Wednesday, July 23, 2014

A modest proposal to businessmen with eyes on Russia and Ukraine

To be accurate, what I intend to write is not even a proposal, more of a suggestion, brought about by my continuing astonishment at the naiveté or stupidity or hopefulness beyond experience of businessmen who still think that they can go into Russia or Ukraine (until recently), buy property, set up a business or open a branch of existing one and get away with it, perhaps to make profits. How many cases of people being bullied, cheated, robbed, reduced to a nervous break-down and having their Russian employees murdered must we witness before people abandon all hope?

Now, don't get me wrong: I do not consider those businessmen to be motivated by charitable impulses. Not only do I not think that they are, I do not think that they should be and I would not trust them if they were, NGOs and large charities not being among my favourite organizations. 

Nor do I think those Western businessmen are particularly honest or honourable themselves and I came across a number of people who saw a chance in the collapse of the Soviet Union for a quick buck or a thousand in the chaos that was around them. But, surely, they have realized by now that the state and its minions in those countries, Vlad and his Chekists as well as Yanukovich and his "family" until recently are more corrupt, more brazen, less scrupulous and can command more power of different kinds than any Western business. 

Curiously enough, the problem of bullying, violent expropriation and nullification or subversion of contracts is greater in Russia and Ukraine than in the Caucasian and Central Asian republics not because these are not corrupt or oppressive but because, as the evidence seems to show, their officials, once bought, stay bought. Not so with the "European" parts of the former Soviet Union (excluding the Baltic states, always an anomaly) who have always been rather contemptuous of their Caucasian and Central Asian brothers and comrades. Perhaps, they should rethink that attitude. 

These thoughts were passing through my head as I was reading Oliver Bullough's recent report, published by Legatum Institute and Institute of Modern Russia, entitled Looting Ukraine: How East and West Teamed up to Steal a Country

I shall write in greater detail about the report, its somewhat emotional title and the presentation of it I went to. In this posting I want to concentrate on one tiny example Mr Bullough cites. Discussing how corruption worked under then President Yanukovich he explains that towards the end "property rights became so loose, and rule of law so weak, that state officials and insiders began, simply, to seize businesses", giving Yanukovich a hefty share of the profits. 

A certain British businessman, here named Bernard Carr, lost an office building to "competitors" who gained access to the land registry. This is his account:
It's basically about who pays the police more. The problem was that the police were being paid by both sides. We were paying the police and so was he. So we went to court and tried to buy our way through the court. The lawyers said if we paid 6,000 euros we would win, but you can't guarantee the other guy won't pay 7,000 euros. And you don't get a refund if you lose, which we did ... I have lost count of the number of times I've been told that if I pay someone a couple of grand a problem would go away, but then not have it go away.
I do not expect anyone to feel particularly sorry for Mr "Carr" or be sympathetic to his plight. It did, however, led me to that suggestion. It is that every businessman who thinks that he can do business in Russia and Ukraine and all he has to do is shell out a few appropriate bribes ought to have the following two lines inscribed on the wall of his office and, perhaps, as a screen-saver on his laptop:

That if once you have paid him the Danegeld,    
You never get rid of the Dane.


  1. Good old Kipling, he never lets us down.

    Some of us in this country could benefit from re-reading "The Gods of the copybook headings", too.

    Not to mention "The Reeds of Runymede"; discuss this last, as the examiners might say, with reference to the (a) European Union and (b) the Regulation of Investigatory Powers Act.

  2. Gah! I meant "The Old Issue" of course.

    *Hangs head in shame*