The Russian economy (catch all)

[Beelzebubalicious]

By the way, Stan, some of the things on this list might be applicable to you. I was only 2 years in Ukraine, but a lot of them applied to me....

[Surferbeetle]

From the Moscow Times: Millionaire's Crisis Plan: Return to Bartering

While the global economic crisis didn't sweep into Russia until September, Sterligov said he sensed that trouble was looming in August and got to work.

"I decided that barter trade would be the right choice for the world in times of liquidity problems and payment delays," he said in a recent interview.

So from August to November, computer programmers hired by Sterligov created an interactive database allowing the barter of debt and goods worldwide.

Sterligov illustrated a possible barter deal with a real-life example: Magnitogorsk Iron & Steel Works' estimated debt of 1 billion rubles ($30.4 million) to Mechel for coal supplies.

"Mechel could put information about MMK's nonpayment in our system and then add which products it needs itself," Sterligov said.

MMK, in turn, would put 1 billion rubles of steel into the system, he said. At some point, a company would surface that wanted steel and had a product needed by Mechel, and the deal would be completed.

"For this to work, you have to have thousands of bids in the system," Sterligov said, adding that debt would probably become the most popular item for barter.

Mechel and MMK declined to comment about their possible participation in such a system.

Barter trade was widespread in Russia in the 1990s, when economic turmoil following the Soviet collapse prompted companies to pay employees and creditors with the products they produced — anything from bricks to vegetable oil.

From the NY Times: Have Car, Need Briefs? In Russia, Barter Is Back

All this evokes a bit of déjà vu. In the mid-1990s, barter transactions in Russia accounted for an astonishing 50 percent of sales for midsize enterprises and 75 percent for large ones.

The practice kept businesses afloat for years but also allowed them to defer some fundamental changes needed to make them more competitive, like layoffs and price reductions. It also hurt tax revenues.

The comeback is on a small scale so far. The most recent statistics available, from November, showed that barter deals made up about 3 to 4 percent of total sales, according to the Russian Economic Barometer, an independent bulletin. Nevertheless, economists are taking note.

From BBC German Sterligov: The oligarch who gave it all up

A man who became Russia's second official millionaire following the collapse of communism has abandoned his wealth to live as a peasant in a remote part of the country.

[Beelzebubalicious]

Return to bartering? I don't know if they ever left....I posted this report before, but it's worth posting again. It's a good explanation of Russia's virtual economy, including the role of bartering.

"Abstract: The virtual economy was the system of informal rent-distribution that arose in post-Soviet Russia in the 1990s as nonviable Soviet-era manufacturing industries sought to protect themselves from the discipline of the market. Enterprise directors and their allies throughout the economy (including government officials) colluded to use nonmarket prices and various forms of nonmonetary exchange such as barter to transfer value from resource sectors to manufacturing industry. The article discusses the system’s historical roots, describes some of its characteristic phenomena, and outlines a model for behavior of enterprises."

[Beelzebubalicious]

This was in today's Eurasia Daily Monitor:

Russia Preparing to Buy Allies Through Anti-Crisis Assistance

"Moscow's anti-crisis subsidies are targeted selectively and geared for sphere-of-influence building. Russia is rewarding allied Armenia; it has precipitated Kyrgyzstan's threat to remove the U.S.-led military presence from that country; and it induced a reluctant Belarus to accept Russia's demand to turn the joint air defense system into a unified system."

The author of the article also questions whether Russia will be able to actually disburse these funds...

US/European Donors pledges billions for Georgia...and Russia responds. Do any of the players actually have the cards or are they bluffing? My answer is high-stakes bluffing.

[Stan]

US/European Donors pledges billions for Georgia...and Russia responds. Do any of the players actually have the cards or are they bluffing? My answer is high-stakes bluffing.

Hey Eric !
No bluff on the NATO/US/EU part. FY08 and 09 funds are definitely there (note that some monies from previous FYs are good for 2 to 5 years).

Have you had a chance to peruse the EUMM site? Lots of bluffing going on there as the EU get's Georgia to back off the demarcation line and asks the Russians to do the same

Now that's major bluffing

Regards, Stan