Reforms have brought a degree of transparency to Ukraine’s political system. A legacy of oligarch interference over political institutions, however, is not so easily disrupted; evident in media revelations that President Poroshenko has prioritised the security and growth of his business interests over the promises he made to the electorate. As Ukraine’s future balances between progress and regression, will the balance tilt towards further reform, or will the road towards a new oligarch class and influence be opened?
Although the life expectancy of Kazakh opposition parties is usually brief, rising social discontent is changing the equation. Disaffection with political governance is no longer limited to the grassroots, but increasingly resounding within the middle and business classes, and within elements of the ruling elite itself. This is feeding a resurgent opposition; but will change be orderly or chaotic.
Increased affiliation to the Russian Orthodox Church has proved to be a trend among Russia’s elite groups during Putin’s third presidential term. Both the church and elite groups benefit from their mutual allegiance. While power players finance Church operations, the Church provides ideological backing to the Kremlin and a positive public image for business elite.
VTB’s involvement in the Mozambique debt scandal attracted attention to the bank’s operations in Africa and other foreign countries. The bank is closely connected to Russia’s most powerful elite groups who frequently use it to solve politically-sensitive problems. VTB’s foreign activity should be closely monitored vis-à-vis the Kremlin’s attempts to use it to informally promote its foreign policy goals.
Institutional and systemic lapses continue to undermine Georgia’s investment environment. Using the fertilizer sector as a case study, this analysis highlights how sustained interference of politically connected informal business networks in key enterprises has prevented modernisation, and further contributed to deepening a negative image of the country’s wider business and investment climate.
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Behind the scenes, Kazakhstan’s political and business clans have always bickered; but the era of high economic growth that largely insulated the regime from elite discontent is now over, and the rivalry between various factions has begun to surface in public. As Nazarbayev seeks to balance the two main elite groups, a third has risen and is raising questions.
Although a lesser discussed set of bilateral relations, Kazakhstan and the United Arab Emirates are sending signals of enhanced cooperation. Given the UAE’s desire to expand and diversify its economy, established investors should keep one eye on the effects that emerging bilateral agreements may have on their interests.
Russia’s banking sector is undergoing the largest reshuffle in decades. The result is that over 50% of banking assets are controlled by a handful of large state- and private-owned entities, through which informal networks leverage their influence. Details of the power dynamics and influence power players wield over Russia’s banks are provided in the Report Store.
As Kazakhstan’s agricultural sector is increasingly becoming of strategic importance to the country’s economy, it has attracted not only interest amongst the Kazakh political elite but also foreign investors, including China. This sector is starting to attract the attention of the country’s key power players.
Russia’s formal institutions are often undermined by informal institutions. This means that what the government says or legislates for is not a good guide to how the country is governed in practice. Instead of creating the conditions for stability and modernisation, Putin’s government has actually done the opposite and entrenched informality.
Nominee ownership is a common tool used by politically exposed individuals in Kazakhstan to obscure their assets, or increase their corporate tax efficiency. Shadow Governance research on Dutch companies with shares in some of Kazakhstan’s most lucrative industries reveals how members of the political elite use opaque mailbox companies in the Netherlands; ostensibly for tax avoidance.
Over the past few years, children of Russia’s elite groups have – with increasing frequency - been appointed to high-profile positions in state-owned corporations and ministries, or have taken over their parents’ business. Shadow Governance examines how blood relations, combined with strong societal networks, are used to exert influence and engage in resource distribution.