Forget reform if Putin stays in power

Reuters , Sunday 18 Sep 2011

Former tycoon Mikhail Khodorkovsky says there is no hope for reform in Russia if the country's Prime Minister Vladimir Putin stayed in power

Russia's Prime Minister Vladimir Putin (Photo:Retuers)

If Vladimir Putin remains Russia's paramount leader, hopes for reform will be extinguished and Russia's brightest people will emigrate in droves, former tycoon Mikhail Khodorkovsky told Reuters from jail.

Khodorkovsky, once Russia's richest man, was arrested in 2003 after falling foul of the Kremlin under then-President Putin and his YUKOS oil company was crippled with massive back-tax claims and then sold off by the state.

"The hopes for internal reform of the current system of power would disappear," Khodorkovsky, 48, said in a written reply to a question asking what would happen if Putin returned to the Kremlin or remained paramount leader.

Putin, who now serves as prime minister, steered Dmitry Medvedev into the Kremlin in 2008 because the constitution barred him from running for a third consecutive term. He is widely expected to run in a March 2012 presidential election.

"Emigration of socially active and intellectual Russians would accelerate," Khodorkovsky said from prison colony No. 7 in the town of Segezha, near the Finnish border about 900 km (550 miles) north of Moscow.

Reuters submitted dozens of questions to Khodorkovsky through associates and he returned written answers this week. He said no one had influenced his answers, though he did express concern that his answers could provoke reprisals.

"I am not scared for my life but I do not exclude that there are grounds for such fears," said Khodorkovsky, once one of the most powerful oil barons in the world's top energy producer.

A chemical engineer who served in the Communist Youth League, Russia's most famous prisoner started to trade goods as the Soviet Union crumbled but soon began buying up state assets, gaining control of some of Russia's best oil fields.

Some answers were poignant: he said he had only seen his loved ones "through the glass" of visiting rooms and expressed regret for the pain caused to his family and colleagues.

But he expressed no regrets about his fate, a 13-year sentence in one of the world's toughest prison systems.

Putin has compared Khodorkovsky to U.S. gangster Al Capone and hinted that he was behind a series of murders, accusations Khodorkovsky's lawyers say are ridiculous.

Khodorkovsky declined to write replies on several questions about Medvedev, the 46-year-old Kremlin chief, but forecast turmoil in Russia sometime after 2015.


When asked whether the 2012 presidential election would be fair, he answered that the question needed to be rephrased.

"The real question is: will the elections appear fair enough so that the legitimacy of the president is sufficient when the crisis comes. The depth and essence of the crisis, I cannot predict, but it is inevitable soon after 2015," he said.

The former CEO and main shareholder of YUKOS, which he had built into Russia's biggest private company with a market capitalisation of $40 billion, said Russia's ruling elite was increasingly dependent on revenues from rising oil prices.

He said that if the price of oil -- the lifeblood of Russia's $1.5 trillion economy -- did not keep rising, then the Kremlin could face unrest in the regions similar to a workers' protest in the northern town of Pikalyovo during the 2008-2009 economic crisis.

By the time the dust had settled on the ruins of the Soviet economy, Khodorkovsky was one of Russia's most powerful oligarchs, the businessmen with enormous wealth and power who surrounded late President Boris Yeltsin.

But after rising to power in 1999, Putin warned the oligarchs that if they wanted to keep their fortunes they must stay out of opposition politics. Most listened.

Khodorkovsky did not: He was arrested on Oct. 25, 2003, by armed security agents and is due to be released in 2016.

"It was a demonstration of the authorities' readiness to prevent unsanctioned opposition activities by business," Khodorkovsky said. "The main prize for the raiders was Yukos."

Yukos, his main asset, pumped more oil than OPEC member Qatar, but was bankrupted by tax claims and its main production asset was sold off by the state in an auction.

State-run oil firm Rosneft eventually bought the Yugansk unit, making it Russia's biggest oil producer.

Yukos management and shareholders have brought a case in the European Court of Human Rights demanding $100 billion from Russia for crushing the company. A decision is due on Sept. 20.

Khodorkovsky blamed Igor Sechin, a Putin ally in charge of the energy industry, for orchestrating the attack on Yukos.

"He is the instigator and inspiration for an orgy of state raids which, after destroying Yukos, spread over the entire country," said Khodorkovsky.

Sechin has justified Rosneft's purchase of Yukos assets, saying it paid a fair price and that Yukos has been proven to be involved in murders, extortion and tax evasion.

Khodorkovsky dismissed speculation he would seek revenge.

"Forgive? I doubt it," said Khodorkovsky. "But spend time on revenge? I am too pragmatic."

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