Corruption 'corroding' Russia

REVEALING that dollars 2bn ( pounds 1.4bn) had gone missing in Russia's trade balance last year, President Boris Yeltsin complained yesterday that police and security officers were wasting their time chasing petty thieves while organised crime and official corruption were corroding the very foundations of the state.

Dishonesty was now so widespread, he told a politicians' conference on crime, that 40 per cent of businessmen and two-thirds of commercial organisations were involved in bribery, tax evasion and other illegal transactions. 'Corruption within government literally corrodes the state structure of Russia from top to bottom,' he added. 'The criminal world is becoming increasingly bold and aggressive, feeding off the political and economic instability in Russian society.'

Mr Yeltsin gave few details of the missing money other than to say that there was a discrepancy between the turnover of the Russian Foreign Trade Ministry and its balance sheet from January to September 1992. 'Which foreign banks is the money working for?' he demanded. 'Who in the government profits from this lawlessness? And we, meanwhile, are chasing pickpockets.'

The President, who is under pressure from an increasingly disgruntled population to improve law and order as well as achieve a breakthrough in economic reform, said he had asked Vice-President Alexander Rutskoi to head a special new anti-crime commission. Mr Yeltsin also suggested using soldiers made redundant because of military spending cuts to strengthen the hard- pressed and poorly paid police.

The police, who not only lack sophisticated equipment but are also short of basics such as boots and uniforms, were completely unable to cope with the record 2.8 million crimes reported last year. The murder rate grew by 40 per cent in 1992 and the number of robberies was 60 per cent up on the previous year. Large numbers of Russians now carry small arms, supposedly to defend themselves, and it is common to hear gunshots in the Moscow night.

Almost certainly aiming to impress delegates to Mr Yeltsin's conference, the Moscow city authorities this month launched a clean-up drive called Operation Signal, during which extra police patrols combed known sleazy locations such as railway stations in search of criminals. Newspapers and television ran pictures of confiscated weapons and captured villains in cages but most were the small fry of whom Mr Yeltsin spoke with such frustration. 'All the big sharks have been scared away,' said Major Vladimir Danilov, who takes care of the district around Moscow's Belorussia station. 'We are only catching the little fish in our net.'

Indeed, combating serious crime and corruption seems almost impossible as it is already an integral part of the Russian system. The underground entrepreneurs and Communist officials who used to scratch each others' backs in the Soviet era when capitalist activity was outlawed now work together in the fledgeling market and their old habits of bribe-giving and taking die hard. A senior politician in St Petersburg, for example, recently demanded a bribe of dollars 50,000 to register a Finnish firm in his city.

The corruption runs through industry and right to the top of the government, making it difficult for Mr Yeltsin to cleanse effectively without pulling the whole structure down around him.