Blackmail, corruption and populism – why residents of Chechnya have had their gas debts written off

Observers on why the Chechen prosecutor’s office insists on writing off debts and why Gazprom is opposing it

REUTERS/Said Tsarnayev 

A confrontation has begun in Chechnya between the government of Ramzan Kadyrov and the Russian company Gazprom.

The government has come out in defence of the poor and wants to write off their gas debts. Gazprom, meanwhile, insists on receiving the money owed to them. Many observers are not on the side of the poor, but are instead on the side of the gas giant.

Moreover, many say that there may be a considerable level of corruption involved in the Chechen authorities’  proposal.

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The essence of the debate

The idea to write off the gas debt of residents of Chechnya was first put forward by the prosecutor’s office of Chechnya.

The main argument was that the statute of limitations had expired on the debt, and that Gazprom’s claims “had created social tensions in society which could have led to wide-spread protest”.

The sum in question was about $140 million, and on 16 January, the Zavodskaya District Court of Grozny ruled that the debt should be written off.

Many observers regard both the court decision and the main argument in support of it strange and unprecedented.

Gazprom, for its part, said it would appeal the court’s decision.

Why have observers reacted in this manner? Russian news outlet Caucasian Knot offered several explanations.

Blackmail 

Natalia Zubarevich, an expert in the field of regional socio-economic development at Moscow State University, said that she had never heard of such write-offs, especially under the pretext of “preventing possible protests”.

“If I understand correctly, this can be interpreted as: ‘Until we start shooting at you [the public], you’ll forgive us for everything. I call this blackmail,” says Zubarevich.

Zubarevich also says the indebtedness of the republics of the North Caucasus for the payment of gas far exceeds the debt of the whole of Russia.

Covering up thievery 

In Russia, there is a corrupt practice of attributing gas debts to the population, which makes it possible to hide the loss or theft of fuel, confirmed one expert in the field of energy Nikolay Khrenkov.

PR and populism 

The decision to write off debt was made with the direct participation of the head of Chechnya, Ramzan Kadyrov, says political scientist Alexey Malashenko, head of research at the Dialogue of Civilizations Institute.

Kadyrov is aware of the growing social tension in the republic and is seeking to ease it, demonstrating at the same time that “he is upholding the interests of the people”, he says.

“The situation is in Kadyrov’s hands – he can pretend to be brave in front of the federal centre [Moscow], which in this case is represented by Gazprom,” concluded Alexey Malashenko.

The head of the Civic Assistance Committee, Svetlana Gannushkina, also linked the decision to write off the debts of Chechnya to PR for Kadyrov. Such a decision would do much for his popularity, she noted.

What’s next?

Despite the dubious economic motivation, Chechnya’s gas debt may well be written off with the approval of the federal centre, Svetlana Gannushkina believes.

“Most likely, the government of the Russian Federation will reimburse Gazprom and take money from the treasury,” the human rights activist believes.

“Let’s see who is stronger in Russia – Gazprom or the Head of Chechnya,” writes one commentator on the website of the Caucasian Knot.

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