31 October 2003 01:52
The October revolution THE LEX COLUMN:
Uncertainty about what was going to happen to Mikhail Khodorkovsky's
stake in Yukos has been answered. It is now in the hands of the Russian
state. Unfortunately, the seizure of an oil giant's chairman's
shares - about half the total - raises even more questions than it answers.
Perhaps the move is just a logical extension of last weekend's arrest
and incarceration of Mr Khodorkovsky. After all, the Russian government
accuses him of fraud and tax evasion and says he owes them a lot of money.
Grabbing his Yukos shares is one way Vladimir Putin, Russia's president,
can ensure this bill can be paid.
This assumes, however, that the fight is purely between Mr Putin and Mr
Khodorkovsky, who has angered the president by refusing to stay out of
politics. But which political faction supports the seizure of assets? Is it
the one that wants to proceed with Yukos's plans to sell a large chunk
to an American oil company, but just does not want Mr Khodorkovsky to reap
the benefits? If so, the overall picture for Russia might not change much. Or
is it the old guard, which wants to keep Russian assets in Russian hands? Of
course, some Russians hate the idea of private enterprise altogether.
If this move reflects nationalism, the outcome could have serious
implications for foreign direct investment in Russia, one motor of recent
economic strength. The most pessimistic view is that this now provides a
blueprint by which the Russian state can renationalise the assets it sold
cheaply to the oligarchs. If Mr Putin goes after another business scalp, this
theory may gain credibility. So far, it looks too conspiratorial.
One thing is certain, however. More questions than answers breed market
instability: both Russian shares and bonds, particularly corporate ones, fell
yesterday. Expect more volatility.
[FTI [The Financial Times]] |
RUSSIA IN FACTS
