to New York partly reflects the heavy depreciation in the dollar in the last three years. Had the dollar remained stable, New York would now be worth around a quarter more in pounds per square foot.

8 Knight Frank, Country Review, 2007.

1 Quoted in Sun, 6 August 2007.

2 Quoted in Financial Times, 27 November 2004.

3 D. Midgley and C. Hutchins, Abramovich: The Billionaire from Nowhere, HarperCollins, 2004, p. 13.

4 Quoted in G. Rayner and O. Koster, ‘Putin “Told Roman to Clean Up His Act”’, Daily Mail, 15 March 2007.

5 Dominic Midgley, Spectator, 8 October 2005.

6 Observer, 24 December 2006.

7 T. Walker and R. Eden, ‘Roman’s Candle’, Sunday Telegraph, 29 October 2006.

8 Quoted in A. Blundy, ‘Cash and Caviar’, Guardian, 8 September 1994.

9 Quoted in L. Thomas, ‘Rich Russians Go on London Spending Spree’, Sunday Times, 13 February 1994.

10 Quoted in C. Toomey, ‘The Tsars Come Out to Play’, Sunday Times, 23 April 2006.

11 Quoted in Stefanie Marsh, The Times, 13 July 2006.

12 Quoted in K. Murphy, ‘Ruble Rousers’, New Republic, 4 February 2007.

13 A. Akbar and A. Osborne, ‘Harvey Nichols Goes East, Independent, 16 April 2005.

14 Quoted in Thomas, op. cit.

15

Ibid.

16

Quoted in V. Groskop, ‘Tsar Attractions’, Guardian, 19 August 2005.

17

Vogue, November 2006.

18

Financial Times, 8 October 2005.

1 International Herald Tribune, 10 March 2007.

2 Quoted in M. Taylor, ‘Salesroom Records Tumbled in a Frenetic Week’, Guardian, 23 June 2007.

3 G. Barker, ‘Party Could Run and Run’, Evening Standard, 9 February 2007.

4 Abigail Asher, Spear’s Wealth Management Survey, Art and Collecting Special, Spring 2007.

5 The Times, 22 August 2006.

6 Asher, op. cit.

7

Express on Sunday, 24 June 2007.

8 Quoted in The Times, 9 June 2007.

9

Ibid.

10

William Hazlitt, Political Essays, 1819.

11 Mike Von Joel, ‘After the Second Home, Mistress and Boat – an Art Collection, That’s the Thing’, State of Art, Spring 2007.

12

Ibid.

13

‘The Great Russian Art Boom’, Channel 4, 28 September 2008.

14 Ibid.

15

The Times, 22 August 2006.

16 Ian Cobain, ‘Usmanov’s responses to Guardian questions’, www.guardian.co.uk, 19 November 2007.

17

See note 1.

18

Andrew Osborn, Independent on Sunday, 11 June 2006.

19 Vogue, November 2006.

20

Stefanie Marsh, The Times, 13 July 2006.

21 Mail on Sunday, 18 March 2007.

22 Quoted in Sunday Times, 13 July 2008.

23 Anna Politkovskaya, A Russian Diary, Harvill Secker, 2007, p. 43.

24 Guardian, 27 February 2003.

25 Mineweb, 15 January 2007.

1 Michael Gillard, ‘From the Kremlin to Knightsbridge’, BBC Radio 4, November 2006.

2 Alan Cowell, The Terminal Spy, Doubleday, 2008, p. 174.

3 Russian money-laundering: hearings before the Committee on Banking and Financial Services, US House of Representatives, 21-22 September 1999, p. 191.

4 Khodorkovsky owned 28 per cent of Menatep, which, in turn, owned most of Yukos.

5 Thomas Catan, Financial Times, 16 May 2004.

6 Lucy Komisar, ‘Yukos Kingpin on Trial’, CorpWatch, 10 May 2005.

7 Gillard, op. cit.

8

Quoted in Mail on Sunday, 23 November 2003.

9

Gillard, op. cit.

10

Trade was another widely used means of siphoning off large volumes of money and defrauding Russia. Exporters would report selling at a price well below the actual price received and the difference would be stashed away in foreign bank accounts. Maria E. de Boyrie, Simon J. Pak and John S. Zdanowicz, ‘Estimating the Magnitude of Capital Flight due to Abnormal Pricing in International Trade: the Russia-USA Case’, Center for International Business and Educational Research Working Paper, Florida University, 2004.

11 Lucy Komisar, ‘While Washington Denies Any Problem, Swiss Probe “Missing” $4.8 Billion Loan to Russia’, Pacific News Service, 16 October 2000.

12 Simon Pirani, ‘Oligarch? No, I’m Just an Oil Magnate’, Observer, 4 June 2000.

13 Guardian, 15 December 2001.

14 ‘The Tycoon and the President’, The Economist, 21 May 2005.

15 Valentine Low, ‘Russian Oil Baron Builds £10m Bridge with West’, Evening Standard, 11 December 2001.

16 Guardian, 15 December 2001.

17 Lucy Komisar, ‘Yukos Kingpin on Trial’, CorpWatch, 10 May 2005.

18 Rachel Campbell-Johnston, ‘Walpole’s Coming Home’, The Times, 2 October 2002.

19 Rob Blackhurst, New Statesman, 31 January 2005.

20 Andrew Jack, Inside Putin’s Russia, Granta, 2005, p. 213.

21 Jack, op. cit., p. 310.

22

Quoted in Financial Times, 13 November 2003.

23 Quoted in Marshall Goldman, ‘The Rule of Outlaws Is Over’, Transition Newsletter, Vol. 14/15, 2004.

24

Kim Sengupta, Independent, 20 July 2004.

25 Spectator, 8 October 2005.

26

Sengupta, op. cit.

27

Quoted in A. Higgins and S. Liesman, ‘Markets Under Siege’, Wall Street Journal Europe, 24 September 1998.

28 Quoted in Nick Kochan, ‘Mammon: Russia’s Unorthodox Exile’, Observer, 26 March 2006.

29 Standard Schaefer, ‘Russia: Reforming the Reformers,’ Counterpunch, 27 February 2004.

30

Pirani, op. cit.

31 Schaefer, op. cit.

32

Paul Starobin, ‘A Russian’s Plea to Back America’, BusinessWeek, 14 March 2003.

33 Quoted in Independent, 12 January 2007.

34 Paul Klebnikov, Wall Street Journal, 17 November 2003.

35

See note 1.

36

Quoted in Peter Baker and Susan Glasser, ‘How Democracy Was Rolled Back in Russia’, Wall Street Journal, 8 June 2005.

37

‘Key Shareholder in YUKOS Granted Israeli Citizenship’, Haaretz, 5 November 2003.

1 Strobe Talbott, The Russia Hand, Random House, 2003, p. 207.

2 Quoted in ‘Worldbeaters’, New Internationalist, December 2003.

3 The Russian Godfathers: The Fugitive, Oxford Productions, BBC2, 8 December 2005.

4 David Charter and Philip Webster, ‘Groucho Trips up the G8 Spin Doctors’, The Times, 13 July 2006.

5 New Perspective Quarterly, September 2004.

6

Russian Godfathers, op. cit.

7 Dow Jones International News, 17 November 2003.

8 Tony Halpin, ‘Putin Critic Charged with Stealing $13 million from Bank’, The Times, 31 July 2003.

9 ‘There Is Nothing to Take Away from There’, Kommersant, 13 May 2005.

10 Quoted in Mark Franchetti, ‘Russian Threat to Reveal Putin’s Corrupt Aides’, Sunday Times, 24 April 2005.

11 Nick Paton Walsh, ‘Moscow Diary: Crime Pays’, Guardian, 2 April 2005.

12

Gordon Hahn, ‘Managed Democracy? Building Stealth Authoritarianism in St Petersburg’, Demoktratizatsiya, 12, no. 2, Spring 2004, pp. 195-231.

13 Paul Klebnikov, Godfather of the Kremlin, Harcourt, 2000.

14 Russia’s GDP in 2004 was $458 billion.

15 Y. Osetinskaya, ‘Thirty-Six Billionaires’, Vedomosti, 13 May 2004.

16 Ibid.

17

Olga Kryshtanovskaya and Stephen White, ‘Putin’s Militocracy’, Post-Soviet Affairs, 19, no. 4, (October- December 2003), pp. 289-306.

18

A. Cowell, The Terminal Spy, Doubleday, 2008, p. 48.

19 New York Review of Books, 13 April 2000.

20 Sunday Times, 23 December 2007.

21 Guardian, 13 April 2007.

22 Russian Interior Ministry News Bulletin, 11 December 2001.

23 ‘Worldbeaters’, op. cit.

24

Quoted in Michael Freedman. ‘Dark Force’, Forbes, 21 May 2007.

25 Minutes of Evidence Before the Foreign Affairs Committee, HC 495-iii, 18 July 2007.

1 According to some accounts, there were more than three Russians at the meeting, at least initially. See Alan Cowell, The Terminal Spy, Doubleday, 2008, p. 8.

2

Ibid., p. 22.

3

Viv Groskop, interview with Marina Litvinenko, Observer, 3 June 2007.

4 Ibid.

5

Sunday AM, BBC1, 10 December 2006.

6 Thomas de Waal, ‘Murder Most Foul’, Washington Post, 27 July 2008.

7 Gary Busch, a London-based transportation consultant, quoted in Bryan Burroughs, ‘The Kremlin’s Long Shadow’, Vanity Fair, 1 April 2007.

8 Martin Sixsmith, The Litvinenko File, Macmillan, 2007, p. 168.

9 Tom Mangold, ‘The Litvinenko Mystery’, BBC Radio 4, 16 December 2006.

10 Ibid.

11

Sixsmith, op. cit., p. 305.

12 Ibid., pp. 244-5.

13

Moscow Times, 24 April 2007.

14 Newsnight, BBC2, 7 July 2008.

15 The group of three was joined by another man, but only as Litvinenko was leaving. The man’s role remains unclear but he was not contaminated with polonium and is not believed to be a suspect.

16 A. Goldfarb with M. Litvinenko, Death of a Dissident, Simon & Schuster, 2007, Part V: The Return of the KGB.

17 Bryan Burroughs, ‘The Kremlin’s Long Shadow’, Vanity Fair, 1 April 2007.

18 Quoted in C. Shulgan, ‘I, Spy – Russia’s Most Wanted’, Toronto Globe & Mail, 31 March 2007.

19 ‘Litvinenko Poisoning: An Interview with Yevgeny Limarov’, Kommersant-Vlast, 25 June 2007.

20 Sixsmith, op. cit., p. 281.

21 Olga Kryshtanovskaya and Stephen White, ‘Putin’s Militocracy’, Post-Soviet Affairs, vol. 19, no. 4, 2003.

22 Sharon Werning Rivera and David Rivera, ‘The Russian Elite Under Putin: Militocratic or Bourgeois?’, Post-Soviet Affairs, vol. 22, no. 2, 2006, pp. 125-44.

23 Arkady Ostrovsky, ‘Yukos Crisis: Putin Oversees Big Rise in Influence of Security Apparatus’, Financial Times, 1 November 2003.

24 Ibid.

1

Quoted in Catherine Belton, Financial Times, 13 July 2007.

2 Keith Dovkants, ‘Abramovich Accused of £5 bn Shares Blackmail’, Evening Standard, 11 October 2007.

3 This account is as reported by Berezovsky. Abramovich and his representatives refused to comment.

4 Kevin Dowling, Sunday Times, 7 October 2007.

5 ‘Berezovsky v Abramovich’, [2008] EWHC 1138 (Comm) (22 May 2008) paras 4(e) and 2; ‘Particulars of Claim’, Berezovsky v Abramovich, High Court, 8 January, 2008, p. 17.

6 Dominic Midgley and Chris Hutchins, Abramovich: The Billionaire from Nowhere, HarperCollins, 2004, p. 239.

7 Eric Reguly, Toronto Globe & Mail, 12 November 2007.

8 Luke Harding, Guardian, 24 July 2007.

9

Belton, op. cit.

10 Ibid.

11

Andrew Kramer, New York Times, 20 August 2006.

12

Ruling by Justice Clarke, ‘Cherney v Deripaska’ – 2008 EWHC 1530 (Comm), Queen’s Bench Division, High Court, 3 July 2008, para. 58.

13 Belton, op. cit.

14

Quoted in ruling by Justice Clarke, para. 9.

15

Ibid., para. 9.

16 Ibid., para. 166.

17

Sabrina Tavernise, ‘Handful of Corporate Raiders Transform Russia’s Economy’, New York Times, 13 August 2002.

18

Rusal always claimed that the dispute between Cherney and Deripaska was a matter for them and not the company, making the company’s main owner the sole defendant.

19 Ruling by Justice Langley, ‘Cherney v Deripaska’ – 2007 EWHC 965 (Comm) – Case No. 2006 Folio 1218, Queen’s Bench High Court, 3 May 2007, para. 39.

20

Ibid., para. 45.

21

Ruling by Justice Clarke, op. cit., para. 264.

22

Ibid., para. 47.

23 Ibid., para. 10.

24

Benjamin Wegg-Prosser, Guardian Blog, Guardian, 23 October 2008.

25 Jon Ungoed-Thomas and Nicola Smith, ‘The Secret World of Lord Freebie’, Sunday Times, 10 October 2008.

26 Washington Post, 25 January 2008.

27 John Helmer, ‘Deripaska Settles Big London Claim to Speed Aluminium IPO’, www.johnhelmer.net, May 2007.

28 Quoted in Toronto Star, 13 November 2007.

29 ‘Jim Pettit: Immigration from Russia to the US Seems to Have Peaked and Is Now Falling’, Interfax, 2007.

30

Martin Sixsmith, The Litvinenko File, Macmillan, 2007, p. 135.

31 Belton, op. cit., 13 July 2007.

32 Nicolas van Praet, ‘Magna’s Man in Moscow Remains a Mystery’, Financial Post, 25 August 2007.

33 Financial Times, 19 July 2005.

34 Mail on Sunday, 30 April 2006.

35 St Petersburg Times, 2 May 2006.

36 Terry Macalister. ‘City Are Worried by the Rush to Float’, Guardian, 1 November 2006.

27 Independent, 27 June 2006.

38 Edward Lucas, ‘We Must Be Tough with the Despot’, Daily Mail, 13 July 2007.

39 John Helmer, ‘Cherney and Putin to the Rescue of Russian Aluminium’, Standart News Agency, 4 September 2007.

40 Belton, op. cit.

1

D. Robertson, The Times, 11 October 2008.

2 Geordie Greig, ‘Capital Gains’, Tatler, June 2007.

3

Independent, 17 December 2006.

4 Chris Blackhurst, Evening Standard, 30 April 2007.

5

Daily Mail, 1 May 2007.

6

Quoted in J. Sherman, ‘Super-Rich Barred as Kensington Keeps it in Family’, The Times, 14 November 2005.

7 Helen Davies, Sunday Times, 12 November 2006.

8 Sunday Times, 4 July 2004.

9 Quoted in K. Sekules, ‘The Best Town to Make an Upper Lip Stiff’, New York Times, 7 February 2007.

10 Editorial, Spear’s Wealth Management Survey, Winter 2006/7.

11 Rosie Cox, The Servant Problem, Tauris, 2006.

12 Financial Times, 27 October 2007.

13 See, for example, Doreen Massey, World City, Polity, 2007, chapter 2; Chris Hamnett, Unequal City: London in the Global Arena, Routledge, 2003; Greater London Authority, London Divided: Income Inequality and Poverty in the Capital, London, 2003.

14 Evening Standard, 6 July 2007.

15 Simon Parker and David Goodhart, ‘A City of Capital’, Prospect, April 2007.

16 Ajay Kapur et al., ‘The Global Investigator. Plutonomy: Buying Luxury, Explaining Global Imbalances’, Citigroup Equity Research, 14 October 2005.

17 Luke Harding, Guardian, 14 October 2008.

18

See note 1.

19

Guardian, 25 October 2008.

20 Andrew E. Kramer, New York Times, 18 October 2008.

Ibid., para. 9.

16 Ibid., para. 166.

17

Sabrina Tavernise, ‘Handful of Corporate Raiders Transform Russia’s Economy’, New York Times, 13 August 2002.

18

Rusal always claimed that the dispute between Cherney and Deripaska was a matter for them and not the company, making the company’s main owner the sole defendant.

19 Ruling by Justice Langley, ‘Cherney v Deripaska’ – 2007 EWHC 965 (Comm) – Case No. 2006 Folio 1218, Queen’s Bench High Court, 3 May 2007, para. 39.

20

Ibid., para. 45.

21

Ruling by Justice Clarke, op. cit., para. 264.

22

Ibid., para. 47.

23 Ibid., para. 10.

24

Benjamin Wegg-Prosser, Guardian Blog, Guardian, 23 October 2008.

25 Jon Ungoed-Thomas and Nicola Smith, ‘The Secret World of Lord Freebie’, Sunday Times, 10 October 2008.

26 Washington Post, 25 January 2008.

27 John Helmer, ‘Deripaska Settles Big London Claim to Speed Aluminium IPO’, www.johnhelmer.net, May 2007.

28 Quoted in Toronto Star, 13 November 2007.

29 ‘Jim Pettit: Immigration from Russia to the US Seems to Have Peaked and Is Now Falling’, Interfax, 2007.

30

Martin Sixsmith, The Litvinenko File, Macmillan, 2007, p. 135.

31 Belton, op. cit., 13 July 2007.

32 Nicolas van Praet, ‘Magna’s Man in Moscow Remains a Mystery’, Financial Post, 25 August 2007.

33 Financial Times, 19 July 2005.

34 Mail on Sunday, 30 April 2006.

35 St Petersburg Times, 2 May 2006.

36 Terry Macalister. ‘City Are Worried by the Rush to Float’, Guardian, 1 November 2006.

27 Independent, 27 June 2006.

38 Edward Lucas, ‘We Must Be Tough with the Despot’, Daily Mail, 13 July 2007.

39 John Helmer, ‘Cherney and Putin to the Rescue of Russian Aluminium’, Standart News Agency, 4 September 2007.

40 Belton, op. cit.

1

D. Robertson, The Times, 11 October 2008.

2 Geordie Greig, ‘Capital Gains’, Tatler, June 2007.

3

Independent, 17 December 2006.

4 Chris Blackhurst, Evening Standard, 30 April 2007.

5

Daily Mail, 1 May 2007.

6

Quoted in J. Sherman, ‘Super-Rich Barred as Kensington Keeps it in Family’, The Times, 14 November 2005.

7 Helen Davies, Sunday Times, 12 November 2006.

8 Sunday Times, 4 July 2004.

9 Quoted in K. Sekules, ‘The Best Town to Make an Upper Lip Stiff’, New York Times, 7 February 2007.

10 Editorial, Spear’s Wealth Management Survey, Winter 2006/7.

11 Rosie Cox, The Servant Problem, Tauris, 2006.

12 Financial Times, 27 October 2007.

13 See, for example, Doreen Massey, World City, Polity, 2007, chapter 2; Chris Hamnett, Unequal City: London in the Global Arena, Routledge, 2003; Greater London Authority, London Divided: Income Inequality and Poverty in the Capital, London, 2003.

14 Evening Standard, 6 July 2007.

15 Simon Parker and David Goodhart, ‘A City of Capital’, Prospect, April 2007.

16 Ajay Kapur et al., ‘The Global Investigator. Plutonomy: Buying Luxury, Explaining Global Imbalances’, Citigroup Equity Research, 14 October 2005.

17 Luke Harding, Guardian, 14 October 2008.

18

See note 1.

19

Guardian, 25 October 2008.

20 Andrew E. Kramer, New York Times, 18 October 2008.

FOOTNOTES 1 Mandelson wrote to The Times on 25 October 2008, ‘The Director-General for Trade in the European Commission, David O’Sullivan, confirmed… that I made no personal intervention to support the commercial interests of Mr Deripaska. Mr O’Sullivan explained… that in respect to both the nine-year debate in the EU over tariffs on raw aluminium and to anti-dumping duties on Russian aluminium, the decisions were made ‘after the usual consultation procedures had taken place, including with industry and all 27 European member states, and were based on sound facts.’

Appendix 2

Note, German CHRIS HELMBRECHT's account of moving to Russia, is right after September 11, 2001. In which he was in NEW YORK CITY when the World Trade Center fell. The original 2013 book is in German and is still available to purchase today on Amazon.com.

Cover

Copyright

© www.PaulEng.com

CHRIS HELMBRECHT, born in 1971, has been living in Moscow for ten years after working in New York and Tenerife. After a career as a [German] federal police officer and as one of the best extreme snowboarders in Germany, he now runs a creative agency and is one of the best-known party makers and DJs in the city. His blog on stern.de about the wild life in the Russian metropolis caused a sensation. He also writes for various magazines and is the initiator of the English language moscowblog.com. In 2012 he played the leading role in the Russian short film Ya Vernus (Eng. "I'll be back").

More about the author, the clubs and (night) life in Moscow:chrishelmbrecht.com moscow-blog.com

www.weparties.com

Chris Helmbrecht

Fucking Moscow!

Sex, Drugs & Vodka

WILHELM HEYNE VERLAG MUNICH

Preliminary remark

The following descriptions do not claim to be factual. They deal with typified people who could exist in one way or another. These archetypes become part of a work of art through the artistic design of the material and its classification and subordination in the overall organism and become so independent compared to the images described in the text that the individual, personal-intimate is objectified in favor of the general, symbolic of the figures. The text is recognizable for the reader, so the text is not exhausted in a reportage-like description of real people and events, but has a second level behind the realistic level, since the author plays with the entanglement of truth and fiction, which deliberately blurs borders .

Original edition 08/2013

© Chris Helmbrecht. This work was mediated by the literary agency Gaeb

© 2013 by Wilhelm Heyne Verlag, Munich, in the Random House GmbH publishing group Editor: Elly Bosl Cover design: Stefanie Freischem, yellowfarm gmbh using fotolia.com/tribalium81;istockphoto/fatmayilmaz; shutterstock/FashionB; shutterstock/Alex Moe

Set: Buch-Werkstatt GmbH, Bad Aibling

ISBN: 978-3-641-08381-6

www.heyne.de

Departure

Victor picks me up from the airport. It's gray and cloudy outside at minus 15 degrees. "Welcome to Moscow, the city of sin," he greets me.

Then we are chauffeured in his black Gelandewagen for two hours through the suburbs to the city center, past countless prefabricated buildings and tenements. The closer we get to downtown, the better the houses look. There is snow on the road, but the many dirty Ladas and Volgas drive as if it were summer and the roads were dry. In between there is always a luxury car, often with blue lights and security guards. There is jostling and printing, a miracle that there are no accidents. At some point we get stuck in traffic. The driver turns and looks at Victor without a word. He just nods. Then the chauffeur pulls the car to the right and drives onto the sidewalk. For the next few kilometers we roll past the traffic jam. Every now and then we have to stop at a traffic light, drive around a lamppost or pedestrians. Our driver honks and curses even as he shoos a woman with a stroller in front of him. I'm shocked. Victor just says, »Time is money. I have to get back to the office. If they catch us, we'll just pay a little bribe and then we'll be on our way."

Finally we arrive at Victor's house. He lives in one of the Seven Sisters, one of the Stalin skyscrapers from the 1950s. Victor shows me the apartment and immediately sets off again. "I'll pick you up after work," he says. "Make yourself at home."

When he's gone, I look out the window. The apartment is on the ninth floor and below me lies the city, shrouded in a gray veil of smog and cold. "What a shithole," I think. "This is by far the most terrifying city I've ever seen."

At the moment, however, I prefer this Odnis to Tenerife. Anything is better than the sunny pensioners' paradise where I was still working as Marketing Director a few weeks ago. Actually, everything was relaxed, but then one day one of my two bosses got in touch. "Would you come to my office, please?" he asked. I already suspected nothing good. A little later he actually said, 'I'm sorry, boy. You did a good job, but we didn't get the next round of funding. we have to let you go You are just too expensive. Please hand over your projects to the others. After that you can go.

Then I found out that I was getting paid for the next three months. I just nodded and walked out. Outside, on the office's huge terrace, it was sunny and beautiful. It was February, there was snow everywhere in Europe, but here the thermometer showed 20 degrees plus. I've been out here a lot lately, fleeing the cold and dark office for five minutes, soaking up the sun and looking out to sea.

"What the hell," I just thought. It was actually clear that things would not go well with this company for much longer. Somehow I didn't want to give up hope: after almost six years of working in New York and a terrible end, 9/11, the job in Tenerife was a welcome change. It wasn't a job anymore. What to do? I still had enough savings to last a few months. And the three paid months, including car and apartment. So look for a job again and then see where to go. My phone rang. On the display was a funny number "007... Ah, James Bond," I thought, trying to guess what country code that was.

"Hello Chris, how are you? This is Victor, remember?"

Of course, I remembered! Victor is an investment banker originally from Lithuania and one of my New York friends. We met two years ago on a ski trip in Vermont. In New York, Victor, who likes Italian girls, liked to come to the pasta dinners of my Italian girlfriend at the time.

I hadn't heard from him since then, other than a few irrelevant emails.

"Well, just lost my job," was my slightly depressed reply.

'Come to Moscow,' Victor said spontaneously, 'here the Russian bar is dancing and the ruble is rolling. In earnest. The economy is booming, the party life is amazing and I'm sure you'll find a job here. Actually, I'm calling because I wanted to come visit you. But for now it's best if you come to me first."

That's probably the famous hint, I thought as I sat down at the computer and looked up flights ten minutes later. A week later I was on the plane. Tenerife - Berlin - Moscow. And now I'm here. The first time Victor is trying his best. He takes as much time as he can. While he's working, his driver drives me around town and I go sightseeing. Or I visit strangers with whom Victor made appointments for me. I should get to know the city and make as many contacts as possible. Some of the meetings are already real interviews. But in the end it's always the same:

"Do you speak Russian?"

"No, a week ago I didn't even know I was going to Russia."

"Pity. Your CV is very good, but we can't use you if you don't speak Russian."

I'm not so sure anymore if I want to move here at all. The people on the street scowl. You never smile. It's the same in the offices. Except that the managers still have a considerable portion of arrogance.

"And how was your day?" Victor asks thoughtfully in the evening.

"Not so good. I don't think the city is for me. Neither do the people. Somehow I don't get along with the Russians."

“Bullshit!” replies Victor. “You just have to see behind the hard shell. There is a soft core there. And the women! Yes, they are very special. Come on, let's go to a bar for dinner and then for a drink."

It's been like this every night since I've been in Moscow. Victor takes me to one of the best restaurants in town. We eat and talk. At some point he flirts with the ladies at the next table, and then we go to a bar with the girls. Strangely enough, there are always a lot of girls sitting in the restaurants, usually in pairs in front of a pot of tea. Victor is practiced. He gets the girls ready within a few minutes and brings them to our table. I'm speechless. feel naive I don't know what to do with my interlocutor, because most of them don't speak English, and Victor soon loses interest in translating. In between he says things like: "Man, they're both really hot for you. I told them that you are a DJ living in Spain. On an island.” In fact, that's true. Except I'm not a pro DJ but the former manager of an Internet booth, and that the island is not called "Ibiza" and is not exciting, but that it is a matter of the pensioners' paradise of Tenerife. But how is Victor supposed to know that?

"Which one do you want?"

That's Victor's standard question, and my answer is pretty much always the same: "None."

I don't mean to be bitchy, but somehow the girls don't turn me on. I have a communication problem and I'm slowly getting enough of the city.

"OK, OK. Let's go to a club today."

Finally, something different. Our driver takes us there. When we arrive there are already Bentleys, big dark SUVs and big Mercedes limousines on the sidewalk.

"What's going on here?" I ask, excited like a little kid in front of a toy store.

"This is Shambala, Moscow's best place, and there's a private party going on at the moment."

"Do we have an invitation?"

"We don't have to," Victor replies a little arrogantly. We pushed past the crowd towards Tur.

Victor greets friendly.

The guy at the door shakes his head and says something like "Sorry, we're having a private party today" in Russian.

Victor reaches into his coat pocket and shakes the doorman's hand. He now nods in a friendly manner and pushes the grid away. Victor pulls me by my jacket into a dark, run-down courtyard.

On the left is a door, and from there you can hear the pounding of the bass. Yes, that sounds like a good party. Inside we hand in our jackets. I'm surprised that neither the club nor the cloakroom cost anything.

"How did you get us in anyway?" I ask Victor. He grins and pulls a 1,000-ruble note out of his jacket pocket before handing it over.

'It was even cheaper than I thought. I was counting on 2,000 rubles.' That's about fifty euros. "But then he let us both go for a thousand."

That's how I know Victor, the little rascal.

We go down the stairs. The club is not big but there are two dance floors. One is directly above the other and has a glass bottom. It appears to be closed today. There are a lot of teenagers downstairs. In the whole club, it seems, no one is older than 19, apart from the waitresses and a couple of bodyguards. Otherwise, Victor and I are already the oldest here at over thirty.

"Rich kids," Victor says. "I have no idea what the reason for the celebration is. Maybe it's a birthday, maybe a student party."

"And the luxury cars out there? Whose are they?"

"The kids, of course. Man, you're in Moscow. Come on, let's go get a drink. They're free today. The children of the rich pay too. Enjoy it."

Victor pursues his favorite pastime and hits on women. Or should I rather say "little girls"? I'm a little bored, but only briefly, because then I notice that two girls are dancing on the glass dance floor above us. Both are stark naked. After a while you probably can't call it "dancing" anymore, because they play, caress and kiss each other. And again and again they do the splits and press their vagina against the glass. I must have been staring quite a bit, because after a while Victor comes up to me and asks, "Why are you looking so stupid? It's normal here. Come on, let's go over to the stairs, we can see the spectacle better from the side."

"Are the girls here all clean-shaven?" I ask as I watch them chupa chup each other.

"Yes, that's usual," replies Victor confidently. One of the dancers is flirting with me, but I'm not sure if she's serious or if it's part of her show.

When I turn around, Victor has already chatted up two women.

"Hey, this is Chris from the Canary Islands," he introduces me. "He's a pro surfer and DJ."

Well, this time he almost got it right. After all, I used to be a professional snowboarder, so the sports equipment looks similar to a surfboard.

"This is Nastia and Sveta," he says. Both are barely older than 18, but look very elegant. They're not the typical suburban girls that Victor usually picks up. Lo and behold, both speak English. After a while I find out that Nastia's father is in the oil business and Sveta's father is a construction worker. I like the girls and I'm waiting for Victor's "Which one do you want?" question. But then someone pushes me from behind. I turn around, a girl is standing behind me. She is beautiful with blonde medium length hair and blue eyes. She must be in her early twenties. Somehow she doesn't fit into this society, her charisma is rather rural and naive. She has a cigarette in her hand and clearly asks for a light, although once again I don't understand anything.

"Sorry, I don't smoke," I reply, she turns away.

Somehow the girl looks familiar to me. When I try to get a closer look, she grins at me and pops a chupa chups in her mouth. I have to laugh and go over to her. We try to exchange a few words, but she doesn't speak a word of English. We can't get any further with hands and feet either. I turn to Viktor, but he's gone.

"Sorry, I have to look for my friend," I say. She smiles shamefacedly. "Do not run away."

Victor is standing at the bar talking to another woman. "What about Nastia and Sveta?" I ask.

"They both left pretty quickly when you went to see the blonde. They were only interested in you. But don't worry, I have a date for agreed on Sunday. Then it's R 'n' B Night at the Garage Club. It's a good club too. What was that blond angel?"

"That was one of the strippers. Come on! Come along. you have to translate We'll make it clear! And she also had a partner."

"Hm, that costs money," says Victor.

"Really? Do you think? I have the feeling that this can also be done without."

"Let's see," says Victor. But by the time we get to the corner where I left her, she's gone.

"Well!", says Victor, "Someone else was probably faster. Come on, let's go home. I have to work tomorrow."

I'm disappointed, but raved about the 'chupa chups woman' on the way home.

Today I liked Moscow for the first time.

Victor and Victoria

The next day Victor comes home earlier. We go to the supermarket around the corner to buy some food. The prices are steep, sometimes even higher than in the Big Apple.

"Moscow is one of the most expensive cities in the world," says Victor. He explains to me that Russia has a centralized structure and that Moscow is at the center. If you want to do business, you have to go to Moscow, whether you're selling timber from the tropical rainforest or diamonds from the Far East. So a lot of rich businessmen come to the city regularly. Many now even have their own apartments and offices here. Out in the open country there is nothing. If people find work there at all, they don't earn more than 200 euros a month, while here in the city they can get between 1000 and 3000 euros. And there is also the opportunity to make a career here. Young and pretty girls in particular are looking for a rich man who will marry them or keep them as mistresses and pay for them. You can shop cheaply in the markets and on the outskirts of the city, but the center is mostly populated by the rich and the middle class. Life here is correspondingly expensive.

Muscovites call everything up to the third ring road the center, although Europeans tend to think of the area inside the first ring, the so-called Garden Ring, as the center. In the largest country on earth, the dimensions are just different. Officially, Moscow now has around 11 million inhabitants, making it the largest city in Europe. However, Viktor tells me, there are still a few million illegal immigrants and Russians from other regions who mostly live in the suburbs and try their luck as taxi drivers, workers or even as criminals.

When we get home, Victor and I make tea. "Russians don't like coffee," says Victor in a slightly derogatory tone. That's actually always the case when he talks about Russians. Up until now, Victor has always been in my Russian drawer, because I met him through a group of Russians in New York. He is also fluent in Russian and looks typically Russian with his Slavic face and expensive designer clothes. If you ask him about it, Victor gets angry and quickly makes it clear: he is first and foremost a Jew, and Jews didn't have it easy under communism. After perestroika, the young among them could not wait to emigrate, and many took the opportunity to go to Israel. Victor originally comes from Lithuania, then moved to Israel and only studied there, then in the US. Today he has a Lithuanian and an Israeli passport. After his studies he was allowed to stay in the States and started his career as a banker.

"Just as I was starting to make some money, the crisis started. That's why I quickly accepted an invitation from a Moscow investment bank."

"And? Are you making good money now?' I ask. Victor doesn't like these direct questions. He looks embarrassed, but chance comes to his aid. The doorbell rings.

"Ah, these are the girls."

"What girls?" I ask.

'I forgot to tell you. My girlfriend is coming over and she's bringing a friend for you."

"You have a girlfriend?"

I didn't expect that after Victor hasn't missed an opportunity to collect phone numbers from complete strangers over the past few days.

Victor doesn't answer and opens up to the women. The usual procedure takes place in the corridor: the girls take off their heavy fur coats and take off their scarves, hats and gloves. Then they both go to the bathroom to get ready. In the meantime, Victor comes back into the kitchen and is grinning from ear to ear.

"You were lucky. Her friend is better looking than her," he says.

I just nod.

The way Victor talks about women always leaves me speechless. Actually, I am not a child of sadness and have already experienced a lot. But somehow I can't get going in Moscow. I don't know if it's the stranger, or the cheap come-on, or the fact that the girls get into it.

"Today it will be something. You lay them down! You've been here five days and you still haven't made any clear."

Something is happening outside. The girls come out of the bathroom. Both wear fashionable clothes, as for the club or a fine restaurant, not for home. I can see part of the hallway from the kitchen. I'm surprised when I see the two of them opening their large handbags, pulling out a pair of heels each, and putting them on.

"The women here are always very fashionable," says Victor. They also have to look good at home, especially when it comes to a date with an investment banker and his boyfriend. After a style check in the mirror, the girls enter the kitchen and are introduced to me. I feel kind of sloppy and underdressed, because I'm sitting at the table in loose jeans and a casual t-shirt. Worst of all are Victor's Gaste slippers. My grandfather could have owned it too.

"This is Victoria, my friend," Victor says. "And this is her friend, Marina."

I quickly discover that Victoria does not speak English. Marina knows a few words and we can at least talk a little. Victoria, I learn, is in her mid-twenties and comes from a town 500 kilometers southeast of Moscow. She studied business administration and now works for an insurance company. There she earns around 1000 euros. That's not much if you're not from Moscow and have to pay the exorbitant rents. That's where an investment banker like Victor comes in handy. He gives lavish gifts, pays for going out and goes shopping with her. If she's lucky, he'll even invite her on vacation. All this is not uncommon in Moscow. It is part of Russian culture for men to give expensive gifts to women. The more expensive the gift, the greater the love and the greater the affection of the woman. Victoria has brown eyes and brown curly hair. She's actually pretty. Her dress is an expensive original or a good copy of Dolce & Gabbana with a plunging neckline. She has lovely long legs and is wearing stockings, the lace trimmed end of which flashes briefly as she crosses her legs. At the end of the endless legs are fashionable high heels with the longest heels I have ever seen.

Victoria catches me eyeing her and grins cheekily. The face is friendly, but also has something wicked. She wears a lot of makeup, but that's also normal in Russia. whose lace-trimmed end flashes briefly as she crosses her legs. At the end of the endless legs are fashionable high heels with the longest heels I have ever seen. Victoria catches me eyeing her and grins cheekily. The face is friendly, but also has something wicked. She wears a lot of makeup, but that's also normal in Russia. whose lace-trimmed end flashes briefly as she crosses her legs. At the end of the endless legs are fashionable high heels with the longest heels I have ever seen. Victoria catches me eyeing her and grins cheekily. The face is friendly, but also has something wicked. She wears a lot of makeup, but that's also normal in Russia.

"Oh man, those Russian women," I think. “These are particularly pretty creatures. Or maybe rather sexy? A little bit useful too. No, not the vulgar form. More like a first-class call girl.”

Marina excuses herself and goes to the toilet for a moment. "Actually, I don't think they're that great," says Victor. "Who?" I ask.

"These," says Victor, nodding at Victoria with a false grin. 'But she's good in bed and I should have a girlfriend to help around the house and give me some stability. Otherwise I'd just be fucking around.” I'm shocked by Victor's openness to Victoria.

"Don't worry. She doesn't understand anything. She can't speak English."

I am silent and nod. "Maybe that's what you get from consuming one woman at a time," I think.

"Women are a dime a dozen here. It's crazy. As soon as you send one home, the next one is already in front of the door. There are always new ones coming. You're getting younger and younger. All are pretty and know what to do. They come from the suburbs or from the regions. There's a constant flow of supplies."

"Madness," I think. This is no longer real.

Marina is back. I haven't really warmed to her yet. She has long blonde hair and wears a dress in the same style as Victoria. I catch myself wondering if she's also wearing stockings.

"So, we'll leave you alone now," says Victor and goes into the bedroom with his girlfriend.

"Shall we go to the living room?" I ask Marina. "It's more comfortable there. do you want a drink Anything other than tea?”

"No thanks, I don't drink," she replies.

I take her by the hand and lead her into the living room. There we sit on the couch and talk. Marina is 27 and works as a doctor in a women's clinic. As a gynecologist, she earns 200 euros a month there. A six-year-old son is waiting for her at home.

“How do you manage in Moscow with so little money? And where's the father?' I ask.

“We have an apartment on the outskirts. My family owns it, so we don't have to pay rent. The father is long gone. He was a loser and I left him."

"Will he pay for the little one?"

"No. I don't even know where he is. Haven't heard from him in years. I'm making just enough to keep us both going. I also do abortions at the clinic. This is often used here. Especially in the suburbs.'

Suddenly we hear loud moans coming from the bedroom next door. It's getting louder and louder. No, it's not Victoria moaning, it's Victor. I'm a little under pressure, put my hand on Marina's knee and caress it. I slowly run my hand up her leg. She looks at me waiting. The moaning in the next room gets even louder and you can now hear the bed banging against the wall. We look at each other and suddenly have to laugh. Somehow I like Marina, but there is no erotic tension between the two of us. I realize my hand is out of place on her thigh and this woman deserves more respect. A single mother, she makes ends meet with a lion's will to fight. I could probably even sleep with her but that just doesn't feel right. I slowly take my hand off her thigh. She thanks me with an open and nice smile.

"Would you like some more tea?" I ask.

"No, I think I'm going home now. My little one is waiting for me. He is alone and it is getting late."

Marina changes shoes and packs up for the winter. I'll take her down to the street, get her a cab and pay for the ride out to the suburbs. Before she gets in, she kisses me tenderly on the cheek.

"You're a good one. I'm not sure if this city is for you. farewell I hope we'll see each other again," she whispers in my ear.

When I come back to the apartment, it's quiet. I drink a beer, look out the window and let my mind wander. Russia is a tough country. Not only because of the weather, but also because of the living conditions. no Moscow is not a city for me. Apart from the different culture and the shameless consumption, you have to earn a lot of money to be able to enjoy life here. I prefer to look for another city. Maybe I'll go back to New York... I look at the clock. It's time for bed, but first I'll make myself a cup of tea. As I wait for the water to boil, Victoria comes into the kitchen. She is in panties and has a t-shirt over it.

"Could you please make me one too?" she asks in English.

"What? Do you speak English?" I'm surprised.

"Oh, I guess I gave it away. Yes, I took several Business English courses during my undergraduate studies. But please don't tell Victor about it. He would probably be ashamed."

I don't think so, but it's probably better if I don't interfere in his affairs.

"No fear. Where's Victor?” I ask.

"He's all set and sleeping." Victoria grins contentedly. Then we sit together at the table and talk for a while. Your English is perfect.

Two kinds of protection FSB and Business

Two days later. We're meeting the two rich kids from Shambala for R 'n' B night at the Garage Club. Unusual cars are again in front of the door. This time they look like they came straight out of a Playstation game. Japanese and American street racers, pimped up to the point of no longer doing it. Almost all are painted in special colors, some decorated with elaborate airbrush motifs. It's cold outside and there's snow. Loud hip-hop blasts out of the cars, the doors are open and the owners of other cars and hot girls in clothes that are far too tight are standing around. It's still quiet in the club itself, apparently the warm-up is taking place outside. Victor's friend is a real estate agent and one of the owners of the club. We sit at the table with him and talk about the wild 90s in Moscow. Victor's friend distributed Red Bull in Russia until a few years ago. He says that one day he came home and the door to his apartment had been forced open. A couple of big boys were waiting in the apartment and they kindly asked him to hand over the distribution of the energy drink to them.

"It was the mafia," he says. There was no point in resisting - he signed. Now he has a better "kryscha," says Victor's friend.

"Krysha?" I ask.

Victor explains:

"IT MEANS 'ROOF,' AND THAT MEANS PROTECTION YOU CAN HAVE TWO KINDS OF 'KRYSCHA', THE SECRET SERVICE, IT USED TO BE THE KGB, NOW IT'S CALLED THE FSB. OR THE MAFIA. IT'S BEST IF YOU HAVE CONTACT WITH BOTH OF THEM. YOU NEED A "KRYSCHA" IF YOU WANT TO DO BUSINESS."

"From what order of magnitude?" I ask.

"I think you get on their radar, usually by the IRS or your competition, if you're making more than $250,000 a year. Before that, you're too small for one number and they won't bother you unless you're disrupting one of their charges' business.'"

"Interesting. How do I have to imagine that in concrete terms?”

"It's like a tax. You give away a certain percentage of your profit or sales. Sometimes it is the whole business if it disrupts their activities or is very profitable."

Victor's friend adds: "An acquaintance of mine has invested in a computer tomography scanner in a town 300 kilometers outside of Moscow. That was the only device far and wide and became a gold mine. It didn't take long for word to get around and the mafia was at his door. They just took the thing from him. Thank God the device ran long enough to recoup the acquisition costs. So he didn't lose any money, but he didn't win any either."

Then our two girls finally come to our table. They move gracefully like models and I wonder how many hours they've practiced in front of the mirror. Victor's friend says goodbye. He has to go home to his wife, he says. Nastia and Sveta look even better than a few days ago. We'll order a few drinks and talk. Unfortunately, the conversation is superficial, arrogant and just too shallow for me. We only met briefly at Shambala, but the girls there were very different. It must have been the alcohol - either my level or hers. After a while I get bored with the chatter. I decide to go to the bar. First to get a drink, but maybe I can find better entertainment there. The club is slowly filling up but apparently it's still too early. Well, it's half past midnight on a Sunday night. What to expect Victor said the club fills up after one o'clock. Let's see.

"Barkeeper! Another Red Bull vodka, please.” Two women are sitting at the bar. A dark blonde with a good figure and a pageboy cut and a small brown-haired woman with slightly Asian eyes. Should I speak to her? No, there's bound to be something better. The bartender puts my drink at the bar for me and then talks to the girls. They seem to be friends. I decide to pretend to wait for my drink a little more. I just can't go back to our table. Suddenly Victor is standing in front of me.

"Man! These women are so stupid. That is not how it works."

I nod.

"What about these two?" he asks. I shrug disinterestedly, but Victor doesn't even wait for my answer before addressing the two of them. I can already imagine what nonsense he is talking about again. This is Chris, superstar, DJ, helicopter pilot and so on. After five minutes he turns to me: “These are two ballerinas from the Bolshoi Theater. Great, is not it? Which one do you want?”

"If I have to, I'll take the blonde," I answer sullenly. The constant teasing is getting on my nerves. The brown-haired girl, I learn, is called Lili and is the daughter of one of Russia's biggest mafia bosses. Lili isn't particularly tall, a bit more powerful, and you wouldn't think at first glance that she was dancing in the best ballet in the world. She has a Russian pop star as a boyfriend and is part of Moscow's better society.

Victor grabs my hand and pushes me to the blonde. »This is Julia, she is also a ballerina at the Bolshoi.«

He says it so proudly, as if he has known Julia since childhood. We introduce ourselves and shake hands.

“So, ballerina at the Bolshoi. Is that a big deal?” I ask. She immediately lectures me: "The Bolshoi is the best ballet in the world."

“These are stars!” adds Victor.

“Ah, sorry. I'm an art philistine.” She takes it easy. Then I casually add, "But I've had a ballerina girlfriend before. Back in New York. She was with Alvin Ailey, but that's more modern dance." Victor finds that the two rich goren have moved on.

"Shall we sit down at the table again?" he asks. The two girls are interested and come with me. Then we talk the rest of the night.

Julia is interesting and at first I didn't realize what a top physique she has. She is 24 years old and has been dancing at the Bolshoi since she was young. Her mother was a prima ballerina herself and now trains her. Her stepfather was the director of the Bolshoi, but is already retired.

Also, Julia had been dancing in Valencia for six years before coming back.

"What? Volunteering from Spain to Moscow?” I ask.

“Like I said, the Bolshoi is the best group in the world, and Moscow is my hometown. I wanted to go back, but today I sometimes regret the step. Maybe I'd be happier in Spain.'

As it turns out, Julia speaks very good English and fluent Spanish.

"The manager here is our friend," she explains. “We're here almost every Sunday because we have to dance over the weekend. Our day off is Monday.«

'Ah, that's good. I work tomorrow and Chris flies back on Wednesday. He could use an English-speaking guide,” says Victor.

Julia isn't too enthusiastic about the idea: »Let's see. Maybe,” she simply replies.

Around three o'clock in the morning it's time to go home. Lili has her own driver who is waiting for her outside in the black BMW 6 Series. Julia accepts Victor's offer to drive her home. He sits in the front with his driver while I talk to Julia in the back. "Can I see you again before I go?" I ask cautiously.

"Here's my number, call me tomorrow and we'll see." When we get there, I get out first and open the door for her. She likes that and gives me a kiss on the cheek to say goodbye. Then we drive to Victor's and I text her goodnight. She does not answer.

"So what do you think of them?" asks Victor.

'I wasn't interested at first. But when I spoke to her, I realized how beautiful and charming she is. And she's intelligent too. Great woman!"

"Someone has a crush on them, huh?” Victor replies.

"Crush? That would probably be an exaggeration. But she certainly impressed me and is the best girl I have met in Moscow so far.

"Well, maybe there'll be something with that Moscow one-night stand after all..."

'Not so sure. She said she has a boyfriend."

"That doesn't mean much here," Victor replies.

The next day I call Julia, but she doesn't answer the phone. After three attempts I give up, I don't want to be pushy. In the evening Victor is more disappointed than I am. He really wants me to have sex before I fly back to Spain. Somehow I have a feeling he's looking for a boyfriend to go around town with and pick up women with. Therefore, if I had a reason to come back to Moscow, he would be quite pleased. However, I'm not sure if a one night stand would be reason enough to move to this horrid city. I used to compare New York to Sodom and Gomorrah, but Moscow seems a thousand times worse and far more decadent.

The next day I text Julia again. I would really like to see her before I fly back. During the day, however, there is radio silence, I am disappointed. Maybe Victor is even right about me having a bit of a crush. When Victor finally gets home from work, we go to a sushi restaurant. On the way he calls Lili and tries to invite both of them. When he hangs up, he grins: "They're just dancing, but we'll meet them after their performance and go for a drink."

I am content and thinking about how to behave. Around eleven we meet the girls in a bar. I flirt with Julia like a champion and I'm successful. First she takes my hand, then we get closer. When Lili wants to leave, Victor takes the initiative and invites them both over. Lili and Julia are coming with me. We'll keep drinking at home. Victor entertains Lili so that she doesn't leave too early. When Julia and I finally kiss, Lili goes home and Victor goes to bed. Finally we have time for ourselves. The night is spent! We're having sex and it's the best we've had in a long time. Then we lie in bed together and talk. When I hold Julia in my arms, I feel energy flowing between the two of us. It goes so far that we both start to tremble and then press each other even tighter.

She has to leave at eight o'clock: "I have to be at training at ten and before that I have to go home and get ready."

"Will it work?" I ask with a bad conscience.

"It has to be, but it was worth it," Julia purrs contentedly, and we say goodbye with a long kiss. Then I pack my things. Meanwhile, Victor comes out of the bedroom.

"Well finally! Chris scored. But that was on the very last printer."

"And not only that...Now I actually have a bit of a crush. The woman is just great and in bed a bomb."

"Well then I can send you home with peace of mind, right?"

An hour later we are already on our way to the airport. It's snowing badly. Again we drive on the six-lane outer ring road, the MKAD, past the prefabricated buildings of the suburbs....

Appendix 3

Why Russians Don’t Smile: A Guide to Doing Business in Russia and the CIS Countries

4th Edition

Luc Jones

Why Russians Don’t Smile

4th Edition

Acknowledgements:

We would like to express our thanks to everybody who contributed comments, articles and general advice for our publication. Additionally we are extremely grateful to our sponsors for their support which helped to make this book possible.

Limitation of use:

Please note that commercial use, distribution, reprint or publication of all or any parts of the book is prohibited without prior written authorisation from the author. Reference to the author is obligatory when quoting any content from this publication.

Author: Luc Jones

Project manager: Evgeniya Gonzales

Designers: Ekaterina Gnidina, Nataliya Demkina

Published by: Intermark Relocation

7/1 Kropotkinsky Pereulok

119034, Moscow, Russia

+7 495 502 95 53

www.intermarkrelocation.ru

Moscow, 2020

Luc Jones Why Russians Don’t Smile 4th edition

Chapters

I. Scope of this book

II. Introduction to Russia and the CIS region

III. Expatriates in Russia

IV. Travelling to and around Russia and the CIS countries

V. Foreign assignments and hiring locally

VI. Behavioral differences faced by Expats

VII. Cultural differences

VIII. Language barriers and deciphering names

IX. Doing business part 1

X. Doing business part 2

XI. Entertainment in Russia

XII. Life in Russia - how Russians live

XIII. How Russians view foreigners

XIV. Charity, Corporate Social Responsibility

XV. Life outside of Moscow and St Petersburg

XVI. CIS focus - the ‘other’ Republics

XVII. Public Holidays in Russia

XVIII. Useful contacts

XIX. Glossary of Terms and Acronyms

About the author

Luc Jones

Luc Jones was born in Huntingdon, UK in 1973 to a British father and a French-Canadian mother and grew up in West Devon. His first trip to Russia was while still at high school in Tavistock: a week in Moscow and Leningrad in February 1991, followed by a year studying in Moscow and Yaroslavl in 1993/4 during his degree – Russian and Soviet Studies at The University of Portsmouth, UK. After a brief spell teaching English in Moscow in 1995/6, Luc joined ITE Group Plc (one of the world’s largest exhibition and conference organizers), working on the Moscow Motor Show.

Luc’s life in recruitment began with Antal in Warsaw in 1998 where he worked for 2 years, covering Poland and the Baltic States. He then joined CRM giant Siebel Systems (now part of Oracle) based in Prague, responsible for the CEE region, Turkey and South Africa. Moving back in Moscow in early 2002 with Antal, Luc worked his way up to Partner and Commercial Director before he joined Fircroft at the start of 2019 as Regional Sales Director for the CIS countries.

An extensive traveler, Luc has visited 145 countries including all 15 former Soviet Republics and continues to discover new places of interest throughout the world. Luc lives in Moscow and plans to do so for the foreseeable future, yet travels extensively throughout the CIS. Luc speaks Russian fluently in addition to his native English and has a very good knowledge of (Quebecois) French, Polish and Spanish.

I. Scope of this book

What does it cover, whom is it written for and why

THIS BOOK HAS BEEN WRITTEN AS A GUIDE FOR THREE MAIN GROUPS:

Expatriates who have recently relocated to Russia/CIS (or are considering doing so in the nearest future) or live in their home country but visit on a regular basis. These are usually senior management of multinational corporations who are typically spend 3-4 years on a particular assignment before moving on or back home, or perhaps having been assigned this part of the world as a part of their overall territory.

People who perhaps don’t visit Russia/CIS often (or ever at all) but cover the region as part of their remit – this group includes human resources and recruitment managers, finance directors and even some CEOs. Since many multinational organizations use their European office to spearhead development and growth in the CIS region, this book has been written from the perspective of a Western/Central European manager.

Russians and citizens of other CIS countries who are interested in how they and their countries are perceived by foreigners. This is especially the case for those working for a multinational company, or perhaps for a local organization which is expanding into new markets abroad. If they report to a foreigner (based locally or abroad) or work with them on a regular basis, they can be more aware of potential pitfalls that they wouldn’t normally consider.

This book makes no apologies for being very much from a UK/European perspective as this has traditionally been the main target audience. Even US or Asian multinationals are likely to make business decisions for the CIS region from an office in Europe, for geographical and cultural reasons. However, this is not to say that North Americans, Africans, Asians, those from the Middle East or in fact anyone even remotely connected to the CIS might not benefit from reading this book.

The focus is primarily on Moscow although several chapters are devoted to other parts of Russia, such as St Petersburg and the Far East, plus all the CIS countries. Additionally this book does not claim to comprehensively cover every aspect of doing business in Russia/CIS, be it cultural, economic, business or social. An entire encyclopedia could be (and in many cases has already been) written on every single topic. Rather this book is meant as a guide for those new to this part of the world who wish to have an easy to read guide that they can quickly refer to, rather than having to read through a ‘War and Peace’ length novel.

THERE IS A SAYING THAT FOREIGNERS CRY TWICE – FIRSTLY WHEN THEY ARRIVE IN RUSSIA, AND SECONDLY WHEN THEY LEAVE IT.

Probably the biggest and most common mistake which foreigners make is that they assume that since Russians look like we do, they automatically think like we do. They don’t. Read on to find out more…

GETTING IT WRONG

The cost of failure can be high so you need to do your homework before setting out. Russia is not a country where you can just show up and make a fast buck – you need to be in it for the long term. Some have tried and failed, but many more have done extremely well in Russia. See also chapter 5 for whom to hire, how and why. One of the most frequent reactions to the first three editions of this book from Russians themselves has been that foreigners will read it, but ignore much (or all) of the advice given because they still think that they are smarter. Do yourself a favour and don’t fall into this category.

II. Background to Russia/CIS Geography, history, religion, nationalities and initial stereotypes

GEOGRAPHY

You don’t need a University degree in Geography to know that Russia is not only the world’s largest country (even after the demise of the USSR), but covers one eighth of the earth’s land mass. It’s a vast territory although the majority of visitors and Russians alike see precious little of it. It spans nine time zones (until recently it was eleven, but was scaled back) yet cities thousands of miles apart look remarkably similar thanks to the Soviet uniformity of buildings. One of the key reasons for this concrete ubiquity is that until the 1917 October revolution, many of today’s towns and cities were little more than remote villages that were changed forever during Stalin’s industrialization policies of the 1930s. For ease of understanding, the country is generally broken down into three geographical zones:

Since European Russian is by far the most populous area, this region itself is divided up into five parts:

Moscow and the surrounding area (often referred to as the Golden Ring)

St Petersburg & North-Western Russia

The Volga Region

The South, which includes the Caucasus

The Urals, which form the border between Europe and Asia

Few people agree (apart from the geographical border between Europe and Asia) as to exactly where one area stops and the next one starts, so these are given more as a general guide.

European Russia

Siberia

The Far East

HISTORY

There are entire libraries devoted to Russia’s rich history, and one would do well to acquaint themselves with at least the basics of twentieth century Russian history for a broader understanding of where the country is today, and why.

From a business perspective, it is crucial to understand that Russia has come a long way in a very short space of time – it can be hard to imagine that little more than a generation ago, the whole essence of doing business as we know it was not only an alien concept, it was in fact highly illegal. There are complaints both from inside and outside of Russia that far too many people are still employed by the State – estimates vary but it’s rumored to be around 50% even if the official figure is considerably lower. Putting things into context however, until the fall of Communism, the figure (officially at least) was 100%.

Westerners are raised in a society where everyone is constantly trying to sell you something, advertising is everywhere, choice is the norm and the whole ethos of life is geared around making money. Russia and the former Soviet States are very much emerging markets without a history of commercial business. During Soviet times you typically bought what they had on sale regardless of whether or not you actually needed it as it probably wouldn’t be there tomorrow, and you could then quietly sell it on, or trade it off sometime down the line. The inefficiency of the planned economy led to chronic shortages of even the most basic consumer goods as efforts were ploughed into heavy industry and military production. As a result, a massive grey economy emerged as Soviet citizens showed their resourcefulness in obtaining supplies that weren’t available through normal channels (ie, shops). Previously your standard of living depended not only on your salary, but on your connections and clout (known in Russian as ‘blat’ or ’svyazi’) either personal, or via the workplace. Your physical location – Moscow was always considered the showpiece of the USSR (see the ‘Moscow vs the Rest of Russia’ piece below) meant better access to goods and services, and also your line of work; those in the military, even serving in remote locations were always well fed.

A joke from the Communist era sums up both the influence and the necessity of the Soviet grey economy rather aptly: A senior American and Soviet diplomat meet and are discussing salary levels and standards of living in their respective countries. The American proudly boasts that “in the United States of America, the average salary is $25,000 per year, and $15,000 is needed to survive, but we don’t care what he spends the remaining $10,000 on.” The Soviet diplomat replies, that “in the Soviet Union, the average salary is 2,000 RUB per year and the amount needed to survive is 5,000 RUB, but we don’t care where he finds the remaining 3,000 RUB!” The result today is that Russians maintain a high sense of loyalty to those that they deem close to them, such as their friends (especially those made during student days), former colleagues and family members – you will notice how Russians often refer to a cousin as a brother or sister. This is manifested in how Russians make hiring decisions in the workplace; ‘po rekomendatsii’, based on a trusted recommendation. This might strike Westerners as a classic case of cronyism, or even corrupt practices. Russians view it somewhat differently, as working with a reliable and trusted partner who can be called upon to be sure to get a job done. See chapters 9 and 10 for more information on doing business in Russia.

I ONCE ASKED A RUSSIAN ‘WHY IS THE AIM OF SOCIALISM TO MAKE EVERYBODY POOR?’ – HE DRYLY RESPONDED ‘THAT’S NOT THE AIM, BUT THAT’S CERTAINLY THE RESULT!’

RELIGION

The majority of Russians will claim adherence to the Eastern Orthodox Church, even if few actually attend services. The communist period was officially atheist and religious buildings were at best left to decay or reused for other purposes, such as storage, or in extreme cases, destroyed. Fortunately, slowly but surely some are being restored to at least part of their former glory, evident by the increasing beauty of onion domes on the horizons of many Russian cities, towns and even villages. It is interesting to observe that many drivers in Russia have mini Orthodox icons on their dashboards, especially in Russian-made cars – possibly a testament to the atrocious standard of driving in Russia and the high death rate on the roads. Few are aware that Russia has more Muslims than the rest of Europe combined – anywhere between 10-20 million, depending on which statistics you believe. However, the Sovietization policies resulted in heavy integration with surrounding Slavs, so most are moderate (Chechnya and Dagestan being the notable exceptions), and there is also a significant Buddhist minority in Kalmykia (southern Russia), the Altai region close to Mongolia and Buryatia (in Eastern Siberia, by Lake Baikal). The blatantly anti-Jewish policies of the Soviet Union resulted in a significant number of Jews emigrating (mainly to Israel and the USA) but many remain, and often occupy senior positions in large, local businesses. Nevertheless, it should be emphasized that whilst some take their faith seriously, Russia is a secular State and not an openly religious country. Whilst Russians are well aware of other faiths, it is rarely brought up as a topic of conversation. New Year’s Eve is celebrated with considerably more vigour than either Christmas or Easter.

NATIONALITY

It is worth spending a moment or two on this as to Russians, one’s nationality and ethnicity means much more than it does to westerners. For starters, Russia is the ninth most populous nation on the planet, yet is far from being a homogenous country. You would be forgiven for assuming that this is a Slav-only place, and whilst Slavs certainly dominate, there are well over a hundred separate nationalities, ranging from Tatars who boast over five million, to the Evenki people in the far north-east of Russia whose numbers are in the tens of thousands. Despite Soviet attempts (in some areas considerably more ‘successfully’ than others) at wiping out individualism, effort was made to glorify the benefits of being a Soviet citizen, people will proudly tell you that they are ethnically Armenian/ Bashkir/Chuvash/Dagestani, albeit one that was born in Russia. Russians use two words to describe the people who live in Russia (not including Expatriates, tourists or migrant workers). This may strike Westerners as rather bizarre, and possibly even derogatory since someone of Indian parentage who was born and brought up in the UK would almost certainly consider him/herself as British, and anyone who has received their Green Card to the USA can quite proudly call themselves an American.

===RUSSKIY – REFERS TO PEOPLE WHO ARE CONSIDERED TO BE ETHNICALLY RUSSIAN ROSSIYANIN – REFERS TO PEOPLE WHO LIVE IN RUSSIA (OFTEN FOR GENERATIONS) BUT ARE NOT NECESSARILY ETHNIC RUSSIAN===

Not so in Russia, and you will even hear people say ‘I’m not Russian, I’m Jewish’. Consequently some Russians can find it hard to comprehend how a black guy could be British or an Arab could be French. Obviously this is less likely to be the case with Russians who have lived, or travelled extensively abroad, but if you are of non-Caucasian origin, it’s worth bearing this in mind when visiting Russia as unfortunately some prejudice does exist. Whilst this is almost exclusively aimed at migrants from some former Soviet Republics (particularly Central Asia and the Caucasus) some Russians – especially in more remote regions, are unused to seeing anyone who doesn’t look like them, so although you are unlikely to encounter any outright hostility, do expect to be stared at.

Few are aware that Russia has more immigrants than any other country in the world after the United States. However, the overwhelming majority of these come from the former Soviet Republics, and there is some resentment of their presence – especially in Moscow where many head for. The fact that unemployment in Russia’s capital is low, and they are employed to do menial jobs that Russian don’t seem to want to do at salaries that Russians wouldn’t even consider getting out of bed for appears lost on many ethnic Russians. Do be aware that the word ‘Caucasian’ to Russians (pronounced ‘Kavkaz’ in Russian) refers to dark-haired people from the south of Russia (notably Chechnya, Dagestan and Ossetia), plus also the former Soviet Republics of Armenian, Azerbaijan and Georgia. It DOES NOT mean ‘white’ in the European sense.

MOSCOW VS THE REST OF RUSSIA

In Western culture, we usually begin introductions with asking someone’s name, and then where they are from. Non-Muscovites living in Moscow can be uncomfortable when faced with this question, and may either not reply, answer simply “I’m from Russia” or say that they are from Moscow, even if they arrived only recently. The exception is St Petersburgers, who view themselves as culturally more advanced, and are the only Russians who look down upon Muscovites, as brash. See chapter 15 for more information on life outside of Moscow and St Petersburg. Average living standards were higher in Moscow and Leningrad (as St Petersburg used to be called) than elsewhere in the USSR, and it is also where the best higher educational establishments were, so this is where Soviet citizens strove to move to. The USSR had a residency permit system, known as a ‘propiska’ which allowed you live and work in a certain part of the country, and the authorities dictated who lived where, and who was allowed to move where, and when. In practice it was a clever and useful tool for the state to control the population as it heavily restricted even basic freedoms, Russia has suffered from a severe housing shortage since Stalin’s industrialization policies that began in the late 1920s and which forced the masses from the countryside into urban areas. Nowadays the system still exists, although it is much less enforced than before, yet you may observe a slight superiority complex amongst Muscovites when in the company of out-of-towners, colloquially known as ‘limitchiki’. There is more than a grain of truth in the joke that when Russian girls from provincial towns arrive in the capital, their preference is for a husband who has a propiska. This is beginning to change, as wealthier Russians choose to move out from a polluted downtown Moscow to greener areas outside the city limits. Russia is a very centralized, top-down society and despite Vladimir Putin hailing from St Petersburg, Moscow is where the bulk of business decisions are made, and naturally where the wealth is concentrated.

FAQs FOR PEOPLE PLANNING TO VISIT RUSSIA FOR THE FIRST TIME: What’s Russia like?

Whatever you’ve ever read in the international media or seen on TV, either ignore it or believe the opposite. Most people’s first comment upon arrival is “oh wow, it’s normal. I had no idea it would be like this”. Bottom line, come with an open mind and you’ll be pleasantly surprised. Is it always cold?

It does get cold (if you’re concerned about global warming, come to Russia in the winter) but summers can be scorchingly hot, with spring and autumn seeming to last only a few weeks. However, buildings are well heated, often excessively so and it’s a drier cold than in Europe, so if you wrap up in appropriate clothing, you’ll be fine. Do you have to drink heavily to do business?

A lot of vodka does get drunk, although beer has in fact overtaken the clear stuff as Russians’ choice of tipple and wine and cocktails are increasing in popularity amongst the middle classes. Granted, there may not be many abstainers and Russians still refer to vodka as ‘water of life’ but there’s more sobriety than you may think. Lunchtime drinking in the corporate world is almost unheard of – see chapter 11 for more on entertainment after working hours.

Is Russia dangerous?

In a nutshell, no. Stories about the fabled Russian mafia might make great headlines for lazy journalists but the days of shootouts in broad daylight and kiosks being blown up are long gone, and were in fact highly exaggerated in the first place. Sure, Moscow has its fair share of petty crime like any other big city, but the majority of incidents against foreigners occurs due to drunken misunderstandings with the Police or taxi drivers (and/or with recently-met local women when under the influence).

Speaking some Russian or having a Russian friend/colleague generally prevents such issues as does local knowledge and not acting as though you’ve just arrived in town. Russians will tell you to avoid the outskirts of Moscow at night but there’s no reason for you to be there anyway, and the centre of Moscow or St Petersburg is probably safer than your hometown after dark.

====How will I get around if I can’t understand the funny writing?====

Russian uses the Cyrillic alphabet, as do nearby Belarus, Bulgaria, Ukraine, Kazakhstan, Kyrgyzstan, Tajikistan, Mongolia and parts of the former Yugoslavia. It’s much less daunting than it first appears (some of the letters are the same, or similar to their Latin equivalents) and English language signage is on the increase, particularly in Moscow, St Petersburg and other places where foreigners may venture, such as airports. The World Cup in 2018 and the Sochi Winter Olympics in 2014 were just two examples of high profile events which improved matters considerably. You will even see Chinese characters in some places, in response to Russia’s drive to increase both business and tourism from the People’s Republic. See Chapter 8 for more information on learning the local language. Isn’t the country far too corrupt to be able to do business transparently?

Many of the world’s largest & best known multinational organizations are present in Russia, and run successful, profitable operations. Most have been here since the 1990s; they are audited and scrutinized both locally and internally, and simply wouldn’t tolerate an environment where they couldn’t run a clean business. Nobody is pretending that it’s plain sailing but it’s much less of an issue than the international media would have you believe. Chapter 10 goes into more detail on this subject.

====Surely international sanctions prevent our company from doing business with Russia?====

Following Russia’s annexation of the Crimean peninsula in March 2014, economic sanctions were imposed against Russia by several nations, namely the USA, Canada, Australia, Japan, the European Union, and (hardly surprisingly), Ukraine. Many of these sanctions are aimed directly at businesses connected to Vladimir Putin’s inner circle and/or business connected with the Crimea itself, such as ports where cruise ships cannot dock. Mostly, the sanctions prohibit the sale, supply, transfer or export of goods and technology in certain sectors, although the number of companies whose businesses have actually been affected remains small. Sadly, some companies have chosen to ‘self sanction’, incorrectly assuming that they cannot do business in Russia and arguably it has been this assumption which has hurt the Russian economy more than the sanctions themselves. Obviously if you or your business are from one of the countries involved then it’s important to check what impact this might have (and your country’s Embassy will be able to advise here). Russia retaliated in August 2014 by banning certain foodstuffs from countries which had imposed sanctions and has managed to turn this into an opportunity to promote ‘import substitution’ which has enjoyed considerable successes. In some cases Russia lacks the equipment to produce locally, a gap in market which is being filled by foreign manufacturers.

Why does nobody ever smile?

If you travel on the metro in the mornings, you’ll certainly see many glum faces and yes, it is rare for Russians to smile for no reason. Why? Some blame a combination of the poor weather, at least in the winter, a turbulent history, especially in the past century coupled with a general mistrust of outsiders (it didn’t pay to be inquisitive during communist times) and difficult living conditions for most, even today. In Western culture we smile to make people feel comfortable rather than us being genuinely happy to see them. If a Russian doesn’t smile at you, it doesn’t mean that they don’t like you (don’t take offense – it’s nothing personal), but if they do smile, then chances are that you’ve made a favourable impression on them. There is another explanation, that Russians view someone with a permanent smile as the village idiot, and smiling without a reason is viewed as being insincere.

III. Expatriates in Russia

Who are they and how they differ from each other and also from their local staff

Like in any large city, the Expat community is very much a mixed bag but the majority of white collar workers fall into three distinct categories. CORPORATE EXPATS (CORP-PATS)

Typically Corp-pats have been posted to Russia/CIS with little or no previous experience of this part of the world, but their key selling point is their in-depth knowledge of their employer after years, if not decades with the firm, perhaps in multiple locations. They are seen as a safe pair of hands and are almost always employed in senior level positions. Trust is another influencing factor, especially in a finance role. The standard assignment is three years in length, sometimes more but the aim is often to eventually replace yourself with a local before moving on to pastures new within the firm, or it could mean returning home. Corppats almost always confine themselves to the ‘Expat bubble’, living in a compound or an area populated by other foreigners. This is especially the case if they have arrived with a family in tow, and hang out in expat circles, which in reality means downtown bars & restaurants where they are likely to bump into people similar to themselves. Few learn much, if any Russian as the corporate language at work will be English and they see little need to immerse themselves into the local culture as in all likelihood they’ll be moving on in a few years anyway.

RUSSIFIED EXPATS (RUSS-PATS)

Russ-pats may have studied Russian language and/or Russian literature, politics, history, economics at University and moved to Russia as they genuinely love the place. They are employed in a wide range of professions, and may now have family ties here, such as a spouse, children and perhaps have even purchased an apartment, or God forbid, a dacha! Some are in fact Corp-pats who have somehow stayed on and immersed themselves into the local community and have set up their own business, or work for somebody who has. More recently some Expats with specific skills have found themselves in demand by Russian companies who value their international background & input, especially if they come with previous CIS work experience and some knowledge of the Russian language.

RE-PATS

Re-pats emigrated from the CIS after the fall of the Soviet Union, but for a variety of reasons have decided to return to the motherland. Initially it was adults who were seeking their fortune abroad, although increasingly we are seeing their children who left when they were very young and so are bilingual, or close to. Some felt disillusioned with life ‘abroad’, others found the going tough and didn’t make it whilst many wanted to be closer to their relatives as they age. A few even realized that from a purely business perspective, they could make more money and have a faster and more successful career back in Russia/CIS, having picked up business acumen and strong language skills abroad. Russians themselves are rarely positive about Re-pats, viewing them as arrogant. Admittedly some do return with a ‘hey, I’m better than you as I’ve lived/ worked/studied abroad and I speak great English’ attitude (Russians can spot them a mile away as they frequently drop English idioms into their everyday Russian speech). When interviewing Re-pats for jobs in Russia, they should be taken on an individual basis, while naturally those who return with a shiny American passport and demand an expat package and a hardship allowance, can be quickly discarded.

It’s also worth you checking if Re-pats are eligible to work in Russia as some will have lost, or given up their Russian citizenship. Expats view Re-pats as Re-pats, whereas Russians simply view Re-pats as Russians who’ve spent some time living abroad. Moscow is a fairly transient place as far as the expat community is concerned, since Corp-pats almost always leave once their three year contract is up, either moving on to their next assignment in another farflung place, or simply returning home. Nevertheless, the Moscow expat circle is extremely welcoming and easy to break into. There are numerous social clubs, sporting activities, business associations and religious groups that welcome newcomers. They are by no means exclusively aimed at Expats, and can be a great way to get to meet English-speaking locals. See chapter 18 for a list of websites.

IV. Travelling to, around and visiting Russia and the CIS countries, plus moving to and settling in Russia

GETTING TO/FROM MOSCOW FROM ABROAD

Being the largest city in Europe, Moscow is served by daily flights from almost every European capital city of any significance with some countries (such as Germany) also having direct flights from provincial cities. From Western Europe flights tend to take off in the morning/ lunchtime, arriving in Moscow late afternoon/early evening, or leaving late evening, landing in the middle of the night, or in the early hours of the following morning. Flying east you will effectively either lose most of the day on the plane, or a night’s sleep – you choose what’s best for you, although upon your return you’ll land at pretty much the same time as you took off. There are also direct, regular scheduled flights from many large Asian and Middle-Eastern cities plus a few in the USA although from Africa, Latin America and Oceania you will almost certainly require a change of planes. Bear in mind that if you do arrive in the early hours of the morning, your hotel may well charge you for an extra night, or for early check-in, and given the cost of high-end accommodation in Moscow, this can outweigh the benefits of taking the ‘red-eye’ flight.

Sheremetyevo (SVO) airport is in the north of Moscow and is Aeroflot’s hub for both domestic and international flights. It also handles Skyteam’s airline partners (KLM-Air France, Delta, Korean Air, Alitalia, Czech Airlines), as well as Finnair, and for flights to mainland China with Air China, China Eastern and China Southern. Terminals D and E have been built recently and are very much up to international standards, while F was rebuilt for the 1980 Moscow Olympic Games and retains a certain Soviet feel to it. Terminals A, B & C are located on the other side of the airport; there is now a free shuttle train service, which runs under the runway, only takes a few minutes and operates frequently. These mainly handle domestic and charter flights although some changes and construction are still in progress so it is definitely worth checking in advance. Domodedovo (DME) airport is in the south and is home for most of OneWorld’s airlines, such as S7 one of Russia’s largest domestic carriers, British Airways (although be careful, one of the three daily flights to Heathrow now leaves from Sheremetyevo), Iberia, Cathay Pacific, Qatar Airways and JAL. It’s also Star Alliance’s Russian home, so Lufthansa, Austrian, TAP, Thai, Turkish, Singapore and Egyptair fly from here, plus Emirates and Etihad. Air Astana recently relocated their Moscow home to here, for flights to Almaty & Nur-Sultan, in Kazakhstan, and Ural Airlines for numerous domestic and international destinations. Vnukovo (VKO) in the south-west acts an overspill for Moscow’s main two airports, plus Turkish Airlines who have moved here (landing and takeoff fees are reportedly lower). Additionally Uzbekistan Airlines now fly directly to 13 cities in Uzbekistan. Otherwise it is mainly used by Utair, Russia’s third largest airline, Pobeda (Aeroflot’s Low Coster) and for holiday charter flights.

Zhukovsky (ZIA) located to the east of Moscow with the aim of being a magnet for low-coster and charter. It only handles a few airlines, the most notable being Belavia with several flights per day to Minsk and URAL Airlines. For the time being at least, the biggest downside to Zhukovsky (apart from the small number of airlines actually using this airport) is that there is no direct train link from Moscow’s city centre. It necessary to catch a train from Kazansky station to the town of Zhukovsky, and connect from there on a shuttle bus. Or just catch a cab and risk the traffic. Clearing both customs and immigration is a relatively painless process; regardless of which airport you arrived at. Lines are rarely long (unless you are unlucky and several planes have landed just before yours) but queues move quite quickly. Unless you are carrying upwards of $10,000 in cash or any obviously restricted items, there is no need to fill out a customs form. GETTING TO/FROM THE AIRPORT INTO MOSCOW If you are new to Moscow and/or don’t speak Russian or read Cyrillic, it would make sense for you to arrange for your hotel to have a driver meet you at the airport, standing with a sign (with either your, or the hotel’s name on it) in the arrivals terminal.

TAXI

Nowadays, the taxi situation is largely regulated at Moscow’s main airports and is a considerable improvement from the “taxi mafia” days of the 1990s, but can still be a little daunting for the uninitiated as the waiting drivers tout for fares and can be quite pushy. The best advice is to walk past the waiting drivers (ignore the official looking badges they wear) as these guys charge well above the standard rate, and misunderstandings do happen. Use one of the desks further back as prices are now official and listed in. Russian and English, and the staff should speak reasonable English, even if your driver doesn’t. Early mornings and evenings heading into Moscow should be relatively traffic-free, at least by Moscow standards, but fares are generally fixed in advance and shouldn’t depend on the journey time. Unless you are taking one of the red-eye planes returning from Moscow, your flight back to Western Europe is likely to leave in the evening. Given the heavy traffic leaving downtown Moscow towards the end of the working day, allow a good two hours, especially if you’re setting off on a Thursday or Friday. The jams are at their peak in the summer months when it seems as though the entire city decamps from Friday lunchtime onwards and heads out to their dachas for the weekend.

AEROEXPRESS An easy way to avoid spending hours stuck in the back of a cab is to take the Aeroexpress train from central Moscow to the airport or vice versa. Trains service Moscow’s three largest airports every half hour; trains begin at around 06:00 and continue until at least midnight. Journey time is around 45 minutes, and means that you’ll never miss another flight ever again.

Trains for Sheremetyevo leave from Belorussky station (this line has recently been extended with additional stops en route, including to Moskva City, Moscow’s financial district)

Trains for Domodedovo leave from Paveletsky station Trains for Vnukovo leave from Kievsky station All three of these stations are on the Moscow metro’s circle (brown) line and are signposted in English. The Aeroexpress trains are clearly marked and are usually red (do NOT jump on to a green train; these are the suburban commuter trains, called ‘elektrichka’ which will take you into the middle of nowhere) but doors may only open a few minutes before the train actually departs for the airport. If in doubt, don’t worry, just ask, although a crowd of people carrying suitcases is generally a telltale sign. A single ticket is RUB500 and they have a business class carriage for RUB1,500 which guarantees you a seat and they give out free bottles of water & Russian language newspapers. At peak times these trains can get pretty full, although there is usually more space in the back few carriages, and you might be fortunate enough to ride on one of the swanky, new double-decker trains. For those in a hurry to get to the airport, you can jump on the train and buy a ticket upon arrival at one of the ticket booths, which also have instructions in English – they accept Rubles and credit cards, although there can be quite a scrum getting through the barriers so if possible buy one before you board. If you don’t need a receipt and have a contactless debit or credit card, you can save time and receive a small discount by simply tapping your card on the entrance/exit gate at the airport, and they are also available online at a reduced price. For information on the exact times (and any updates), check out: www.aeroexpress.ru (in Russian & English). In case you are feeling a little apprehensive, ask a Russian colleague or friend to accompany you as far as the train for the first time. Trust me, coming from someone who has missed flights in the past due to heavy traffic, these aeroexpress trains are a godsend. If you are visiting your Moscow office and your travel schedule has been arranged by your Russian office manager, it’s worth bearing in mind that she may assume that as an important foreigner, there is no way that you could even consider lowering yourself to taking Russian public transport, as few senior Russians would. She might be shocked that you even suggested it. In fact, she will probably think that as a clueless newcomer to Moscow you will invariably get lost, mugged or abducted and it will be all her fault, so she will insist that you take a taxi. Perhaps she just wants to get rid of you, but this will result in you leaving at lunchtime for an excruciatingly slow trip to the airport, probably arriving many hours before your evening flight. Bottom line, if time is important to you, consider taking the aeroexpress to/ from the airport. Finally, if transiting between Moscow’s airports, allow yourself a MINIMUM of two hours travelling time to get from Sheremetyevo to either Domodedovo or Vnukovo regardless of which mode of transport you use. GETTING AROUND MOSCOW Amongst the largest, best (and surely the most beautiful) in the world is the Moscow metro. Sure, it can get crowded at times, ridiculously so during rush hour, but it’s fast and very efficient. Little wonder that millions of people use it every day to get to & from work, and around the city. Many of the older stations are works of art in themselves, and a single ticket costs less than a Dollar, regardless of how far you travel – there are no zones. Tickets can be purchased for individual or multiple rides, or monthly passes which work out slightly cheaper in the long run, and are on sale at every station, whenever the metro is running, which is from shortly before 6am until 1am. Every metro station is permanently manned both by the metro’s own staff and by the Police, so consider it a pretty safe way to travel even at night. 38 39 One recent development is that there are now signs and announcements in both Russian and English at all stations. However, one slightly confusing aspect is that some stations use different names for the same interchange, but some are the same. An added bonus is that WiFi is available on the metro, for free. Your mobile phone should also work, even if the reception is a little patchy in places. If you have multiple meetings and especially if some are out on the outskirts of the city where metro stations are fewer and farther between, consider hiring a car with a driver for the day, or even for the duration of your trip. It’s not as expensive as it may sound, and your driver will drop you off & wait for you. Experienced drivers are pretty adept at sorting out a whole host of problems, such as when you’ve arrived at a building and the security guard doesn’t want to let you in as he can’t find the propusk (entry pass) that may or may not have been ordered. Curiously Russians don’t seem to mind sitting in traffic jams, viewing an hour stuck in gridlock in their own vehicle as preferable to a twenty minute ride on the crowded metro. This largely stems from cars having been difficult to obtain during the communist period, involving a long wait and invariably some strings pulled along the way, all to secure a Lada! So if you are going to a meeting together with Russians, don’t be surprised if they turn their noses up at the thought of taking the metro, although there is a good chance that they will have pre-arranged the transport. An increasing number of taxi companies operate in Moscow and even in mid-sized Russian/CIS cities, cabs can typically be at your door within five or ten minutes. Peak times are a different matter due to heavy traffic so to be on the safe side it’s best to book in advance. Waiting times are comparatively cheap so if you’re going to a meeting, it can make sense to ask the driver to wait and take you back. Parking can be limited, so your driver may in fact need to find a space half a mile down the road (where it’s free to park) and you ring him once you’re done already to return. The occasional dispatcher may speak a little English but drivers are unlikely to know more than the odd word, although if they’ve carried non Russian-speaking passengers before, they should know the drill. There are now certain apps which can be downloaded (such as Uber, Yandex Taxi or Gett) which avoid the need for speaking Russian, although in practice the driver is still likely to call you to tell you that he has arrived, and exactly where he is waiting for you. This is a safe bet as the car and the driver’s details will be sent by SMS to your mobile phone. For the fullblown Russian experience, do as many locals still do and stick your hand (not your thumb) out on a busy street, then watch the cars stop for you. Yes, in theory any car doubles up as a private taxi – you tell the driver where you want to go, agree a fare and jump in. The authorities have tried to make this practice illegal but old habits die hard and it is still a popular way of getting around quickly, especially late at night when the metro is closed. It’s safer than you might think, but if you don’t like the look of the driver (and/or his car) then don’t be shy about waving him on and getting into the next car. At busier spots at night, cars will often line up behind one another; it’s also possible that the driver may not want to take you if it’s completely out of his way. Avoid any cars that wait outside top end hotels, bars, clubs and especially at train stations & airports – these jokers charge much more than the going rate and are notorious for rip-offs, especially from drunken foreigners and can get aggressive if you don’t cough up. Only ever catch the moving cars and ALWAYS make sure that you’ve agreed on the destination AND the fare in advance. Worst case, get someone to write it down for you in Cyrillic beforehand. It is worth bearing in mind however that many of these ‘gypsy cab’ drivers are migrant workers from the poorer Central Asian and Caucasus Republics who cruise the Moscow streets at night looking for customers. They drive beaten-up old Ladas (called a ‘Zhiguli’ in Russian) that are barely roadworthy – count yourself lucky if the seatbelt actually works, and their knowledge of Moscow’s roads may be limited, especially if heading to the outskirts. Therefore, as well as not speaking any English (even Russian for most of them is a second language) they may ask YOU if you know the way to your destination ‘dorogu pokazhite’?! Normally this mode of transport is only recommended once you know your way around town but it’ll certainly be an experience that you don’t encounter back home. However, given the popularity and ease of ordering a cab visa an app, flagging down a car is much less common than it was just a few years ago. Many of Moscow’s downtown streets now have a ‘paid’ parking scheme, with shiny parking meters having sprung up, although few foreigner are brave enough to drive their own car around town. Those who do are generally long term Expats as it’s not common practice to hire a car and drive it yourself. 40 41 TRAVELLING WITHIN RUSSIA Russians like to joke that a foreigner drove his car into the Soviet Union and fairly quickly ran into a pot hole in the road. When help eventually arrived in the form of the GAI (the state traffic police) he grumbled that back home there would be a red flag warning of any such holes. The response was a blunt ‘didn’t you see the big, red flag (of the Soviet Union) when you crossed the border?!?!’ Despite some recent improvements, roads outside of cities can be in poor condition, exacerbated by extreme cold in the winter followed by heat waves in the summer. In Moscow these have been upgraded considerably but this has happened in conjunction with a boom in car ownership, resulting in gridlock throughout the day and well into the evening, so much so that you’ll hardly notice any lull outside of rush hour. Work out where you’re going in advance and allow more time than you’d expect as even major highways often only have a single lane going each way. Don’t expect much in the way of service stations (apart from fuel and perhaps a few snacks) so stock up and strap yourself in as it could be a bumpy ride. Driving your own car in Russia is an art in itself, and will require you to have your driving license from your home country translated into Russian. You’ll also require nerves of steel, and some might even say a death wish! RUSSIANS TRADITIONALLY COMPLAIN THAT THE TWO BIGGEST PROBLEMS IN THEIR COUNTRY ARE IDIOTS AND ROADS (AND SOME SAY IDIOTS WHO BUILD ROADS)! Russia boasts an impressive network of domestic flights on numerous airlines. There used to be dozens, some, tiny; with one plane running a daily service from a provincial town to Moscow and back, although the industry has consolidated considerably in recent years. The big 4 local carriers – Aeroflot, S7, Ural and Utair dominate most of the popular routes. Given the country’s size, flying is often the only way to travel, but this results in fares being expensive by international standards. Low-costers are in their infancy with the Aeroflot subsidiary ‘Pobeda’, which means ’victory’ being the only success story. Regional airports in Russia range from little more than a concrete shed, which have seen no renovation work done since communist times and to brand, spanking new buildings, such as the new Pulkovo terminal in St Petersburg, with Kazan, Irkutsk, Samara and Yekaterinburg also deserving a mention. Most provincial airports are somewhere in between, although infrastructure projects have been earmarked as priority in many cities, at long last. Even the most rundown airport should have a separate area for business class passengers (often just marked ‘VIP’ although in Central Asia it’s called ‘CIP’ – Commercially Important Person, but essentially the same thing). In some airports, such as Kazan it is in a neighbouring building and you will be bussed out to the plane separately. These zones are mainly for senior, local officials but business class travelers and those holding certain frequent flier status may also make use of them. Unlike in many business lounges throughout the world, expect to pay for some, if not all food and drink (if in doubt; ask – or don’t be surprised if you are presented with a hefty bill shortly before boarding the plane). Priority Pass is accepted at an increasing number of business lounges and some accept walk-in customers for a fee. Most domestic airlines have a business class section, although on the whole this is poor value for money for shorter hops. The Russian airline industry deservedly gets a bad press, although the larger airlines run fleets of almost exclusively foreign planes and since these are typically leased, they are required to conform to international safety standards. Even though Russia has seen an increasing number of domestic flights in the past decade, don’t automatically assume that you can fly directly from one provincial city to another. Even in Siberia the only route may be via Moscow and even if there is a direct flight, it could only operate once or twice a week and be prone to delays, especially in more remote areas where the weather can play havoc with timetables. At the time of writing, for most airlines if you check in for your flight in Russia on-line (domestic or international), you will still need to print out the boarding card. You cannot just flash your mobile phone at the security guard/immigration officer as he/she needs to stamp it to allow you through. The country’s rail network is impressive, extensive and safe. Trains always run on time and are clean, if a little on the slow side. Long distance trains have bunks for sleeping (typically in a ‘kupe’ compartment of two or four; there is also a dormitory class called ‘platskart’ which is probably best avoided if you value even a modicum of privacy) although fares can rival what you’d pay to fly now that government subsidies are being removed. If you’re not in a hurry and want to see the countryside at the same time as meeting ordinary Russians, experiencing life on the rails, practicing your Russian over an evening beer in the restaurant car, then the train is an ideal way to travel. I speak from experience as someone who journeyed as a student from Vladivostok to Moscow on the trans-Siberian back in 1994, stopping off for a few days each in Khabarovsk, Ulan-Ude, Irkutsk, Novosibirsk and Yaroslavl. Rather confusingly, ALL trains in Russia run on 42 43 Moscow time regardless of where you are, and train stations are hardly user-friendly places, especially to the uninitiated, even with some signage now in English. Fortunately tickets can be purchased via travel agencies and now online although they are printed in Russian only, and often still list the old name (ie, Sverdlovsk and Gorky for Yekaterinburg and Nizhniy Novgorod respectively) whereas the timetable at the station may use the new name. Business travelers are likely to be most interested in the Sapsan, the high-speed train that now runs several times a day between Moscow and St Petersburg and is proving to be stiff competition to the airlines on this popular route, taking a mere four hours. It has economy and business class, WiFi for all and a restaurant carriage, but has become a victim of its own success as tickets can sell out well in advance, so book early. The Sapsan now also runs from Moscow to Nizhniy Novgorod, with plans in place to extend it as far as Kazan, the capital of the Republic of Tatarstan, and frequencies are increasing but it still pays to book well in advance. ID is required when purchasing plane and train tickets (the exceptions are the Aeroexpress and the suburban ‘elektrichka’) and keep the same form of ID with you – preferably your passport, when you travel.

REGISTRATION

Russia still retains an annoying hangover from the Soviet period, whereby all citizens are required to register with the local authorities if spending more than three business days in a particular location (90 days, if you have an HSQ visa). If you are staying in a hotel, this will be done for you automatically; your passport will be taken away for a few moments and photocopied (some local authorities will charge you a small fee for the privilege of being in their city, although it is usually added to the final bill) sometimes it comes in the form of a stamp and a few handwritten squiggles on the back of your migration card, or it could be a separate piece of paper. It’s worth hanging on to these, just in case some overzealous, bored official decides to be particularly jobsworth and lays down the law. Gone are the days when every individual city had to be listed on your Russian visa, yet there are still certain cities and regions in Russia that require an additional permit to enter (the far-eastern province of Chukotka – where Roman Abramovich used to be the governor, is a a good example, as is Norilsk). Fortunately most of these places are extremely remote and it’s unlikely that they will be your first port of call. Many are judged to be strategic locations but it is worth enquiring with your hosts if prior permission is required – they will know if it is. As is often the case in Russia, there is a good chance that no-one will actually check whether or not you’ve registered at any stage during your trip, or even visited a restricted area. However, you could land yourself in hot water if someone decides to take a closer look (the Police have been known to inspect documents at some provincial airports and prevent you from boarding the plane if you cannot prove that you have registered). This is of course little more than a money-making scheme for them; they’re not in any hurry, but you are. The moral here is that unless you are familiar with the territory AND speak Russian, it’s better to play it safe or it could ruin your travel plans. Oh, and if you want to exit Russia smoothly, don’t lose your migration card which will be given to you as you go through passport control upon arrival. WHAT IS THE CIS? The Commonwealth of Independent States, or CIS was formed in 1991 to incorporate the 15 former Soviet Republics minus the three Baltic States (Estonia, Latvia and Lithuania). In practice, the CIS is effectively a loose association of states as Turkmenistan is an unofficial associate member, Georgia withdrew in 2009 and unknown to many Ukraine was never officially a formal member as it chose not to ratify the CIS Charter since it disagreed with Russia being the only legal successor of the Soviet Union. Whilst the term ‘CIS’ is preferable to expressions such ‘ex-Soviet’ and ‘Former USSR’, don’t expect colleagues back home to be familiar with it, or even know which part of the world it refers to.

TRAVELLING TO NEIGHBOURING CIS COUNTRIES

If your business takes you to other former Soviet Republics, you’ll need plenty of room in your passport for additional stamps (you will be stamped both upon arrival and departure), and possibly a visa. Unless you actually need to come to Russia (thus avoiding the need for a Russian visa), you can now fly directly from Europe & the Middle East to almost all CIS countries. Turkish Airlines boast the most extensive coverage of the CIS region, flying to every CIS capital (except to Yerevan, in Armenia, for political reasons) plus other major cities, with Lufthansa also a good bet. The advantage of flying from Moscow or St Petersburg (if you are already here, or planning a trip there anyway) is that both the list of destinations and the frequency of flights is significantly greater. For example there are direct flights from Moscow to more than a dozen cities in Kazakhstan, whereas flying in from abroad typically requires a change of planes in either Almaty or Nur-Sultan. It is becoming increasingly possible to fly from one CIS country to another, although the smaller (and less significant) the country, the greater the chance of having to change planes, usually in Moscow or Istanbul. When booking flights, note that the airport IATA code will often refer to the old, Soviet name of the city – some notable examples:

St Petersburg

Atyrau

Samara

Yekaterinburg

Aktau

Bishkek

Khujand

There are no scheduled flights between any cities in Russia and Ukraine, due to ongoing political tensions between the two countries. Unfortunately, this is unlikely to change anytime soon; the standard routing is via Minsk, Warsaw or Chisinau. One option is to catch the overnight train between Moscow & Kiev if you don’t mind being woken up several times to allow the customs officials to search your bags and the immigration officers to stamp your passport.

At the time of writing, there are no direct flights between Russia and Georgia, although it is hoped that this is only a temporary measure, but you can fly via Yerevan or Baku without too much hassle. You can transit through five Russian airports (Sheremetyevo, Domodedovo & Vnukovo in Moscow, Pulkovo in St Petersburg and Koltsovo in Yekaterinburg), but you must have an onward ticket and you cannot leave the airport. Don’t try to do anything clever by attempting to fly into one Moscow airport and out of another as you won’t be allowed to do so; in fact you’ll probably be denied boarding at your original destination.

VISAS TO RUSSIA:

• Visa information is subject to frequent change; please check before

travelling.

Basically, all Western visitors to Russia require a visa, and these must be obtained in advance. You cannot just rock up & buy one on the border, and on top of this you will require a letter of invitation (LOI). Even if you only need to change airports, you will need a transit visa and once again, this must be obtained in advance at a Russian Embassy or Consulate.

(Leningrad) (Guriyev) (Kuybyshev) (Sverdlovsk) (Shevchenko) (Frunze) (Leninabad) LED GUW KUF SVX SCO FRU LBD

Apply early. Sure, Russian visas can be procured by wellconnected agents in a day or two, but you’ll pay through the nose for the privilege. Visas come in several forms; chiefly tourist, business, transit & employment, and their length varies from a maximum of one month for a tourist visa, to a three year work visa for ‘highly qualified specialists’ (HQS).

If you are planning on making numerous trips to Russia, it would make sense to apply for a one-year multiple-entry business visa. Bear in mind that you are only allowed to spend a maximum of 180 days per year in Russia, and a maximum of 90 days in any 180-day period. The point here being that you are not supposed to work on such a visa as it is aimed at businesspeople based abroad, and authorities do check (if you don’t believe me, take a look at the scanning equipment at passport control at international airports). Russian Embassies differ from country to country as to how strictly they apply the rules. In theory you are supposed to apply in your home country but this isn’t always enforced. The days when Expats living & working in Russia could hop over the border to Helsinki or Tallinn on a visa run may not be completely over, but it’s something of a lottery as to whether you’ll be lucky or turned away. Agencies can advise here but remember that they make a living by selling LOIs & their various add-on services so they are not exactly in the business of helping you to cut corners. The amount of information required when applying has increased recently, largely as a reciprocal response to Russians being required to jump through hoops to obtain certain visas. The UK is a prime example of this; since the British government insists on ALL visa applicants to the UK listing which countries they’ve recently visited and visiting a visa centre to have their fingerprints taken, the Russians decided to make Brits do the same. Unless your idea of fun is negotiating with Soviet-style consular staff (who generally look for problems rather than trying to solve them), it is highly advisable to use the services of a reputable agency for procuring visas. Granted, they don’t come cheaply – once you’ve factored in the Embassy fee, the LOI charge plus the agency’s service commission, it can run into several hundreds of dollars. However, if you value your time AND your sanity, you will trust me on this one. Every country has agencies who specialize in visas to CIS countries – almost all of these can also arrange other services that you may require, such as flights and hotel booking, airport transfers, 46 47 domestic flights, the use of an experienced interpreter whilst in Russia/CIS plus the translation of your company’s promotional materials into Russian. Avoid coming to Russia on a tourist visa if business is your primary reason for being in the country. Granted tourist visas are easier to obtain (a hotel booking should suffice, rather than an LOI), not to mention cheaper, and if you are simply attending a trade fair or a conference then you should be OK so long as you don’t do this repeatedly. However, arriving in a suit carrying a briefcase containing your firm’s promotional materials and some product samples may raise some suspicions upon arrival, and you may have some explaining to do if you are stopped. Having said that, arriving into Russia and clearing both immigration & customs is generally a fairly painless and swift experience, a world away from what it was like back in the chaotic days of the 1990s. All non-Russian and Belarusian citizens will be handed a small migration form (which is usually printed out on the spot for you at most Russian international airports); whatever you do, don’t lose it. It will be requested when you arrive at your hotel, and you will be asked to surrender it when you leave the country, regardless of what visa you are travelling on. Russia is currently in the process of implementing an e-visa scheme for selected nationalities to visit a few, specific parts of the country, namely St Petersburg (plus the surrounding Leningrad region), plus several territories in the Far East of the country. This is an attempt to boost tourist numbers, and shouldn’t be seen as a loophole for business travelers. Despite the existence of the CIS, there is no equivalent of the Schengen visa (and as for a single currency like the Euro, dream on) so you will need separate visas for visiting other, neighbouring countries. Fortunately, the entry requirements for most of these have eased up considerably in recent years. The problem is that hard facts can be difficult to source as certain CIS Embassies are particularly unhelpful and some visa agencies will try to sell you either a visa, or an LOI (or both) when in fact you no longer need one. See the individual country section 16 for more information on individual entry requirements, although the information provided should be used as a guide only, as every CIS country’s requirements vary and things can change without notice – and often do. CIS citizens may travel to each other’s countries visa free, making life easier when travelling with a Russian colleague or partner, or having a local representative in place who can simply jump on a plane at short notice. There are a few minor exceptions to the standard visa rules, such as some countries issuing visas upon arrival to citizens whose country doesn’t have an Embassy in their country. Nevertheless, in most cases you still need the LOI which needs to be pre-arranged, and you also run the risk of the airline staff not allowing you to board without a visa in your passport. Then, upon landing the consular officials may not be familiar with such procedures so expect delays. Summed up, you will save yourself a considerable amount of blood, sweat and tears by obtaining all the necessary visas in advance in your home country before you leave for a trip to the CIS, as these Embassies are more user-friendly. Oh, and before you bitch and moan about the hurdles that you have to jump over to get visas to come to Russia, spare a thought for CIS citizens when they apply for a visa to visit western countries. It can take weeks, and you often have to apply in person after having filled in pages of forms online together with copious accompanying documents. St Petersburg, Russia’s second city: St Petersburg is famous enough for cultural and historical reasons and does a considerably better job of attracting tourists than business people. Yet with a population close to 5 million, there is more to Russia’s second largest city than pretty buildings and museums. St Petersburg and the surrounding area, known as the Leningrad region (after the city’s name from Communist times) is in fact a key financial and industrial centre. Production ranges from pharmaceuticals, FMCG, medical equipment and chemicals to heavy machinery, automotive and military equipment, assisted in no small part by its strategic location giving easy access to the sea. Many international companies, particularly from Scandinavia use St Petersburg as a stepping stone into Russia and the CIS whereas others who began with Moscow have opened branch offices in St Petersburg given the city’s size and growth potential. The St Petersburg International Economic Forum (SPIEF) is a prestigious business event taking place every year since 1997 and brings together heads of state, political leaders, senior figures in the Russian government, and of course business people. In recent years the forum has taken on increased significance as Vladimir Putin addresses the delegates and Kremlin watchers analyze his opening speech for hints as to which direction the country may be heading. Usually held in early or mid-June, SPIEF’s key purpose is to provide an opportunity for the public and private sectors to collectively work together as one, and overcome 48 49 obstacles, which divide Russia and other nations. Following Russia’s annexation of the Crimea in 2014 and subsequent economic sanctions imposed, SPIEF has turned into a hot potato for foreign businesspeople and politicians alike. Show up and you face being accused of endorsing Mr Putin’s ‘aggression’, yet stay away and risk missing out on big investment deals. Many have opted for a midway point of sending a less-senior person along in their place, citing ‘more important’ matters back home or elsewhere, although anyone with any interest in Russia at a senior level should at least be aware of the prestige of this event.

www.forumspb.com – in English & Russian

Brand new Pulkovo airport (LED) is Russia’s 3rd busiest airport and has flights to all major cities within Russia, the CIS, and abroad. There are also frequent trains to Moscow, either on the Sapsan during the day, or overnight on a sleeper. The St Petersburg metro is Russia’s 2nd largest and an easy way to avoid the city’s traffic jams although careful if you suffer from vertigo as you descend as the stations are extremely deep. INTERMARK RELOCATION TIPS If you decide to take a job offer and move to Russia, it is easier to have a good relocation package. The key factors for a successful relocation are fast and safe moving, housing selection, leasing (or subleasing) contract agreement, and of course, visa and work permit registration. Going through this process can be excruciating and challenging experience. Based on our 26-year expertise, we selected the basic tips to make your move to Russia / CIS smooth and easy. To make it simple, we break it down into three most significant steps of any relocation – moving, home search and lease agreement. MOVING The road is always easier if you are traveling with a good map. Knowing when to get things done, and in what order, will put your mind at ease and prevent you from being overwhelmed by the details of a big move. Plan your move in advance Contact the moving specialists up to one month before you hope to leave even if you do not know exactly when the big day will be. They will tell you what they offer and what you need to plan for. This will help you organize your time and concentrate on the essentials.

Don’t pack everything yourself You can think that it’s a good way to save your money. In fact, you almost certainly would pay through the nose, as professional companies use a range of appropriate packing materials and employ trained staff to pack your things safely and in right way. And if you have antiques and artifacts with you, you will need someone with a proper experience to take a special care of it while moving. Decide what you really want to bring The less you have the cheaper it is to move. Start as early as possible and divide items into “keep”, “trash”, “recycling” and “donate”. Be ruthless! If you have not used it in a year (or forgot you even had it), then you do not need it. Another issue is import duties. Import customs duty in Russia is €4/ kg before tax. So think yourself – is it really cheaper to ship particular things and belongings from home or buy new here? HOUSING The rental market in Russia is still very young. In Soviet Russia, there were no high quality apartments or houses for rent. Nowadays, the majority of Russian people in big cities live in flats in residential blocks of different types. If you plan your relocation to Russia and are in a process of home-search, it is better to ask your HR coordinator or your relocation consultant to help selecting possible options. This will save you the trouble of contacting numerous real estate agencies, most likely complicating and duplicating the process and thus consuming your time and energy! What are the options? Most of housing options include three main types of buildings. Prerevolutionary houses are built before 1917; facilities and architectural features can be anything between beautifully decorated, reconstructed ones and shabby small houses. Stalin-era buildings mostly built in the period 1917-1950 and tend to have high ceilings, thick walls and big windows. Finally, modern buildings constructed after 1991 and favored by many expats for their good condition, security measures, underground parking and other facilities. Apartment sizes and features Most apartments even in Moscow are not very large – typically between 50 and 150 sqm. The number of rooms is an important factor influencing the price – for instance, if we take two apartments of a similar size, location and quality – the one that has more rooms will be more expensive. Smaller 50 51 apartments (up to 100 sqm) for rent are usually furnished, whereas larger ones are mostly offered for rent unfurnished. There is no defined market standard for what a furnished apartment must have, as it rather depends on the particular landlord. Renting Price We would say that rent price depends on the following key factors: location, security and parking features, standard of communal areas, infrastructure and amenities. Please keep in mind that most apartments in Russia belong to and are offered by private individual landlords who very often decide for themselves what they want to get for rent.

LEGAL AGREEMENT

When signing the lease, the parties need to use all their experience to provide important matters and avoid uncertainties that could prevent the long-term cooperation. If you have questions regarding specifics of legal agreements, we recommend you to look for a professional lawyer team.

Subject of agreement

It is important to write down all details of the deal - the exact address and boundaries of the property in lease. Are you planning to rent a furnished apartment? Do not forget to include an accurate list of furniture and household items provided by your landlord under the contract in order to avoid mutual claims upon termination or expiration of your agreement in the future.

Contract duration

Most lease agreements (both company and private) are concluded for 1 year. Of course, the tenant usually has the preferred right for contract extension, but the price may be reviewed by the landlord at the extension time. Speaking of agreement’s termination, the tenant can use this option if he informs his landlord 3 months before the planned move out. The landlord can’t cease the agreement unless the tenant breaks his contract obligations.

Payment and utility bills

All clauses of the contract relating to the rent terms and its amount must be as detailed as possible. A vague description of security deposit, damage compensations order and the currency in which the tenant makes monthly rent payments threatens undesirable disputes between the parties. Therefore, we recommend working out a step-by-step procedure for assessing and reimbursing the potential damage, indicating clear deadlines and responsibility for their failure. An early discussion of utility bills order of payment will also help you avoid future problems with your landlord. It is important not only to distinguish who pays for electricity, gas, water and other utilities, but also to establish the procedure for their payment or reimbursement. Moving to Russia and CIS can be challenging, therefore organizing your relocation in advance step by step is the best way to avoid stress and any potential difficulties in the process. Following the tips listed above may help you to find your ideal place to live and find time to explore Russia in its beauty. To make the experience of relocation to a totally new destination even more exciting and safe we recommend to choose a professional relocation consultancy with full range of services and years of exceptional professional experience. 52 53 V. The selection process: Foreign assignments vs hiring locally (recruitment and HR tips, plus Russians in the workplace) and settling into life in Russia Regardless of whether your company’s operation is looking to recruit its first person to run your business in Russia or you have had an office since the early 1990s and are simply in expansion – or reduction mode, you will nonetheless need to decide on whom to hire. There are no hard or fast rules about whether an Expatriate or a local is a better bet for the top job. This depends very much on your current situation, future plans and who your target audience is, in terms of customers. SMEs usually begin by visiting a trade fair and appointing a local distributor to represent them and promote their products but as the volume of business grows they realize that they need someone on the ground. Even one or even two visits a month simply isn’t sufficient for following up on leads, especially when they are outside of Moscow. Invariably they appoint a local national who speaks the language, is familiar with the territory and has some industry contacts. Such operations tend to remain small, occasionally not progressing much beyond a single sales representative or two working from home, or based at the office of a local partner. An Expatriate posted to Russia is viewed as a trusted pair of hands who is familiar with the internal functions of the firm (often having worked there for many years in various locations) and can help to instill the corporate culture to newly hired local staff, particularly in a larger operation. The benefit is that this person is deemed as highly trustworthy and won’t have his or her own agenda. The downside is that this individual usually arrives with little or no prior knowledge of the country and has to face the standard ‘this won’t work in Russia – Russia’s different’ from his local team. Regardless of the size of your existing or planned operation, if you are considering relocating an Expatriate employee from within your firm to Russia to either set up a new office or a particular line of business, there are a number of issues that you will need to take into account before departure. If the particular employee is a stranger to the CIS region, many employers wisely recommend an initial visit, known as a ‘look-see’ trip. Even if this person has been travelling regularly to the region, there is a world of a difference between spending a few nights a month in a top-end hotel and being ferried around by the company driver to actually living in an apartment, buying food in a supermarket, riding on the metro and having to handle other day-to-day issues that may arise – anything from the landlord showing up unannounced to waking up in the winter to find your car blocked in by a snowdrift. It is also advisable to bring your spouse with you at least once, so he or she can get some idea of what they are letting themselves in for. 54 55 The last thing you need is for an expatriate assignment to be terminated after only a few months as the employee’s better half can’t settle. If you do decide to relocate someone from abroad to work in Russia/CIS, it is absolutely crucial that the person is not only suitable on paper, but is prepared for the harsh realities of life in a former communist country. Just because one of your existing employees studied Russian history at University or has Polish grandparents does NOT automatically make them a perfect fit for the role. Whilst Moscow might appear as heaven on earth for single, straight guys (see chapter 11 for all the fun you can have out-of-hours), relocating with your wife and children presents certain challenges. Granted there are some spouses who have accompanied their Corp-pat husbands across the globe and rate Moscow as one of their best experiences amongst their various assignments. But it’s not a city for the faint-hearted as it can be bitterly cold for up to six months of the year – and then there’s the language barrier. Larger companies often have somebody in the Human Resources department who assists with such moves, helping you to get settled in. One of the many reasons why Expatriates take up assignments in Russia is thanks to the low level of income tax. Russia has a flat 13%, regardless of how much you bring in, which if you are a high earner can mean a lot of extra cash in your pocket every month, especially if you’re used to giving away half of your income to the taxman back home. Then, if your accommodation is paid for by your employer, Russia can be an excellent place to save, particularly if you are paid in a currency other than Rubles, after the recent devaluation. If this person is married, then the family accompany him (and to Russia/CIS, more often than not, it is indeed a ‘he’) as his assignments take him from country to country, with the wife known as a trailing spouse – although some firms prefer the more politically correct term, a ‘supporting spouse’. WHAT IS A ‘TRAILING SPOUSE’? The majority of large, multinational corporations like to maintain a modicum of control by sending in expatriates in for a few, key roles (usually the General Manager and/or the Finance Director). Many trailing spouses are comfortable with this arrangement as it allows them the opportunity to experience living amongst several different cultures although it does mean moving on very few years, sometimes when you’ve just found your feet. Finding somewhere to live in Moscow isn’t as easy as one might think; a shortage of living space in general pushes up prices to eye-watering levels. Even with the recent economic downturn there is a shortage of decent properties to rent at the high end and prices haven’t fallen by anywhere near as much as one might expect. This means that the market continues to favour landlords who conveniently (for them) are able to some extent dictate not only prices, but also terms of lease. Some trailing spouses find themselves in a dilemma when the husband is on a one-off assignment and his better half – who may well have a career of her own back home, has to give everything up to join him. Employment opportunities for trailing spouses in Russia are limited, largely due to lack of relevant experience and language skills, although many such ladies have kept themselves busy through a combination of charity and volunteer work. There are numerous real estate companies who will help you navigate this labyrinth and can advise as to the best areas for families, or closest to one’s office. For this you will pay a finders’ fee of at least one month’s rent, sometimes more, but then your agent effectively disappears and leaves you to it. Some are also able to arrange mini tours of Moscow, showing you round the various areas of the city so you can see for yourself before committing to a particular place. An English-speaking person (possibly even a long-term Expat) will accompany you with a driver and offer advice specific to your needs, which might include checking out the school where you plan for your children to attend. The range and quality of schools in Moscow has increased enormously in recent years, even though the better ones come at a price. With the recent exodus of many Expats, even the international schools may have a significant proportion of local children from wealthier families although this can help with your child’s assimilation to Russia. HIRING (& FIRING) LOCAL STAFF Some tips and advice for when hiring in Russia: Be clear about whom you want to hire, when and why, and avoid changing the job description mid-search. Be ready to make a quick decision – if you think you’ve found the right candidate, make an offer. If not, don’t be surprised if a week later your star candidate has already started another job with a rival firm. Notice periods in Russia are typically two weeks, so ensure that everything is ready for your new person to start. If you need to send your new person on a training course abroad, a 56 57 visa will almost certainly be required and this may take several weeks, so prepare for this in advance. Just because someone calls themselves a ‘manager’ doesn’t mean that they actually manage any people – job titles can be both misleading and inflated compared to what you are used to in your home country. Similarly, someone who calls themselves a ‘Director’ may not be anywhere as senior as you might think. Job titles and one’s status in general are important to Russians, and many will start their careers earlier, typically while they are still studying so a University graduate often comes with several years’ experience. Russians expect to be promoted more quickly than in the West, so when during an interview a candidate asks what the career path is, what they really mean is how long will it take for me to get promoted. Unemployment in Moscow is still relatively low by Western standards, and there is a severe shortage of English-speaking, customer-facing, presentable, pro-active people on the market. Don’t assume that you can just fly in and cherry-pick the best people for your organization, especially if your operation is in its early stages as Russians are relatively risk-averse to such ‘start-ups’, regardless of how large your operations are in other markets. Hard facts regarding pay scales can be hard to come by due to frequent economic changes, so any global salary data that you may have is often out of date before it’s even printed. Be flexible and be prepared to go outside of your bands for a strong person. Contrary to rumours you may have heard, relatively few companies index Ruble salaries against Dollars or Euros. Candidates generally expect a MINIMUM of a 20% uplift when changing jobs, regardless of how well the economy is faring. During tougher times it can in fact be MORE difficult to coax the best employees away so be prepared for greater increases than you would back home. Just because someone isn’t working at the moment doesn’t mean that they were fired, made redundant or are just plain lazy. Few Russians have mortgages or rent, so taking a month or three off work to spend the summer at the dacha isn’t viewed particularly negatively by prospective employers in Russia. 20% Russians aged under 30 will have no memory of the Soviet era and will only have heard rose-tinted stories from elderly relatives who recall the ‘good, old days’. Don’t expect Generations X & Y to have much, if any knowledge of this era. Even if someone is really keen to work for you, they probably won’t show it. Russians believe that demonstrating too much motivation during an interview makes them come across as desperate, so expect candidates to be ‘matter-of-fact’ about their achievements. Telephone interviews are not common in Russia. This might be the biggest country in the world but people meet face-to-face. Obviously if a line manager is based abroad then there may be no option but whereas no-one ever fully does themselves justice over the phone, this is particularly the case with Russians. Skype interviews are a good compromise in such cases. However, wherever possible avoid the need to fly a candidate abroad for an interview as this will severely delay the interview process, and for the same reason try not to have too many people based remotely involved in the decision-making process. Candidates in Russia/CIS generally quote their salaries monthly in local currency (unless otherwise indicated) and may give you the ‘net’ amount, which means after income tax has been deducted. If in any doubts, double-check as it’ll save you a lot of hassle down the line during the offer process, and don’t expect everybody to be familiar with terms such as OTE (On-Target Earnings) since bonus schemes can be rather fluid, particularly in Russian organizations. The office environment differs from back home in a number of ways, chiefly that Russians view work as a place to go, rather something that they actually do. The office is traditionally a place where trusted friendships are made, and even romances formed. The idea that people can work from home is a relatively new concept; when hiring people one of their first questions may be ‘where is your office located’? This is changing slowly, but flats are small so it’s not a case of simply converting a spare room into a mini-office at home as almost nobody has the luxury of so much space (many families sleep in the living room; the sofa converts into a bed at night). Therefore, be flexible about renting an instant office, or asking your local partner/distributor to find your person a desk if you are still in set-up mode. It is usual for Russians to hire family members, relatives and close friends, which is viewed as helping out trusted relatives. X Y Z 58 59 Russians see this as common sense, keeping control. Perhaps strangely, Russians seem happy to openly discuss their current salary with colleagues (so they will know if they are being over, or underpaid), friends and family. Even if you put a confidentiality clause into their contract, you cannot legally enforce it, and the same goes for a non-compete clause. ‘Gardening leave’ doesn’t exist, unless there is a gentlemen’s agreement, althoungh this is not common. Firing Do take advice from your legal and/or HR people if you need to let any of your employees go, regardless of the reason (underperformance, redundancy, etc). The Russian labour code is heavily weighted in favour of the employee so a director firing someone on the spot in a fit of rage is likely to end up paying for this dearly (both figuratively and in the financial sense) if the case does go legal. Ensure that you have everything in writing, fully documented and signed by both parties as e-mails do not (yet) constitute a legal document in a court of law. One trump card on the employer’s side is that every employee in Russia still has a labour book (trudovaya knizhka) which is a physical book that is kept by the company. Since no employee wants evidence that they were fired in this little book, most dismissals are settled ‘by mutual consent’ when both parties agree on a fixed amount for the contract to be terminated.

VI. Behavioral differences faced by Expats in Russia/CIS 60 61 Do’s and don’ts Don’t schedule early morning appointments unless they are with other foreigners. Moscow might be a 24-hour city but Russians don’t do mornings. Many offices don’t begin work until at least 10:00am, preferring to burn the midnight oil, which works in your favor given the time difference with Europe or North America. Breakfast meetings are not common in Russia; if you suggest meeting at seven thirty or eight, chances are that a Russian will think you mean seven thirty or eight in the evening, not morning. On this subject, don’t automatically assume that Russians are familiar with acronyms such as GMT, BST, CET, let alone EST & PST. Moscow and St Petersburg are three hours ahead of GMT, but Russia has experimented with not putting the clocks backwards/ forwards so the difference is sometimes two or three hours ahead for half of the year. Do double check as this is particularly vulnerable to change, and the same goes for other CIS countries. Finally, if you have operations in Siberia or the Far East of Russia, they will be many more time zones ahead of Europe; do take this into account before sending out an invitation for a regional conference call. Additionally, do expect Russians to take what you say at face value. ‘Call me anytime’ might sound like you’re simply being polite, but this could result in you being rung up on a Sunday morning, or at 10pm on a weekday evening (which incidentally isn’t considered late in Russia). Do re-confirm any appointments that you previously set up weeks or even days ago, the day before, or (even better) on the day of the meeting itself. Given the somewhat ad hoc nature of Russian business and the fast paced environment, it’s considered quite normal for meetings to be set up, moved or cancelled at the last minute. This can be done via the company reception or the person’s secretary if you don’t feel comfortable disturbing the person themselves. Reconfirming a meeting is known as a ‘kontrol’ny zvonok’, or a confirmation call. It is also a useful way of ensuring that a propusk has been ordered for you to enter the building, and if it hasn’t, it can be done at this point & will save you time upon arrival as security guards can become flustered when people arrive ‘unannounced’, particularly non-Russians. DO remember to bring some photo ID with you, preferably your passport or driving license or else your meeting may end up taking place in the office reception area. Don’t send a Russian an e-mail asking if you can telephone them in several days’ time (unless of course if it is a lengthy conference call or a telephone interview); just call them. If they are busy, they will tell you and you can quickly agree a time that works for both of you. Interrupting people isn’t really an issue on the phone – worst case, they won’t answer or their mobile will be switched off. Then you can e-mail them. Russians are not voicemail fans; few landlines and even fewer mobiles have this function, and even fewer Russians still will actually check them; if you don’t/can’t get through, it’s fine to send an SMS. On this subject, if you are from North America and you want a Russian to call you back, it would be helpful to add the +1 dialing code to the beginning of your number. Do bring a large stack of business cards with you, several times more than you think you’ll need. Invariably you will be introduced to additional people than those you were expecting to meet, such as other colleagues, partners or customers – be liberal when handing them out. Remember that coming to Russia without business cards is rather like going to a bar back home with no money. You’ll probably get a drink eventually, somehow, but you’ll struggle to be taken seriously. Even better if you can get them printed in Russian on the reverse side. Do greet people upon arrival at an office or business centre, although if you say ‘hello’ to somebody more than once per day, they will think that you forgot that you saw them earlier that day! Don’t believe everything that you read in the international media about Russia – come and find out for yourself. Chat to some Expats who’ve been in town for a while (not just those working for a multinational, blue-chip organisation, but also to those running their own businesses). They will give you more realistic insights into what’s going on than you’ll see on CNN or the BBC and you’ll see that it’s not all bad news by any means. Do take advice from people who have ‘been there and done it’, rather than people who think they have. ‘Yeah, I know all about Russia, I met this Bulgarian guy once who told me about it’ is similar to thinking you can become an astronaut after watching a few episodes of Star Trek. Don’t for a moment think that you are a pioneer just because you are embarking on your first trip to Russia. Sure, it’ll be cool to discuss with your friends in your local pub but Russia has been open to all for three decades. Do come out with a healthy dose of patience and a sense of humour, then explain to your head office that they need to learn to be comfortable with ambiguity. ! 62 63 Why Russians Don’t Smile? Alla Anastos D.M.D. – Dental Director at US Dental Care, Implantologist There are many explanations to why Russians don’t smile much. Most of them are based on the commonly accepted fact that smile in Russian communication is not a signal of courtesy. Russian smile is a sign of personal liking, sincere attitude and feelings, and not politeness. As the Dental Director at US Dental Care (Moscow) – a family oriented clinic that has been providing professional dental services by American Board Certified & Russian dentists since 1994 – I would also add another reason. In the USA, for example, people tend to take care of their teeth in advance, regularly do cleaning and check up. In Russia the situation is different. There is no such established culture. Sometimes patients come with very complicated cases, literally with no teeth and leave the clinic with a perfect smile. Numerous patients are actually shy to smile. We offer all kinds of general and cosmetic dentistry for such patients. Here, at US Dental Care, we strongly believe that preventive care is the key to dental health and a good smile. VII. Cultural differences, Russian superstitions & timekeeping 64 65 Contrary to how it may first appear, Russians are generally much more emotional than Westerners, and sometimes make decisions that on the surface can appear irrational to those of us with a more pragmatic mindset. (Russians think that emotionless, logical decisionmaking & long-term planning is plain boring). Emotions are much more likely to affect a Russian when making a decision than foreigners, who tend to take a more pragmatic approach. Changing jobs is a good example: a case in point is a candidate who has received a job offer that he plans to accept. All he has to do is formally resign, work out his notice period of two weeks and then start in his new company. Then along comes the counter-offer, when his existing employer faced with a valued employee walking out of the door, realizing that it will take considerable time, effort & money to replace this individual assume that it is better and easier to simply tell the guy how much you value him and offer him more cash to stay put. Back home we would rightly assume ‘if you thought I was that great, why didn’t you pay me this extra amount before’!? However, Russians are more likely to take an emotional view of the situation, thinking ‘wow, they not only love me but they’re even prepared to pay me more money – of course I’ll stay where I am’. The fact that the key reasons for wanting to change jobs in the first place were probably not money-related (evidence shows that people usually begin a job search for almost any other reason, be it that they don’t like the job itself, the office is too far from their home, they don’t see any potential promotion on the horizon, or – and this is the most common reason, that they simply don’t get on with their boss) fades away. Statistics reflect the truth that around 70% of people worldwide who accept a counter-offer leave within six months anyway as money wasn’t the main driver. Add to this the fact that as you’ve already demonstrated your loyalty (or rather, lack of it), some firms will pay you more to stay on, then quietly seek a replacement, and as soon as they have one lined up, will then give you the grand order of the boot. Be warned – as an employer, counter-offering is counter-productive (pardon the pun), and as an employee, accepting a counter-offer may seem like a wise move in the short term but definitely not a long term solution. Taking things personally is a very Russian trait – known as ‘obida’ (offence) and affects the way people work, particularly in sales. Russians are extremely reluctant to do anything that could be construed as unsolicited, such as making cold calls due to their fear of rejection which they will take to heart, almost as a personal insult. Add to this the fact that under communism nobody sold anything, and nobody bought anything either (at least not in the B2B sense) so Russia lacks a general sales culture. Concepts such as cross-selling and up-selling are alien to all but the most savvy salespeople. Don’t just show up assuming that it’s second nature because making a profit under communism was a crime that only evil capitalists committed (in theory at least). Networking for business or career purposes as we know it is not well established, and many Russians feel uncomfortable approaching people whom they haven’t met before in a non-social environment. Don’t expect too much from your staff here, and any guidance you can provide ought to prove invaluable. SUPERSTITIONS Even fully grown men will adhere to Russian superstitions – foreigners will be forgiven for any faux pas but it’s always useful to be aware some of the better known ones: In the workplace, Russians may be reluctant to forecast sales projections as they are worried that even mentioning it to someone before it is completed might jinx it (‘sglazit’), so you may find yourself having to ask more questions than you expected to get to the bottom of a project or sales campaign that is still in the pipeline. Similarly women may not announce that they are pregnant until several months into their pregnancy. Russians believe that it’s bad luck to shake hands, or in fact pass anything through the threshold of a door. If you leave home (or any building) and realize that you have forgotten something, it’s considered bad luck to return to fetch it. However, this can be atoned by looking in the mirror on the way out. Empty bottles should be placed on the floor, not left on the table (in practice this tends to happen in the home as one would expect the waiter in a restaurant to clear the empties – although in places where the service is a little on the slow side, you may see Russian guests doing this automatically). Celebrating Birthdays – or in fact any holiday or anniversary in advance of the actual date is considered bad luck. If someone’s Birthday falls on the weekend, colleagues at work would. celebrate it on the Monday afterwards, unlikely on the Friday before. Fortieth Birthdays are rarely celebrated as this date is considered unlucky. 66 67 If you step on someone’s foot by accident, you should let them step on your foot in return to avoid any future arguments – although this rule doesn’t apply on public transport. When giving flowers – and this is a ritual in Russia, be sure that the bouquet contains an odd number; an even number is for funerals. Flower sellers will know this but you would be wise to count as they may not know what occasion you are buying flowers for! Whistling inside any building deprives you of money. Sitting at the corner of the table means that you won’t get married (although this only applies to women, apparently). TIMEKEEPING There is a Russian expression ‘Pyat minut ne opazdanie’ (Five minutes doesn’t constitute being late), and given the traffic jams that you face in Moscow, this is understandable. Schedules are rather more fluid in Russia than in the West so showing up ten or even twenty minutes late is unlikely to raise many eyebrows, although it is considered courteous to call in advance and let them know that you’re en route, but stuck in traffic. A word of warning; meetings with senior government officials are likely to begin on time so it would be seen as bad form to arrive late. Even if they do show up late themselves, they will expect you to have arrived on time! Given the unpredictable nature of the traffic on the roads in Moscow, you should allow much more time for getting to meetings, particularly in the winter when snow and ice slow things down. Arriving early isn’t an issue, and in any case it can take time to actually get into a building as documents need to be checked, and in more remote locations the security staff may be unfamiliar with having foreign guests visiting and therefore may have difficulty deciphering your name on your ID if it isn’t written in Russian. This process at some larger state organizations can take a surprisingly long time (the overmanned security department need to justify their existence somehow, and some firms believe that this is part of their grandiose image, in the same way that an Oligarch surrounds himself with several bodyguards), and even longer if a propusk hasn’t been ordered for you. There is still a degree of paranoia about non-Russians visiting large, state-run companies and ordering a propusk could in fact take several days. Consequently if a meeting has been scheduled at short notice, or you are bringing along an additional colleague, it may be more convenient – and in some cases necessary, to meet in a nearby café or restaurant. Alternatively, if you have a local office in a convenient location, you can always invite your counterparts to your premises, it would be more convenient – and in some cases necessary, to meet in a nearby café or restaurant. Alternatively, if you have a local office in a convenient location, you can always invite your counterparts to your premises. Addresses can be a little deceiving as well as confusing. Since many new buildings have sprung up in recent years, rather than re-number all the existing buildings, the authorities chose a different tactic: adding additional numbers and letters, and there may be little logic as to the actual order. Google maps, SatNavs & their equivalents have assisted to a large extent, but again, allow additional time if the address looks ‘funny’. Bureaucracy continues to be the one of the greatest obstacles to running an efficient business in Russia. Basic tasks such as purchasing insurance or registering your car which in the West can be done on-line or by telephone often require a personal visit and probably during the working day. Applying for a new passport will require the holder to submit their documents in person, and this may involve a trip to the town where they are formally registered. While such procedures are slowly becoming simplified, often there is often no getting around having to take time off for such matters, and your flexibility (& understanding) will be required. Russians have a tendency to leave things until the last minute so don’t expect a little to be done each day or week unless you specifically arrange a call/meeting to discuss progress. Better still, set the deadline for the project much earlier than necessary to be on the safe side. Dress to impress – smart business attire is very much the order of the day (ie, suit, white shirt AND tie for men, skirt or dress for women), and you would be wise to err on the side of conservative, especially when meeting with government officials. It’s best to leave the pink shirt and the loud ties back in your wardrobe at home although the younger generation are more open to less formal styles. Casual Friday is becoming more popular but is not particularly widespread even though more men are now opting for the open collar & no tie look. 68 69 VIII. Language Language barriers and deciphering names Moscow is NOT Dubai, Hong Kong or Singapore, where the business language is English. In Russia and many CIS countries, the business language is Russian. The number of Englishspeakers is certainly on the increase, but don’t expect or assume that everyone speaks English, even in Moscow as outside of grade-A offices, most don’t know more than the basics. Russian is spoken as a first or second language by approximately 300 million people throughout the world, although around 95% of these reside within the borders of the former Soviet Union, and some people’s fluency in Russian in certain CIS countries is now open to question. Large numbers of students came to the Soviet period especially during the 1970s and 1980s from fellow communist countries, as the education system was considered not only prestigious but was more advanced than where they were from. Subsequently Asians (Vietnamese, North Koreans, Mongolians, Chinese, Cambodians and even some from Laos), Arabs (Yemenis, Syrians and Egyptians), Africans (Ethiopians were numerous although a surprising number came from places such as Benin, Mali or Guinea Bissau) and of course Cubans returned home with a degree and in many cases a Russian wife too, continuing the language tradition. The Eastern Bloc countries were generally resistant to the teaching of the Russian language as it was forced upon them, although thanks to being in the same linguistic group, some Poles, Czechs, Slovaks, Bulgarians and citizens of the former Yugoslavia, many people there – especially the older generation still retain some knowledge even if they claim to have ‘forgotten’ everything they learnt in school. Romania and Hungary are the exceptions – knowledge of Russian there will get you close to nowhere. You will also find many Russians speakers in countries where immigrants have congregated, such as the USA and Israel. Many (although by no means all) of these people are Soviet Jews who left during communist rule, or at the very end of the Soviet Union. Add to this the estimated several million non-Jews who have emigrated in the past generation, mostly to the USA, Canada, the UK, Australia and Germany, the latter often being ‘Volga Germans’ who claim to retain some German roots. In fact, most first world cities will now have a diaspora of Russian speakers, ranging from some who have immigrated to others who are they for a shorter period, typically for work or study. So Russian is a more widely spoken language than it may first appear, spoken by many nationalities throughout the globe and therefore Russians are not surprised when they hear non-Russians 70 71 speaking Russian. Nevertheless they are not accustomed to Westerners being familiar with their language for the simple reason that so few actually are even able to hold a simple conversation, let alone master it. The majority of Expats in Russia are either on a business trip, a short-term project or a fixed term contract of 3-4 years whilst being confined to mixing with fellow nationals during their entire stay. They live a stone’s throw away from their downtown Moscow office where the staff speak at least some English, or in a compound filled with other foreigners. Even their driver knows enough to get them around, so it’s no surprise that they rarely pick up more than a few phrases since as soon as their time is up, they know that they’ll be posted elsewhere (or sent back home). Therefore it’s no surprise that few make more than a token effort, despite some starting out with the best of intentions upon arrival. To begin with, Russian is a tricky language with a fiendishly complex grammar – there are 108 different endings for regular nouns, and whilst the number of exceptions might not quite outweigh those that follow the rules, it sure feels like it to anyone trying to memorise them. Even a dedicated student taking daily lessons over a three year period (plus interaction with locals inside and outside of the office) is unlikely to get much past conversational/intermediate level. There are however a few bright spots. Unlike English, which is fairly basic to begin with, but gets harder the further you advance, Russian actually does become easier once you’ve hit a certain point – the difficulty is that disappointingly few ever reach that level. Russian is phonetic, meaning that letters are pronounced as you see them. Once you’ve mastered the Cyrillic alphabet, you can now read Russian. Pity foreigners trying to read British place names, such as Leicester, Slough, Worcester or Loughbrough! Additionally there are fewer regional variations to Russians, so what you hear in Kamchatka will be almost identical to what is spoken in Kaliningrad, Kalmykia or even Kazakhstan. There are minor regional dialects, such as Muscovites drawling their ‘o’ to sound more like ‘a’ so their city sounds more like ‘Maaaskvah’ but compared to how people from Scotland, Texas, Liverpool, South Africa, Jamaica and Birmingham speak English, difference in accents throughout the CIS are nominal. And it may also come as a surprise to hear that the Russian language is extremely standardized, given the country’s vast size and varied ethnic groups. What you’ll hear from all walks of life is almost identical, especially when you compare it to how differently an Australian miner and a London Newsreader would communicate. Please don’t take this as a sign that you shouldn’t bother to even try to learn Russian – quite the opposite! It will make your life a whole lot easier if you can actually read the street signs (many of which are in Cyrillic only) and can communicate with taxi drivers, staff in shops, ticket offices and some provincial hotels, where you will be lucky if even basic English is spoken. Russians will always be impressed if you’ve taken the time & effort to learn a few words and phrases of their language (even if you have to switch into English quite quickly) and will invariably be more helpful than if you just start off straight away in English. Although each CIS Republic has its own official language, Russian remains very much the language of business, politics and academia throughout the region, rather like English on the Indian subcontinent or French throughout much of West Africa. Although there has been some anti-Russian sentiment coupled with a growth in homegrown nationalism in a few countries, most non-Russian peoples of the CIS will only be too happy to speak to you in Russian (particularly if they know that you are not Russian). If you look Caucasian and speak Russian fluently then it may even be assumed that you ARE Russian. Russian, especially spoken Russian uses considerably fewer words than English, so saying ‘there is a cup of tea on the table’ in Russian would simply be ‘na stole – chai’, literally ‘on table – tea’. So when Russians speak English they may sound more abrupt than they mean to, and non Russian-speaking foreigners who hear Russians talking to each other could be forgiven for thinking that they are always arguing. However, written texts in Russian are often much wordier than they are in English. During conversations, be prepared to hear ‘sorry for interrupting’ and the person will continue speaking. Tune into a Russian live debate show on TV and you’ll get the idea! An example of a cultural and linguistic misunderstanding: a European company was looking to hire a General Manager for their Moscow office and decided to meet the first candidate faceto-face one morning in their hotel during a business trip to Moscow. ‘Vladimir’ was introduced to the Europeans and was asked if he would like to join them for breakfast. Vladimir simply answered ‘no’! What Vladimir 72 73 actually meant was ‘no to breakfast’ as he’d presumably eaten at home before the interview as he simply expecting an interview in the hotel lobby, perhaps over a cup of tea, not a full breakfast. Of course the correct answer would have been something along the lines of ‘well, I wasn’t expecting breakfast so I ate at home but I’d love to join you for a coffee!’ but this is rather long winded for Russians. Vladimir certainly didn’t mean to be rude, but the Europeans took this as a blunt rejection and not surprisingly Vladimir didn’t get the job. The moral here is that Russians don’t use wishy-washy expressions such as ‘not really’ when in fact they mean ‘no’, especially if their English isn’t great. Russians tend to read and write English much better than they speak it, largely due to the education system in Russia, coupled with a lack of general practice. Therefore, when speaking to Russians in English, avoid excessive use of slang of colloquialisms; best to park them on the back burner, if you catch my drift or else you could be barking up the wrong tree. Without wanting to sound condescending, stick to plain, easy to comprehend English, especially if you have a strong accent (Russians tell me that the Scottish are particularly difficult to understand). An example – in English, we say ‘yes, it is’, or ‘no, it isn’t’ whereas in Russian it is perfectly acceptable to say ‘yes, it isn’t’ or ‘no, it is’. And whereas Russians generally give shorter answers, this leads to situations where yes means no, or vice versa. Don’t be afraid to question anything that you are not sure about, especially if you don’t hear the answer that you are looking for. It’s best not to ask ‘do you mind doing’ as Russians will answer ‘yes’, meaning that ‘no, they don’t mind’! Bear in mind that if a Russian hasn’t understood you, it is highly unlikely that he or she will actually say so and ask you to repeat or explain - this is the Asian side of Russians; not wanting to lose face by admitting that they didn’t get it first time. Add to this the issue that Russians rarely volunteer information that they consider to be in the slightly bit superfluous, so expect to ask more questions that normal to get the required answer. The patronymic name is used in formal documents as well as when addressing older and/or more senior Russians (note that ‘Mr’ or ‘Mrs’ plus the person’s surname is not common in Russia). Younger people, and especially those who consider themselves to be more international generally omit the patronymic in everyday situations, such as on business cards. Surnames (called ‘familiya’ in Russian) end in ‘ov’, ‘skiy’ or ‘in’ for men, and ‘ova’, ‘skaya’ or ‘ina’ for women. Also common are surnames ending in ‘ich’, ‘ko’ and ‘iuk’ especially for people of Ukrainian or Belarusian descent, for either sex. Surnames of Armenian origin almost always end in ‘yan’ and Georgian in either ‘vili’ or ‘adze’, for either sex. In formal documents, such as passports Russians begin with their surname followed by the name and then their patronymic. On business cards and on CVs however, they often put their name followed by their surname – but not always. Do note that there is no perfect way to transliterate Cyrillic into Latin so you will come across several spellings of the same name, such as Sergei or Sergey, Ludmila or Lioudmila and Evgeny or Yevgeniy. You will also find that some Russians have ‘Westernised’ their names, especially if they have lived abroad as they assume it makes life easier for non-Russians. Examples include Helen for Elena, Julia for Yulia, Kate or Catherine for Ekaterina and Eugene for Evgeny. Both Alexander and Alexei just shorten to Alex. Some pronunciation tips: The letter ‘e’ in Russian is typically pronounced as ‘yeh’ (especially at the beginning of the word) so Elena would be pronounced as Yel-yena and Evgeny as Yev-geny. Also, unstressed ‘o’ is pronounced more like ‘ah’ (especially in & around Moscow) so Oleg would call himself Ah-lyeg. Here are some of the more common first names, together with the more colloquial form – which isn’t necessarily shorter. The best advice would be to stick to the full form unless introduced, or otherwise asked to use the more familiar form (much as you would do in English). RUSSIAN NAMES Have you ever wondered why Natalia and Natasha can be the same person, yet Alexander and Alexey are not? Is Valery really a man’s name? Which way around do Russians write their names and what on earth is a patronymic, anyway?! To make life a little easier, here is a guide to Russian names. Which way around do Russians write their names and what on earth is a patronymic, anyway?! To make life a little easier, here is a guide to Russian names. In Western countries we typically have a first name, a surname with perhaps one or more middle names. Russians have a first name, a patronymic and a surname. MY NAME IS 74 75 Fortunately for newcomers, there are around twenty first names (called ‘imya’ in Russian) for the bulk of the population – a list of the most common names, plus the shortened version is given below. A patronymic name (called ‘otchestvo’ in Russian) is basically the person’s father’s name with – ovich (or sometimes –evich) for males, and –ovna (or sometimes –evna) for females. So Andrei whose father is Vladimir would be Andrei Vladimirovich and Tatiana whose father is Alexander would be Tatiana Alexandrovna. MALE FEMALE Full Alexander Alexey Artyom Boris Dmitriy Evgeniy Fyodor Gennady Georgiy Ivan Konstantin Mikhail Maxim Pavel Roman Sergei Stanislav Timur Valentin Valery Victor Vladimir Vladislav Vyacheslav Yuriy Full Alexandra Anastasia Anna Daria Ekaterina Elena Elizaveta Evgeniya Galina Irina Ksenia Liliya Ludmila Lyubov Margarita Maria Nadezhda Natalia Olga Polina Sofiya Svetlana Tatiana Valentina Valeriya Victoria Yuliya

Lyera Vika Yulia Sasha Lyosha Tyoma Borya Dima Zhenya Fedya Gena Gosha Vanya Kostya Misha Max Pasha Roma Seryozha Stas Tima Valya Valera Vitya Volodya or Vova

(not Vlad)

Vlad Slava Yura Sasha Nastia Anya Dasha Katya Lena Liza Zhenya Galya Ira Ksyusha Lilya Lyuda or Mila Lyuba Rita Masha Nadya Natasha Olya Polya Sonya Sveta Tanya Valya Shortened Shortened 76 77 IX. Doing business part 1 First impressions, breaking the ice and general corporate etiquette in the office You don’t need to be a genius to work out that the Russian economy remains heavily dependent on natural resources, and in particular, oil & gas. Vladimir Putin’s ascent to power coincided with a rise in the price of what comes out of the ground, thanks to a combination of factors, ranging from increased demand (helped in no small part by massive production output in neighbouring China). These petrodollars have funded unprecedented economic growth since the start of the twentieth century following the Ruble default in August 1998, which battered the economy. The main blip was the crash of early 2009 although Russia’s economy rebounded much more quickly than western markets. However, the dual shock of the fall in the world price of oil, coupled with international sanctions in 2014, plus a general negative view of Russia caused the economy to fall into a recession from which is has yet to fully emerge. The profits used from the sale of Russia’s resources fueled this growth, and living standards have risen substantially over the past two decades. Skeptics naturally questioned how sustainable this economic model is in even the medium term, since not only are there huge opportunities for grand-scale theft from the state budget, there has been little incentive to produce much, let alone innovate or reform loss-making industries. Much easier just to buy stuff from abroad, and the response is now a loud ‘I told you so’, even if the State prefers to blame outside interference for economic difficulties. Critics claim that this is the whole point, that it is corruption which keeps the system intact. There is a Russian expression from communist times: ‘Ryba gneyot s golovy’ which loosely translates as ‘a fish rots from the head downwards’ meaning that the corruption begins at the top, which still applies today. Too few state enterprises have been sufficiently reformed to be able to compete with either cheaper goods from China, or better quality products from more established European, North American or Far Eastern countries. There are large numbers of oneindustry towns in Russia which are heavily over-staffed and the standard of their output is questionable at best. They are kept afloat by government subsidies as well as trade barriers that make some imported goods prohibitively expensive. Such practices ought to be coming to an end now that Russia has joined the WTO but progress is slow. Regardless of what you think of the people in the Kremlin, for those enterprising foreign business people, the lack of decent, 78 79 locally produced goods (and services) creates ample opportunities for their companies who want to export to Russia. Russians like brands and are prepared to pay a premium for what they perceive to be quality; the mark-ups in shops can be horrendous when compared to what you would pay for the same items in Western Europe or North America. Starbucks wasn’t nicknamed ‘Ten Bucks’ for nothing. In short, Russians like expensive, which they perceive to be associated with high quality, Russians like things for free (known as ‘khalyava’ in Russian), but they don’t like cheap. Bottom line is that whilst the average Russian consumer is certainly becoming more price-conscious, low-end is viewed as shoddy, particularly in Moscow. One interesting feature of the retail trade is the arrival of promotions and discounts, something which hadn’t existed until fairly recently. The past few years have seen living standards remain static, so Russian consumers have become savvier, and more cost-concious. As a rule however, Russians don’t see the logic of saving money for a rainy day . There is not much of a culture of putting money aside for the future, and with good reason; large numbers of people saw their entire life savings effectively rendered virtually worthless with the onset of hyperinflation at the end of the Soviet Union. Then again after the default of 1998, rampant inflation resulted in many financial institutions going bankrupt and once again wiping out just about everything that wasn’t held in hard currencies. Certainly some trust in the banking system has been regained but the culture of spending what you have as soon as you get it remains. Note how many lower-end employees withdraw their entire month’s salary from the nearest ATM machine as soon as they receive it. Under communism if you didn’t buy it today, it almost certainly wouldn’t be there tomorrow, and this trait among Russians remains to this day even if shortages are a thing of the past. Add to this the fact that Russians’ outgoings (only a minority of Russian rent, have a mortgage or even have bank loan repayments) are small as even utility payments are nominal, especially by Western standards. Therefore you have a country full of people with disposable incomes who cannot buy everything that they want made locally, so the door for manufacturers from abroad opens up. Summed up in a sentence, Russians do business face-to-face, with whom they like, and with whom they trust. It’s not about having the flashiest presentation, or even the best product – what Russians want you to demonstrate is that you are taking them, their company and their country seriously. You may be surprised to hear that cost efficiency might not be your prospective customer’s main interest. Regardless of how big, profitable, impressive and well-branded your company is back home, or in other markets, the Russians that you meet will primarily be interested in what you have achieved so far in Russia itself, what you are currently doing and what your future plans are. It goes without saying that nobody enters a market with the intention of leaving but companies have arrived in Russia with the best of intentions, only to shut up shop after the global HQ changed their business strategy and decided to focus on other markets. The ‘legacy’ that they left behind hinders others, new entrants as it is often, regrettably assumed that they are only here for the good times. Whilst naturally you will want to maximize the time you spend in the country, especially if you only visit once or twice a quarter, one word of caution – avoid trying to cram in as many meetings as possible in a short trip. Russians are not usually as pressed for time as Westerners claim to be, and if they have taken the trouble to meet you, allow them the courtesy of a decent meeting. Usually you will find that the serious talking gets done first, and once business is taken care of, then you can move in to some lighter conversation. The people that you meet will no doubt be interested to hear how you like Russia, your impressions, whether or not it is your first visit and how you find their country. Avoid being negative – Russians are all too aware of their country’s shortcomings and will happily bitch about it, but will be deeply offended if they hear it from you, and will take it as a personal insult. As a result, expectations can be lower, summed up by the expression ‘pyerviy blin vsegda komom’ (the first pancake always comes out lumpy) so if things don’t go according to plan immediately, it might not be the end of the world for you. The exceptions to the rule about moaning are the weather, and the traffic – which everybody complains about continuously. Sport in general and football (soccer) in particular is a good topic for conversation as Russian men enjoy watching the top European leagues, and you can never go wrong with holidays and families, as is the case throughout the world. 80 81 Men will always shake hands with each other, although women do less often, particularly with each other. Don’t worry about initial awkward silences, and don’t feel that you have to talk just for the sake of it. Business meetings tend to be quite formal affairs, particularly in the early stages when you are dealing with people who don’t know much about you. Chances are that they will warm to you if they like both you as a person and your proposal, but instant chemistry isn’t common. The Russian equivalent of ‘breaking the ice’ is ‘melting the ice’. Whereas Russians aren’t particularly bothered if you show up a little late for a meeting, it is considered rude to abruptly finish a meeting that is in full flow (or even during the non business related conversation at the end) as you are rushing out to the next meeting. Russians are likely to consider such behavior as bad mannered, assuming that you are only interested in making money out of them, and aren’t actually interested in them as a person or a company. Schedule meetings accordingly, allowing much more time than you would normally allocate, and not just for the traffic. If you are in a genuine hurry, it is advisable to make the people aware of this at the start of a meeting, saying that you only have an hour as you need to get to the airport and are concerned about missing your flight. If your company is well established in Russia and has a reasonable-sized operation in Moscow, there is a good chance that you will be exposed to corporate life in a Russian office. During communist times, people were effectively paid for showing up to work, and although incentive schemes existed in theory, employees were paid more or less an identical sum regardless of either quantity or quality of output. Add to this the fact that your standard of living was not linked so much to your ability to pay (ie, how much you earn – as it is in the West) but rather to your access to goods & services. Most of these were not available in shops, which were largely devoid of anything that people wanted to buy anyway. The result was a massive, informal economy based on a system of favours via connections which bypassed the formal sector. Insurance companies have struggled to make inroads into the Russian market, largely due to Russians being a fatalist bunch. Until car insurance became compulsory, many Russians thought that buying insurance was pointless. I have heard ‘if I make monthly payments and my car hasn’t crashed or been stolen, then I’ve wasted my money. And if I did lose my car, then it was meant to be’. Fate (‘sud’ba’) is something that even seemingly sensible people believe strongly in, such as if they have a minor car crash on the way to a job interview, then it obviously wasn’t meant to be the job for me. Russians are fiercely loyal to their family and their close friends, which to outsiders can be perceived as a little strange. Since relationships are based largely on trust, it is not unusual for a manager to jump ship to a competitor and take part, or all of his team with him when leaving. The company itself is almost a secondary consideration. The office environment can appear very relaxed to outsiders, sometimes too much so, with a poor work ethic since employees spend time chatting with colleagues over tea and staring into their phones while on social networking sites. The ‘sandwich at your desk’ style of lunch is unusual in Russia (partly because sandwiches aren’t hugely popular); people will either leave the office in small groups for a ‘business lunch’ – a set menu in a nearby restaurant or in the office canteen, if there is one. Some firms subsidize this or have their own canteen, especially in production facilities located far from any hives of activity. Some employees bring food with them from home, purchased nearby, or from one of an increasing number of delivery services, but they will nonetheless eat together. Lunchtime is a fairly fluid time, and lunch itself could be taken anywhere between noon and 4pm. Aggressively trying to change such behavior is likely to be counter-productive and result in demotivated employees, and eventually people resigning. It is considered fairly normal for Russians to quit their job without having a new employer lined up – few, particularly in Moscow have a fear of losing their job thanks to low unemployment; they know that someone will soon hire them, even if they underperformed in their last position. Rather, take time to get to know your employees; join them for lunch or a chat over tea as your Russian staff will value being valued, particularly by a senior employee from abroad. There appears to be little, if any stigma in colleagues dating, even when one or both parties are married, or one reports directly to the other. Russians take a liberal view on such as matters such a boss being romantically involved with a subordinate who is half his age, even if similar actions in your home country are at best frowned upon, and at worst can trigger lawsuits. In downtown Moscow and other large CIS cities, you cannot fail to notice the number of expensive cars on the streets, which are seen as the ultimate status symbol, especially for men. 82 83 A guy driving a top-of-the range high-end vehicle will be assumed to have ‘made it’ in life, even if he had to take out a serious bank loan to finance this purchase and continues to live in a one-room, rented apartment on the outskirts of town with his mother! The equivalent for women would be a mink fur coat, followed closely by boutique clothes, shoes, designer handbag, make-up and jewelry. You only need to take a brief look at the structure of the Russian government (and pretty much all of the CIS countries too, for that matter) to see that it’s a very top-down system. What the big guy at the top says, goes and if you know what’s good for you, you don’t question it and you certainly don’t argue. This is a similar situation throughout the country, be it local government, or Russian companies, both big and small. In the same way that Mr Putin often appoints many regional governors whose key criteria is unwavering loyalty to him, a company owner or Director will similarly appoint trusted subordinates in key positions; often long-time friends or even members of his own family. This is particularly the case in organizations that are fully or partially state-owned and managed. Delegation is not Russians’ strength, partly down to lack of trust towards outsiders, but there are of course plusses and minuses to this. The individual who heads up a particular organization is by and large responsible for everything, even at a micro-level. While this can delay the decision-making process, there is the advantage that if you are able to meet the person in charge, you will avoid going through layers of middle-level managers who don’t decide anything at all and will be frightened to take any initiative. RUSSIANS ARE VERY IMAGE CONSCIOUS FOR THINGS WHICH MATTER TO THEM – REMEMBER THE SPRITE ADVERT WHICH RAN THE SLOGAN ‘IMAGE IS NOTHING, THIRST IS EVERYTHING – OBEY YOUR THIRST’? NOT SURPRISINGLY IT FLOPPED IN RUSSIA, WHERE IMAGE IS EVERYTHING – EVEN MORE IMPORTANT THAN THIRST. Perhaps surprisingly, cold calling works rather well in Russia – secretaries are more likely to be administrative assistants than gatekeepers, and often when someone calls up in English, they assume it is somebody important and put the call through (it might also just be that they don’t speak English particularly well, and just want to get rid of you). Add to this the fact that it is less common for senior executives in Russia to be called up. It is certainly worth a try; you’ll be surprised as to how effective it can be, even though it might take some people that you contact a little while to work out what you want and why. Following up your call with an e-mail is also advisable given that Russians tend to read & write English better than they might speak it. 84 85 Welcome to Rosinka International Residences! We are a luxury gated community of rental family homes. Rosinka spreads over 134 acres of beautifully landscaped gated territory, with a private lake, indoor tennis courts, Olympic sized indoor swimming pool, large athletic complex, restaurants, walking trails, skate park, dog park and many other amenities. All houses have a two car garage. We are located just outside of Moscow, a few minutes from the nearest metro station. On site is the world renowned International School of Moscow, operated by Nord Anglia Education, offering contemporary British international education from Early Years through to secondary school. Our young residents can walk, bike or scooter to school safely without adult supervision. When the snow comes, Rosinka transforms into a winter wonderland and the children can enjoy a sleigh ride to school. Our strictly imposed 20 km/h speed limit allows for peace of mind for parents and children alike. As an enclosed and safe community, children can play and visit freely with their friends and schoolmates without worry and the hassle of travel. Rosinka is truly the unparalleled choice for families with school-aged children. Rosinka hosts over 350 families from more than 30 countries around the world. The spirit of community distinguishes Rosinka through the atmosphere of companionship. With cultural events, sports tournaments, fishing, exhibitions, children’s activities, and more than 20 resident clubs, Rosinka truly offers something for everyone. Our English speaking concierge is available 24/7 to make sure you always feel welcome and comfortable. We look forward to welcoming you and your family to your new home. +7 985 998 05 85 +7 916 900 05 13 rosinkarentals@gmail.com www.rosinka.ru 86 87 X. Doing business part 2 Next steps, negotiations, legalities and dealing with corruption Let’s start with what is foremost on your mind as you consider doing business in Russia. CORRUPTION Is corruption a major problem in Russia? The simple answer is both yes and no. Much depends on your particular line of business and your plans. Russia features high on international corruption indexes and in many respects deservedly so. However, corruption issues affect foreigners considerably less that the global media would have you believe. Much of the ‘corruption’ so to speak which affects Russians on a daily basis is petty – small bribes handed to low-level state employees who are badly paid and use their position of power as a Little Hitler to supplement their meager income, be it allowing someone to jump the line, receive better treatment in a hospital or ensure that repairs are done to their home properly, and more quickly. To what extent you can call this corruption is questionable; it doesn’t always take the form of a cash payment as it could be a box of chocolates or a bottle of Russian champagne given as a ‘thank you’. Everyone is fully aware of how little most people in government jobs earn and even with recent wage hikes, it’s not enough to live well on, so such gifts can make the difference between mere survival and some level of comfort. Putin’s opponents claim that this is all part of the masterplan, to keep everyone under control by expanding the number of public sector jobs, paying those workers a pittance, effectively forcing them to make ends meet by accepting bribes for essentially doing what they are supposed to do. In this way, they are frightened into toeing the line or face the sack for corruption. Inevitably some people are given their marching orders for this reason, although it’s often more to do with colleagues settling scores and/or advancing their own careers. It can even look good as Russia can say to the world ‘hey everybody, we’re fighting corruption; look at these people we’ve ousted’. Fortunately foreigners, even those living and working in Russia are largely sheltered from the hassles of dealing with petty officials who drag their feet in the hope that you will give them a little ‘present’ to speed things up. There is of course a lot of corruption at the top end of government, where appointments are made more on the basis of who you know rather than what you know. This so-called ‘jobs for the boys’ comes back to the issue of trust – any allegations of nepotism would 88 89 be countered by a Russian, saying ‘what, you want me to appoint someone that I don’t even know into this crucial role?! Why take the risk, when I have Mikhail here, whom I studied with at University and we worked together in our previous company. I trust him to get the job done’. Another reason why foreigners are less likely to be exposed to the worst aspect of corrupt practices in Russia is that these tend to involve embezzlement from the state budget when large projects come up for tender. Trust, (‘doveriye’) is a crucial factor when dealing with Russians. In the West we tend to automatically trust people when first meeting them, unless there is good cause not to do so, although even then we tend to give people the benefit of the doubt. Seven decades of communism taught Soviet citizens to trust nobody apart from those closest to them, and to be naturally suspicious of outsiders. If your potential or existing Russian partners or customers suggest meeting up outside of the office, for example out for dinner, or even to visit a banya, you would be foolish not to take them up on the offer. For starters, it’s likely to be a great experience, but this is the Russian ‘getting to know – and trust you’ phase – see it as a Russian-style of due diligence, if you might. Fortunately, whether you are simply coming to Russia to sell your company’s products, or looking to set up production facilities, your main hassle is likely to be insurmountable piles of red tape, which in itself sometimes presents opportunities for corruption. In fact most Russians don’t really know how to approach foreigners in such a way, so bribing opportunities are likely to come in the form of a hint, such as ‘to receive this permission will take several months, but there is a quicker way, although it will cost a little more’. Of course you don’t need me or anyone else to insult your intelligence by telling you that the golden rule is never to engage in practices that could even be considered as anything other than ‘white’ as this will be just the beginning of a very slippery slope. You may win the initial battle but you will almost certainly end up losing the war. Few things in Russia are completely black or white – there are of course plenty of grey areas; an increasing number of multinational organizations have zero tolerance policies on accepting ‘gifts’ from suppliers; not so much a brown envelope stuffed full of cash but even a simple lunch or a calendar at Christmas. Russians rightly view this as petty, but for clarity’s sake you would do well to make it clear from the outset that due to corporate policy you cannot pay for, or accept anything – to save face on all sides, blaming your company’s headquarters is an easy way out, saying that they don’t understand Russia. Older Russians, and those less exposed to outsiders may struggle with the concept of a win-win scenario, assuming that if you are happy with the deal, then they have negotiated badly. Negotiating anywhere in the world is an art in itself, but takes on a particular significance in Russia as your counterparts want to see what you’re made of. Toughness is admired even if it doesn’t feel like it at the time; then there is the expression in Russian ‘proverka na vshivost’; seeing if you stand up to the test. Remember how even at the height of the cold war, the Soviets respected Margaret Thatcher since they viewed her as sticking to her guns. By comparison, Russians view most Western leaders nowadays as wimps, pandering to minority politics and not sticking up for their majority. THERE IS A FAIR DEGREE OF TRUTH IN THE QUOTE: ‘RUSSIA IS A LOUSY PLACE TO DO BUSINESS BUT A GREAT PLACE TO MAKE MONEY!’ Then there is the concept of ‘molchaniye – znak soglasiya’ (silence means approval) which can cause confusion as in the West we believe that if someone doesn’t reply to you then they either haven’t understood you, or more likely didn’t hear you. Again, do double-check but it often happens that if you ask someone to do something, they may simply start doing it without saying ‘yes’ or ‘OK’. Russians can make decisions in business that can strike westerners as illogical at best, and completely irrational at worst, generally based on impulsive emotion rather than any sense of pragmatism. A good example of this is the recent fall in demand for top-end apartments in downtown Moscow following the slide in the oil price, and the ruble crash/default which triggered an exodus of foreigners. Owners of flats that were previously being rented out for $10,000 suddenly found themselves with no takers as senior Expats left town and Russians downsized to cheaper options. A sensible approach (at least in our eyes) would be to find a taker who was ready to pay, say $8,000 a month, as eight grand might not be ten, but it’s certainly better than nothing. The Russian landlords’ view would be that this tenant is physically thieving two thousand bucks out of my pocket, so the majority are likely to remain empty until the market rebounds. This is 90 91 a fairly typical example of how Russians operate in business; even grown men in senior positions can change their mind on a whim, for no logical reason that any rational person can fathom. A FAMOUS QUOTE THAT RUSSIANS ADMIT SUMS UP THEIR COUNTRY IS ‘UMOM ROSSIYU NE PONYAT’ WHICH ROUGHLY TRANSLATES AS ‘THERE’S NO LOGICAL WAY TO UNDERSTAND RUSSIA’. Russia is plagued by a massive, overburdening bureaucracy, which some economists believe knocks several percentage points off the country’s GDP every year. Much of it is a hangover from the Soviet period where terms such as efficiency and profit didn’t exist, and there is rarely little if any logic as to why it is in place – other than possibly to provide employment. As a result, a massive service industry has formed to help ease you through the myriad of forms and officialdom that you will encounter, and this often seems to be done with official blessing. Visit any Moscow railway station (especially in the summer months) and you will see endless lines of people waiting to buy tickets, despite it now being possible to buy them online. Yet every station also has a Service Centre around the corner where for a ‘service charge’ of a few hundred Rubles per ticket you will be dealt with as efficiently as if you were visiting a travel agency, with no waiting. Of course it will be of no surprise to any Russian that this Service Centre is almost certainly owned, run or managed by the relative or friend of the railway station director. Whether you need your products imported, transported, or customs-cleared, your corporate literature translated into Russian, legal services, hiring local staff, payroll and accountancy outsourcing, finding an office, apartment or school for your kids or even just classes for you to learn a little Russian, there are plenty of firms to choose from who will help you. Most recognized international firms are well represented in Moscow, and quite possible also in regional cities plus some key CIS countries, but many others are not, or perhaps have a loose affiliate, franchise or partnership agreement with a local firm. Before engaging a supplier you would be wise to check out the nature of their CIS operation, how long they have been operating here, how big they are, who their client base consists of and whether or not you feel comfortable working with them. One word of warning; whilst many multinationals will have preferred-supplier agreements in places with service providers globally, I would strongly advise against engaging anyone who is not well established in Russia/CIS and genuinely knows what they’re doing. Unless you want to be used as a learning curve for one of your suppliers, you will make your life a whole lot smoother by working with someone who knows the local market, even if they are less well known in your home country. You can of course always try to do it yourself, although whilst you think you are saving yourself some money, there are some things that are best left to the experts – the end results are often disastrous. Don’t use Google Translate for translating your brochures or company website into Russian; the translations can be hilarious – just look at restaurant menus in provincial Russian cities and try to guess what ‘maritime language under marinade’ or ‘sausage in the fatherin-law’ is meant to refer to. Russians are keen readers and are more likely to read your corporate literature if it has been professionally translated into Russian. When looking to hire people in Russia/CIS, Linkedin might be a great tool for sourcing potential candidates, but it cannot establish a person’s motivation (or lack of it), manage the offer process, handle a potential counter-offer issue or provide information on current market trends. A reputable recruitment agency will be able to assist you in such cases. Apart from a few, small samples in your suitcase, you should import product via the correct channels using a recognized freight forwarder that has experience in dealing with customs authorities. Delays are a fact of life but these guys are your best bet for a smooth sailing. 92 93 Chet Bowling Partner Bellerage Alinga Six things a foreign CEO should know about managing a Russian company. Chet Bowling, who has lived and worked in Russia for almost 30 years and is a Partner at Bellerage Alinga - a TOP-5 financial outsourcing companies in Russia, shares the below with foreign CEO’s. 1. The Russian accounting system is governed by the state, including the chart of accounts, accounting principles, and statement forms. Unlike the accounting principles used in Europe (IFRS) and the US (US GAAP), Russian accounting is based not on the business transaction, but on the document confirming it (ie, the legal form is more important than the economic substance). 2. In Russia, it is impossible to dismiss an employee at the employer’s will (at-will termination) without citing grounds stipulated by the Labor Code of the Russian Federation; 3. Failure to comply with currency control requirements may result in significant fines of up to 100% of the transaction amount; 4. Violation of migration laws by the company is punishable by fines of up to RUB 1,000,000 and suspension of business activities for up to 90 days; 5. Over 90% of Russian companies use 1C, a local accounting software that makes it easy to report to the tax authorities; 6. The liability level of the General Director of a Russian business is immeasurably higher than would be the case in a Western company. You may learn more specifics of Russian legislation and business environment in Bellerage Alinga’s guide Doing Business in Russia, which is available on our website: http://www.bellerage.com/video/GuideDoingBusinessInRussia.pdf 94 95 Brookes Moscow (International School) Lazorevyy Proezd, 7, Moscow, Russia, 129323 Telephone: +7 (499) 110- 70-01 E-mail: info@moscow.brookes.org admissions@moscow.brookes.org Website: moscow.brookes.org Brookes Saint Petersburg (International School) Tatarskiy Pereulok, 3-5, St Petersburg, 197198 Telephone: +7 (812) 320-89-25 E-mail: info@saintpetersburg.brookes.org admissions@saintpetersburg.brookes.org Website: saintpetersburg.brookes.org XI. Entertainment in Russia Food, drink and extra-curricular activities and costs Food, drink and extra-curricular activities and costs 96 97 The idea that you have to drink heavily order to do business in Russia is both a myth and an outdated stereotype. Yes, Russia does have a serious alcohol problem but there is a considerable difference between the corporate world in large cities, and the situation in provincial towns and villages. In fact, Russians’ love for driving cars coupled with the zero tolerance for alcohol when driving means that more often than not, several of your Russian colleagues, partners or clients may not drink at all, unless at home or they may choose to leave the car at home on that particular day if they are expecting to drink over dinner. It’s rare for white collar workers to drink even a glass or wine or beer over lunch; the best advice is to go with the flow (no apologies for the pun). Sure boozy dinners occur but in all honesty you’re more likely to drink heavily with your colleagues or with other Expats than with clients. As always, there are exceptions so if you are going out for dinner, you would be wise to establish if it just a quick bite before your counterpart drives back home to his family or whether the booze plans to flow until the early hours. The difficulty is that Russians can be very spontaneous, especially if they are enjoying themselves so if you think it could go this way, best not to arrange an important breakfast meeting the following morning, as just during customer meetings, it is poor form to just jump up & make your excuses. See chapter 12 for what an invitation to visit a Russian home for dinner holds in store for you. The standard of service in hotels, bars and restaurants varies wildly although expensive joints in the largest CIS cities should be on par with what you are used to back home. The days when the ashtrays were emptied once the floor was full are gone; in fact you’re more likely to see it emptied every puff, or your glass of beer snatched away when you’ve only drunk three quarters of it by over-active waiters and waitresses who have been ‘trained’ up to international levels – if anything, it’ll keep you on your toes. TIPPING If the service was good then it’s customary to leave around 10% in restaurants although few places have the facilities to tip using your credit card. Even at those that do, the tip is highly unlikely to actually reach the person who served you; best to tip in cash. There is no need to leave big, American-style (20%+) tips, and whilst barmen and cloakroom attendants will not expect to be tipped, leaving them a RUB100 note is a kind gesture as these people are not usually well remunerated. When paying for a meal in cash, if you hand it over to your waiter or waitress and say ‘thank you’, they will take to mean that you don’t require any change back. If you do, save your spasibo for when you actually hand them the tip. MONEY & COSTS Summed up, since it is largely a business destination, Moscow isn’t a particularly cheap place to visit, and the top-end places can be seriously pricey. The capital regularly makes the top ten of the world’s most expensive cities according to annual surveys, and although a tiny bit of local knowledge can bring down prices significantly, there’s no getting away from the fact that your expenses on a business trip may be higher than many other cities in Europe. The weakened Ruble will work in your favour, especially as more mid-range options appear, especially hotels and restaurants. Public transport is ludicrously cheap and taxis are also good value for money, so long as you’re being charged the official rate. Purchases in Russia can only be made in Russian Rubles (RUB) and nowadays in 99% of cases, prices are listed in RUB. There is no need to buy Rubles before setting off for Russia as rates back home tend to be close to rip-off levels; all international airports in Russia have plenty of ATMs, plus 24 hour Bureau de Changes, even if the rates in the airport have recently worsened and aren’t as favourable as you’ll get in town. Euros (EUR) & US Dollars (USD) command the best rates; you can change just about any foreign currencies in Russia, but the less common they are, the worse deal you’ll get. Credit cards are increasingly accepted even in mid-sized establishments throughout Moscow & St Petersburg, plus most larger cities although it is worth carrying a stack of Rubles in case the PoS terminal is on the blink when you happen to be visiting. This can occur even in higher end places, and even then, don’t be surprised if not everybody can change a RUB5,000 note. CHIVALRY ISN’T DEAD, BUT FEMINISM HASN’T ARRIVED (YET)! A Russian girl once said to me that there would never be any feminism in Russia as all women hate each other here. This was, no doubt said somewhat tongue-in-cheek but there is more than a grain of truth in this expression. The Soviet Union lost millions of people in the Second World War, mostly young men. Countless millions more died in the Gulag 98 99 during Stalin’s infamous purges which began in the 1930s and lasted until his death in 1953; again, the bulk of whom were male. This has left a considerable gender imbalance that remains to this day, although some would argue that it’s now more due to the low life expectancy of Russian men than what happened in the country more than two generations ago. Nevertheless, there is still considerable social pressure on girls to get married (especially outside of Moscow and other big cities) at a young age, as their grandmothers and even mothers remember growing up with a shortage of males. Girls moan about the lack of eligible men and as a result some will date married men without much of an afterthought – even wives who subsequently find out can be more forgiving. Bear in mind that women in the CIS are not anywhere near as desperate to leave their country as they might have been in the early 1990s, and those who really wanted to flee abroad have probably done so already. Sure, there are stereotypes about the grass being greener in the West but unhappy stories of women having returned home disappointed after failed marriages to foreigners are also common. Being an Expat in itself is therefore no longer the guaranteed ticket to getting laid every night of the week, even if some still try (they’re known as ‘Sexpats’), but this isn’t Bangkok. You need to be able to offer something more than just having a western passport, and remember that there are a lot of rich Russian guys who’ll blow much more cash on their women than you’ll ever have – or be prepared to spend. Compared to free-spending Russians, Expats have a reputation for being stingy. Yes, for (straight) single men, one of the big attractions of doing business, or working in Russia/CIS is the opposite sex who deservedly have a reputation for keeping themselves slim and attractive, and dress well, even if it’s just a normal day in the office. Women not only like, but expect men to open doors for them, offer their hand when they step off a bus or get out of a car, help with their coat (on and off) and give them flowers & presents on regular occasions, not just anniversaries. On dates, men pay for everything – just try even suggesting splitting the bill and you can kiss goodbye to the chance of a second date! Equality is definitely a subjective term in Russia with male and female roles clearly defined. Men are expected to carry heavy bags, do DIY around the house and repair the car, whilst women cook, clean and look after the children. This isn’t to say that women are expected to sit at home; far from it, with many in fact earning more than their husbands. Feminism in the western sense is close to being an alien concept. On more than one occasion I have heard Russian women say ‘Feminists are women who act like men – why would I want to act like a man when I am a women. I want to be treated as a women and I want a strong man to look after me’. You’ll be waiting a long time to see Russian females in dungarees with shaved heads, burning bras. 100 101 XII. Life in Russia How Russians live 102 103 Urban Russians live in apartments, mostly in high-rise blocks in what they refer to as ‘sleeping regions’ – similar to what we know as suburbia. A lack of living space was a typical feature of the Soviet period thanks to a rapid industrialization programme, bringing people in from the countryside to towns and cities with little concern for where or what conditions they would have to endure. Entire families were often crammed into tiny two roomed flats (note that Russians refer to how many rooms they have, not bedrooms as the living room almost always doubled up as a bedroom, with a fold-out sofa. Fortunately the bathroom and kitchen don’t count in this tally). People would spend years on a waiting list for a new home, and one of the few ways of jumping the queue was to get married, which partly explains why Russians traditionally got hitched at a young age – often while still at University, and why many families in cities only had one child. The overall demographic situation has made the country’s housing shortage a little more bearable as the country has reported lost around 700,000 people every year since the fall of communism, partly through emigration but largely to a higher death than birth rate. The average life expectancy of a Russian male is shockingly short; in the low 60s. Although more apartment blocks have been constructed in recent years, they remain prohibitively expensive and well out of reach of the average Russian’s pocket, especially with the mortgage market being in its relative infancy. Therefore, the usual solution is to wait until an elderly relative dies, or moving them out to the dacha during their retirement years. WHAT IS A DACHA? A dacha is a Russian country house. These range in size and grandeur from a glorified shed on an allotment with no running water or electricity, to a mansion with all mod cons on the edge of a private lake. Under communism they functioned mainly as a piece of land that allowed the owner to grow food, which was especially important due to the lack of fresh produce available in state stores. Nowadays, only the elderly tend to their vegetables plots, whereas the younger generation (who have never experienced shortages) simply view dachas as a weekend retreat from the city with friends for a BBQ and drinks. THE RUSSIAN PSYCHE: Russia largely lacks the entrepreneurial ‘get-up-and-go’ spirit, with most Russians quietly content with their lot, whilst simultaneously grumbling that their neighbour is better off than they are. It’s easy to blame 70 years of communism for killing off anything remotely proactive, but ‘pofigism’ (a word that roughly translates as ‘can’t be bothered’) is a trait that goes back centuries. Asked why they lack motivation, Russians answer that deep down they believe in some big, kind Tsar who rules over them and that even if things are bad, that they will improve. This mentality helps to explain why Vladimir Putin remains a widely popular figure throughout the country, especially outside of Moscow and a handful of other large cities, despite Western propaganda attempting to suggest otherwise. Russians will openly admit that freedom and human rights as Westerners know them are hardly their top priority, and that a country as large and diverse as Russia can only be ruled in an authoritarian manner. The people want a strong ruler to maintain control and who will look after them, knowing from experience that the alternative is worse. Russia’s flirtation with democracy during Boris Yeltsin’s rule in the 1990s is a recent reminder to Russians that too much freedom leads to utter chaos, as was also the case during the reign of Tsar Nikolay II at the start of last century, whose weakness eventually led to his & his family’s abdication, eventual assassination, and the Russian Revolution in 1917. Russians’ attitudes to abortion, infidelity, divorce and even prostitution can strike outsiders are remarkably liberal, especially given how conservative they are regarding ’alternative’ religion, such as Hare Krishna and ‘different’ lifestyles (ie, non-heterosexual). The western media in particular has been guilty of blowing the anti-gay situation out of all proportion. Russians quite correctly point out that it is NOT a crime in Russia to be gay, yet in Qatar (which is due to host the 2022 World Cup) it IS illegal, and in neighbouring Saudi Arabia gays can face the death penalty, so why pick on Russia? Your best bet is to err on the side of caution and avoid controversial topics unless you want to lose friends and make enemies fast. Remember that you are a guest in Russia and here to do business, not to try to change Russia to suit your agenda. By all means set a good example through your own behavior, but doing anything deemed as remotely provocative will not go down well with Russians, whose attitude to meddling outsiders is ‘if you don’t like it here, leave’. SOCIAL MEDIA Russians are keen internet users and big fans of social media, which has taken the country by storm in recent years. As well 104 105 as Facebook & Instagram, both of which are extremely popular, there are numerous Russian equivalents, the best known being Vkontakte or VK (www.vk.com) which is essentially a Russian language version of Facebook. Whereas back home you typically use Linkedin* for business purposes and Facebook for your family and friends, in Russia the situation is less clear cut. Visitors to Russia are often surprised to receive a Facebook friend request not only from work colleagues, but from people they have met (perhaps just once, and only briefly) in a business situation, be it as a supplier, customer partner or even merely a client prospect. Russians view this as normal; after all the line between work and play in Russia is a blurred one, and don’t forget that Russians typically do business with people whom they are on friendly terms with. This can create a dilemma for people who prefer to keep their business and private lives separate. Ultimately whom you choose to be ‘friends’ with is up to you and there is no need to feel bad about not ‘befriending’ people whom you are not comfortable with seeing what you get up to outside of office hours. Just be aware that Facebook is fast becoming the main means of communication amongst your colleagues and you could find yourself missing out on much of what’s going on around you should you choose to blank those you work with. One solution is to set up a second profile, to keep your work and private lives somewhat separate. Even if you are not a social media aficionado, you may want to at least create a basic facebook account as there are numerous groups worth joining, such as Expats In Moscow. Many nationalities have their own ‘closed’ groups but will happily allow you in should you demonstrate some connection to that particular country.

• At the time of writing Linkedin was still blocked by Roskomnadzor (the

federal body responsible for overseeing the media and IT) for failing to comply with the law about data protection. Whilst it is easy enough to access Linkedin in Russia if you have a VPN, Linkedin has fallen out of favour somewhat as a business networking tool, with many preferring Whatsapp and/or Facebook. Priyatnogo appetita! If you are ever invited to a Russian’s house for dinner, this is most certainly an opportunity you cannot refuse. Consider it an honour and you will experience overwhelming hospitality, especially given the huge choice of decent restaurants in larger cities, it’s less common to be invited into somebody’s home. Expect to be here for the entire evening, and preferably don’t schedule anything for early the following morning. Russians don’t invite people over for a quick cup of tea & biscuits; they go the full distance and pull out all the stops for guests. It’s polite to bring a gift, such as a bottle of wine and a box of biscuits or chocolates (preferably from your home country, but locally purchased is fine) plus a bunch of flowers for the lady of the house. Shops selling flowers are on almost every street corner and many are open 24 hours a day, 365 days a year; buy them on the way. Do remove your shoes upon entering the home – you will be offered a pair of slippers. You will arrive to a table groaning under the weight of all the food on it, usually platefuls of sliced meats, various salads, cheese, bread and cold vegetables, but before you get too carried away, this is only the starter, known in Russian as ‘zakuski’. Most likely vodka will be served (cold, and neat, of course) although women may be offered wine or Russian champagne, which is actually a sweet, sparkling wine, called ‘shampanskoye’. If on the vodka, take it easy! Have a swig of a soft drink (of which there will be a jug or bottle) after each shot, followed by a little food, but avoid the temptation of stuffing yourself. It is customary for each person to take a short toast when raising the glass, and everyone should hold the glass in the air until the speaker has finished, whereupon everyone knocks the vodka back in one gulp – sipping is for ligthtweights. When it’s your turn, it’s sufficient to thank the hosts for their invitation and hospitality, and how pleased you are that you had an opportunity to visit their home. Then say something positive about Russia and the friendship between your two nations; this always goes down well. The main course is likely to be a meat-based dish – there are very few vegetarians anywhere in the CIS, and since meat was often in short supply during Soviet times, the older generation will be somewhat perplexed at how or why you could refuse meat. Even if you’re completely full up, this isn’t the end as a large cake will later be brought out, followed by tea and chocolates (konfety) – it’s OK to pass on the chocs if you’re full to bursting point by this stage. Fortunately, this all takes place over several hours so the trick here is to pace yourself. You will certainly have an evening to remember, particularly as your 106 107 colleagues or clients will more than likely entertain you in a local restaurant. P.S. – ‘Priyatnogo appetita’ means «Bon appetit» and can be said not only at the beginning of any meal, but also whenever you see anyone eating. S lyokhkim parom! Getting naked, hot & sweaty with other men at first might not sound like your idea of fun but you can’t say that you’ve really ‘done’ Russia unless you’ve experienced a visit to a banya. On the surface it is basically a bath house but the whole process is taken seriously, yet at the same time it’s harmless fun even if it doesn’t always feel like it at the time. Think of it as a bit of male bonding, but it’s definitely something you won’t forget in a hurry. In Russia, the banya is very much a ritual although its origins stretch back centuries, to the days when bathing as we know it didn’t exist. Nowadays it’s much more of a pastime yet traditions are maintained so it’s useful to familiarise yourself with what you are about get yourself in to. Essentially you will enter a hot, steaming room, work up a sweat and then wash it off with cold water, but as you will see, there is much more to it than just an old-fashioned way of keeping yourself clean. For starters, a banya can range from a small, wooden shed in the country for just a few, close friends to a huge, ornate building which can accommodate dozens of people, such as the famous Sanduny (see contact details in Chapter 18). You will need a few items to make your experience complete, although these can be purchased or rented at the higher-end places. If going to a banya at somebody’s dacha, check if these will be provided although many shops sell the basics. Generally you pay an entry fee which allows you two hours, although you can add on additional hours if you’re not ready to leave. Many banya frequenters wear a felt hat which helps to protect your ears from the extreme heat. You strip off completely and head into a room where the temperature is close to 100C, so slipping on a pair of flip-flops is a wise move, as is a cloth sheet to wear around your waist if you’re a little shy. It does however double up into a mat to sit on once inside although some opt to stand; you don’t need a PhD in physics to quickly realize that hot air rises so the higher up you are, the hotter it gets. And the longer you stay in the sweatier you become, although hardcore banya aficionados can be seen beating each other with birch branches, called a ‘vyenik’ which improves the circulation, apparently. Water will periodically be poured onto the hot stones to create additional steam, and eucalyptus is occasionally added for a more authentic smell. Don’t be surprised if one of the more experienced participants starts to wave a towel around to spread the heat. Once you reach the stage when your body cannot stand any more heat, you exit the banya, and into a cold pool to wash off all the sweat. Depending on how sophisticated your banya is, this could be anything from a large swimming pool to a pond in the garden, and if you really want to show off in winter months, you can roll around in the snow although this is best done after a few vodka shots. On the subject of refreshments, you won’t be surprised to hear that there is often some alcohol involved after you’ve rinsed the sweat off yourself. Most public banyas will have a small café or shop selling beer, soft drinks and snacks although the swankier the venue, the better the fare (Sanduni boasts an extensive menu, featuring Russian, Georgian and Uzbek cuisine, plus an assortment of beverages from draught beer to vodka, cognac and champagne). Then it’s back in for another round of banya, a ritual which will be repeated several times until you’re ready to keel over. Unless you are lucky enough to have your own banya (or visit someone who does), or rich enough to rent out the entire premises, it’s likely to be a same-sex affair but it’s all completely innocent. Do bring along some soap, shampoo and a towel for showering at the end. Banyas are generally geared towards men but ladies can enjoy them too; some venues have a separate female section. If you only learn one banya-related phrase, it has to be ‘S lyokhkim parom’ which very roughly translates as ‘I hope the steam goes easy on you’. 108 109 XIII. How Russians view foreigners Those living and working in, or travelling to Russia Russians are genuinely interested in what foreigners (mainly Westerners) think of them and equally how they, themselves are perceived. They are acutely aware that Russia’s image abroad is on the whole rather negative and the widely held belief is that their country is unfairly targeted by a hostile western media with an anti-Russian agenda who fear a resurgent Russia. Of particularly annoyance is what they believe to be the double standards of the West selectively trying to force democracy on certain other countries, whilst ignoring the human rights abuses of dictatorial regimes who claim to be on their side. Modern Russia as a country is little more than a generation old and has come a long way in a very short space of time since the fall of communism. Russians are keen to learn but resent being dictated to, and find this attitude particularly condescending. The best advice is not to try to change Russia; the country will develop at its own pace and in its own way. One of the better legacies of the Soviet Union was the educational system which was free for all, and on the whole was pretty good. Literacy throughout the CIS region remains high, even in remote, impoverished areas and Russians who you meet in a business situation tend to be very well educated & highly knowledgeable in areas of culture, politics and geography. In fact the average Russian will probably know more about your country’s history and literature than you do. Many can be disappointed at how little foreigners know about Russia, and unless they are a Russophile, how little curiosity they have for Russia’s cultural heritage and customs. You will earn yourself considerable kudos before travelling to, or relocating to Russia by familiarizing yourself with some background in the country’s history and geography. I often hear from Russians that ‘oh, foreigners think that there are bears in the streets in Russia’ and are surprised when I reply that ‘no, in actual fact Russians think that foreigners think that there are bears in the streets in Russia’. For the record, I have seen bears in Russia on precisely two occasions; once at the Moscow zoo and the other time, in the wild with its cubs on the Kamchatka peninsula, two hours’ helicopter flight from the regional capital Petropavlovsk-Kamchatsky. So yes, there are bears in Russia, but apart from in captivity they are a long way from human habitation. Remember, Russia’s a big country. 110 111 I ONCE ASKED A RUSSIAN ‘WHY IS THE AIM OF COMMUNISM TO MAKE EVERYBODY POOR’? HE REPLIED ‘THAT ISN’T THE AIM, THAT’S THE RESULT’! Once you break through the gruff exterior, Russians are extremely hospitable people who will go out of their way to help you – once you get to know them, that is and have gained their trust. Russia is a country of extremes, in more ways than pure distance. One simple example was when travelling the trans-Siberian railway, the world’s longest train journey from Vladivostok to Moscow, over 9,200 km. We attempted to buy tickets on the overnight train to Khabarovsk yet were being shouted at by the cashier who was questioning what the hell we were doing here and why we as foreigners weren’t being accompanied (admittedly this was the early 1990s and Vladivostok had only recently opened up – even to Russians. Under Communism as a strategic port it was deemed a closed city) – surely it would have been easier to simply sell us the tickets for the next train and get rid of us, oh, but no! She had to over-complicate the situation and create a huge fuss before we eventually purchased our freedom out of town. We couldn’t help wondering why she had been so rude – and we’d faced a similar story when we tried to check into a hotel several days before, when we were greeted with a ‘myest nyet’ (we’re full) by an obstinate, middle-aged woman at the reception. Yet when we tried again some twenty minutes later – it was the only hotel in town which accepted foreigners, a younger lady happily gave us a room, of which there turned out to be plenty. On the train where we shared a carriage with a family from Khabarovsk, who upon hearing that we had nowhere booked for the following night (online bookings didn’t exist back then) invited us to stay the night in their apartment, and their son gave us a tour of the city, followed by some beers and ‘vobla’ (dried fish snacks). Back home, everything is nicely boxed up – nobody will shout at you, yet nobody will go much out of their way to help you. The moral here is that you need to be prepared for either eventuality. Much has been written about the famous Russian soul, and few outsiders will ever fully comprehend it. The easiest way to sum it up is that when Russians do something, they do it ‘ot dushi’, meaning from the soul – ie, because they genuinely want to. Otherwise they simply wouldn’t do it, unless forced to do so, in which case they’d probably do it badly as their heart isn’t in it. Russians sometimes feel that all too often in the West, when people do something to help someone else, it is either because feel indebted to that person, hope that person will reciprocate at some stage in the future or (in the case of charity) it’s to make themselves feel better. But not done simply because you wanted to do it just to please that person. Russia vs America One country that Russians frequently compare and measure themselves against is the United States of America. In a similar way that older Brits may mourn the loss of the British Empire, there are Russians who also feel saddened by the demise of the USSR. This is not only at having ‘lost’ the other 14 republics but also at the fact that they believed that they were very much on par with the United States of America, even if the truth was rather different. I RECALL A CONVERSATION WHEN ONE RUSSIAN ASKED THE OTHER ‘WHY IS IT THAT AMERICA IS SO RICH WHEN AMERICANS ARE SO STUPID’? OVERHEARING THIS QUESTION, AN AMERICAN INTERJECTED ‘BECAUSE IN RUSSIA PEOPLE SIT AROUND THINKING ABOUT MAKING MONEY WHEREAS IN AMERICA WE JUST DO IT’. A good analogy for understanding the difference between Russians and Americans is by describing Americans as peaches (soft on the outside; easy to get to know but hard deep down) and Russians as coconuts (tough to penetrate but much softer once you’re on familiar terms). Russians seem to enjoy a love-hate relationship with America; on the one hand a substantial number of Russians and other CIS citizens have emigrated there since the fall of communism and as their friends & family visit, they have witnessed life on the other side. It’s usually a combination of envy (high living standards, a strong community spirit) mixed with relief that Russia is so much deeper since they perceive Americans to be superficial and insular, taking little interest in the greater world outside of their country. America’s image suffers from the increase in Russian nationalism, driven by the Kremlin playing the tough guy to a domestic image, wanting to demonstrate that all Russia’s woes are as a result of American foreign policy whose sole desire is to bring Russia to its knees. With a statecontrolled media, you would be surprised how many Russians, especially 112 113 the less-well educated genuinely swallow this propaganda, and refuse to comprehend that nowadays America might have other priorities. Some are even shocked to learn that America ISN’T purely focused on Russia, as surely it should be. XIV. Charity, Corporate Social Responsibility Your firm’s presence in Russia 114 115 Many visitors to Russia, and even Russians themselves cite envy (zavist) as one of the social problems facing the country today. The Soviet Union was nowhere near as equal as it liked to portray itself to the outside world – contrary to popular belief, not all Soviet citizens were paid the same, but inequality has soared since the beginning of capitalism in the early 1990s. The majority of the population struggled to adjust to life in a free-market society, with practically no safety net in the form of a welfare state that they had previously become accustomed to. Particularly hard to fathom was for state employees, factory workers or pensioners who had received no income in months and were left nearly penniless, seeing flash, ‘new Russians’ driving around in expensive, foreign cars and throwing money around as if there were no tomorrow. Although living standards have risen considerably across the board since Mr Putin’s rise to power, the gap between rich and poor in Russia – and sometimes even more so in certain CIS countries, is staggering. However, when Russians talk about white envy (belaya zavist) they in fact mean that whilst they are mildly jealous, they are in fact happy for you. If your firm is well established or planning to expand in Russia then there is a good chance that you will want to contribute to those less well-off in the country. Corporate Social Responsibility is still in its relative infancy in Russia, with charity still not well understood, and even less so in many CIS countries. Under communism, charities as such did not exist as it was the state’s role to look after its subjects so you are effectively dealing with a new entity here. The authorities’ overall perception of charity work is nowhere near as positive as it is back home. Whereas people in the West see it as giving something back, Russian officials view it as meddling by outsiders, possibly disguised as tax avoidance, a front for a religious cult or in worst cases, even espionage. Those in charge of the country still see their role as ensuring that everyone lives equally and fairly (even if this was never the case during Soviet rule and most definitely is not the case today) so any outside ‘help’ is therefore proof that the state is unable to provide for all. Which it clearly can’t, yet those at the top still prefer to cling to the ideology that the state knows best and outside assistance is neither welcome, nor required. Slowly but surely, attitudes are changing for the better and there are an increasing number of beneficial, gross-roots projects but it would be wise to seek advice before wading in with great intentions. Many Russians are themselves skeptical as to the benefits of charity, assuming (and sometimes, unfortunately not without good reason) that any money donated to a local hospital or orphanage is more likely to end up in the director’s pocket than reaching those it was intended to benefit. Although the entire Former Soviet Union has a lengthy list of social ills ranging from poverty causes by unemployment in some of the more remote southern republics to rampant alcoholism in areas further north, the biggest difference you can probably make is assistance with disadvantaged young people, in particular orphans. However, showing up at the local orphanage with armfuls of presents at Christmas might seem like a laudable thing to do, yet in practice, simply creates a dependency culture. Often the personal time you spend may be equally as important as any funds that you donate. A Russian friend who visited the UK back in the late 1990s commented to me that he couldn’t believe how many ‘invalids’ there were on the streets of London. It quickly dawned on him, however that back home there are just as many, but they are confined to a life indoors. Most buildings, both public and private are woefully under-equipped to handle wheelchairs, or anyone with any other disability, for that matter. There are a growing number of reputable organisations which are helping to improve the quality of life for those affected, and the perception of the population as a whole towards people with disabilities is beginning to change for the better. The various foreign business associations will be able to advise you as to how best to approach this delicate matter as almost all have made impressive inroads, even if it seems like a drop in the ocean. 116 117 XV. Life outside of Moscow and St Petersburg Just as London or New York are not representative of the United Kingdom or the United States respectively, Moscow, and to a certain extent St Petersburg are hardly accurate reflections of Russia as a whole. The bulk of the country’s wealth lies in the capital, and Moscow is where most decisions are made. Even if your company’s main focus is a remote part of the country, as is generally the case with the natural resources industry, it’s likely that you will have (or need to have) an operation in Moscow, even if it just a small, representative office. Unlike in many countries where each region and city has its own identity, in Russia you effectively have Moscow, followed by St Petersburg, and then there’s everything else. Next in line are the fourteen ‘million’ cities (in Russian they’re known as the Millioniki as their population is over 1,000,000). In descending order of population they are Novosibirsk, Ekaterinburg, Nizhny Novgorod, Kazan, Chelyabinsk, Omsk, Samara, Ufa, Rostov-onDon, Krasnoyarsk, Voronezh, Perm, Volgograd and Krasnodar. Recent statistics show that around 80% of foreign visitors to Russia do not venture outside of either Moscow or St Petersburg so taking a trip outside of Russia’s top 2 is already a step off the beaten track. Just like in Russia as a whole, cities also largely follow a top-down system, where the local governor of the region has often been personally appointed by Mr Putin himself. In return for being highly loyal local to the Kremlin, this governor is pretty much given a free rein to run his territory as a personal fiefdom, with official blessing. The same goes for the mayor of a particular town or city, and the way in which the area is run depends largely on this one person and his entourage. In practice, most of the key businesses and industries will be controlled by a handful of Minigarchs who are likely to be close friends or even relatives of the head honcho. As usual, there are both advantages and disadvantages to this system. On the plus side, in regions where the governor is progressive and wants to attract foreign investment, there is less bureaucracy, minimal corruption and things can generally get done a lot more quickly – IF, and here’s the caveat, you can convince the governor (or at least someone influential within his team) that your project is worthwhile. The cities of Kaluga, Ulyanovsk, Tyumen and Kazan are four excellent examples of where the local governor has gone out of his way to make 118 119 outside investors feel welcome, and personally made himself available to ensure that things got done. This of course works fine for large-scale investment, and there are numerous examples of blue-chip multinational organizations which have built up production facilities at record speed and are enjoying nice returns on their investment. The disadvantage is that smaller fry can struggle to make themselves heard and with Russians’ dislike of delegating, even a workaholic governor with all the best intentions may take quite a while to get around to seeing you. On the flip side, for every modern governor there at least as many, if not more ‘Red Directors’ who view business, and in particular foreigners with suspicion. Unless he (and it’s always a ‘he’) can see a personal benefit to what it is you want to do, it’s likely to be a non-starter. These regions tend to rely on handouts from the federal budget for their very survival but are allowed to exist in this way as they generally support ailing industry that is viewed as potentially strategic, or of possible value to the state. The commercial section of your country’s Embassy will be able to advise as to where to venture – and how, plus the various Chambers of Commerce can provide useful information on local conditions. Both Embassies and Chambers of Commerce run trade missions (sometimes in conjunction with one another) to other cities in Russia, which can be an extremely useful way of meeting senior local officials, talking to well-established companies already on their ground (both local and international), plus of course mixing with other potential investors on the trip. Trade fairs, exhibitions and conferences in regional cities also offer excellent insights into conditions and specifics of the region – the key is to do your homework before committing, and it is absolutely essential that you have both local approval AND support. One interesting, relatively recent development is that regional governors are now beginning to come to Moscow and even abroad with their entourage in order to pitch for inward investment projects. This is a huge leap forward as previously they simply sat at home & waited for the opportunities to roll in. Whether this change in strategy has been ordered from above or is their own initiative is anyone’s guess, but nevertheless it is definitely pleasing for potential investors they at last feel wanted. Some regions appear to be taking this seriously, and have hired young, English-speaking advisors who have created literature on past successes coupled with advice for potential investors. There is most definitely life outside of the MKAD. Even cities with a few hundred thousand people now have decent enough hotels & restaurants, plus an airport with regular, scheduled flights to Moscow and/or the provincial capital. They may lack the glitz of Moscow but you won’t starve. THE RUSSIAN FAR EAST Known to Russians as ‘Dal’ny Vostok’, the Russian Far East (RFE) is a vast territory, spanning east to west from Lake Baikal all the way to the Pacific Ocean, and from north to south from the Arctic sea to Manchuria. Virtually empty of people, yet highly strategic, the region shares land borders with Mongolia, China and North Korea, plus maritime borders with both the USA and Japan. Resource rich yet at the same time remote, even from Moscow this region has seen its population fall from around 8 million in the last days of the USSR, to just over 6 million today, largely as a result of migration to the European part of Russia (plus also abroad), and to declining birth rates in general in Russia. This is slightly less than one person per square kilometer, making it one of the most sparsely populated regions on the planet. Natural Resources are the primary reason why many investors, both foreign and Russian are active here; the key sectors are in oil, mining and forestry. Other industries include shipping, fishing and light industry. Sakhalin is all about offshore oil, with the capital, Yuzhno Sakhalinsk hosting a plethora of energy and services companies all getting in on the action. Mining operations (anything from gold, to coal, to silver to diamonds) are typically centered in and around the regions of Chita, Yakutsk, Magadan, Khabarovsk, Chukotka and Kamchatka. Offices will be in the provincial capitals but the actual sites may be located hundreds, if not thousands of miles away from anywhere. In many cases, you’ll be lucky if there is even a dirt or ice road; more often than not you will need to charter a plane or helicopter. Transport and logistics are an issue. There are regular flights to most cities but they don’t come cheap and are prone to delays and cancellations thanks to the weather. Be realistic when planning schedules, allow at least a day either side of any trip, if only to help you to adjust to the extensive time difference, regardless of whether you are travelling from east or west. One foolproof way of getting around without delays is by train. The famous Trans-Siberian railway has been transferring passengers from Moscow to Vladivostok since 1916, and the journey can be 120 121 done non-stop in 7 days (as opposed to a 9 hour flight). There are also branch lines, such as the BAM (Baikalo-Amurskaya Railway) which follows a similar, but slightly more northernly route over the top of Lake Baikal. Recent extensions include reaching north up to Yakutsk (well, the town on the other side of the Lena river, if you don’t then mind taking a ferry to finish your journey) and there is currently talk of building a bridge to link the island of Sakhalin to the mainland. Interestingly, the RFE was only, finally connected to the rest of Russia by road in 2010, when Vladimir Putin famously drove a Lada along a stretch of the Amur Highway, between Chita and Khabarovsk. Although Russia drives on the right, almost three quarters of cars in the region are right hand drive, typically meaning that they (mainly second hand) are imports from nearby Japan. Vladimir Putin has recently put an emphasis on investment in the Far East in recent years and traditionally attends the Eastern Economic Forum, which has been taking place in Vladivostok in early September every year since 2015. The aim has been to revitalize business and attract foreign investment to the region. It’s a major event, and one worth attending if you’re interested in this part of the world: www.forumvostok.ru (in Russia and and English) XVI. CIS focus The ‘other’ Republics 122 123 ARMENIA Population – 3,000,000 Capital City – Yerevan (population – 1,000,000) Currency – Dram The world’s oldest Christian country (adopting the religion in AD301) as any Armenian will proudly inform you, Armenia has a glorious history but current conditions are slightly less rosy. To say that the end of the USSR spelt disaster for Armenia is a gross understatement; the economy literally evaporated overnight as subsidies from Moscow ground to an instant halt and the markets for uncompetitive goods that nobody needed, produced in the country, disappeared. Armenia was already reeling from a massive earthquake in Spitak, in the north of the country in 1988 which killed over 35,000 people (mostly crushed to death as substandard Soviet-built buildings collapsed on top of them), and to make matters worse was embroiled in the Nagorno-Karabakh war with neighbouring Azerbaijan over rival territory. A Russian brokered peace was administered in 1994 but the two countries still do not enjoy any diplomatic relations. The 1990s saw Armenia lurch from one crisis to another; shortages of food, water and electricity plagued the country, and in solidarity with its Azeri ‘brother’, Turkey closed its border with Armenia, effectively ensuring a near blockade, as the border with Azerbaijan is also firmly shut. The route north to mother Russia via Georgia has also restricted over the years due to a dive in their bilateral relations although there are signs of improvement here. Millions of Armenians have fled the country since independence in 1991, mainly for Russia but there are also large Armenian diasporas in France, the USA (primarily in Los Angeles and New York), Lebanon and throughout the CIS, although in practice this means mostly in Russia. The country has been kept alive by generous donations from wealthy Armenians abroad, as well as migrant workers in Russia sending back a chunk of their wage packet to their family. A reported 25% of Armenia’s GDP is made up of remittances. Local infrastructure, such as roads, bridges, tunnels and new buildings are impressive for a small, poor landlocked, country – the newly built international school in Dilijan is just one example of what is being achieved to modernize the country. Investment opportunities however remain nominal for outsiders, apart from a smattering of mining, construction, infrastructure and tourism projects, although most tourists are from the diaspora – which is a shame as Armenia boasts a rich history. The official population officially hovers around the 3 million mark although is rumoured to be lower as those of working age seek better opportunities, and above all work abroad. Slowly but surely improvements are being felt, and the downtown area of Yerevan has undergone a makeover in recent years with new hotels, boutique stores and cafes continuing to open up. The country now has a new airline, Aircompany Armenia, after Armavia went bust in 2013. The official language is Armenian which is a separate branch of the Indo-European tree and is partially related to Persian (Armenian shares a small border with Iran to the south, and with whom it maintains surprisingly good relations; in fact Armenian is one of few countries in the world which can claim to get on with the USA, Russia and Iran)! Armenians call their country ‘Hayastan’ and Armenian even has its own alphabet, although Russian is widely spoken, especially in the capital Yerevan. English is on the increase, particularly amongst young, urban Armenians. Visas are not required for citizens from the UK, European Union or the USA. Canadian, South African, Australian, New Zealand, Israeli and even Turkish passport holders can buy one on arrival without an LOI. AZERBAIJAN Population – 10,000,000 Capital City – Baku (population – 2,250,000) Currency – Azerbaijani Manat The rise of Azerbaijan, and its relative wealth can be summed up in one simple word; oil. The black gold has funded a construction boom in downtown Baku, the capital that is situated 28 meters below sea level. The city certainly oozes wealth as can be seen by the number of shops selling the latest fashionable clothes and accessories, flash cars and top-end recreation venues, from hotels to restaurants and nightclubs. Nevertheless, many ordinary Azeris feel that the oil boom has provided them with little obvious improvements to their everyday lives, benefitting 124 125 mainly the corrupt elite, and that Baku’s beauty is all for show. Azerbaijan likes to portray itself as a ‘Europe meets the Orient’ destination, although ’Moscow meets the Mediterranean’ would possibly be a more accurate description – in a positive sense, of course. President Aliyev keeps a tight grip on power, and is accused of human rights abuses by some western countries as no real opposition to his family’s rule is tolerated. Most however prefer not to meddle in the country’s internal affairs to keep the oil pumping, turning a blind eye although in fairness Aliyev is genuinely a popular figure who has transformed the country from a remote backwater to a mini-Dubai with international recognition. Despite being a majority Muslim country, Azerbaijan prides itself on being tolerant of other peoples and religions. Azeris prefer western-style clothing; any women you see in Baku wearing headscarves will almost certainly be tourists from the Arab Gulf countries. Most restaurants (apart from fast food joints) serve alcohol, and the few Azeris who don’t drink certainly won’t mind if you have one. Or even two. One area where Azerbaijan has made considerable improvements is in the ease of doing business – the country was recently ranked 57th in the Global Competitiveness Report, which is significantly higher than other CIS countries. The oil is predicted to continue flowing for years to come, so with the right leadership Azerbaijan can look forward to a bright future. Although the currency was devalued in 2015 after global oil prices crashed, this proved to be a temporary blip. A dark spot is the frozen conflict with Armenia, which shows no sign of being resolved anytime soon; the two sides are locked in an apparent stalemate. Azerbaijan has been using some of its oil revenues to purchase military equipment and has been making threatening noises, although it is highly unlikely to attack Armenia – Russia maintains three military bases there in an attempt to keep stability in this volatile region. Whilst being the mainstay of the economy, oil however isn’t the only revenue earner. There is now more of an emphasis on diversity away from the energy sector, such as construction, agriculture and food production; don’t be surprised to see the Made in Azerbaijan slogan proudly showing on many goods. Tourism is the latest big thing, centred around the increasing number of events which Baku is fond of hosting, many of a sporting nature (think football or Formula 1), plus international conferences. Oil however dominates, plus the related services built up around the international majors, and of course the state energy giant SOCAR. Azeri language is closely related to Turkish, enough so that both peoples can just about understand each other. Although you’ll rarely see anything written in Cyrillic, Russian is still widely taught – and spoken by most people in business and in services positions, with English gaining in popularity, thanks in no small part to the large Expatriate community based in Baku. The good news is that Azerbaijan has introduced a relatively simple e-visa process, saving you the hassle of making a trip to an Azeri Embassy. However, these are intended either for people visiting on a business trip, or as tourists. They are generally single entry, valid for one month; the point being that you cannot use these to work in the country. BELARUS Population – 9,500,000 Capital City – Minsk (population – 2,000,000) Currency – Belarusian Ruble If you come to Belarus expecting a European version of North Korea then you’re in for something of a disappointment. Belarus’s long-serving President, Alexander Lukashenko has been dubbed ‘Europe’s Last Remaining Dictator’ by the USA, a title which he seems to relish but Belarus’s capital, Minsk is no Pyongyang. Granted at first glance Belarus looks like a throwback to the days of the Soviet Union; much of the country’s economy remains under state control. It is still heavily reliant on Russia for the import of raw materials, and as an export market for Belarusian goods, both FMCG, textiles & heavy machinery. Visitors’ initial comments are how little advertising there is on the streets compared to back home but the country, and especially the capital are kept spotlessly clean. Downtown Minsk is a classic example of Soviet planning on a grand scale, since the city was rebuilt after having been completely destroyed during the Second World War. In fact it’s fair to say that parts of Minsk resemble one huge war memorial, but when you think what Belarus went through (the 126 127 country – albeit as part of the Soviet Union, lost around three million people, almost a third of its population) you can begin to understand why its people don’t want to forget their sacrifice. Visit the new Belarusian Patriotic War Museum in Minsk or the nearby Khatyn memorial for better understanding. Belarus is still a tricky place to do business, but the climate does seem to be improving as Mr Lukashenko tries to rely less on what are essentially Russian subsidies in the form of cheap gas, amongst other carrots. Some western firms who previously relied on a local partner to sell their products are now setting up shop themselves, and Minsk now boasts decent hotels, bars, shopping malls and restaurants; something that was unthinkable only a decade ago. The Chinese are muscling in too, although the biggest investor by far is Russia, and Russian nationals make up most of the (admittedly small number of) tourists; many come to visit the twenty or so casinos, which are banned in Russia, and also in neighbouring Ukraine. Unemployment is low by European standards although this can be attributed to Soviet-style policies of employment; more people hired than required in state institutions, and salaries are therefore hard to live on in these roles. Many younger, more opportunistic Belarusians have left the country in search of higher-paid work elsewhere – mainly to Russia but also further afield, such as to Germany and the USA. Mr Lukashenko preaches stability as his motto, and raison-d’etre for staying in power, although the economy remains relatively weak. Although Belarusian and Russian are the two official languages of Belarus, in reality everyone in big cities speaks Russian as their native tongue with Belarusian only really used in rural areas. Signs could be in either, but the preference is very much for Russian, apart from the occasional government building, although there are plenty of similarities between the two. Alexander Lukashenko has in the past been ridiculed for promoting Belarusian despite having a poor grasp of the language himself. Don’t expect much English spoken outside of top end hotels and perhaps a few restaurants, although slowly, more signs are appearing in English to accommodate non-Russian speaking visitors. The majority of nationalities can now enter Belarus visa free, but only by flying into, and out of Minsk International Airport (MSQ), you’ll be stamped in and you can stay for up to 30 days. Land borders still require a visa obtained in advance although there is talk of moving these to visa-free too, in due course. The exception is flying from Russia; you MUST either have a Belarusian visa, or fly via a third country (usually Riga, Warsaw, or Vilnus) or you will be denied boarding. GEORGIA Population – 3,700,000 Capital City – Tbilisi (population – 1,150,000) Currency – Lari Not to be confused with the American state, Georgia (’Sakartvelo’ in Georgian) is in fact a sovereign country in the south Caucasus, but it is precisely this geographical location plus a complex ethnic make-up which have proved to be the country’s Achilles heel since independence in 1991. Georgia suffered from economic collapse as well as civil unrest with two regions – Abkhazia & South Ossetia breaking away. Following the brief war with Russia in 2008 both have since declared their independence, although hardly anyone recognizes them. It was only with the Rose Revolution in 2003 that saw the overthrow of Eduard Shevardnadze did rampant corruption come to an abrupt end. So much so that Georgia has one of the world’s most favourable investment climates, and has attracted considerable inward investment, much of it from western countries, plus neighbouring Turkey. Growth in the first few years since Mikheil Saakashvili came to power was impressive, albeit from a low base, and poverty rates declined significantly, particularly in & around the capital Tbilisi. Some multinational companies use their office in Tbilisi as a base to cover the southern Caucasus since for political reasons if you are based in Azerbaijan you cannot realistically trade with Armenia, and vice versa; Georgia in such cases acts as a useful buffer between the two. It was the war with Russia in 2008 that damaged Georgia’s economy most of all; Russia had always been Georgia’s main trading partner and key market for Georgian produce, chiefly wine. Mr Putin took an instant dislike to Mr Saakashvili’s pro-western stance, and NATO ambitions, and when Saakashvili gambled on bringing back South Ossetia under Georgian control by force, Russia needed little encouragement in coming to the rescue. Just as relations with Russia appeared to be getting back on track, Georgia’s northern neighbour abruptly cancelled all flights between the two countries in the summer of 2019. These ups and downs over the past decade have forced Georgia to look elsewhere for new trading partners, mainly to Europe and to Asia. 128 129 Tbilisi, the capital has undergone a massive transformation in recent years, although if you step back a few streets from the very centre, much work remains to be completed. Roads have improved significantly as have the railways although the mountainous terrain keeps more rural towns isolated and little has changed there in decades; villagers effectively eke out a subsistence lifestyle. Tourism is playing an increasingly important role in the country’s economy and development, despite logistical difficulties for Russian visitors. However, Georgia’s location is a hindrance – surprisingly few western airlines fly to Tbilisi, even today although Kutaisi, the third largest city is beginning to attract low-costers. The world is finally waking up to the secret that Georgia offers stunning scenery, historic, old churches, often high up in the mountains and beaches on the Black sea. It’s also a ridiculously good value for money destination, with Georgian food and wine – and the famed Borjomi mineral water being worth the visit alone. Don’t plan on losing much weight during your visit as you won’t be able to resist yet another delicious khachapuri. Talk to Georgians and they are indeed grateful that petty corruption that used to make life a misery has come to an end, yet unemployment remains high. Those who have a job complain that they don’t earn enough, and prices continue to rise. Squabbles among the main political parties dominate local news and demonstrations have been frequent in the centre of Tbilisi. Georgians remain mixed in their opinion about whether or not the country is headed in the right direction. Georgian is a language isolate, having no proven connection to any other language, and it has its own, unique alphabet. It is the native language of all Georgians, and since Saakashvili came to power, the teaching and subsequently the use of Russian has dwindled significantly in place of English (Saakashvili studied in the USA and speaks English fluently). Nevertheless, anyone aged over 40 should have a good command of Russian, and younger Georgians are keen to learn English, especially in Tbilisi where over a quarter of Georgians live. In an attempt to encourage both tourism and inward investment, visas are not required for passport holders of all but the world’s poorest countries. KAZAKHSTAN Population – 18,500,000 Capital City – Nur-Sultan, formerly Astana (population – 1,000,000) Currency – Tenge The second largest country in the CIS by geography and the ninth largest country in the world – please get any thoughts of Borat out of your head immediately before visiting (the movie was filmed in Romania in case you were wondering). Instead, come & be part of one of the better economic secrets that the Eurasian region has to offer. Much of the country is steppe, meaning flat, grassy land where little grows, and between cities, there’s an awful of a lot of nothing in between. Yet what Kazakhstan does have going for it is natural resources in abundance. Mining is concentrated mainly in the north and east, there are copious amounts of oil by the Caspian Sea to the west, plus manufacturing further south. Add to this a government who are probusiness and welcome foreign investment, plus who manage to get along well with their key neighbours, plus western powers, and you have a recipe for a country going places. The main difficulty for investors is geography; Kazakhstan is a long way from virtually anywhere. Even from Moscow, Dubai, Beijing, Delhi or Istanbul to Almaty, you’re looking at a flight of at least four hours. This of course means less competition for those who do make the journey and the pickings are generally good if you can get it right. Of course it’s not all good news; the regime has little tolerance for dissent of any kind, resulting in no creditable opposition and the authorities’ human rights record is at best questionable. The GDP may be on par with Malaysia but there is huge inequality with many feeling left out and struggling to find their place in the new Kazakhstan, and corruption through nepotism is still a major issue for investors. One bright stop in particular was the smooth (& not to mention rather unexpected) transition of power from Nursultan Nazarbayev who had ruled since Soviet times, to Kassym-Jomart Tokayev. Nazarbayev is rumoured to still pull many strings from behind the scenes and therefore isn’t quite out of the picture as such, but most importantly, for foreign investors it does appear to be more or less business as usual. Rumours continue about further devaluations of the Tenge although despite the volatility regarding the world price of commodities, Kazakhstan does 130 131 seem to have largely weathered the storm since the global financial crisis a decade ago. However, ‘new’ is the operative word in the capital, recently renamed Nur-Sultan (from Astana, which translates as ‘capital’ in Kazakh), which an Australian Expatriate described as ‘Canberra on steroids’. Nur-Sultan was little more than a provincial backwater town in the middle of the northern steppe when it was chosen to supersede Almaty in 1997 and is now a testament to Kazakhstan’s vision for the next generation – hopefully a bright future, albeit a cold one in the winter when temperatures plummet. Almaty remains the commercial capital as Kazakhstan’s largest city and the population have also witnessed their city boom in recent years; quite a feat when expansion is made all the more difficult by the surrounding Tian Shen mountains – stunning as they are, but hard to build on. Given the distances between cities and the poor quality of many provincial roads, getting around is best done in the air. The country’s leading airline is Air Astana and has hubs in both Almaty and Nur-Sultan, with frequent flights to most other cities of any significance in Kazakhstan, as well as throughout the CIS, particularly to Russia. Their safety record is impressive, particularly compared with other carriers in the region. Middle class Kazakhs have money in their pockets and love quality products – they’re ready to pay a premium as it’s a long (& pricey) flight to go shopping for a weekend so most stay put and spend locally. Kazakhstan boasts around 130 different nationalities, although everyone seems to get along fine. Around 70% of Kazakhstan is ethnic Kazakh, with Russians making up almost a quarter of the population, although mixed marriages are considerably more common in Kazakhstan than in the other four Central Asian countries. Ethnic Russians tend to live in the larger cities and their presence over the past two centuries has had a profound influence urban Kazakhs, who differ significantly from their rural counterparts. The Kazakhs you come across in a business situation will be very well educated, either locally, in Russia or even further afield), and will wear western-style clothes. Alcohol consumption is the norm rather than the exception, and even if someone isn’t drinking (hey, they may be driving; Kazakhs love their cars too), they won’t object to you having a glass or two. Hospitality is a big issue in Kazakhstan, since given the remoteness, the country doesn’t see as many visitors as it should. Therefore you are likely to be given a warm welcome, and consider staying on an extra day or two to visit Almaty (or Nur-Sultan), especially if you’ve only been to the Caspian. Both street and city names can cause confusion in Kazakhstan, as many have been changed to a more Kazakh-sounding version yet locals often refer to the old, Soviet name. Some, such as Ust-Kamenogorsk, Uralsk or Semipalatinsk (now Oskemen, Oral and Semey respectively) are guessable yet the capital Nur-Sultan is now the 6th name for the city in under 200 years (in the past it has been called Akmoly, Akmolinsk, Tselinograd, Akmola, and most recently, until the change in 2019, Astana). Almaty was until recently better known as Alma-Ata yet when founded was in fact Verny. Officially Kazakh and Russian have dual official status, but in larger cities such as Almaty and Karaganda (in fact any with a sizable ethnic Russian population), Russian dominates. Curiously Almaty doesn’t have what could be described as a single, main street running through the centre, such as Moscow’s Tverskaya or Kiev’s Khreshchatik; it’s simply a criss-cross of roads (admittedly some larger than others), and confusingly the city slopes downwards to the north. Hint, the mountains behind you are in the south – on the other side is Kyrgyzstan and lake Issyk-Kul, if you fancy a hike of several days. There also a knack to getting around town; the majority of Almaty streets have changed names since independence, with Kazakh warrior heroes taking preference over Soviet Communists. This would not be a problem in itself (many other CIS cities have swapped some road and metro names) yet old habits die hard and the majority of the population, regardless of ethnicity still refer to the ‘old’ version even though street signs list only the new one. And just to make your life even more difficult, since roads can be many miles long you will need to tell your driver not only the (old) name, but also the name of the nearest intersection. Sounds daunting but you get used to it – just allow ample time as buildings are large and what looks like a stone’s throw away on a map could be a half hour drive, and traffic jams are common throughout the day. A metro has been built recently in Almaty but currently only has one line and whilst beautifully decorated is of limited use to 132 133 business travelers, but cabs are cheap and plentiful. Do keep some energy for Almaty’s nightlife which has to be the best in Central Asia, boasting an excellent & growing selection of bars, cafes, restaurants and nightclubs. There is a solid Expat crowd which is welcoming and easy to break into, and plenty of networking events if you’re new to town – the remoteness results in foreigners still being much more of a novelty than in Moscow. The only ones complaining are those who have been forced to relocate to the capital or to the Caspian! The Kazakh language is currently undergoing a transition from the Cyrillic to the Latin alphabet, and the process isn’t without its teething problems. Even using the Cyrillic alphabet, Kazakh had 9 letters for sounds which don’t exist in Russian, so series of accents have been added to supposedly ‘help’ make matters easier. Therefore don’t be surprised to see the country written as ‘Qazaqstan’, although only time will tell as to how smoothly (or not) this move will be. For decades, particularly during the Soviet period, the better educated the ethnic Kazakhs are, the less likely it is that may speak their own language in larger cities. In fact it was viewed as backwards to speak Kazakh, since Russian was the language of the USSR and this meant everything. Kazakhs even have an expression ‘Shala-Kazakh’ for Kazakhs who don’t know Kazakh, or speak it badly. Nevertheless, finally, and thanks to some government-backed initiatives, Kazakh is most certainly making a comeback even if many Kazakhs feel more comfortable using Russian (or even English) in business. Even some of the ethnic Russians living in Kazakhstan learn some Kazakh now, and at the same time English is becoming more popular, but is still not widely spoken outside of business circles. Citizens of most countries can now visit Kazakhstan for 30 days visa-free, for either business or tourist purposes. Becoming legally employed in Kazakhstan is a trickier issue as there is a law regarding local content (ie, for every foreigner employed, you need to ‘balance the books’ with nine locals on your payroll), so this is where outsourcing providers play a role. KYRGYZSTAN Population – 6,400,000 Capital City – Bishkek (population – 1,000,000) Currency – Som Kyrgyzstan may be a popular answer to pub quiz questions as one of the four countries in the world that has only one vowel (the others are Chad, Egypt and Cyprus to save you having to Google the answer) but rarely makes the international headlines. Except when there’s a coup, of which there have been two since independence in 1991. Whereas the other four Central Asian countries are ruled by autocratic leaders who’ve been there since Soviet times (or their predecessors were, and little else has changed), Kyrgyzstan kicked out the aged Askar Akaev in 2005, only to do to the same to Kurmanbek Bakiev in 2010. Bakiev had promised much, but only delivered a similar recipe of corruption and cronyism which was great for the tiny few in his clan who benefited, but kept the bulk of the population in poverty. After ethnic riots killed hundreds in Kyrgyzstan’s second city, Osh in the south (which has a large Uzbek minority) following the second coup in 2010, calm appears to prevail, although economically the country still struggles. Interestingly, Kyrgyzstan until recently was the only country in the world to house both a Russian, and an American military base (the latter used to act as a transit point for NATO supplies into Afghanistan) although under pressure from Russia, the Americans were recently, finally given the elbow. Kyrgyzstan may badly need the Yankee Dollar but it needs the Russian Ruble much more. Foreign investment is largely centered around the mining industry, as there are few other opportunities on offer. Kyrgyzstan is a mostly mountainous country. More than a million of its people work abroad (typically in Kazakhstan or Russia) as migrant workers. These remittances are crucial to keeping their country afloat, as well paid employment back home remains scare. Add to this a lack of strategic investment thanks to perceived political instability and government-level corruption, and it doesn’t paint a pretty picture. The people of Kyrgyzstan continue to vote with their feet by leaving the country and heading abroad in search of better employment opportunities and few seem optimistic about better times lying ahead anytime soon. Tourism is one bright spot, and the removal of visas for all but the most tin-pot regimes has brought in more foreign visitors; prices are low and the mountain scenery is stunning, especially around lake Issyk-Kul, the world’s second highest. There’s little in the way of mustsee sights in the drab, Soviet-built capital, Bishkek, but it’s hard to visit Kyrgyzstan without spending at least a day in the capital, so make the most of it. Visit Osh bazaar close to the centre for some great souvenirs and you’d be surprised at what the nightlife throws up if you know where to look. 134 135 Curiously Bishkek was recently ranked as one of the cheapest capital cities in the world to live in, and is thus marketing itself as an inexpensive place to learn Russian. There are certainly worse places to spend a summer; the only major outlay will be your air fare. An increasing number of airlines fly into Bishkek despite its remoteness. In terms of language, Kyrgyzstan is the arguably the least localised of the Central Asian countries, despite most of the Russians having fled during the economic chaos in the 1990s. There have been some efforts to promote the Kyrgyz language although many signs are still in Russian only and in urban areas all Kyrgyz speak good, if not fluent Russian – in fact in Bishkek itself, Russian certainly dominates in business circles . Little English is spoken apart from those in the tourist industry although it is slowly on the rise. No visa required for most nationalities (ie, EU, USA, Canada, Australia, New Zealand & Turkey); South Africans and Israelis can buy a visa upon arrival without an LOI. MOLDOVA Population – 2,700,000 Capital City – Chisinau (population – 700,000) Currency – Leu (plural – Lei) Moldova sometimes feels more like a remote province of Romania than a country in its own right, but that’s probably because essentially, that’s what is it. Formally founded when the MolotovRibbentrop pact was signed in 1939, dividing up large swathes of Eastern Europe into Soviet & Nazi spheres of influence, Moldova currently wins the booby prize for being the poorest country in Europe. Moldova has little going for it as far as the casual investor is concerned; there are no natural resources of any significance and wedged in between North-Eastern Romania and Western Ukraine gives the country little strategic importance or influence. It does hope to join the European Union at some stage although in reality this seems to a long way off, although Moldovan passport-holders may now visit (but not work in) the EU, visa free, the first CIS country to be granted such a privilege. There is one exception; wine. Produced in the region for centuries, the industry took a battering during Mikhail Gorbachev’s antialcohol campaign in the late 1980s, but has seen a revival in recent years and some of the better wines actually taste quite good & are pretty cheap when sampled locally. The smattering of tourists who visit Moldova usually take in a wine tour, and the Milestii Mici complex is listed in the Guinness Book of Records for having the largest wine cellars in the world, containing almost two million bottles. The second largest, Cojusna is also worth a visit & is closer to Chisinau, although both recommend that you book tours in advance as Moldova still isn’t really geared up to individual tourists just rocking up unexpected. The capital city, Chisinau (pronounced ‘Kish-in-ow’ in Moldovan, but Russian speakers refer to it as ‘Kish-in-yov’) thinks that it has undergone somewhat of a facelift in recent years, but in reality little has changed. Soviet-era high rise blocks of apartments dominate the skyline and there are few places of interest to visit other than in & around the main street, Stefan Cel Mare. For those wanting to experience a little piece of Soviet nostalgia, take a two hour drive (or train) east to the breakaway province of Transdniestria (Pridnestrovia in Russian), on the border with Ukraine. Incorrectly assuming that at the time of the breakup of the Soviet Union, Moldova would be re-incorporated into Romania proper, the ethnic Russians and Ukrainians who lived in the more builtup Transdniestria region took up arms and broke away from Moldova. A stalemate has ensued since 1992 but that hasn’t stopped Transdniestria from issuing its own currency, the Transdniestrian Ruble (worthless outside of the ‘country’ but makes great souvenirs). Their flag is the only one is the world to display the hammer and sickle, despite not actually being a communist state. Nowadays, no additional documents are required to visit for short stays and it’s worth a day trip to the capital, Tiraspol or the nearby town of Bendery. You’ll be surprised that such places still exist in Europe, a classic example of a frozen-conflict, and what’s more, it’s perfectly safe, if a little bizarre. Transdniestria functions pretty much as a country proper, even though no-one, not even Russia recognizes it; Transdniestrian citizens carry Russian passports. The Moldovan language is almost identical to Romanian, which are Romance languages with similarities to Catalan, Italian, Spanish and Portuguese. This helps to explain why so many Moldovan migrants head to southern Europe in search of work (plus to Russia too, of course, and some, also to neighbouring Ukraine) as well paid jobs are in short supply in Moldova. Moldova’s population has almost halved since the break up of the USSR. 136 137 Moldovans are more likely to speak, or at least partially understand these languages in favour of English. Russian is spoken by pretty much everyone, and in cities many people will speak it as their first language. No visas are required for the majority of nationalities (ie, EU, USA, Canada, Australia, New Zealand, Israel and Turkey), although South Africans DO need to apply in advance, AND require an LOI. TAJIKISTAN Population – 9,300,000 Capital City – Dushanbe (population – 800,000) Currency – Somoni Always the poorest of the USSR’s 15 Republics, Tajikistan remains impoverished more than a generation after the fall of the Soviet Union. The country endured a civil war between 1992-1997 when with Russian backing the current leader, Emomali Rakhmon finally ousted the Islamic fundamentalists. Tajikistan’s geography severely hinders progress, as it borders Afghanistan to the south, China’s Xinjiang province to the east (over the Pamir mountains), Kyrgyzstan to the north (also over the Pamirs) and Uzbekistan to the west, with whom it rarely sees eye-toeye. This is partly a contest of egos but also a fight over who controls the region’s water supply – see the Uzbekistan chapter for more details on this touchy subject. President Rakhmon tolerates no dissent but his tight control over the country’s economy prevents growth, which is minimal. Potential projects in mining and hydro energy in the form of dams are fraught with wrangling, both legal and political and take forever to get off the ground; inward investment is minimal despite some recent efforts to market Tajikistan as a place to do business. Heroin smuggling from Afghanistan across the porous, mountainous border represents one of the few ways of making serious money, despite Russian attempts to prevent it, as that’s where much of the finished product ends up. Tajikistan is heavily depending on remittances from migrant workers who mainly toil on construction projects in Russia, bringing in almost 50% of the country’s GDP. Rakhmon is fully aware of his dependency on mother Russia yet from time to time irks the hand that feeds his country by behaving irrationally, such as threatening to ban the teaching of Russian in schools, or de-Russifying Tajik surnames (he was previously known as Rakhmonov, before dropping the ‘ov’ ending as it sounded ‘too Russian’). The NATO-led operation in Afghanistan had let to Tajikistan being used as a base for logistical support, and brought in much-needed funding. This has now all but dried up as the Allies withdrew, and without much-needed reforms the economy is unlikely to show many signs of growth. The Capital Dushanbe (which curiously means ‘Monday’ in Tajik) seems affluent enough, with plenty of decent shops, restaurants and even Hyatt & Hilton hotels, and everyone seems to have the latest mobile phone. Yet in rural areas people live close to a subsistence existence, relying on their animals, the crops they grow and money sent home by the men in their family working in Russia. Not that this stops the government embarking on seemly pointless, grandiose efforts to prove itself to the few who are paying any attention, such as building the world’s biggest library, tallest flagpole, largest tea house, and most recently an enormous theatre with the largest capacity in Central Asia. Dushanbe is adorned with Soviet-style posters of Rakhmon greeting happy workers, overseeing the country’s modernization and praising people surrounding completed projects, few of which bear any resemblance to reality. Nobody is expecting any serious improvements anytime soon; if anything the Tajik security services have strengthened their grip on sociality as a whole under the guise of preventing the rise of Islamic fundamentalism. There have been recent clampdowns on any media outlets, which report anything even vaguely critical of the government and social networking websites are frequently blocked. Tajik is the ‘odd man out’ of the Central Asian Republics as the language is closely related to Persian, rather than Turkish but has borrowed words from other languages, including Russian, which is still spoken in larger cities. Tajiks are well aware that knowledge of Russian allows them to work in Russia and other CIS countries. Tajikistan sees very few outsiders other than fellow CIS citizens or the occasional Chinese delegation (either as business people or tourists) so as a result English is virtually non-existent. E-visas are now available so long as you fly into Dushanbe airport (but not at other airports or at any land borders), with no LOI required. TURKMENISTAN Population – 5,250,000 Capital City – Ashgabat (population – 1,000,000) Currency – Turkmenistani Manat ! 138 139 Arguably the second most closed country in the world after North Korea, Turkmenistan thrives thanks to having the world’s fifth largest deposits of natural gas. It’s a bizarre destination that few people ever visit thanks to its self-isolation policies. EVERY Non-Turkmen citizen needs a visa, and these can be hard to obtain for anything other than standard tourist trips, and even these must be fully escorted by a local guide at almost all times. The capital Ashgabat (which charming translates into ‘city of love’) is plain bizarre – try to imagine Dubai under communist rule and you’ll come close. Stories about the previous president Saparmurat Niyazov’s eccentricities were well documented; he changed his own name to Turkmenbashi (father of all the Turkmen people), as well as some of the names of the months of the year to make them sound like his relatives. A few of the many banned pleasures were smoking OUTSIDE, dogs in the entire capital and then libraries were shut down everywhere except in the capital. Niyazov died in 2006 but the gold statues that he had built of himself in Ashgabat remain. He was replaced by his dentist, Gurbanguly Berdymukhamedov who hinted at reform but has kept to similar hard-line, closed policy, perhaps with fewer of the eccentricities of his predecessor. Doing business in Turkmenistan requires the patience of a saint and extreme persistence, preferably with high-level contacts thrown in for good measure as the entire country’s economy is under state control. The majority of business not surprisingly revolves around the gas industry, but also construction and some agriculture. Those firms who have made it in Turkmenistan enjoy something of a monopoly, so there is some reason to be optimistic, but be prepared for frustrations, and to be there for the long haul. The official language is Turkmen which is related to, but isn’t as close to Turkish as the name might suggest. Few Russians remain in Turkmenistan and its isolation means that Russian is not as widely spoken as in other CIS countries, even though the well educated will still speak it fluently. Good luck trying to get around in English, but then again you’ll almost certainly be escorted by an agency-approved, English-speaking guide anyway. Visas required by all (including for CIS citizens), and must be obtained in advance. An LOI is required, and foreigners will need to be accompanied throughout their stay in Turkmenistan. If you ! do make it there, pat yourself on the back as Turkmenistan is one of the world’s least visited countries, so you’re one of a select few. UKRAINE Population – 42,000,000 Capital City – Kiev (also spelt ‘Kyiv’) (population – 2,900,000) Currency – Hrivnia The name ‘Ukraine’ literally translates as ‘the edge’ which is rather fitting since Ukraine cannot quite decide whether she wants to be part of Europe (meaning in practice stronger ties to the European Union), or greater Russia to which there are closer ties historically, especially East of Kiev and along the Black Sea coast. There is an expression told to me by a local businessman in Ukraine, that ‘dyengi lyubyat tishinu’ (money prefers calmness), something which has been in short supply in Ukraine. One feels that if, since gaining independence in 1991, politicians spent less time fighting amongst themselves (sometimes physically) and more time sorting out the country’s woes, Ukraine would be in a stronger position. Ukrainians lament that where Poland went through a process of shock-therapy in the early 1990s, Ukraine got the shock without the therapy to back it up. Ukraine is the largest country wholly in Europe and has the second largest population of any CIS country, after Russia. It was the breadbasket of the USSR and hosted large numbers of factories geared to industrial and military production in the east of the country. It was very much the CIS’s gateway to Europe, so should have been in considerably stronger shape than it is, even before hostilities broke out in the eastern part of the country. Corruption is a serious issue, and much of the economy is controlled by a handful of well-connected Oligarchs who have little incentive to instigate change, despite ‘assistance’ from well-meaning foreign advisors. Ukraine found itself virtually bankrupt in the early 1990s, immediately following the collapse of the Soviet Union when shortages were rife, and the country issues such as the Chernobyl disaster to cope with, something that it simply couldn’t afford. The ongoing, semi-frozen conflict with Russia has decimated the country’s heavy industry and the loss of Crimea to Russia has dealt a blow to the Ukraine’s tourism industry. Doing business in Ukraine at the best of times is no walk in the park, and many investors have left disappointed, some with horror stories of how their businesses were stolen – either by, or with the 140 141 help of corrupt officials. There is money to be made; just look at how many multinational corporations have offices in Kiev although this is a world away from village life where little has changed since the collapse of the USSR. The retail sector continues to expand, and gas exploration has suddenly become big news, with FMCG, Agricultural & Pharmaceutical companies also showing growth. Ukraine surprised many in the world in 2019 by electing reality TV actor and comedian, Vladimir (‘Volodymyr’ in Ukrainian) Zelensky to become President. The irony was that Zelensky had played the role of an ordinary man who rants about corruption, and then goes on to become President, in a popular TV series. His landslide victory was confirmation that Ukrainian voters were fed-up with old-style politics and were ready to give a chance to someone who had a clean background. Most felt they had little to lose. Zelensky certainly has a job on his hands but early signs have been encouraging; the economy appears to slowly, be turning around and general business confidence is on the increase. Huge challenges remain, however, such as how to stem the flow of young, educated Ukrainians from leaving the country (estimated at around 100,000 per month), plus managing relations with Russia. Language is a thorny issue in Ukraine and certainly divides opinion – Kiev vs Kyiv isn’t a fixture in the Ukrainian footballing calendar, it is in fact the transliteration of the Ukraine’s capital into Latin letters from Russian vs Ukrainian. Not surprisingly Ukrainians prefer the latter version, although for continuity’s sake many people stick with the old form, to avoid confusion. Similarly you will see differences between the Russian spelling of some cities in Ukraine, such as (Lvov vs Lviv, Kharkov vs Kharkiv and Odessa vs Odesa). In theory at least Ukrainian is the country’s only official language, but visit large cities such as Kiev or Odessa, and you’ll see a very different picture, where Russian is by far the most common language on everyone’s lips. Russian always dominated in eastern cities and in the Crimea, and this is even more the case now. English is becoming more widely spoken in parts of Ukraine that attract more tourists, namely Kiev, Odessa and Lvov thanks to visa-free travel for westerners in 2005 that remains to this day. The European low-coster airlines were quick to seize the moment when Ukrainians were granted visa-free access to the Schengen zone, with flights now available to numerous Ukrainian cities from almost every European destination you can think of (and even some you’ve never heard of). No visas are required for many nationalities, and for those who do, electronic visas are easily available online. Be aware that The Crimea is now de facto under Russian control so Russian visa requirements apply. Whilst hostilities are on-going, travel to the Eastern part of Ukraine (particularly the Donetsk & Lugansk regions) is not recommended, and in any case business has almost ground to a halt there. UZBEKISTAN Population – 34,000,000 Capital City – Tashkent (population – 2,500,000) Currency – Sum Uzbekistan is a country undergoing huge transition quite literally, as we speak. Shunned by most international businesses since the breakup of the Soviet Union in 1991, Central Asia’s most populous nation has put itself back on investors’ maps as the multinationals pour into, and set up shop in the capital, Tashkent to take advantage of what the country now has to offer. The years following independence were not easy ones. Uzbeks understood the need for keeping control of a volatile area, as Uzbekistan is the only Central Asian country to share a border with all of the other four ‘Stans. The key was to prevent a civil war in the 1990s, as was witnessed in Tajikistan (and which many believe could easily have occurred in Uzbekistan). Nonetheless, Uzbeks lamented the tight grip over the country, in every way, from politics to the economy, using the threat of Islamic fundamentalism as an excuse to clamp down on just about anything. Uzbekistan’s long term leader Islam Karimov died in September 2016 after having ruled the country with an iron fist since Soviet times. During his tenure, the country had an appalling record for human rights, events of which have been well documented, including a daylight massacre of hundreds of civilians in Andijan in 2005. Karimov seemed to care little what the world thought, and western-imposed sanctions had no obvious effect on his domestic or foreign policy. His trump card had always been his country’s strategic location, sharing a border with Afghanistan, which ironically was from where the Soviet Union first attacked, then finally retreated from their decade-long war that began in late 1979. As NATO forces began to leave Afghanistan and take their tons of military equipment with them, Uzbekistan was an obvious exit route; many times safer than through the mountainous, tribal areas of Pakistan. Successive western 142 143 governments seemed happy to effectively turn a blind-eye to Karimov’s abuses at home in return for safe passage out of Afghanistan, a picture, which obviously suited Karimov nicely. Uzbekistan is a country rich in natural resources, particularly gold, copper & coal, plus considerable gas reserves. There is massive agricultural potential, especially in the harvesting of cotton, traditionally one of Uzbekistan’s hard currency earners. It is however precisely cotton that has caused so much agony in the region since production was stepped up by Soviet planners in the 1960s. Cotton is an extremely thirsty crop and rivers that normally flow into the Aral Sea were diverted to grow cotton on an industrial scale, resulting in the Aral Sea shrinking to only a fraction of its previous size. It’s said to be one of the biggest man-made, environmental disasters of all time, and yet water still dominates the political landscape in the southern part of Central Asia. Uzbekistan is both angry and frightened at the prospect of its two eastern neighbours Kyrgyzstan and in particular Tajikistan damming up mountain rivers as they could then more easily dictate terms, although some believe that has been more about a clash of personalities and egos among big men used to getting their own way. Everything changed once the current leader Shavkat Mirziyoyev came to power in December 2016. He set about removing Karimov’s cronies from power and began replacing them with (in his words) “new, young people who love their country”. Mirziyoyev has pursued an active foreign policy, and made it clear that he is keen to attract foreign inward investment. He has travelled the country extensively and stated that he intends for Tashkent to be a magnet for business. The result is that the capital is now awash with representatives of international businesses, and there are copious service providers who will help you and your company find your feet. Significant amounts of Red tape have been removed, the local currency, the Sum is now convertible, credit cards are more widely accepted and perhaps most importantly, you can repatriate any profits that your company makes. Critics will say that it’s simply been the transfer of power from one large family to another and that the speed of reform is slow, but changes continue, and largely for the better. Get there before your competitors do! Uzbekistan must also be visited for tourist purposes. The country will leave you in awe; there are thousands of years of history to be witnessed and prices are very low. The Uzbek people, despite all the hardships (most work for peanuts locally, and many others have left to seek their fortune elsewhere, mainly in Russia) are extremely hospitable and welcoming to foreigners. Given the beauty of the ancient, Silk Road buildings in Samarkand, Bukhara and Khiva to name just three places, it’s a shame that nowhere near as many people make the trip as should. The traditional Chaikhana (tea house) has been replicated throughout the CIS region which is testimony to the food’s popularity – you won’t be disappointed. Uzbek, the official language is related to Turkish, but more closely to Kazakh and Kyrgyz. Despite most of Uzbekistan’s sizable Russian minority having left the country in the past three decades, many remain and therefore Russian is still widely taught and therefore spoken, particularly in Tashkent. The ethnic Tajiks who live in Uzbekistan speak Tajik too, but don’t expect much English to be spoken although the language is gaining in popularity. In accordance with Uzbekistan’s open door policy, the majority of visitors, both business and tourist can now enter the country visa-free for at least 30 days, and those who do require a visa can get one online with a minimum of fuss. Along with visas, the country has also done away with customs declaration forms (unless of course you are bringing in restricted goods, and/or large quantities of cash). Immigration and customs formalities are now speedy processes, a world away from the long queues and bag searches of just a few years ago. 144 145 THE EURASIAN CUSTOMS UNION (TAMOZHENY SOYUZ) Much noise has been made about The Eurasian Customs Union of Belarus, Kazakhstan, and Russia, which came into existence in January 2010 and was launched as a first step towards forming a broader European Union-type economic alliance of former Soviet states. Armenia & Kyrgyzstan subsequently joined up in 2015, and Tajikistan’s possible membership is still under discussion. There is also speculation that some non-CIS countries might eventually sign up (such as Mongolia, Turkey & Vietnam) , but as things stand, these remain as just rumours. Some Western critics see this as a way for Vladimir Putin to try to reestablish a Russian-dominated, USSR-style union among the Post-Soviet states, although in reality for foreign investors this Union is likely to be of interest if you produce goods in one of these countries (or ship into one), and subsequently export them to member states. Note that when flying between countries in the Customs Union, technically you cannot purchase anything from the airport Duty Free shops, even though not every store in the region feels the need to apply this rule. SPECIFICS OF RELOCATION TO THE CIS COUNTRIES Moving to CIS countries can be quite an interesting and versatile experience as their territories feature cosmopolitan cities with modern services and infrastructures among pristine rural areas. Although you can usually expect a welcoming and easy-going attitude towards expats in most of these countries, relocating and launching your business here can be a challenge for unprepared businesspersons. This is due to the common historical and institutional background during the Soviet period. However, as we can observe now, their economic and political development strategies have become increasingly divergent after gaining independence in 1991. While some CIS states have a developed housing market with various options, there are countries with a limited choice for expats. Putting aside Russia as its core member, let us take a closer look at the others below. The key players are Belarus, Kazakhstan, Azerbaijan, Ukraine and Georgia (the latter two are formally not CIS members but usually featured as significant parts of the region). The housing market in these countries is still in the process of transformation; however, we cannot help but notice the rapid changes towards services quality and business environment progress in recent years. Common practices include landlord-oriented deals so be prepared to pay rental and insurance payments in cash, and small choice of high-class and big apartments in most of the cases. Rental prices usually include only cold rent, consequently, taxes and utilities come on top. On a positive side, market analytics shows a smooth shift to a tenant-focused supply in the last few years due to the expat influx, countries’ willingness to collaborate with the Western world, and favourable investment climate. Still, CIS is a colorful patchwork of regions with different cultures, customs and traditions. So let’s speak about some local differences in each of these countries.We start with Azerbaijan, the Land of Fire, as locals call it. The place where East meets West, this country mixes fairytale-like architecture of Arabian Nights and modern skyscrapers. Private property owners in Azerbaijan own the majority of the apartments on the market. Most local and international businesses are located in Baku, the capital of Azerbaijan. What is quite a rare situation in CIS countries is that you can find almost any type of housing here – from villas with large gardens and occasional swimming pools to duplex penthouses offering spectacular views of the city. Oriental exotic motifs in furnishing and interior design is a common thing, though it can be quite confusing (if not over the top) for many expats from the western part of the world. The same picture can be found in Kazakhstan where due to the country’s rapid development and economic growth the housing market is experiencing a massive increase in both real estate prices and rent over the past few years. Of course, like with the majority of CIS countries, most businesses are concentrated in the big cities - especially in Nur-Sultan (previously known as Astana, built from scratch among vast steppes and featuring a wide range of modern houses with facilities), Almaty (previously the principal city of Kazakhstan) and oil centers like Aktau and Atyrau. Local real estate agents often lack professional experience and may be unreliable in negotiating process. Most property owners show their apartments themselves, which can take a toll on the logistics of your search. Therefore, we recommend planning it in advance. Rental prices can vary depending on location and accommodation type. One of the most landlord-oriented countries is still Belarus. Still engulfed by its Soviet legacy, Belarus is emerging as a budding and modern expat destination. Despite its broad range of housing 146 147 options – from grandiose Soviet-era apartments to modern apartments and residential complexes – it is necessary to mention the difficulties you can face during the negotiations with the landlords. For example, it is usually complicated to discuss the proprietor’s responsibility for ongoing maintenance in your apartment and possibility to include utilities in your rent. As everywhere in CIS, cash payments are preferred. There are less popular directions for relocation in CIS states, however. Armenia, Kyrgyzstan, Moldova, Uzbekistan are traditionally considered to have less developed housing markets. Supply of high-quality apartments is very low and limited. Local currency in almost everywhere is volatile, so landlords prefer to sign rental agreements in USD/EUR with payments in cash. To avoid the risks of overpaying your property owner we recommend fixing rent in local currency. It would be very difficult to find a proper real estate agency here, as most deals are made by personal contact and sometimes only via verbal agreement. Among other CIS countries Uzbekistan has its own unique flavor. It combines medieval buildings as if from the pages of an old oriental tale, elegant European architecture from the period of the Turkestan governor-generalship, standard concrete “boxes” of the Soviet era and, finally, in the big cities, you can find even modern skyscrapers of glass and concrete. Landlords will almost always request USD payments in cash. Even though local housing market is still very young, recent political and economic changes promise a speedy development and significant influx of investments in the next few years. As already mentioned above, the personality and experience of the landlord is an important factor to consider. Intermark Relocation keeps a record on many proprietors and our consultants are able to advise you in many cases whether a particular landlord is easy to work with or not. Once you have chosen the property, we will start negotiations on your behalf. Our consultant will do the legal check on landlord’s ownership documents and provide you with a comprehensive report. Our professional team will help you and your family with all the necessary information and paperwork to make the process of moving and adaptation as smooth as possible. Relocation made easy with Intermark! Marina Semenova Managing Director & Shareholder Tel: +7 495 502 95 53 | +7 963 644 7770 m.semenova@intermarkrelocation.ru www.intermarkrelocation.ru 7/1 Kropotkinsky Pereulok Moscow, Russia, 119034 +7 495 502 95 53 www.intermarkrelocation.ru relo@intermarkrelocation With over 20 years of experience we here to help you to make Russia & CIS your home! • Temporary Housing • Orientation & Home-nding • Legal due diligence • Settling in & 24/7 Help-desk • Departure Support • Spousal support & Coaching RELOCATION • Work Permit • Visa support (all types) • Residence Permits • Migration registration & notications • Legalization & duplicates’ procurement • Immigration due diligence IMMIGRATION • International moving • Domestic moving • Transportations of antiques • Oce moving • Vehicle moving • Stock and storage MOVING PAS SP OR T 5 148 149 XVII. Public Holidays in Russia Russian public holidays fall on specific calendar days but there is an art to knowing exactly which day or days off you will get. Typically, if the holiday falls on a Monday, Wednesday or Friday, you simply get that day off. If it falls on a Saturday or Sunday, you usually find that the following Monday won’t be a working day. If it’s a Tuesday or a Thursday, you might be given the Monday before – or Friday afterwards too, allowing for a longer weekend but you may be forced to work a Saturday the following week to compensate; but not always. A list of public holidays is available at the start of each calendar year but even these are subject to occasional change so it’s worth making absolutely certain in advance before booking flights out to Russia as some people may use the opportunity of a quieter spot to take the whole week off. KEY PUBLIC HOLIDAYS IN RUSSIA 1st January – New Year’s Day In fact the first working day of the New Year is often not until the 10th January since Russian Orthodox Christmas is celebrated on 7th January. Due to the exorbitant cost of flights/ holidays over new year’s, some people take an additional week or even two off, so don’t count on much happening until the third week of January. 23rd February – Defender of the Fatherland Day Formerly known as Soviet Army Day; now women prepare food and drinks for the men in their lives (both in the office, and at home), in anticipation of 8th March, and is therefore commonly referred to as ‘Mens’ Day’. 8th March – International Women’s Day For Russia’s females, this is one of the biggest days of the year, with office parties, champagne, chocolates & presents galore. It’s worth being in Russia to witness this one; but come prepared (ie, bearing gifts), and watch the price of flowers shoot up in the days before. 1st May – Labour Day Don’t expect much business to take place during the first ten days of May as many Russians use this period as an opportunity to take an extended holiday. 9th May – Victory Day Commemorating the end of the Second World War – you will witness massive street parades involving WW2 memorabilia 150 151 (think tanks trundling down the main roads of Moscow and noisy aircraft flying overhead); remember that the Soviet Union lost a reported 27 million people between 1941 – 1945 so you can understand why this one is such a big deal. 12th June – Russia Day Until recently was known as Independence Day, but nobody was quite sure exactly from whom, hence the name change – but it’s a day off nonetheless. 4th November – Unity Day Previously October Revolution Day was celebrated on 7th November but now an obscure victory over the Poles in the 17th century is celebrated instead. Useful contacts Chambers of commerce, local websites, social events and corporate sponsors 152 153 CHAMBERS OF COMMERCE If your firm isn’t already a member of these organizations, then check these out and sign up. All have their own niche and can be extremely useful in terms of local knowledge, relevant contacts, networking and for lobbying on companies’ behalf. Annual subscriptions vary depending on company size – be prepared that some will try to charge you the maximum rate, based on your corporation’s global revenue, even if your Moscow office is only a two-man show. However, depending on the circumstances, some may let you sign up as an individual member at nominal cost but you will need to ask. Here are some of the largest and best known chambers, although even some of the smaller nationalities will have either a formal or informal network with events of varying frequency. American Chamber of Commerce (AmCham) One of the largest chambers (not only in terms of members but also events) who have a history of effective lobbying on behalf of the foreign business community as a whole, and running sector specialized meetings with senior people ranging from multinationals to high-level government figures. Open to all; you don’t need to be an American or an American company or even have an office in the States to join up. There are separate Am Chams located in the capital cities of all major CIS countries. www.amcham.ru Russo-British Chamber of Commerce (RBCC) A well-established and extremely well-connected chamber that is professionally run, with offices in London & Moscow. Events range from evening drinks/networking sessions (sometimes held at the British Ambassador’s Residence or in the Embassy) to specialized conferences with top-level industry speakers in all three locations. The RBCC also cooperates closely with the British Embassy and the DIT (formerly known as the UKTI), and also facilitates trade missions to key cities in Russia. www.rbcc.com British Business Club The BBC has been completely revamped, and now no longer requires an annual membership fee; you simply pay to attend each particular event, where there is an entrance fee, although this often does include some refreshments. Open to all, register via the website to receive regular updates about what’s coming up in the calendar. www.britishclub.ru Canadian Eurasian-Russian Business Association (CERBA) A forum for all Canadians in throughout the CIS, or anyone even vaguely connected with Canada. This may include those with a Canadian partner, working for a Canadian company or someone who has previously lived in Canada, as well as a platform for Canadians in Canada who have business interests in the CIS region, or are looking to do so. CERBA runs regular events, ranging from social to business (the annual mining conference is just one of many) as well as some political lobbying, in Canada as well as in Russia, Kazakhstan and Uzbekistan. This is one chamber that definitely punches above its weight in terms of size and activity, with additional charity fundraisers and missions to far-flung parts of the CIS with a strong focus on where Canadian companies are particularly active (oil, gas and other natural resources such as mining and forestry, agriculture and transport) and publishes a regular newsletter. Offices in Moscow, Almaty, Tashkent plus five Canadian cities (Montreal, Toronto, Ottawa, Calgary and Vancouver) www.cerbanet.org Association of European Business (AEB) The AEB represents EU-related business in Russia under the motto of “Quality Information, Effective Lobbying, Valuable Networking” and runs a large number of events, some general, others more sector specific (IT/ Telecoms, Transport, HR, Oil and Gas to name but a few). Also hosts visiting trade delegations and evening networking events on at least a monthly basis, and produces a sector-specific quarterly magazine featuring business issues. www.aebrus.com The Russian-German Chamber of Commerce (AHK) Representing both the interests of German business in Russia, and Russian business in Germany since 1995, AHK consists of around 860 members, mainly SMEs. Germany is one of the largest and most prominent investors in Russia, and AHK stresses its mission as Impulse, Service and Lobbying, which in practice supports entry to the market to establish and maintain contacts with business partners, plus providing market information and practical advice. Various regular topical events are held for the German-speaking business community and lobbying the interests of German industry at the political and administrative level is another key feature. www.russland.ahk.de (in German & Russian) 154 155 CCI France Russie The French-Russian Chamber of Commerce, encompassing the Frenchspeaking world who organize conferences and events in numerous industry sectors & disciplines, as well as quarterly publications plus a surprisingly high number of social and cultural gatherings. You don’t have to be French or even speak French to join, but basic knowledge of français will certainly help. www.ccifr.ru BRBC – Belgian-Russian Business Club A semi-formal organization for Belgian nationals working in Moscow and for employees of Belgian companies operating in Russia. Holds events several times a year, typically a corporate presentation followed by networking over food and drinks held after work, often in the Belgian Embassy. For more information and to get yourself on the list, send an e-mail: belgianrussianbusinessclub@gmail.com EUROBAK European Business Association of Kazakhstan (EUROBAK) is a noncommercial organisation representing the European business community in Kazakhstan, with a particular focus on Almaty. It was formed upon the joint initiative of EU companies, working and investing in Kazakhstan, and the Delegation of the European Union to Kazakhstan. It plays a key role in promoting and nurturing mutual understanding between Kazakhstan and the countries of the European Union in both business and social spheres and runs regular events, both business and social in Almaty. www.eurobak.kz Finnish-Russian Chamber of Commerce Finnish-Russian Chamber of Commerce (FRCC) was founded in 1946. It is a non-profit organization, whose mission is to promote companies’ business and competitiveness as well as economic relations between Russia and Finland. www.svkk.fi PUBLICATIONS, WEBSITES AND TV The Moscow Times Sadly no longer available in printed form (at least in English – there is a Chinese language edition), The Moscow Times is nonetheless an excellent source of news featuring business, politics, travel, and culture mostly in Moscow but also throughout Russia. Aimed primarily at foreigners living and working in Russia, although educated, Englishspeaking Russians are also regular readers. www.themoscowtimes.com Russia Today (RT) A Russian, state-funded TV channel featuring news bulletins, documentaries, talk shows plus cultural programmes and even some sports in Russia, but aimed at the overseas market. Mainly in English but also have Russian, Spanish & Arabic programmes. www.rt.com Russia Beyond Previously referred to as ‘Russia Beyond the Headlines’, Russia Beyond is a multi-lingual brand of TV-Novosti, an autonomous non-profit organization, funded by the Russian government. It publishes a wide range of expert opinion on current affairs, travel and cultural events in Russia, as well as Russian’s actions on the international arena. www.rbth.com The websites www.expat.ru & www.redtape.ru both provide excellent local knowledge on everything from obtaining visas to the latest restaurant, with chat forums to swap information with others. Russia in Your Pocket Available in print, PDF and on-line, In Your Pocket guides feature mainly Moscow and St Petersburg plus jaunts out to other cities. Frequently updated and brutally honest, IYP guides cover hotels, bars, restaurants plus other specifics to quickly find your feet in a new city, whether travelling as a tourist, businessman or as an Expat relocating to Russia. There are also separate guides to Armenia, Azerbaijan, Belarus, Georgia, Moldova and Ukraine. www.inyourpocket.com Internations Runs networking events throughout the world; ideal if you’re new in town or simply visiting and wish to hook up with other expatriates or internationallyminded locals. Active in most key cities in the CIS where Expats might live & work. www.internations.org Fryday A networking club for professionals organising social and business networking events across Eastern Europe and Central Asia. www.fryday.net Sanduny Banya (full name – Sandunovskskiye Bani) The website is now in English and Russian with plenty of pictures of what 156 157 you can expect inside; well worth a visit if you’re a banya virgin (foreigners are a rarity in this Russian ritual). www.sanduny.ru CONTACT DETAILS OF CORPORATE SPONSORS: Bellerage Alinga Moscow: Shchipok St., 11 bld.1, Moscow, Russia +7 495 755 55 68 Saint Petersburg: ‘Regus Nevsky Plaza’ business center, Nevski prospekt, 55A, St Petersburg, Russia

+7 812 313 91 43

www.bellerage.com Brookes School Moscow Lazorevyy Proyezd, 7, Moscow, Russia +7 499 110 70 01 www.moscow.brookes.org Conner & Co LLC ‘Mirland’ business center, 2nd Khutorskaya St., 38A, bld. 23, Moscow, Russia info@connerco.ru www.connerco.ru Fircroft Russia 4th Floor, Office 5, Tverskaya St., 16, bld.3, Moscow, Russia +7 499 649 28 29 www.fircroft.ru Intermark Relocation Kropotkinsky pereulok, 7/1, Moscow, Russia +7 495 502 95 53 relo@intermarkrelocation.ru www.intermarkrelocation.ru ROSINKA International Residencies IRC “Rosinka”, village Angelovo, Krasnogorsk Region, Moscow, Russia +7 985 998 05 85, +7 916 900 05 13 www.rosinka.ru US Dental Care Business Center ‘Olympic Hall’, Olimpiyskiy prospect, 16, bld.5, Moscow, Russia +7 495 933 86 86 www.usdentalcare.com XIX. Glossary of Terms and Acronyms 158 159 Banya – a Russian bath house (see the section at the end of chapter 12 for tips on visiting a banya) The Caucasus – the area between the Black Sea and the Caspian Sea combining the three independent ex-Soviet Countries of Armenia, Azerbaijan & Georgia, plus several regions which are part of the Russian Federation (namely Dagestan, Chechnya, Ingushetia, Ossetia & Kabardino-Balkaria), although some say it reaches as far as Sochi. Occasionally referred to as Transcaucasia. CEE – Central and Eastern Europe (usually refers to all of the former ‘Eastern Bloc’ countries including the former Soviet Republics, although sometimes includes Germany, Austria and even Switzerland). Central Asia – sometimes referred to as ‘The Stans’, namely the 5 ex-Soviet Republics of Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan. Occasionally abbreviated to CAR (Central Asian Region). Eastern Bloc - a group of Communist states in Central and Eastern Europe, plus East and South-East Asia under the hegemony of the USSR, between 1947-1991. However, Westerners generally use this term to refer to the USSR and its satellite states in Eastern Europe, namely East Germany, Poland, Czechoslovakia, Hungary, Romania, Bulgaria and Albania. Elektrichka – a suburban train. Very cheap, but a slow way to travel. EMEA – Europe, Middle East and Africa FSU – Former Soviet Union Letter of Invitation (LOI) from an official organization or a travel agency, often one approved by the country’s Ministry of Foreign Affairs or sometimes it is simply a confirmation number, in order for a visa to be issued. Marshrutka – a minibus, which runs along a fixed route, often complementing the bus service. Faster, as it stops only on demand (& therefore the fare is slightly higher). Some also run to nearby towns. MKAD – the Moscow (or Minsk) ring road, similar to the M25 around London. In St Petersburg, it’s just KAD. NGO – Non-Governmental (and usually not-for-profit) Organisation Podyezd – Entrance to a building (usually residential) Propiska – a residency permit, allowing the bearer to live in a particular city (typically refers to Moscow) Propusk – a pass or entry permit (generally valid only once, unless you actually work there) allowing you to enter a particular building or compound SME – Small and Medium Enterprise (occasionally referred to as SMB – Small and Medium Businesses) Spravka – a piece of paper that is usually signed and stamped which is required to obtain a particular document

USSR – Union of Soviet Socialist Republics

Visa support – this usually comes in the form of an LOI (letter of invitation). 160

© Intermark Group, Inc. 2020

Appendix 4

e

Twelve reasons why Russia sucks

James Sunderland

June 9, 2018 • 30 min read

Two major difficulties that arise whenever I need to write something — how to start the story so that it enthralls readers and sets a proper article tone, and how to make an ending that, like a good wine, leaves a taste of something special. This time the difficulty has doubled — I now need a beginning to the whiny post that could persuade you it’s not whining at all.

I’ve played around with several options, tried to make it look like an insight, a counter-propaganda that exposes the lies about an almighty empire —the myth Russia is desperately trying to breed starting from late 2000-s, shortly after the famous Putin’s speech at the 2007 Munich Security Conference. I’ve tried walking in the shoes of a man who mourns his dying country and cannot accept what is currently happening to it. But every attempt inevitably boils down to this — it’s a purebred whine. A yammer. My personal bitch-fest.

So then, let it be. A self-pity parade of a guy who cannot but think how unfair it is that every child on this planet plays a cruel lottery upon birth. Some are lucky enough to enjoy the birthrights of a civilized country, while others can only catch a glimpse of it. Something very similar to be born deaf-mute, or blind, or unable to experience anything else that is a regular part of “ordinary” people’ existence.

Sigh.

1 Poverty

2 Obedience

3 Indifference

4 The War

5 Enemies

6 Laws

7 Religion

8 Fatalism

9 Education

10 Aggression

11 Alcohol

12 Pride

Poverty

As a tourist, you would probably visit the “northern capital” of Russia — Saint Petersburg. Founded by Peter the Great, this former capital of the Russian Empire is indeed a sight to behold. Wandering among the gold-plated halls of famous art galleries, stone Griffins with golden wings, and marble Atlases that uphold the roof of the New Hermitage, one can get an impression of a truly European country with a proud history and strong economy to uphold this beauty.

Those who come to Moscow will also have a similar impression thanks to fascinating churches and galleries, the Moscow City district, and the amount of Bentleys, Lamborghinies, Ferraries and Teslas rewing on the streets.

I understand those who are fooled by these two cities, I really do. But here’s the truth — the rest of russian cities look like this.

Chelyabinsk

Ugly human anthills patched together into one depressing tohubohu, mud and holes instead of the roads, and the gray color — oh, this never-ending gray color that paints everything from houses and dead trees to frowned faces around you.

Velikij Ustug

For the last few years I’ve been living in Tula — this is the capital city of the Tula State, something like Austin in Texas or Sacramento in California. What if I tell you that this state capital and the place from the photo below, with crooked wooden barracks half-swallowed by the Earth itself, are in fact the same city? What an awesome opportunity to visit not just the country, but the living XVII century as well.

The central district of Tula, Boldina street

If now you are thinking I’m showing you the ruins of the suburbs and abandoned “ghost cities” of the USSR era — unfortunately, no. Brace yourselves, the pictures below are taken in Voronezh, a city with more than a million of citizens, a capital of the Voronezh State.

These photos were taken by a famous russian blogger Ilya Varlamov, you can see more in this LiveJournal post of his.

Now, let me get this straight — my goal here is to show you the dark side of a Moon, to confront the veneer of a prosperous and powerful country with the ghastliness of a daily life. For this sake, I may be exaggerating things — of course, such horrifying conditions are not that often in Russian cities. But neither they are rare. Seeing these pictures comes with no surprise to a regular Russian, we all accept the possibility of someone living in similar houses just down the street.

If you’re wondering what makes Russian cities (and — God have mercy on me— villages, I don’t even dare to post any photos of them) look like living illustrations for the “shithole” dictionary entry, the poverty must be among the major reasons for that. According to the most optimistic reports, the average salary in Russian cities (apart from Moscow and Saint Petersburg) is 20,000–40,000 rubles a month. That is $330–660, less than $8000 a year. Sometimes more, if you served in military and were engaged into local conflicts, or were employed by wealthy oil company. But most of the time, much less.

After 45 years of busting her ass as a nurse, my retired grandmother receives a pension of $210 a month. Imagine you make $2520 a year and ask yourselves, whether the photos above still seem unbelievable to you.

This all-embracing Russian poverty is everywhere: in people’s houses, clothes, the cars they drive, the food they eat, the entertainments they have. Every May, Russia celebrates the beginning of the barbecue season, “shashlyk”. Ask a Russian if (s)he loves shashlyk and most probably a smile will slowly cover his\her face. Hell yeah! However, this barbecue is somewhat different from what you’re probably imagining now. A “shashlyk” is basically a group of people sitting in the nearest forest (or right in the yard behind their home) in a pile of trash, grilling cheap meat and consuming tons of cheap alcohol, leaving burnt grass, coal, shattered glass, and plastic bottles behind them. This disgusting view is a music to a Russian ear, the fairly earned right to relax!

Happy holidays!

Every time you are tricked into thinking that Russia is a powerful and wealthy country, remember these pictures and laugh from your belly.

Obedience

If I had to pick one definitive feature of a Russian person that separates us from the “western people”, I’d choose obedience. Submission. And nope, I’m not talking about BDSM practices here.

Throughout the history, Russians had a very special relationship with people who wield power. Tzars and emperors were referred to as “The Lord’s Anointed”, the one who reigns by the divine right, and their power was believed to be sacred. Much like in the ancient Egypt, except for the fact that it was happening 4500 years later. When the Soviets were formed, this sacred monarchy was replaced by the religious communist cult — instead of the Lord’s Anointed ones we got the Bearers of the Great Lenin and Marx Ideology — a change of decorations, but not the idea behind. …As a result of this unhealthy relationship with the government, the regular Russian person is born with a rare genetic malfunction: an inborn submission to any authority — a president, a senator, a mayor, a cop, a boss, a landlord, you name it. Most importantly, to G-men.

Jozeph Stalin, one of the bloodiest tyrants ever born, has ordered millions of people shot or sent for years into concentration camps also known as GULAGs. Those few who are old enough to remember 1930-s, talk about a vivid memory of being constantly afraid. In the dark hours, people were waking up from the quiet squeals of car brakes in their yards — they knew who that was.

The black “Voronok” — the signature NKVD vehicle used to transport prisoners

Paralyzed, they would lay still in their beds listening to the NKVD officers’ steps, praying the executioners were not after them.

“You are under arrest”.

No one asked what exactly they were charged with. No one tried to fight back. Because it didn’t matter. It could be your neighbor who said you secretly listen to jazz music at nights. It could be your employee who did not receive a raise the previous month and claimed you are a British spy. It could even be an arrest with for reason at all, just because NKVD received orders to arrest 500 people in this area by the end of a month. It didn’t matter. People would silently go into those black cars without knowing if they ever going to see their families again.

Could you imagine something like that happening in France? Or Spain? Or U.S.? The entire nation is aware that the people are being enslaved and murdered by their own government, and still they praise the Party, the Leader, and silently march into their graves. And if you think those times are gone, you are wrong again.

Here’s South Korea — the riots booming in 2017 as the nation learned the President Park Geun-hye faces charges in bribery and influence peddling. ….

What’s the difference?

South Koreans kept protesting until the corrupted president got arrested and, later, sentenced to 24 years in prison. Russian “protest” lasted for a few hours.

Dozens of people beaten with police batons, hundreds arrested. The next day the country lives its ordinary life as nothing ever happened (probably, because nothing happened indeed). People head to their workplaces and talk to each other during the lunch break. Very few bring up the yesterday protests, and even when they do, everyone smiles. They all know it’s useless. Because THEY have always been stealing from US. And THEY always will be. WE know that and WE accept it.

This “WE versus THEY” metaphor is essential for understanding the Russian mentality. The “people” and “authorities” (any authorities, not just the government alone) both do everything they can to alienate themselves from the opposite party. This reminds me of the Indian caste social stratification system. If you are one of the “people”, you accept your poor status. This comes with understanding that THEY can do whatever they want — steal from you, send you to die for Assad in Syria, stick a broom into your arse or break your spine with a chair in a police station… Or mock your worst tragedy.

In March 2018, the fire in the Kemerovo “Winter Cherry” trade center killed nearly 70 people, the tragedy which inflamed minor protests against the fatal negligence of the town administration. During one these protests, the vice-senator Sergey Tsivilev said to the face of a man, who had lost a wife, a sister, and three kids to the fire, that he came on stage with his speech to “feed on this hot topic”. And the grieving father has swallowed that.

In Russia, the “government” is thought to be a separate, almost miraculous entity, something entirely different from the people. Ordinary citizens do not consider themselves as a part of the country, only as expendables. Keep that in mind while you read the rest of the article, this magic formula can solve a lot of your riddles.

Indifference

In her “The Life-Changing Magic of Not Giving a Fuck” best-seller, Sarah Knight describes a “fuck budget” everyone has. Whenever you do something that requires your time or energy, you spend some of the “fuck bucks” from this budget. The life-changing magic itself is to understand that your budget is limited and stop wasting “fuck bucks” on irrelevant things. Well, if Russians are poor financially, at least they are “fuck bucks” millionaires, since “not giving a fuck” is another common Russian treat.

I’ve already mentioned not giving a hoot about massive corruptions and the fact that everyone, from the President to a local judge, steals budget money. In the end, people who consider themselves as expendables, not citizens of their country, have a moral right to have no responsibility for it, or a desire to change the course.

we don’t riot against this neo-monarchy — what’s for? Another one will come place and start stealing, what’s the difference?....Truly, this country does terrible things to your mind.

But the indifference stretches far beyond the politics. Russians don’t give a shit about how the city looks. Every elevator, every house is covered with penis drawings (or its textual representation, the branded Russian “hyi” word), gum, and piss (the later is even laughed upon, in the figure below people ask the symbol of “goddamn Americans”, President Obama, to stop pissing in their elevator — a local humor, don’t ask me to explain).

Most benches near the apartment entrances are broken. Doors are covered with ads. Light bulbs are broken or stolen. Patches of different paint — signs of feeble repairs attempts — cover dirty walls that lose their plaster skin.

Dog shit covers every yard and most of the playgrounds. Dog owners and their our own kids cannot walk more than 30 steps without stepping into another pile, but no one cares and (almost) no one cleans after their dogs.

Why? To quote a well-known Russian designer Artemy Lebedev, we all have our “comfort zones”, but if civilized people’ comfort zone includes the streets they walk, the parks they visit, the cities they live in, and the countries they inhabit, a comfort zone of a Russian ends at his doorsteps. Everything outside my apartment does not belong to me, hence I don’t give a shit about it.

And for those who dare to upset the established order of not caring, we have a perfect and constantly used reply: “Tebe bolshe vseh nado?”, which means “are you the one who cares the most?” Indeed, are you the one who stepped more than anyone into dog shit? We all do, buddy, shut up. We all live in these ugly homes, who gave you the right to be offended with this sight more than we are? Bite the bullet and keep your mouth shut, just like we do. And believe it or not, that works as a charm — most anyone instantly chills and backs out.

You don’t want to be the one who cares a little bit more than everyone around you does. And even if you do, “Odin v pole ne voin” — “One man, no man”.

The high noon of this herd morale is pictured in the critically acclaimed 2014 movie “The Fool” by Alexander Bykov: a regular service guy finds out that the house with 860 people inside is about to collapse because of a giant crack in the wall. Rushing into the restaurant, where the mayor happens to celebrate her birthday, he alerts everyone about the upcoming tragedy, which is about to happen because of the tragic negligence, bureaucracy and the fact that most of the city budget has been systematically stolen by the government pen-pushers throughout years. The good civil servants quickly come to understanding that they won’t be able to cover this story up, and they are much more comfortable with burying everyone alive under the ruins and blaming a couple of fall guys in the office, rather than evacuate that “living trash”. Desperate, the movie antagonist runs back to the falling building and starts banging into doors, shouting about the emergency and rushing everyone to get outside… where he eventually gets killed by the mob, angry at the guy who has forced them leave their cozy wormholes. A fiction movie, yes, but for everyone who’s lived here long enough it looks more like a terrifying prophecy, a dark omen of what is to come, a reminder for those who want to change the way the things work here.

“Chelovek cheloveky volk” — “We are wolves to each other”

The degree to which Russians don’t give a shit about the people around is frightening. A few years ago the Russian media was covering a story about a university teacher that had a heart attack and collapsed on a street in Saint-Petersburg. He lied down covered with snow for two hours and eventually died. No one approached him. “Huh, probably another alcoholic had too much for today, that’s not my business”. This specific case took place several years ago, but such tragic events happen every week.

The guy in the video pretends he suffers from a sudden pain in his stomach — watch how “fast” the help comes

The emergency medical info available from the locked iPhone screen, bracelets for diabetics that warn people about the wearer’s condition in case (s)he suddenly collapses — none of precautions make sense here in Russia, because should anything happen to you, the first one who approaches you would probably be a city worker who came to collect your body. But at least our “fuck budgets” are always topped, right?

The War

World War 2 (WWII) or the "Great Patriotic War) as it is called in Russia, is an event that keeps shaping and molding the modern Russia even 80 years after it ended.

The nation that lost over 30 million people killed directly at war, — not counting millions executed in Gulags by the Soviet government — celebrates the 9th of May as a demonstration of an endless power.

Occasionally, someone tries speaking about the 9th of May as a day of grief, a day to remember the terrible price we’ve payed, a day to respect the dead. Every year I see humble attempts to focus people’s attention on those few who actually participated in the Great War, who now live their last days abandoned by everyone, starving and unable to pay their utilities or buy their medicine. But those words are lost in the maddening joy and immeasurable pride of the “grateful sons”.

This is a day of massive celebration, very close to the New Year in terms of joy and involvement. By “celebration” many Russians mean drinking themselves half-dead (“for the Horde… ugh, veterans!”) and beating someone’s face to a pulp…

…or simply enjoying cat food (seriously) as a digestive

This is the day when car owners proudly ride with “We can repeat!” stickers on the rear car windshields. These stickers illustrate USSR dog-fucking the Nazi Germany and imply same will happen to our modern foes.

This is the day when people decorate everything — from bags and t-shirts to vodka bottles in shops with black-and-orange stripes, the “Georgy ribbon”, an official symbol of the victory.

Funnily enough, the St.George medal was never assigned to anyone during the war. This medal originates from the older times of the Russian Empire. For that reason, the black-and-orange ribbon was popular among the RLA (Russian Liberation Army) of General Vlasov — the famous “traitor” that has surrendered the entire army to Nazis and fought on the Reich’s side against the Soviet Union. Modern day patriots that preach the importance of remembering our history hail the Nazi symbol — quite peculiar, isn’t it? Did I already mention that Russians don’t give a shit about anything? This certainly applies to war symbols as well.

Enemies

There’s a perfect reason why Russia gladly cultivates the myth about the glorious victory — this ideology braces people in the face of the external threat, namely, the “goddamn America”. And the entire world with it, for that matter.

The war is not over. THEY (oh, this magical word again) are plotting to destroy our land, to take away our resources and treasures! Hitler ideas are still alive, only this time our western foes use economics instead of foot soldiers and cluster bombs.

If you ask a North Korean about the world outside, (s)he will probably be very honest in saying that Korea is surrounded by enemies and in front of the western capitalistic plague this proud little country stands strong as the last refuge for hope. Propaganda is known to be able to turn people into zombies, and it’s no surprise the modern day Russia swarms with brain-dead puppets who believe the same crap. …Our masters still ride luxurious cars and send their children to London and New York, while the regular people become the real target for those sanctions. Which doesn’t bother them much because first, that’s an evil plan by our enemies who are destined to fail, we just need to hold on a little longer, and secondly, hey we don’t give our “fuck bucks” away, remember?

Another interesting point to be made is that despite a very evident urge to secure their place in the sun through armed conflicts, Russians bear a wide-eyed confidence that Russia is a country that during its entire history has never started a war, only was a target of the hostile aggression from our neighbors. Well, ahem, don’t get mad: despite the fact that 53 out of 75 armed conflicts that took place since the middle of the XVI century were actually initiated by Russian Empire\USSR\Russia, our people prefer the good ol’ “from lip to lip” way to share the knowledge about the world, rather than using Google and their own heads.

In her memoirs, Elena Bonner, a wife of the Soviet nuclear bomb’s father and a Nobel peace prize laureate Andrey Sakharov, shared a memory of a dialog she had in a taxi cab, somewhere around 1971:

— (taxi driver) …that happened the same year the Czechs attacked us.

— Sorry?

— Well, Czechs… They attacked us in Prague, remember?

Laws

As I have said before, the total obedience to any government requests is a very common Russian trait. However, — surprisingly or not, — this is somehow mixed with a total outlawry. As another Russian proverb states (I’m gonna reference quite some of these throughout the article):

“The idiocy of Russian laws is offset by their poor enforcement”.

In a way, the total government corruption can be linked to the same philosophy of a total law denial. The difference is only in the caliber of a law you are allowed to disregard. “Small people” commit smaller crimes, — smoke in elevators and public transport, park their cars on the lawns, occupy parking lots arranged for disabled people, drive the wrong side of a road, cell alcohol and tobacco to teenagers, etc. — but they do it regularly. I doubt you can have a 20-minute walk without witnessing someone violating a law.

Jaywalking — check. Slaloming between moving vehicles— check. Police car driving the wrong way — check. The second pedestrian not giving a shit about a girl hit — check. Lifting a person with possible fractures after a car impact — check.

The most far-fetching iniquity that has been poisoning this poor country for years is, probably, the bribery. Though many researches point out that bribery — or, to be more specific, the tradition to give and receive “gifts” — is very common to most Asian countries (which is the reason for some very harsh punishments in, for instance, China: you don’t fight the plague with just procedure masks, sometimes you need to bring a flamethrower), many link the rise of this all-consuming crime to the times of the General Secretary of the Communist Party Leonid Brezhnev. They say, the dangerous mixture of bribery and a necessity to have a pull in every department was born exactly in Brezhnev’s days. But as a person who has lived here long enough, I personally do not care when or why did it start: all I care is how long will it last.

My first speculation of this venom that poisons my country happened when I was somewhat about 14. I suddenly started wondering why Mom takes a box of chocolates every time I catch a cold and need to see a doctor. Up until that time, I was considering such things as a simple gratitude. Kids’ parents buy presents for teachers in schools, patients take gifts to doctors, your relatives gift something to nurses that look after you in case you get hospitalized. Everything looked like a gratitude indeed — up until I realized this is a requirement rather your own good will.

Another Russian proverb: “Ne podmazhesh — ne poedesh”. Means “if you don’t grease the wheels, the cart won’t go”. And boy, do you need the grease when living in this country…

A gift to a doctor is not just a gratitude, it’s the assurance that (s)he will pay enough attention to your health issues. Same with nurses, if you want them to change bed and clean urinals after your severely ill relative — you need to be extra “grateful” to them. The fact that all these people must do that for free because that is their direct job and they are getting paid for it is totally ignored.

This becomes more of a problem when that is not exactly your wish to pay. Cops camp the roads hiding in the bushes to catch red-handed excessive speeding drivers and those who ride without safety belts on. But not to enforce the law, rather to trade the official punishment (licence suspension, for instance) for money. Pay them now, and you are free to go. Same applies to universities and colleges — you can buy your spot there and\or keep paying teachers to pass exams. Same applies to the army — parents pay enormous buybacks to allow their kids to dodge the humiliating service in Russian army.

And same applies to schools. For instance, have a look at this very symbolic article — auto-translate it to English, the language is pretty straightforward — about a kid from Zhigulevsk, who started a petition against the public school — which means it is officially free — that collects money to (the official explanation) pay salaries to security workers and janitors (yep, no one asked before why a federal school has no money to pay janitors for their service). The kid was labeled as a “traitor”, teachers started bullying his entire class: you get the idea, it’s safer to deal with the young rebel with the hands of other kids in the class who get angry when they are punished “for his actions”. In the video that one of the students has shot in the class, the teacher suggests that if this brave kid refuses to pay, he should bring a bucket, a mop, and start mopping floors in the class himself, and that he lives in the society and must obey its rules. Thankfully, the media brought the story to the public. But what if they didn’t?

The total “pay-to-win” system in Russia leaves no questions why the most powerful people in the country steal billions of budget money and people are somewhat okay with that: they do the same everyone else does, only on the bigger scale.

Religion

According to a Constitution of the Russian Federation — wow, it feels really weird mentioning it: it has been so long since we saw it working last — Russia is a multicultural nonsectarian secular state. However, that county exists only on Constitution pages as an utopia. The real Russia looks more like ISIS in terms of religious bigotry.

I am well aware that even democratic countries can be entangled with religious crap, the need for which sits tight somewhere in the back of our heads. U.S. alone has hundreds, maybe thousands of cults, from local one-town communities to powerful and influential organizations like Scientology. The itch to explain things in the most simple way (often, the most idiotic one at the same time) comes from the way our brain evolved — that organ that takes only 5% percent of our total body weight consumes around 70% of the total energy our organism produces. Cognition is a very costly process, and our internal systems — more precisely, the limbic system also known as the paleomammalian cortex, which manages our primal functions: eating, moving, breeding, emotional responses, etc. — that system does everything it can to minimize the risk of burning through the available energy supplies (your primal brain knows nothing about Walmart and your ability to buy more food and refill those supplies at any time). By the way, that is the reason you feel so nice when you take a day off and spend it on a couch watching a TV-show instead of doing something that needs to be done— as a reward for defeating the neocortex (involved in higher-order brain functions such as cognition, spatial reasoning and language), your brain gets a free shot of endorphins that enforce that feeling of pleasure.

Okay, enough with the medicine — the bottom line is that people are prone to making fast decisions and thinking less. Always have been, and always will be. That is the major reason why a set of ready-to-use “How to live your life” guides called religions are loved all around the world. But in Russia, that love has definitely grown into something much more ominous.

Let’s have some fun — I’ve made a test for you, answer the following questions with Yes\No statements:

Does the primary religion in your country openly spread a terrifying myth that HIV does not exist, and that AIDS comes from stress, vaccines, and bad environment — statements that enforce the HIV denial movement and lead to an epidemic?

Is your army equipped with mobile praying stations that can be deployed on a battlefield?

The church wagon…

…and its even more hilarious version — the pneumatic air church, yay!

Can you be convicted for 3.5 years for playing Pokemon Go in church in your country?

Does your country allot military corps to set up the guard of honor that meets a plane with a saint’s bones?

Is consecrating rockets a necessary procedure that ensures the flight will be successful?

Oops, sorry, that is the successful start of the Falcon Heavy by the heretic Elon Musk…

…and that is a Russian pope who sprinkles a rocket with holy water. Either a water was fake, or the priest wasn’t a sincere believer, or maybe the God himself was against this launch —anyway, the rocket crushes shortly after the take off.

Does the primary church in your country hire priests, who “cleanse” poor fellows with mental disorders by riding them?

Behind the scenes of the “Exorcist”

If gave positive answers to at least two of these questions, I bet we can chat about this article in Russian.

Fatalism

A careful reader has already smelled that scent of fatalism in the text above. The final piece of puzzle that can explain why any law is neglected and any crime is not big enough to inflame mass protests. The fate.

“Ne mi takie — zhizn’ takaya”

You guessed it — another proverb. “It’s not our fault — that’s just the way the life is”. Almost like 2Pac — “that’s just the way it is”. 2Pac, however, mixed that line with “we gotta make a change”. Russians drop this part for there is no light in a tunnel, no faith that anything at all can change. Our fates are sealed and there’s no way we can do anything about that (apart from writing a whiny Medium article, yes).

Those familiar with fascinating Russian literature agree that it’s largely touched by this feeling of something horrible nearby, the doom, the bitter end that awaits us. The epitome of such mood is probably Dostoevsky, whose novels are soaked in this grim mood, a unique mixture of desperation and faith in a higher power.

As I write these words, I suddenly have this thought: what if this blind Christian faith carried through centuries is in fact a natural response to the inevitability of the dark end, an answer for that all-consuming fatalism? If we, the unwilling, the unable, came in this world to suffer, without the prospect of any significant positive change to look forward to, — the end of times when the Lord will make everything right is the only thing left to believe in. Better late than never, huh? Could it be that I’m right, I wonder.

Education

Meet Mikhail Zadornov — one of the most iconic Russian stand-up comedians.

If you ask anyone what’s his iconic phrase, I doubt someone will have difficulties answering “Nu tupie-e-e-e”, which means “Oh they’re morons”. At first “they” meant Americans, later — any “western” person. Almost single-handedly, this guy has forever secured the myth about Russians who are the smartest nation ever. Or at least certainly smarter than moronic Americans.

This stuff wouldn’t gain so much popularity if many Russians didn’t already share the same opinion. As a journalist Alexander Nevzorov says, “a porn magazine can cause erection only if you have penis in the first place”. Believe it or not, many Russians are positively sure that Russia (26 Nobel laureates, many of which — surprisingly!— are residents of foreign countries, like 2010 laureates Geim and Novoselov who work in Manchester) is way “smarter” than the U.S. (371 Nobel laureates), which is largely considered to be the country for fags, morons and fatsos.

Most Russians are positively sure that Soviet Union had the world’s best education. Yeah, right, that pretty much explains why our university diplomas have no value outside Russia, or why millions of Russians were holding jars of water in front of their TV screens in 1980’s, waiting for the famous “psychics” and “faith healers” Chumak and Kashpirovsky to “charge” the liquid with their supernatural abilities and heal the viewers. Chumak is dead, but Kashpirovsky still packs the houses full of people ready to pay money for miraculous recovery.

Yes, that shit was broadcasted on official Soviet TV channels

Funnily enough, Zadornov who had publicly spoiled his U.S. visa and rose through the ranks by trash-talking about western people as untalented brain-dead hucksters and profiteers, rushed into a private EU clinic after being diagnosed with cancer. Unlike millions of his followers, who cannot afford the same and have learn the hard way that their country with “best-in-class educational system” cannot provide a decent medical treatment.

Aggression

If you have ever been to websites like bestgore.com, you probably know what human beings are capable of doing to each other. People behead, flay and dismember their foes alive— not for survival, but just for money, pleasure or out of religious beliefs.

This unspeakable cruelty is horrifying, but so it is rare — most of the time crimes like that are carried out by troubled people with absolutely no remorse or empathy towards others. What you see much more often is something I call a “household cruelty” — hateful actions performed by ordinary people in their everyday life. And that groundless, gratuitous hate towards the others is something in which no nation could arguably “outshine” Russians.

Those who ever tried online games like Counter Strike, Dota or WoW, instantly agree with me — Russians are often considered most toxic players ever. These people can abandon matches, intentionally “feed” their opponents and flame their teammates before the game has even started. Just watch any Russian Dota stream on Twitch or see any highlight compilations— 95% of these “highlights” are not some sick plays, but an exceptionally “epic” flame or a trash-talk.

Some people, however, are capable of turning that aggression into something fabulous.

The entire web, not just video games, is a place for any Russian maggot, obedient and speechless in everyday life, to show his\her true colors. Here’s an example.

A CCTV camera catches a group of teenagers stealing a bronze duck effigy from a city park. Most likely, drunk guys were having fun and showing off in front of the girl — you know how it goes, right?

Definitely, not the most admirable behavior by the young lads. But not the worst crime either. The question is what punishment is fair for these fellows? I’d say, they (or their parents, in case boys are under the legal age) must be charged for the repairs, plus an extra fee. That’s not what Russians in the comment sections think.

“Rip their heads off…”

“Nothing to do with their strength — send them to Syria!”

“Put them down before they breed.” (note: almost 60 more people love this idea)

“They should be sent to BAM or Belomorcanal” (note: the guy is talking about huge highways built by convicts in USSR; many have died on those backbreaking construction sites)

“They won’t feel any shame. Hit them with a crowbar in the spine so that at least they could feel pain :)”

“Execute these fuckers!!!”

“Castrate them!”

“Give them a life sentence!!!!”

“People like them should be gunned down.”

“I wish I knew who these creeps were, I’d break their legs”.

“These fuckers must be reading it now. I’d rip your arms and legs off. Honestly, I’d gladly beat you to death.”

Do not get me wrong, but don’t you think that wishing death, sterilization, legs torn out and arms ripped off is a bit too much for breaking the statue of a duck?

And if you wonder why there is no “intolerance” section here in this article — that is because intolerance is a direct consequence of this raging misanthropy. I do not think people hate gays — or blacks, or Americans, or Muslims, or anyone other person in the world for that matter — because they uphold traditional values and families. As simple as it is, all these people easily represent someone different from a regular Russian, and that reason alone is enough to break their faces and wish them death. As Marilyn Manson adequately puts in his song, “we’re killing strangers so we don’t kill the ones that we love”.

Alcohol

I guess you’ve been waiting for this for a long time. Yes — bears, vodka, balalaika. Vodka is a brand that instantly associates with Russia, and by the George I wish I could say that drunk Russians is nothing but a stereotype. But first, that would confront the official data regarding worldwide alcohol consumption per capita rates. And secondly, unfortunately, this is just the way it is.

Every birthday, every holiday, or simply every Friday or weekend is impossible without alcohol. And do not get me wrong, there are other countries whose drinking is almost a part of the national idea —for instance, South Korea or Japan. But honestly, I have little interest in drunk Japanese lying in the subway in their business suites every Friday. I’m concerned in the consequences drinking brings to my own country.

A drunk pope on the Geländewagen fatally hits two road workers and flees from the scene. This was one of 169,432 road accidents that took lives of 19,088 people in Russia in 2017.

A drunk student tries to step from the balcony into a window. Falls down eleven stories to his death (warning: graphic video).

A drunk cop walks into a supermarket and starts a shoot-out, executing two people and wounding seven more.

A politician gets sloshed with vodka in a forest with his friends, sees a wood ranger’s dog and kills it, then slams the ranger himself into the tree. According to the locals, shooting stray animals and people’s cattle is a well-known hobby of the civil servant, who by the way still keeps his position.

Four drunk teenagers, ages 15 to 17, torture a homeless woman and beat her to death.

Another group of drunk high school students kill a woman they meet in a cafe. According to the police reports, the attacker has torn the victim’s face apart and pulled her entrails through the vagina. I’m not sure if that case illustrates the terrors of drinking, or the aggression — or rather, the sadistic evil inside our people — but I will spare you from seeing the aftermath photo.

A drunk man teases the bear and loses the arm.

And of course…

Numerous drunk kids set stray cats and dogs on fire and chop their noses off.

Tons of drunk husbands beat their wives to death.

Thousands of drunk people attack random passers-by on streets.

Countless drunk workers lose their limbs and their lives in factory accidents.

Innumerable drunk parents beat and kill their kids.

Call me a hypocrite if you want, but the nation of people who unleash such horrors after a few sips should never have free access to alcohol. Which, sadly, will never happen. The alcohol provides a good measure of control: for as long as an “ordinary” Russian can get drunk, he would prefer that to fighting for his rights, justice, or country leaders that see other goals rather than filling their own pockets.

Pride

Finally, after everything written above, after you get the glimpse of that dark side of “ordinary” Russians — cruel, indifferent, ignorant, spineless people — does it come as a surprise that Russians are extremely proud of their country?

There are probably experts in Russia that can provide you with an exact formula of how this feeling emerges. I’m not one of them. I myself keep wondering what exactly gives birth to this moronic patriotism, a feeling that Bernard Shaw defines as “fundamentally, a conviction that a particular country is the best in the world because you were born in it”. I also cannot but quote George Carlin on this matter:

“Pride should be reserved for something you achieve or obtain on your own, not something that happens by accident of birth. Being Irish isn’t a skill… it’s a fucking genetic accident. You wouldn’t say I’m proud to be 5'11”; I’m proud to have a pre-disposition for colon cancer.”

But still, even though patriotism it is a moronic feeling, I can understand Americans’ patriotism — in the end, they belong to of one of the most influential countries. I understand Swedes — people of the country that has been named the most livable country times and times again. I understand Chinese — people of the country that not too long ago was merely a machinery for the western world, but has now risen to have great impact on the globe and one of the world’s fastest growing economy.

But I can neither understand, nor comprehend the mysterious Russian patriotism. A feeling of pride that you belong to a country, inhabited by those who you hate. A feeling of joy to live in a state that shows no joy of knowing you live here. A feeling of honor to be born in a country that prefers making enemies rather than investing in its own people. An unconditional commitment to your land, a willingness to fight and die for the country that does not value your life and will most likely abandon its own defenders, as it did after every military conflict before.

One of numerous dog-poor WWII veterans goes begging in a Moscow subway

That illogical pride must be the final part of the grand absurd design that enchants many foreigners, who are mesmerized with the inexplicable way this country exists. God only knows how millions of these interconnected systems assemble into one love-hate piece, but that knowledge is not even required. In the end, it all boils down to immortal poem by Fedor Tyutchev:

You will not grasp her with your mind

Or cover with a common label,

For Russia is one of a kind —

Believe in her, if you are able.

Too bad the poet does not have advice for those who are unable.

External links

• https://whydontrussianssmile.com/index.php/12_reasons_why_Russia_Sucks
• https://russiansociology.fandom.com/wiki/12_reasons_why_Russia_Sucks
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Appendix 6

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Index

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Footnotes

1. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
2. ↑ Moscow Believes in Tears: Russians and Their Movies. Louis Menashe. (2014). Famous Russian idioms. New Academia Publishing. https://books.google.ru/books?id=S3u3b_U-c78C&printsec=frontcover
3. ↑ Seymour Martin Lipset (1922–2006), Sociologist.
4. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
5. ↑ Nicolas Zernov. (1978). The Russians and Their Church (Crestwood, NY: St. Vladimir’s Seminary Press. 176.
6. ↑ Hofstede Insights, Country Comparison: USA. https://www.hofstede-insights.com/country-comparison/the-usa/
7. ↑ Hofstede Insights, Country Comparison: Russia. https://www.hofstede-insights.com/country-comparison/russia/
8. ↑ Realo, Anu; Allik, Jüri. (April 1999). A Cross-Cultural Study of Collectivism: A Comparison of American, Estonian, and Russian Students. The Journal of Social Psychology 139(2):133-142. DOI: 10.1080/00224549909598367 http://universitypublications.net/ijas/0705/pdf/H4V1015.pdf
9. ↑ ^{9.0 9.1 9.2 9.3 9.4} Meyer, Erin. (2014). The Culture Map: Breaking Through the Invisible Boundaries of Global Business. https://drive.google.com/open?id=1qoT-v2SDoSuj0VIXAmOpVxvvw4uUi5Vy (Full Book).
10. ↑ Lugris, Mark. (June 13, 2018). Russian Workers Being Trained To Smile More Before The World Cup. https://www.thetravel.com/russia-teaches-workers-smile/
11. ↑ Trompenaars, Fons., & Hampden-Turner, Charles. (1998). Riding the Waves of Culture: Understanding Diversity in Global Business, 2nd ed. McGraw Hill. 83–86.
12. ↑ Riding the Waves of Culture. Exclusive Interview with Dr. Fons Trompenaars. (March, 2018). https://mundus-international.com/wp-content/uploads/2018/03/Swedish-Press-Mar-2018-Interview-Trompenaars-Williams.pdf
13. ↑ ^{13.0 13.1 13.2} Meyer, Erin. (May 30, 2014). One Reason Cross-Cultural Small Talk Is So Tricky. Harvard Business Review. https://hbr.org/2014/05/one-reason-cross-cultural-small-talk-is-so-tricky
14. ↑ Taras, Vas. (December, 2015). Peach vs. Coconut Cultures. https://x-culture.org/peach-vs-coconut-cultures
15. ↑ Lebowitz, Shana. (August, 2017). The 'coconut vs peach' metaphor explains why Americans find the French standoffish and the French find Americans superficial. Business Insider. https://www.businessinsider.com.au/why-french-people-find-americans-superficial-2017-8
16. ↑ Lugris, Mark. (June 13, 2018). Russian Workers Being Trained To Smile More Before The World Cup. https://www.thetravel.com/russia-teaches-workers-smile/
17. ↑ Bohm, Michael. (April 28, 2011). Why Russians Don't Smile. The Moscow Times. https://www.themoscowtimes.com/2011/04/28/why-russians-dont-smile-a6672
18. ↑ Putnam, Samuel., & Gartstein, Masha A. (June 2018). Russians don’t smile much, but that doesn’t mean they don’t like you. The Washington Post. https://www.washingtonpost.com/national/health-science/russians-dont-smile-much-but-that-doesnt-mean-they-dont-like-you/2018/06/29/beceb9d8-7a21-11e8-93cc-6d3beccdd7a3_story.html
19. ↑ Khazan, Olga. (May, 2016), Why Some Cultures Frown on Smiling, Finally, an explanation for Bitchy Resting Face Nation. The Atlantic. https://www.theatlantic.com/science/archive/2016/05/culture-and-smiling/483827/
20. ↑ Olga Khazan. (May 3, 2017). Why Americans Smile So Much. How immigration and cultural values affect what people do with their faces. The Atlantic. https://www.theatlantic.com/science/archive/2017/05/why-americans-smile-so-much/524967/
21. ↑ Adam Chandler. (October 21, 2016). Why Do Americans Move So Much More Than Europeans? The Atlantic. https://www.theatlantic.com/business/archive/2016/10/us-geographic-mobility/504968/
22. ↑ Park, Robert E. (July-August, 1924). The Concept of Social Distance. Journal of Applied Sociology, 8 339-344. Emory S. Bogardus. (March-April, 1925). Measuring Social Distance. Journal of Applied Sociology, 9 299-308.
23. ↑ Putnam, Samuel., & Gartstein, Masha A. (June 2018). Russians don’t smile much, but that doesn’t mean they don’t like you. The Washington Post. https://www.washingtonpost.com/national/health-science/russians-dont-smile-much-but-that-doesnt-mean-they-dont-like-you/2018/06/29/beceb9d8-7a21-11e8-93cc-6d3beccdd7a3_story.html
24. ↑ Arapova, Maria A. (2017), Cultural differences in Russian and Western smiling, Russian Journal of Communication, 9:1, 34-52, DOI: 10.1080/19409419.2016.1262208
25. ↑ Khazan, Olga. (May, 2016). Why Some Cultures Frown on Smiling, Finally, an explanation for Bitchy Resting Face Nation. The Atlantic. https://www.theatlantic.com/science/archive/2016/05/culture-and-smiling/483827/
26. ↑ Samuel Putnam, (June 27, 2018). Why are Russians so stingy with their smiles? https://theconversation.com/why-are-russians-so-stingy-with-their-smiles-98799
27. ↑ The "Heartland" is the central part of a country. A prerogative used by those on the coasts of the USA is “Fly over states”.
28. ↑ Visson, Lynn. (2001). Wedded Strangers: The Challenges of Russian-American Marriages. Hippocrene Books.
29. ↑ Bohm, Michael. (April 28, 2011). Why Russians Don't Smile. The Moscow Times. https://www.themoscowtimes.com/2011/04/28/why-russians-dont-smile-a6672
30. ↑ Koren, Marina. (February, 2014). Why Russians Aren’t Smiling at You in Sochi. The first rule about smiling at Russians is you do not smile at Russians. The Atlantic. https://www.theatlantic.com/international/archive/2014/02/why-russians-arent-smiling-at-you-in-sochi/569632/
31. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
32. ↑ Seton-Watson, Hugh. (1952). The Decline of Imperial Russia, 1855–1914. Routledge. 24.
33. ↑ Gray, Paul. (July 24, 1989). Russia's Prophet in Exile Alexander Solzhenitsyn. Time Magazine. 61. https://content.time.com/time/subscriber/article/0,33009,958205-8,00.html
34. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
35. ↑ Edward Adrian-Vallance, https://www.facebook.com/edward.adrianvallance
36. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
37. ↑ Edward Adrian-Vallance, https://www.facebook.com/edward.adrianvallance
38. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
39. ↑ 55
40. ↑ Herbert, Wray. ‘To suffer is to suffer’: Analyzing the Russian national character. (June 30, 2010). Association for Psychological Science. https://www.psychologicalscience.org/news/were-only-human/to-suffer-is-to-suffer-analyzing-the-russian-national-character.html
41. ↑ Oleg Yegorov. February 22 2019. Why do Russians benefit from suffering? https://www.rbth.com/lifestyle/330011-russian-suffering
42. ↑ Jonah Lehrer. 2010. Why Russians Don't Get Depressed. https://www.wired.com/2010/08/why-russians-dont-get-depressed/
43. ↑ Caroline Humer. (July 15, 2010). Russians brood, but Americans get depressed - study, Reuters. https://www.reuters.com/article/idUSN15202897. "Russians dwell on negative emotions much as novelists Fyodor Dostoyevsky and Leo Tolstoy so famously detailed, but they are less likely to become depressed than Americans, according to two new studies." Igor Grossmann. University of Michigan researcher who worked on the studies.
44. ↑ Varnum, M. E. W., Grossmann, I., Kitayama, S., & Nisbett, R. E. (2010). The Origin of Cultural Differences in Cognition. Current Directions in Psychological Science, 19(1), 9–13. doi:10.1177/0963721409359301
45. ↑ Igor Grossmann and Ethan Kross. The Impact of Culture on Adaptive Versus Maladaptive Self-Reflection. Psychological Science , AUGUST 2010, Vol. 21, No. 8 (AUGUST 2010), pp. 1150-1157 Sage Publications, Inc. on behalf of the Association for Psychological Science. URL: https://www.jstor.org/stable/41062346 "Although recent findings indicate that people can reflect either adaptively or maladaptively over negative experiences, extant research has not examined how culture influences this process. We compared the self-reflective practices of Russians (members of an interdependent culture characterized by a tendency to brood) and Americans (members of an independent culture in which self-reflection has been studied extensively). We predicted that self-reflection would be associated with less-detrimental outcomes among Russians because they self-distance more when analyzing their feelings than Americans do. Findings from two studies supported these predictions. In Study 1, self-reflection was associated with fewer depressive symptoms among Russians than among Americans. In Study 2, Russians displayed less distress and a more adaptive pattern of construals than Americans after reflecting over a recent..."
46. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
47. ↑ Li Mu, https://www.facebook.com/li.mu.5015
48. ↑ Edward Adrian-Vallance, https://www.facebook.com/edward.adrianvallance
49. ↑ Edward Adrian-Vallance, https://www.facebook.com/edward.adrianvallance
50. ↑ Nina Khrushcheva, "Culture Matters, But Not (of All Places) in Russia," in Correspondence: An International Review of Culture and Society (New York: Council on Foreign Relations, winter, 2000/2001 no. 7), 48.
51. ↑ Laurens Van der Post. (1964). Journey Into Russia. Random House.
52. ↑ Richard Stites, Revolutionary Dreams, Utopian Vision and Experimental Life in the Russian Revolution (New York: Oxford University Press, 1989), 124.
53. ↑ Richard Stites, Revolutionary Dreams, Utopian Vision and Experimental Life in the Russian Revolution (New York: Oxford University Press, 1989), 207.
54. ↑ Daniel Matuszewski, former IREX deputy director, in a December 15, 2001 e-mail to Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
55. ↑ Lev A. Tikhomirov, Russia, Political and Social, quoted by Wright Miller in Russians as People (New York: E. P. Dutton, 1961), 81.
56. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
57. ↑ Fred Hiatt. (December 3, 1994). Russian Astrologers' Horrorscopes. Washington Post. https://www.washingtonpost.com/archive/politics/1994/12/03/russian-astrologers-horrorscopes/3a9536df-d9f3-402c-b798-6418b3b10c82/
58. ↑ Richard Lourie. 1991. Predicting Russia’s Future. Knoxville, TN: Whittle Direct Books. 82.
59. ↑ Richard Lourie and Aleksei Mikhalev. Why You'll Never Have Fun in Russian. The New York Times, June 18, 1989. https://www.nytimes.com/1989/06/18/books/why-you-ll-never-have-fun-in-russian.html
60. ↑ Richard Bernstein. (November 28, 1989). Soviet Author's Humor Has a Bitter Aftertaste. The New York Times.
61. ↑ Llewellyn Thompson, in his final briefing for American correspondents prior to his departure from Moscow in 1968, a meeting that Yale Richmond, attended found in From Nyet to Da: Understanding the New Russia. (2008) Nicholas Brealey Publishing.
62. ↑ Tibor Szamuely. (1974). The Russian Tradition. New York: McGraw-Hill. 6.
63. ↑ Fyodor Dostoyevsky. (1873). "A Word or Two about Vranyo," Diary of a Writer. Quoted in Hingley, Ronald. (1977). The Russian Mind. 166.
64. ↑ Andreyev, Leonid. (1913). Pan-Russian Vranyo. Vserossiiskoe vranyo. Polnoe sobranie sochinenii (All Russian Lies. Full Composition of Writings). St. Petersburg. Volume V.
65. ↑ Samuel Rachlin. (March 20, 2015). Propaganda and the Russian Art of Lying. https://www.lrt.lt/en/news-in-english/19/96536/propaganda-and-the-russian-art-of-lying
66. ↑ Putin and the Presidents: Julia Ioffe (interview). PBS, Frontline. (Jan 31, 2023). https://www.youtube.com/watch?v=qEu0oRajJxE at 33:11.
67. ↑ Ronald Hingley. (March-April, 1962). That’s No Lie, Comrade. Problems of Communism. http://traveller.in.net/2019/03/03/vranyo/
68. ↑ Fyodorov, Boris. (May 1, 2001). The Washington Post.
69. ↑ Fyodor Dostoyevsky. (1873). "A Word or Two about Vranyo," Diary of a Writer. Quoted in Hingley, Ronald. (1977). The Russian Mind. 105.
70. ↑ Hingley, Ronald. (March-April, 1962). That’s No Lie, Comrade. Problems of Communism. http://traveller.in.net/2019/03/03/vranyo/
71. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
72. ↑ Zbigniew Brzezinski quoted in the Wall Street Journal. March 25, 1983.
73. ↑ Sharon Tennison, Center for U.S.-U.S.S.R. Initiatives, San Francisco, California, in a memo to U.S. foundations, May 15, 1990.
74. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
75. ↑ William McCulloch. (March 14, 1994). Kennan Institute, Washington, DC.
76. ↑ Parade Magazine (October 8, 1989). 27.
77. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
78. ↑ Nina Khrushcheva, "Culture Matters, But Not (of All Places) in Russia," in Correspondence: An International Review of Culture and Society (New York: Council on Foreign Relations, winter, 2000/2001 no. 7).
79. ↑ Geoffrey Hosking. (1990). The Awakening of the Soviet Union. Cambridge: Harvard University Press. 132.
80. ↑ Ruth Amende Roosa, "Russian Industrialists Look to the Future: Thoughts on Economic Development, 1906–17." in Essays in Russian and Soviet History. (1963). John Shelton Curtiss. New York: Columbia University Press. 198–218.
81. ↑ Vladimir V. Belyakov & Walter J. Raymond. (1994). The Constitution of the Russian Federation. Lawrenceville, VA: Brunswick Publishing. 27.
82. ↑ Russian Agrarian Reform: A Status Report from the Field. (August 1994). Seattle: Rural Development Institute.
83. ↑ Background Note: Russia. (February, 2007). U.S. State Department.
84. ↑ Vladimir Shlapentokh. (May 20, 2007).Johnson’s Russia List #114.
85. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
86. ↑ Georgi Poltavchenko. August 5, 2000. Rossiskaya Gazeta.
87. ↑ Pyotr Savitsky, quoted by Françoise Thom in “Eurasianism: A New Russian Foreign Policy,” Uncaptive Minds 7, no. 2 (Summer 1994), 66.
88. ↑ Marshall Shulman. Carnegie Endowment for International Peace. Washington, DC, February 12, 1989.
89. ↑ The New York Times. (June 1, 1990).
90. ↑ Andrew Jack. (2005). Inside Putin’s Russia. (2005). New York: Oxford University Press. 62.
91. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
92. ↑ Yevgeny Yevtushenko. (April 7, 1958). Literaturnaya Gazeta, quoted by Klaus Mehnert. (1961). Soviet Man and His World. New York: Frederick A. Praeger, 30.
93. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
94. ↑ Marquis de Custine. (1989). Empire of the Czar: A Journey Through Eternal Russia.New York: Doubleday, Anchor Books. 183.
95. ↑ Anton Chekhov. (1900). Three Sisters, Act II.
96. ↑ Elena Petrova. (2006). How To Find And Marry A Girl Like Me.
97. ↑ Ana Siljak. (December 2016). Nikolai Berdiaev and the Origin of Russian Messianism. The Journal of Modern History. Volume 88, Number 4. https://doi.org/10.1086/688982
98. ↑ Mikhail F. Antonov. Bill Keller. (January 28, 1990). Yearning for an Iron Hand. The New York Times Magazine. 19.
99. ↑ Serge Schmemann. (February 20, 1994). Russia Lurches Into Reform, But Old Ways Are Tenacious. The New York Times.
100. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
101. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
102. ↑ Marquis de Custine. (1989). Empire of the Czar: A Journey Through Eternal Russia. New York: Doubleday. 437.
103. ↑ Andrei Sinyavsky [Abram Tertz, pseudonym]. (July 19, 1965). Thought Unaware. New Leader 48, no. 15. 1.
104. ↑ Hedrick Smith. (1976). The Russians. New York: Times Books, Quadrangle. 120–21.
105. ↑ Anna Hunt. (November 2001). So Has the Russian Mafia Met Its Match? The Independent. https://www.malkin-71.net/news/business/news/so-has-russian-mafia-finally-met-its-match-9256977.html
106. ↑ The New York Times, (November 7, 2007).
107. ↑ Marshall I. Goldman. (June 1990). Gorbachev at Risk. World Monitor. 38.
108. ↑ Johnson’s Russia List #20, (January 29, 2008).
109. ↑ Johnson’s Russia List #25, (February 5, 2008).
110. ↑ Johnson’s Russia List #20, (January 29, 2008).
111. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
112. ↑ Robert G. Kaiser. (July 8, 2001). Washington Post Book World.
113. ↑ George Vernadsky. (1953). The Mongols and Russia. New Haven: Yale University Press. 337.
114. ↑ Yuri Afanasyev. (January 31, 1991). The Coming Dictatorship. The New York Review of Books. 38.
115. ↑ George F. Kennan. (February 5, 1989). After the Cold War. The New York Times Magazine. 38.
116. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
117. ↑ Visson, Lynn. (2001). Wedded Strangers: The Challenges of Russian-American Marriages. Hippocrene Books.
118. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
119. ↑ ^{119.0 119.1} Sorokina, Anna. (2018, July). What should you say when Russians ask ‘How are you’? Russia Beyond. https://www.rbth.com/education/328673-how-are-you-russian
120. ↑ Meyer, Erin. (2014). The Culture Map: Breaking Through the Invisible Boundaries of Global Business. https://tinyurl.com/TheCultureMap (FULL BOOK).
121. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
122. ↑ Serge Schmemann. (December 26, 1993). What Would Happen If...? New York Times. https://www.nytimes.com/1993/12/26/books/what-would-happen-if.html
123. ↑ Richard Lourie and Aleksei Mikhalev. (June 18, 1989). Why You'll Never Have Fun in Russian. The New York Times. https://www.nytimes.com/1989/06/18/books/why-you-ll-never-have-fun-in-russian.html
124. ↑ Barbara Monahan. (1983). A Dictionary of Russian Gesture. Tenafly, NJ: Hermitage. 15.
125. ↑ George F. Kennan. (1967). Memoirs, 1925–1950. Boston: Little, Brown. 564.
126. ↑ The Soviet Union Approach to Negotiation: Selected Writings Compiled by the Subcommitte on National Security and International Operations (pursuant to S. Res. 24, 91st Congress). (1969). https://books.google.ru/books?id=T7lgtPwJqq4C
127. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
128. ↑ Ripp, Victor. (1990). Pizza in Pushkin Square: What Russians Think About Americans and the American Way of Life. New York: Simon and Schuster. ISBN 978-0-671-66725-2.
129. ↑ Visson, Lynn. (2001). Wedded Strangers: The Challenges of Russian-American Marriages. Hippocrene Books.
130. ↑ Bosrock, Mary Murray. Put Your Best Foot Forward: Asia: A Fearless Guide to International Communication and Behavior (St. Paul, MN: International Education Systems, 1997).
131. ↑ The Diversity Executive Leadership Academy. https://diversityexecutiveacademy.com/the-top-ten-nonverbal-behaviors-in-russian
132. ↑ Inge Morath and Arthur Miller. (1969). In Russia. New York: Viking. 15.
133. ↑ Nina Belyaeva. Quoted by Georgie Anne Geyer. (May 31, 1990). “… wrong basket?” The Washington Times.
134. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
135. ↑ Geoffrey Hosking. (1990). The Awakening of the Soviet Union. Cambridge: Harvard University Press.
136. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
137. ↑ Elena Petrova, (2006) How To Find And Marry A Girl Like Me.
138. ↑ Elena Petrova, (2006) How To Find And Marry A Girl Like Me.
139. ↑ David M. Buss, "The Evolution Of Desire: Strategies Of Human Mating", where research was run across 37 cultures.
140. ↑ Elena Petrova, (2006) How To Find And Marry A Girl Like Me.
141. ↑ Elena Petrova, (2006) How To Find And Marry A Girl Like Me.
142. ↑ Elena Petrova, (2006) How To Find And Marry A Girl Like Me.
143. ↑ Elena Petrova, (2006) How To Find And Marry A Girl Like Me.
144. ↑ Visson, Lynn. (2001). Wedded Strangers: The Challenges of Russian-American Marriages. Hippocrene Books.
145. ↑ Visson, Lynn. (2001). Wedded Strangers: The Challenges of Russian-American Marriages. Hippocrene Books.
146. ↑ ITAR-TASS Reports Women Earn Less Than Men, Have Better Education. (March 8, 2005). Statistics from Russia’s State Statistics Committee. (It is not stated where or how Poleyev did his research).
147. ↑ Hingley, Ronald. (1977). The Russian Mind. New York: Charles Scribner's Sons. 188. https://archive.org/details/russianmind00hing
148. ↑ Visson, Lynn. (2001). Wedded Strangers: The Challenges of Russian-American Marriages. Hippocrene Books.
149. ↑ Elena Petrova. (2006). How To Find And Marry A Girl Like Me.
150. ↑ The Washington Post. (October 28, 1994).
151. ↑ Serge Schmemann. (February 20, 1994). Russia Lurches Into Reform, But Old Ways Are Tenacious. The New York Times.
152. ↑ Crossroads. (Spring 1991). Newsletter of the American Collegiate Consortium for East-West Cultural and Academic Exchange. Middlebury, VT.
153. ↑ Landon Pearson. (1990), Children of Glasnost: Growing Up Soviet. Seattle: University of Washington Press. 94.
154. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
155. ↑ Visson, Lynn. (2001). Wedded Strangers: The Challenges of Russian-American Marriages. Hippocrene Books.
156. ↑ Pamela Druckerman. (March 25, 2008). Lust in Translation: Infidelity from Tokyo to Tennessee. ISBN: 978-0143113294
157. ↑ Pamela Druckerman. (March 25, 2008). Lust in Translation: Infidelity from Tokyo to Tennessee. ISBN: 978-0143113294
158. ↑ Sauer, Derk. Typisch Russisch. (Typically Russian). Amsterdam: Veen, (2001). https://www.russlandjournal.de/typisch-russisch/
159. ↑ Psychologist Alexei Zinger.
160. ↑ Pamela Druckerman. (March 25, 2008). Lust in Translation: Infidelity from Tokyo to Tennessee. ISBN: 978-0143113294
161. ↑ Pamela Druckerman. (March 25, 2008). Lust in Translation: Infidelity from Tokyo to Tennessee. ISBN: 978-0143113294
162. ↑ Pamela Druckerman. (2008). Sleeping Around the World. January Magazine. https://www.januarymagazine.com/features/lustexc.html
163. ↑ Wendy Z. Goldman. (1993). Women, the State and Revolution: Soviet Family Policy and Social Life, 1917–1936. Cambridge. 107
164. ↑ Natalia Lebina. (1999). Povsednevnaia zhizn’sovetskogo goroda: normy i anomalii, 1920–1930 gody. St Petersburg. 272.
165. ↑ Igal Halfin. (2002). Intimacy in an Ideological Key: The Communist Case of the 1920s and 1930s’, in Language and Revolution: Making Modern Political Identities. London. 187–188.
166. ↑ Orlando Figes. (2008). The Whisperers: Private Life in Stalin's Russia. Picador.
167. ↑ Leon Trotsky. (1973). Problems of Everyday Life: Creating the Foundations of a New Society in Revolutionary Russia. London. 72
168. ↑ Alex Inkeles & Raymond Augustine Bauer. (1959). The Soviet Citizen: Daily Life in a Totalitarian Society. Cambridge, Mass. 205.
169. ↑ Masha Gessen, (2017). The Future Is History: How Totalitarianism Reclaimed Russia.
170. ↑ Julia Ioffe. (2010). The Cheating Cheaters of Moscow How infidelity has become accepted and even expected in Russia, Slate.
171. ↑ Visson, Lynn. (2001). Wedded Strangers: The Challenges of Russian-American Marriages. Hippocrene Books.
172. ↑ Murray Feshbach. (November 1, 1994). Kennan Institute, Washington, DC.
173. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
174. ↑ Alaka Malwade Basu. (2003). The Sociocultural and Political Aspects of Abortion: Global Perspectives. Greenwood Publishing Group.
175. ↑ Chloe Arnold. Abortion Remains Top Birth-Control Option In Russia. (June 28, 2008). Radio Free Europe.
176. ↑ Russian Survey Highlights-Results of the 2011 Russian. (2011). CDC.
177. ↑ Putin’s Next Target Is Russia’s Abortion Culture. (October 3, 2017). Foreign Policy.
178. ↑ Marriage in Russia, Facts and Details. http://factsanddetails.com/russia/People_and_Life/sub9_2d/entry-5011.html
179. ↑ Murray Feshbach. Russian Military: Population and Health Constraints. Prepared for the Conference on Russian Power Structures: Present and Future Roles in Russian Politics, sponsored by the Swedish Research Institute of National Defense and the Swedish Defense Commission, Stockholm, October 17–18, 2007.
180. ↑ Moscow Times, (November 29, 2001).
181. ↑ Women’s Day was formerly known as International Women’s Day.
182. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
183. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
184. ↑ ITAR-TASS Reports Women Earn Less Than Men, Have Better Education. (March 8, 2005). Statistics from Russia’s State Statistics Committee. (It is not stated where or how Poleyev did his research).
185. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
186. ↑ Visson, Lynn. (2001). Wedded Strangers: The Challenges of Russian-American Marriages. Hippocrene Books.
187. ↑ Visson, Lynn. (2001). Wedded Strangers: The Challenges of Russian-American Marriages. Hippocrene Books.
188. ↑ Visson, Lynn. (2001). Wedded Strangers: The Challenges of Russian-American Marriages. Hippocrene Books.
189. ↑ Constitution (Fundamental Law) of the Union of Soviet Socialist Republics. (1977). Novosti. 38.
190. ↑ ITAR-TASS Reports Women Earn Less Than Men, Have Better Education. (March 8, 2005). Statistics from Russia’s State Statistics Committee.
191. ↑ Richmond, Yale. (2008). From Nyet to Da: Understanding the New Russia. Nicholas Brealey Publishing.
192. ↑ Louneva, Tanya, "Business Negotiations Between Americans and Russians" (2010). Wharton Research Scholars. 57. https://repository.upenn.edu/cgi/viewcontent.cgi?article=1059&context=wharton_research_scholars
193. ↑ Russia: Among the Worst Countries for Expats. Expat Insider 2021. Internations. https://www.internations.org/expat-insider/2021/russia-40134
194. ↑ Adapted from Vladimir Zhelvis, Xenophobe’s Guide to the Russians (2001; London: Oval Books, 2010).
195. ↑ Why do so few Russians speak good English? https://www.rbth.com/lifestyle/330073-why-russians-speak-english March 6, 2019 YEKATERINA SINELSCHIKOVA.
196. ↑ Sinelshikova, Yekaterina. (January 29, 2018). Why People Hate Muscovites. Russian Beyond. https://www.rbth.com/lifestyle/327414-why-people-hate-muscovites .
197. ↑ Klien, Naomi. (2008). The Shock Doctrine. "In this...alternative history of the most dominant ideology of our time, Milton Friedman's free-market economic revolution, Naomi Klein challenges the popular myth of this movement's peaceful global victory. From Chile in 1973 to Iraq today, Klein shows how Friedman and his followers have repeatedly harnessed terrible shocks and violence to implement their radical policies. As John Gray wrote in The Guardian, "There are very few books that really help us understand the present. The Shock Doctrine is one of those books."
198. ↑ The wealthy few move policy, while the average American has little power. Study: US is an oligarchy, not a democracy. (17 April 2014). BBC. https://www.bbc.com/news/blogs-echochambers-27074746
199. ↑ L. Robert Kohls, Executive Director, The Washington International Center. Washington, D.C., April 1984.
200. ↑ Kaplan, Dana Evan (Aug 15, 2005). The Cambridge Companion to American Judaism. Cambridge University Press. p. 118. ISBN 978-0-521-82204-6.
201. ↑ http://shitmydadsays.com/

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