30.12.08

A decision by the Russian Government to introduce what are in effect prohibitive customs duties on the importation of used cars into Russia has set off protests in all the major cities. It comes as no surprise that the tone is being set by Vladivostok, where since the disintegration of the USSR a significant portion of the population has become accustomed to living off the importation of Japanese vehicles. Last weekend was marked by these protests, with leaders of the so-called "off-system" opposition like Viktor Pokhmelkin and Vladimir Ryzhkov rushing to the Far East to press vehicle owners' protests into the service of their own popularity rating.

Meanwhile the question remains unanswered: to what extent can the protests that are occurring all over be considered "spontaneous"? Are those who are saying that these protests are backed by Far Eastern crime groups that live off the illegal importation of old Japanese cars right?

As you will recall, the government decided on 11 January to raise customs duties on used vehicles imported into Russia to virtually prohibitive levels. At the same time Russian citizens were offered government compensation when buying cheaper (up to R350,000) domestically-manufactured vehicles on credit.

This would cover VAZ, GAZ, Renault Logan, Skoda Fabia and Chevrolet Lanos cars. For residents of the Far East, where prices for Russian-built vehicles are objectively higher because of higher shipping costs, provision is being made for a zero rail shipping rate for transportation of cars from European Russia. In other words, the government wants to force Russian Railways to operate at a loss for "social" reasons.

But that is not the most important thing. More importantly, attempts have already been made to force residents of the Far East to buy domestic.

It is simply that the current Russian authorities have for some reason forgotten that. Those times the attempts ended extremely unsuccessfully, even though the idea was not just "social" delivery of vehicles to the region, but actually their "social" assembly locally. That is to say, the problem of providing additional jobs was also solved.

This time not even that much is being done, despite the fact that according to some estimates the automotive business in Vladivostok alone employs more than 80,000 people. In other words, the car business create between one-fourth and one-third of all jobs in the region. But it is precisely that Russia-wide business that has attracted the wrath of Russian authorities. There was a reason why Vladimir Putin stressed as he proposed measure to alleviate the effects of combating used cars imports that in the past six months the Far East has imported 350,000 vehicles, yet only 15,000 stayed in the region.

The prime minister assured us that "the rest are someone's business, as a result of which the workers at Russia's automobile plants are suffering."

In other words, Russian authorities are taking action to benefit the workers of Russian car manufacturers, or more likely the owners of those companies, among whom are many foreign corporations like Chevrolet and Renault. Yet those same authorities do not care about the interests of Russian businessmen who deal in the delivery and subsequent resale of Japanese cars all across Russia. To a certain extent the government is of course correct - it is more important to support real production. Even if we are only talking about the final assembly of imported components. However, on the whole Vladimir Putin's decision seems clearly ill-conceived. There is a reason why even United Russia hesitated for several days, trying to decide whether to support the decision unequivocally or ask for adjustments. And full support was given only after an outcry from the White House.

But there is another problem as well: the protest rallies themselves, and the demonstration-oriented activism of those who oppose the new duties. The problem lies in the fact that whereas the government is openly lobbying for the interests of the car manufacturers, which coincide with the interests of the workers employed in the assembly plants, the protesters are openly lobbying not only for their own interests, but also for the interests of the crime groups that live off the semi-legal importation of foreign used cars.

"The gray-market importation of used cars from Asia is a profitable business. A vehicle is brought in as a set of parts (an "erector set"), documents are forged, and bribes are paid to officials instead of customs duties being paid.

In Vladivostok even the children know that this is how a majority of the local dealers operate," the weekly Nezavisimaya Gazeta writes. And it is obvious that this is true. Hence the "high" degree of protestors' independent organization in Vladivostok. City residents who for years were unable to elect a mayor, and in some years past a city duma as well, suddenly joined hands and took to the streets as soon as there was talk of limiting imports of Japanese used cars. There is a suspicion that money is behind that.

Now we are seeing the clear politicization of this conflict between one lobbying group (the government) and another (the car mafia). Comparing the first hand accounts of those who participated in or witnessed the Far Eastern protests, it is not hard to see that the press has been inflating the size of the demonstrations. The authorities have in fact had to resort to force and even send special police tactical units to Vladivostok from Central Russia. However, a review of the available videotapes showing the dispersal of unauthorized demonstrations in Maritime Kray confirm that the dispersals themselves were not carried out as harshly as organizers claim, and the number of protesters was significantly lower. At this point at least we are talking about hundreds of participants and tens of people arrested, not thousands of participants and hundreds of people arrested.

Obviously there is a PR-driven, manipulative exaggeration going on of the conflict between "two commercial entities" over revenue from car sales. Who is doing the exaggerating and why is not very clear. Most likely, at this point we are seeing a desire on the part of the Maritime Kray car mafia to slightly inflate the scale of the clashes, simply in order to scare the government.

However, in the future we could see the construction of a classic manipulated revolutionary scenario. And if the authorities intend to deal with the crisis, they have to take into account the danger of an alliance between the opposition and mafia - that is, criminal -business. If that alliance become a reality, it will be extremely difficult to beat it.

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Source: Politkom.ru