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The Last Word

Eric Kraus
is the Managing Director of Anyatta Capital, the investment advisor to the Nikitsky Russia/ CIS Opportunities Fund. For over a decade he has been analysing investment opportunities in Russia. He writes a monthly newsletter Truth and Beauty ( and Russian Finance) available in pdf format at

You have been called many things over the years, but recently someone described you as a Putin apologist?

Hogwash! I am not an apologist for anyone. I am an outright and enthusiastic Putin fan. Russia has become home to me, and I am frankly grateful to President Putin for the transformation of Russian life under his watch. I believe that history will count him amongst those very few men who proved to be, quite literally, the saviours of their countries.

When Putin became Prime minister the jibe about Russia, Ivory Coast with nukes was commonplace. How have things progressed?

Seven Years later and it is another country. Russia has found its voice on the global stage, and demands respect, if not love. After a dirty war, Chechnya has been pacified and no longer threatens to plunge Russia into civil war I have nothing good to say about the Kadyrov faction now in place, except that who but one Chechen warlord faction could have beaten back the Islamists? The Russian economy is well on its way to doubling in size; at more than $300 bn, Russian reserves are the worlds third largest after Japan and China. Incomes have increased dramatically, with an explosion of the middle class, and the percentage of the population living below the poverty threshold has decreased from about 35% in 1999 to 15% today. President Putin has made bringing this last 15% into the fold one of the major priorities for the end of his presidency.

Russia is widely criticised for its lack of democracy. Your view?

For Russians the word Democracy is associated with the worst excesses of the Yeltsin years. While there can be no debate that some form of democracy is optimal for rich countries, empirically none of the developing countries which have enjoyed the fastest, sustained growth in overall well-being first Japan, Korea, Taiwan, Singapore and Malaysia; now Vietnam, China and Russia - were particularly democratic, at least during the initial phases of their transformation. Russia is relatively democratic for a country at its level of economic development; perhaps, in a decade or so, it will be no less so than the European Union.

What about Russias poor image abroad?

Russias attempts to project a positive image abroad could be most charitably described as pathetic. It would be helpful if the Russian administration could clarify its attitude towards the West. Either take the Chinese approach and inform the Western powers that their opinions are strictly their own problem, or alternately, make a concerted and especially a sustained effort at managing the spin, consistently and coherently. The middle ground is simply not tenable.

These opinions and remarks are taken from T&B of 12 February 2007.
Eric Kraus may be contacted at :

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