Cubby Broccoli`s 007 movie plot ideas come true in Russia

Roger Boyes, Berlin correspondent of The Times (UK), has likened the current state of the Russian energy companies to that of an idea Cubby Broccoli had for a James Bond plot.

Gazprom may lack the sinister aura of James Bond’s foes, but it is as powerful as Dr No.

Boyes writes: Many years ago, as a young correspondent in communist Poland, I took a call from the office of the film producer Cubby Broccoli. Somewhere in distant Hollywood an argument was raging about the plausibility of a James Bond script. Broccoli’s bagman, an old schoolfriend, wanted to know how a crackpot communist dictator would go about buying up a capitalist state. “What if the Russians just hold us to ransom instead of nuking us?” asked Hollywood, and did not wait to hear the answer.

Vladimir Putin would have warmed Cubby’s heart and not just because he is an old KGB agent. He is a wolfish cold warrior in a sheepskin coat, determined to adapt the old categories to modern times. The Cold War defined Russia’s legitimate spheres of interest in Europe and Asia, its global reach. And so under President Putin new generations of long-range weapons are tested; he cracks down on critics at home; tries to muzzle the press; centralises power; and sees enemies everywhere. The West, though wrinkling its nose at the latest flash of autocracy or double-dealing at home, does not take this Cold War posturing too seriously. The projection of Soviet power abroad depended on two instruments — the red army and an aggressive Marxist-Leninist ideology — which no longer play a serious role in Russian foreign policy.

Yet Mr Putin has been developing a new policy instrument: the Russian gas and oil-exporting companies that already all but dominate Europe’s energy supplies. Gazprom may lack the sinister aura of some of James Bond’s foes but its power is more than equal to that of Dr No or Goldfinger. Gazprom is assumed to be lurking behind the winner of this week’s £4.8 billion bid for Yuganskneftegaz, the core oil-producing subsidiary of Yukos, the company owned by Mikhail Khodorkovsky, the jailed oligarch and critic of Mr Putin. The President wants Yukos in his hands to prevent the nightmare possibility — a sale to American companies with Mr Khodorkovsky’s profits being ploughed into an anti-Putin party — which would weaken him at home and abroad.

Gazprom has woven a web of energy dependencies from Turkey to Turkmenistan, from Berlin to Baku. The International Energy Agency estimates that gas will account for 62 per cent of European energy consumption in 2020. Two thirds of it will come from Russia. That is why Gazprom is allowed to function as a state within a state, the last great Soviet institution to resist talk of market forces, transparency or even basic verifiable accounting. The gas supplied to Russia’s “near abroad ” — the republics of the former Soviet Union — is subsidised. Many countries in the new EU borderlands — Belarus, Ukraine, Moldova — are heavily in debt to Gazprom. A threat to turn off supplies because of unpaid bills immediately destabilises the countries and makes them vulnerable to Russian demands. Before the recent revolution in Georgia, Moscow decided to stop gas deliveries there for “technical reasons”. Russia wanted to prevent the closure of its military bases in Georgia in order to keep up the pressure on Chechnya.

This is brute power and Mr Putin is the master of it. A sign of the importance of Ukraine to Russia was the appointment as ambassador to Kiev some years ago of Viktor Chernomyrdin, a hard-hitting politician but also a former head of Gazprom. Mr Putin has a KGB man’s cynicism about power. In his world it does not matter much who rules Ukraine. As long as Russia is its primary supplier of energy, any new ruler, the pro-Western Viktor Yushchenko included, has to stay on the friendly side of the Kremlin. After all, Alexander Lukaschenko, the ludicrous, sometimes vicious ruler of Belarus, was once a kind of dissident. The Russians could engineer a coup or street revolution against him at any time simply by raising the price of gas and oil in midwinter. So far Mr Putin has chosen not to. And why should he? Mr Lukaschenko dances to the pipes of Gazprom.

Mr Putin’s champions in the West, above all in Germany, argue that there was never a choice between democracy and dictatorship in Russia. Rather, Mr Putin inherited a state poised between rampant criminalisation and lawless oligarchs on the one hand, and a stable, orderly modernising society on the other. Mr Putin is not a saint, admit the advisers of the Chancellor, Gerhard Schröder, but he made the right choices. If Mr Putin followed Western advice on Chechnya there would be a destructive Islamic state within striking distance of Western Europe. But there is an ancient fallacy at work. It is assumed by Herr Schröder, at least, that the Russian president has a genuinely benign interest in Europe — in part because he speaks German and bought his first washing machine in a Berlin department store. In the days of Peter the Great, the great compact was that Western Europe would help Russia to modernise in return for access to its natural resources. On paper that is the way it looks today. Germany has just agreed to supply highspeed trains to Russia, and Ruhrgas, the German energy concern, has a 6 per cent stake in Gazprom. But Mr Putin is more interested in China — where Gazprom is about to become very active indeed — than in the European Union. By cuddling up to Mr Putin, Herr Schröder thinks that he is securing Germany’s future. In reality he has become his patsy.

Mr Putin’s management of Russia’s oil and gas resources shows how misguided it is to give the Kremlin the benefit of the doubt. Corruption is worse than it was under Boris Yeltsin; much of the destructive enthusiasm deployed against Yukos is motivated by the desire of Kremlin associates to enrich themselves. Gazprom has, at its heart, a network of politicians and former secret service agents. Some simply want to be rich and award each other contracts. Others believe that they are in the vanguard of a new Russia, keen to expand its influence westwards and eastwards. It is the engine room of Mr Putin’s Russia.

Thanks to `Barry` for the alert.

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