Sunday, January 08, 2006

Future-gazing

Carl Bildt, on the future of Russia:
Looking ahead, one can perhaps discuss two scenarios, although in the short run they are not necessarily mutually exclusive.

The one – let us call it the IKEA scenario – is more optimistic. While sceptical of the possibility of reversing the present trend of de-democratisation of the country, it sees hope in the retail revolution now sweeping the vast Russian area.

With IKEA stores going up everywhere, attracting crowds as nowhere else in the world, there are signs of the gradual emergence of a broader middle class, caring about their homes, their property, perhaps even their freedom and most certainly their future.

Consumers have arrived in Russia, but citizens are not yet in place. But over time, consumers evolving into citizens could provide the base for a more open society, and more responsive state and a more broadly-based and dynamic economy.

The other – the Venezuela scenario – is more pessimistic. It notes the present clear trend of the state – centred on what’s inside the walls of the Moscow Kremlin – to take back control of key sectors of the economy, but notes that on present price levels even a profoundly mismanaged energy sector will provide enough of resources to sustain an increasingly populist, authoritarian and nationalist petrostate.

It’s not difficult to find support for either scenario in the Russia of today.

I remember the days in the past when it was sometimes said that while the United States had a military-industrial complex, the Soviet Union as a whole was one.

Today, we might be entering into a new situation.

We might well see a Russia dominated by an energy-political complex where political and economic powers are brought together beyond what any transparent political process is meant to reach.

The conflict with the Ukraine can certainly be viewed in this light.
(Excerpted from Bildt's remarks on "New Europe and the High North" at the Annual Conference of the Confederation of Norwegian Industries in Oslo on Wednesday.)
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