RUSSIA: Russia's Prime Minister sought yesterday to silence talk of a massive reversal of the murky 1990s privatisations that created a handful of billionaires who are now feeling the squeeze of an unprecedented Kremlin investigation, writes Daniel McLaughlin from Moscow.
Mr Mikhail Kasyanov became the latest political heavyweight to join a battle that pits Russia's richest tycoons against a shadowy coterie of power-hungry men who followed President Vladimir Putin from the KGB and St Petersburg to the Kremlin. "Of course, we believe and have always believed that the results of past privatisations are irreversible," Mr Kasyanov said, apparently trying to soothe businessmen badly spooked by a criminal investigation engulfing Russia's biggest oil firm, Yukos.
A billionaire shareholder in Yukos faces charges of embezzling more than £150 million and the company's chief, Mr Mikhail Khodorkovsky, has been unceremoniously hauled in for questioning - a stunning twist of fate for Russia's richest man.
He is one of a small group of ruthless dealmakers who exploited post-Soviet mayhem to snap up Russia's finest industrial assets at rock-bottom prices, but who thought President Vladimir Putin had closed the book on the chaotic 1990s when he came to power in 2000.
Mr Putin sealed an informal pact with the so-called oligarchs soon after he succeeded Mr Boris Yeltsin as president, by which he would not investigate the sources of the tycoons' billions as long as they steered clear of the political world. Mr Khodorkovsky, many commentators here say, has attracted the Kremlin's ire by funding the liberal parties and politicians that will oppose Mr Putin and his supporters in December's parliamentary elections and March's presidential vote.
Other observers see the impasse as a turf war between Mr Putin's colleagues from his days as a KGB spy and St Petersburg official, and the circle of politicians and businessmen who thrived under Mr Yeltsin, and became know as "The Family".
"The conflict is essentially between a commercial faction - led by the old Yeltsin 'family' - facing off against a more political group from St Petersburg, whose primary focus is to consolidate Putin's power base," said Mr Stephen O'Sullivan, joint head of research at UFG bank in Moscow.
"The commercial group feels that their very considerable achievements are being undermined by the current market turbulence." Russia's stock exchange has followed Yukos shares down since masked police with guns raided the firm's offices last week, and took another dive on Wednesday with news that the company's tax payments were under investigation.
The tax probe has also touched Sibneft, the oil producer at the heart of the fortune of Mr Roman Abramovich, Russia's second richest man and new owner of Chelsea football club.
Though Mr Kasyanov's words may have offered some solace to rattled businessmen yesterday, they will still be wary of conflicting signals from Russia's political and security elite.
While saying there would be no wholesale re-nationalisation of Russian industry, Deputy Property Minister Mr Alexander Braverman cautioned: "We should distinguish between privatisation results as a whole and certain privatisation deals."