Page 1

East cop 48_Layout 1 13/06/13 02.44 Pagina 3


july august 2013

48 A/L/P/E €14,00; B €12,00; F €15,00; D €17,00; NL €16,00; UK £14,00; N kr 160,00; CH fr 17,00




My Europe EMMA BONINO writes for East INDIA

Anish Kapoor, essence and absence by Bina Sarkar Ellias EUROPE

A new political geography by Mark Leonard INDIA

That’s Bollywood, darling! by Chandrahas Choudhury AFGHANISTAN

A meeting with Maria Bashir, Chief Prosecutor of Herat by Serena Grassia



Equity participations t Advisory activities t Business scouting t

PUBLIC FACILITIES tExport Credit tTrade development tFeasibility studies


July august 2013



East cop 48_Layout 1 13/06/13 02.39 Pagina 4

subscribingisworthit 1 YEAR (6 issues)

2 YEARS (12 issues)

Italy euro 35 abroad euro 50 Italy euro 50 abroad euro 65

STUDENT DISCOUNT – 30% 1 YEAR (6 issues)

2 YEARS (12 issues)

Italy euro 25 abroad euro 40 Italy euro 35 abroad euro 50

FOR OTHER DISCOUNT CODES CONTACT: tel. 02 45702415 HOW TO SUBSCRIBE BANK TRANSFER Payable to STAFF Srl, via Bodoni 24, 20090 Buccinasco (MI) IBAN IT06F0760101600000020530200 Transfer Motive: EAST + Name, Surname, Address, Post Code, City, Country CREDIT CARD From the site: by fax: 02 4570 243; by e-mail: BY POSTAL ORDER Postal account no. 205 30 200, made payable to STAFF Srl, Via Bodoni 24, 20090 Buccinasco (MI) Transfer Motive: EAST + Name, Surname, Address, Post Code, City, Country

EAST MAGAZINE IS ON iPAD AND iPHONE 1 issue euro 3.56 – 6 issues euro 11.99. In Italian and English

EAST FRIENDS Do you want to join the East Friends’ exclusive international network? A packed schedule of appointments, meetings, online and offline forums, to expand and select your contacts, broaden your business prospects and your social networking opportunities. EAST FRIENDS is a sponsor of East Magazine. To find out more write to us at

1_E Editoriale 48-1_Layout 1 18/06/13 17:46 Pagina 1


Tigers of the Orient by Flavio Fusi


abre-tooth tigers, tigers hidden in the jungle undergrowth, battleworn tigers, wounded, bleeding tigers. The title of our dossier is a tribute to the two vast continent-countries (the “dear enemies”) that are currently dictating the turbulent beat of our new century. Two giants: the Indian heirs to the “children of midnight” and the new China that belongs to the voracious grandchildren of the peasant led by Mao Zedong on their ‘Long March’. Youth, growth, speed. By 2020, the average age of the Indian population will be 29, compared with China’s 37 years. Europeans, whose average age at that stage will be 45, can only be considered old, if not on the verge of becoming ‘ancient’. While the fires may have stopped burning in the West, an explosive mixture is brewing in the Eastern furnace. Beijing is still chasing the ideological spectre of harmony, but ‘contradiction’ is actually the fuel driving both Asian power houses. China is ‘condemned’ both to grow economically and stall its demographics. Its ‘one child’ policy is a dead end for the future. The new Chinese imperialism is gobbling up whole chunks of the African continent. The devastating corruption within the huge public sector is a menacing Polyphemus hanging over the new party leadership and the state. The India of new professions, advanced technologies, huge fortunes and Bollywood splendour is also the India that insults women, where girls are stalked and raped and its lawless urban sprawls have no recourse to justice. And its future is undermined by a dilapidated child healthcare system, a low level of education and mass unemployment. The New Delhi daily, Tehelka, openly asks “Have we missed the last train for the 21st century?”. Huge contradictions and major challenges, compared to which all crisisstricken Europe can muster is little more than a whimper. If the 26 million unemployed Europeans all voted together, the ‘no job’ party would secure almost 50 seats in the European parliament. In Europe, the young become old without having ever lived. And yet there’s no backlash, no sign of a contradiction: just a ‘weak reasoning’ that feebly and ineffectually wavers between austerity and growth. Listlessness versus fury, political parties on the run and economists at loggerheads. As far back as 1923, Joseph Roth described Europe as “a sad continent, rapidly digging its own grave”. Even today, its lethargy and indifference resemble a form of death. As history and the tale of the two Oriental tigers teach us, contradiction alone is the painful lifeblood of the future.

east european crossroads


2-3_E Sommario 48_Layout 1 19/06/13 13.26 Pagina 2


july /august 2013


east, european crossroads year IX · n. 48 · july/august 2013 EDITOR IN CHIEF

1 Editorial by Flavio Fusi

Flavio Fusi


Federico Ghizzoni (PRESIDENT), Giuseppe Scognamiglio (VICE-PRESIDENT), Giuliano Amato, Seyda Canepa, Silvia Francescon, Giovanni Moro, Vincenzo Nigro, Fabrizio Onida, Lapo Pistelli, Lucrezia Reichlin, Renato Ruggiero, Danilo Taino

4 Angela, Enrico and François’ Europe by Giuseppe Scognamiglio


6 BrussEls NotEBook by James Fontanella Khan



Aldo Bonomi, Massimo Cacciari, Ferruccio De Bortoli, Francesca Gori, Lev Gudkov, Ulrike Guérot, Wojciech Jagielski, Predrag Matvejevic, Moni Ovadia, Soli Özel, Sergio Romano, Farian Sabahi, Gyorgy Schoepflin, Luigi Tomba

by Emma Bonino


Silvia Francescon, Francesca Nenci, Fabrizia Falzetti, Emanuela Hernandez, Nicholas Hunt, Alba Chiara Lamberti, Barbara Modugno, Rinaldo Rinaldi, Ilaria Sbarigia, Silvia Settecasi


Europe: rediscovering its federalist origins


11 EAst Forum A new political geography


by Mark Leonard

Europeye srl Via Gregorio VII, 368 - 00165 Roma -

by Sylvie Goulard

Demos and Democracy

BOARD OF DIRECTORS EUROPEYE Giuseppe Scognamiglio (PRESIDENT), Rinaldo Rinaldi (DIRECTOR), Marco Valentini (DIRECTOR), Silvia Francescon (DIRECTOR), Fabrizia Falzetti (EXECUTIVE DIRECTOR)


by Ulrike Guérot


Fabrizia Falzetti, Emanuela Hernandez, Silvia Settecasi, Anna Piccarda Lazarin


Germany in the hot seat




Putin’s war against civil society


Claudio Patriarca -

by Lev Gudkov


Ilaria Sbarigia -



Nicholas Hunt Nicholas Hunt, Aminda Leigh, Natasha Senjanovic

by Cecilia Tosi


Marina Astrologo, Darcy Di Mona, Guiomar Parada, Helen Farrell, Fiona Haig, Petra Hunt, Alessandra Guidoni, Rossella Ferri


Global Cosa Nostra





over the river and into utopia


Luca Pizzato -

by Danilo Elia


Laura Baldi -



Gaia Carretta -


lilliput growing again


by Antonio Barbangelo


STAFF srl - Via Bodoni 24 - 20090 Buccinasco (MI) T.+39 02 4570 2415




A stormy roman spring


by David Willey


30 PoiNts oF ViEw Crossed wires between rome and Delhi

Messaggerie Periodici - BOOKSHOP DISTRIBUTION

Joo Distribuzione -

by Antonio Armellini



Messinter - Publication registered with the Court of Milan n. 451 del 21-06-2004 COVER PHOTO: XINHUA/EYEVINE/CONTRASTO



INDIA/EU the risk of spoiling the curry

by Francesco Guarascio

2-3_E Sommario 48_Layout 1 19/06/13 13.26 Pagina 3








The tiger and the elephant editedbyEuropeyeResearchTeam




68 70

The Pink Sari Gang CHAMPIONS







The dragon’s claws 76


Censorship in China byBoydvanhoeij




Chinese theatre experiments





The patent war with Big Pharma


Grow but don’t multiply

Mary Kom, punching across the border

viSuaL aRTS







The blogger and the student The garden of harmonious censorship



A thousand and one tales Anish Kapoor: Essence and Absence


Unseen women picking a fight 49






india /China

The dearest of enemies


The giant in a maze





The Baron of Bangalore That’s Bollywood, darling!


China underground







Good Morning Africa

Exterminating seeds put farmers on the rack

92 East books editedbyClaudiaastarita




From the Bhagavad Gita to cooking shows



Twixt dream and reality



94 out oF this worlD


96 NotEs From isrAEl the old man won’t give up by Manuela Dviri



stakanov lives here no longer by Marcia Aunt



by Priscilla Inzerilli



who’s kim Jong-un and why’s he got it in for me


A meeting with maria Bashir 104


the hawk’s strategy

by Stella Morgana



by Luca Gambardella

the peace pipeline

by Eugenio Buzzetti



by Serena Grassia

war and peace cross borders


by Simone Pieranni

the democratic dream in the land of the Pure by Emanuele Confortin




korea seen from korea by Thomas König


Far from ungrateful Europe; i’m off

by Filippo Di Giacomo



Between faith and revolution


Buddhism in the looking glass of the west

by Francesca Lancini

by Stefano Vergine


GUINEA-BISSAU when drugs buy out a nation

by Tomaso Clavarino

121 FiGuriNG it out edited by Carlotta Magnanini

122 tEChNoloGy&r EsourCEs the new industrial revolution by Ascanio Vitale

124 GrAPhiC NoVEl No comment by Mana Neyestani

126 who’s who

4-5_E Scognamiglio48_Layout 1 18/06/13 17:53 Pagina 4


Angela, Enrico and François’ Europe According to a recent survey entitled “The New Sick Man of Europe: the European Union”, conducted by the reliable Pew Research Center in America, Italy is the least dependable country in Europe according to the Germans, the Spanish and, wait for it, the Italians themselves! by Giuseppe Scognamiglio



hereas Germany is indicated as (can you guess?) the most trustworthy nation by seven out of the eight countries polled (the main ones plus the euro-sceptic Czech Republic), but also the most arrogant by five of them. What’s more, since 2007, Italians in favour of the EU have dropped from 78% to 58%, Spaniards from 80% to 46% and the French from 62% to 41%. Strangely enough, the only country where support for the EU has risen over the last year is the Czech Republic. A few weeks ago, Italian Prime Minister Enrico Letta formed a government comprising 33% women (compared to an EU average of 25%) that is backed by the youngest parliament in the nation’s history, with an average age of 48 (lower than the Bundestag’s 50 and the Assemblée Nationale’s 55). A few days after taking office, Letta flew to Berlin, Paris and Brussels not, he said, in the name of “foreign policy, but domestic policy”, because we’re all in it together in Europe and will stand or fall as one, with no exceptions. This led to the felicitous idea of creating shared policies to revitalise our economies after the longest recession ever experienced by the eurozone since the introduction of the currency (the economic results of the first quarter of 2013 now make it six consecutive quarters in reces-

sion). We must rapidly introduce new actions and measures to repair social cohesion in many countries, agreeing upon initiatives to help young people and reduce the staggering level of unemployment (six million jobless in Spain, 3.2 million in France and just under three million in Italy). We must also design proposals that will free up production resources currently being wasted on industrial structures that often cannot compete on international markets and do not have enough financial backing. At the same time, it is also essential to continue with structural reforms, especially those that address our respective weaknesses (the socalled virtuous countries included), to guarantee long-term competitiveness. According to an IMF report, by 2050 the recent pension reform in Italy will lead to a 34% drop in pension expenditure compared to current values, while spending in this area will increase in the United Kingdom (+13%), Germany (+30%), United States (+38%) and Canada (+43%). east european crossroads

4-5_E Scognamiglio48_Layout 1 18/06/13 17:53 Pagina 5


Y Berlin, 30 April 2013. The Chancellor Angela Merkel and the newly elected Italian Premier Gianni Letta during their press conference. As Letta subsequently stated, his trip to Berlin, like the ones to Brussels and Paris, “were about domestic policy, not foreign policy”.


It would be important to move towards a tax union too, perhaps by gradually increasing the EU budget from the current rather miserly 1% of European GDP to 2-3%, which would allow the European government to implement counter-cyclical policies, as well as stand up to any so-called asymmetrical economic shocks affecting specific regions or countries, as has been happening in recent years in peripheral eurozone nations. Even the strict Germans seem to have come round to the idea that if Italy defaults (Italian GDP accounts for 17% of the eurozone’s GDP, unlike Greece, which only represents 2.5%), not even the €750bn in the European Stability Mechanism (to be used to assuage the effects of the crisis) will be enough to bail out a public debt currently standing at over 2,000 billion euros. By the same token, there is now also growing awareness, especially among industrialists, that the German economic model is, and continues to be, driven by exports mainly destined for markets in European countries that are currently in deficit. As for political union, if even François Hollande has highlighted it as an objective to be achieved within the next two years – thus undermining the infamous ‘Gallic grandeur’ – it could mean we are much closer to the decisive steps required to create a United States of Europe than many analysts claim. Political union is the only way out of the crisis and towards restoring Europe to a leading role on the world stage.

In many European countries, as the Pew survey points out, public opinion tends to blame the euro for the current economic crisis. But if we try for once to forsake the apathetic throwthe-baby-out-with-the-bath-water attitude, we’ll soon see that the problem is actually not having combined the introduction of the euro with the four unions – economic, banking, tax and political union – expressly mentioned by the Italian PM in his government programme. Economic union (and monetary union for eurozone countries) means an integration of markets, and the EU is actually at the forefront of this, even if the financial crisis has called into question some of the fundamental principles of the single market, such as the free movement of capital. The idea of creating a unified banking system is based on the need to break the vicious circle between country risk and bank risk, which is paralysing financial institutions’ ability to support economic recovery. number 48 july/august 2013


6-7_E taccuino bruxelles48_Layout 1 18/06/13 17:54 Pagina 6


Brussels Notebook by James Fontanella Khan


WAR ON TAX HAVENS The veil of secrecy that has protected tax evaders for decades is slowly being lifted leaving their bank accounts more vulnerable than ever. Brussels has finally managed to impose its will over EU member states reluctance to take part in the war against tax havens. For more than three years Algirdas Šemeta, the EU’s taxation commissioner, tried to turn the fight against tax evasion into a priority for the 27 countries forming the union. But EU leaders would simply not take him seriously. Then, earlier this year as austerity programmes (adopted to reduce countries’ fiscal debt through a series of painful cost cutting measures and higher taxes) grew increasingly unpopular, finding alternative solutions to bolster national coffers became of the essence. “These playgrounds of the rich and powerful were largely hidden from the public’s view during the long financial boom,” wrote Jeffery Sachs, the eminent American economist and director of the Earth Institute at Columbia University, in the Financial Times. “In the new world of austerity following the 2008 crash,

however, they are increasingly seen as a cancer on the global financial system that must be excised.” Suddenly, Šemeta saw an opportunity to bring his anti-tax fraud plan back on the table, sharing all banking details related to financial and income revenues of EU citizens across all countries. Essentially, the EU wants to give tax authorities in any given member state the right to verify whether its citizens are hiding their money illegally in another EU country. The Commissioner was aided even further in his quest by a series of

 Semeta the fraud-buster lgirdas Semeta is a Lithuanian economist appointed European Commissioner for Taxation and Customs Union, Audit and Anti-Fraud in 2009. Born in Vilnius, he



graduated in 1985 from the Economic Cybernetics and Finance Faculty of Vilnius University with a degree in economics and maths. Between 2008 and 2009 he was Lithuania’s Finance

Minister, a post he had held ten years earlier between February 1997 and June 1999. He has always worked as a civil servant and is a member of the European People’s Party (EPP).

political and business scandals that brought the war against tax cheats further at the fore of the European agenda. Tax avoiders came under increasing scrutiny after the International Consortium of Investigative Journalism published the names of thousands of tax cheats around the world. The CIJ’s ‘leaks’ unmasked the names of 130,000 individuals hiding cash in tax havens and revealed that as much as $31,000 billion, the equivalent of the US and Japanese economies combined, were being hidden in tax havens. The drive for greater transparency was also fuelled by the explosive admission by Jérôme Cahuzac, France’s now former budget minister, that he had lied about holding €600,000 in a Swiss account opened 20 years ago. Finally, news that several multinationals such as Starbucks, Amazon and Google paid close to no

east european crossroads

6-7_E taccuino bruxelles48_Layout 1 18/06/13 17:54 Pagina 7


EURO CITIZENSHIP PUB QUIZ How many EU citizens live in an EU member states outside their country of origin? An Erasmus student boozing in Salamanca and spending every second

number 48 july/august 2013

weekend in either Paris, London or Berlin (thanks to Ryanair) says confidently: “At least 50 per cent but I’m being conservative”. The London banker, a guy who thinks he has the pulse of the global economy in his pocket, laughs out loud at the ‘guestimate’ made by the student and says: “it’s more like 20 per cent, tops 25 per cent”. Then you ask a worker France’s Lille he answers: “I don’t know anybody living abroad, so I’d say 2 or 3 per cent.” Guess who is the winner? No, it’s the working class bloke. Yes, it might come as a shock but the number of people who move for long periods to another EU country are very small. To be exact: 13.6m out of more than 500m. Brussels is now determined to change this by making it easier for anybody to

move in search for work, especially during tough times of economic stagnation in certain regions of the bloc. As part of an EU citizenship proposal Viviane Reding, EU commissioner for justice, proposed that jobseekers should receive unemployment benefits for 6 instead of just 3 months from their home country while scouting for work abroad; citizens should be allowed to vote in their home countries when abroad; a common EU documents should be made readily available and a unified EU disability card should be granted. These are small steps. Some will be opposed by some more conservative countries (see UK and France) but overall they should go down well. After all in order to build a truly united Europe greater mobility is needed.



taxes in EU countries where most of their revenues were being generated angered the public opinion. Especially in the UK, prime minister David Cameron attacked Starbucks for having paid pretty much zero taxes: “Companies need to wake up and smell the coffee, because the customers who buy from them have had enough.” Mr Cameron contested the legality of aggressive tax planning schemes, which entail shifting profits from high taxation regimes to lower ones, used by multinationals, as it erodes vast portions of a country’s tax revenues. As part of the UK’s commitment to the anti-tax fraud campaign Cameron announced that Britain’s Overseas Territories would also partly be lifting banking secrecy rules. All this pushed Europe’s largest countries, including Italy, Spain, Germany, France and the UK to form a coalition at the European level to convince all member states to unite forces against tax fraudsters. Luxembourg and Austria have traditionally been opposed to sharing financial information on individuals with other EU states but given the pressure coming from the bigger boys they are likely to conform soon. The tide has changed. It is unclear how fast things will change but the days when rich people and companies easily shifted cash from one place to another without getting caught are over. Tax havens, obviously, will continue to exist, but it will be much harder to reach them.

If the Commission’s new effort to bolster EU citizenship convinces you to leave your home country and settle in another member state you’ll soon find out that setting up a new bank account is a nightmare. But luckily this might change too! Michel Barnier, the eclectic French EU commissioner for financial services, has made it his personal mission to provide every citizen in the EU with a bank account. At the moment there are 56m people above the age of 15 that apparently prefer their mattress to the vaults of European banks. Why? Well, often banks are not that welcoming and fees make it impossible for poorer individuals to open an account. Under a new plan, each government will have to guarantee its citizens at least one account in a bank where they can save their money, irrespective of their financial conditions. Banking for all!


8-9_E Bonino_Layout 1 18/06/13 17:55 Pagina 8


Europe: rediscovering its federalist origins For the last sixty years Europe has enabled its inhabitants to live in relative peace, freedom and prosperity. No individual Member State on its own would have had the necessary means to offer citizens the same level of comfort, security and stability. This does not detract from the fact that, today, Europe’s limits are plain for all to see.

by Emma Bonino Italian Foreign Minister



ven a committed believer in Europe such as myself has a hard time approving of the Europe we have today. If Europe had listened more carefully to the warnings and suggestions launched from all sides in recent years, we wouldn’t be in our current position, with anti-European and populist tendencies threatening the core tenets of integration and coexistence. And yet, there are still many voices in the world clamouring for “more Europe”. Every day we see concrete proof of how the EU is still a powerful catalyst, attracting neighbouring countries to the east and south, with a view to future integration. But Europe’s appeal to its own citizens is another matter, and the dream of its founding fathers seems to be gradually but inexorably evaporating. Too often, the European Union appears too self-involved compared to the fast-moving world around it. And it is increasingly associated with the imposition of austerity, which can lead to recession, unemployment and high levels of social tension if not combined with appropriate economic policies to spur growth. One thing is clear: actions to safeguard the fundamental freedoms of democratic states cannot rely exclusively on ethical and civil principles; they must also spring from the need to guarantee the necessary security for development, economic exchanges and investment. We have known for some time now that the violation of fundamental rights goes hand-

in-hand with increased risks for businesses. However, in order to be able to rebut accusations of applying double standards, it is important to ensure coherence between the external and internal dimensions of Europe. A civil country is judged on its laws but also on its ability to respect and enforce them. As Italians we cannot ignore the huge volume of legal cases pending against Italy before the European Court of Human Rights and the fact that we are one of the countries with the highest number of convictions. Most of these cases concern excessive trial length and overcrowded prisons. We must therefore make determined efforts to contrast these ‘serial’ violations: our international credibility is at stake. How can we preach respect for universal values abroad if we’re among the countries with the longest rap sheet from the European Court of Human Rights? After all, the trouble we’re encountering in attracting foreign investments is certainly linked to our inability to put our own house in order. How many foreign investors have ruled out Italy due to the length of its civil trials? How many have been deterred by legal ambiguities and lack of transparency? So, it is in our own best interests to react to all these trends. In order to defend Europe, and its fundamental values, we need to reclaim the original sense of the European project, updating it to meet the challenges posed by the early 21st century. Yet no solution will be credible without a political dimension that fully emeast european crossroads

8-9_E Bonino_Layout 1 19/06/13 07.42 Pagina 9



braces the entire European architecture. We therefore need a federal solution. My support for a prospective United States of Europe is not driven by ideology, but by a careful assessment of costs and benefits. I know of no alternative to federalism that might allow 500 million people – from different nations, cultures, religions and speaking a multitude of languages – to live together in freedom while maintaining their diversity. Especially in terms of institutions’ efficacy in answering citizens’ demands for wellbeing and security and the need to provide a common sense of belonging within a ‘viable’ model that must continue to be inclusive, or crumble. If anyone knows of a better system, please speak up. A couple of years ago I proposed a form of ‘light federalism’, an institutional model that requires no more than 5% of Europe’s GDP to fund basic governmental functions like foreign policy and security, scientific research and major infrastructure networks. Unfortunately, the majority of European governments are reluctant to go down this route, and the negative consequences of this indecision are clear to see: European-level initiatives remain fragmented and ineffective, resources are wasted and Europe risks becoming increasingly irrelevant. 2014 marks the centenary of the outbreak of the First World War. We must not forget what happened to European countries when number 48 july/august 2013

nationalism and demagoguery prevailed. If Europe does not resolve the problems caused by the recession/populism dichotomy, we risk losing everything we have achieved so far. The European Parliamentary elections in 2014 are therefore a crucial test: if we want to avoid populist parties gaining extensive support, we must put federal Europe at the heart of the election campaign. If we embrace a new vision that fully involves our citizens and our governments, we can trigger a new phase of reconstruction and growth, fostering the democratic legitimacy of the European project and the EU’s role as a global player. For Italy – which takes over the rotating presidency of the EU in the second half of 2014 – this will mean the chance to make its voice heard and return to being a full-fledged protagonist in the process of European integration, in line with its natural historical vocation.

\ “I don’t know of any alternative system that could hope to replace federalism and still enable 500 million people of different nationalities, different cultures, religions and languages, to live together freely while preserving their diversity”.


11-13_E Leonard-Goulard BIS_Layout 1 18/06/13 18:07 Pagina 16

PROGRAM 8.00 Registration 8.40 Opening remarks Giuseppe Vita

Chairman, UniCredit

8.50 Key notes address Emma Bonino

Minister of Foreign Affairs

9.10 More or less Europe? The Europe we need Guy Verhofstadt

Klaus VĂ clav

Member, European Parliament and President, Alliance of Liberals and Democrats for Europe Group (ALDE)) Former Czech Republic President

Moderated by Lapo Pistelli Deputy Minister of Foreign Affairs

9.50 EU citizenship and democratic legitimacy: How to build a truly European society


Sylvie Goulard Mark Leonard

EU CITIZENSHIP, DEMOCRATIC LEGITIMACY AND AN ECONOMIC UNION: Defining the Policy Agenda to Build a Stronger Future for the European Union

Franco Debenedetti Giuliano Amato

Moderated by Giovanni Moro President, Fondaca

11.20 Coffee break


11.30 Europe’s future: moving towards a stronger economic and monetary union Daniel Gros Romano Prodi

Federico Ghizzoni Dora Bakoyannis Emma Marcegaglia

Rome Sala della Protomoteca

July 11, 2013

Member, European Parliament Director, European Council on Foreign Relations (ECFR) President, Bruno Leoni Institute President, International Advisory Board of UniCredi

Director of the Centre for European Policy Studies (CEPS) Chairman of the Foundation for World Wide Cooperation, Former President of the EU Commission and Prime Minister of Italy CEO, UniCredit Member, Greek Parliament CEO, Marcegaglia Group

Moderated by Lucrezia Reichlin Full Professor and Director Department of Economics, London Business School

13.00 Closing remarks Enrico Letta

Prime Minister (to be confirmed)

media partner

in partnership with

11-13_E Leonard-Goulard BIS_Layout 1 19/06/13 13.27 Pagina 11


East Forum

A new political geography The euro crisis is reshaping politics across Europe – and creating a widening gulf between the European project and its citizens. Established political parties are fighting for their lives; countries that thought of themselves as European in every respect are finding themselves sidelined. We are witnessing the emergence of a new political geography for the European Union. And this is affecting at least four different aspects of the European project. by Mark Leonard

irstly, at the level of elites: established political forces across the continent have been placed under enormous pressure by the crisis, and are being replaced by new political leaders within the established parties or populist movements that are increasingly defining themselves around the crisis. It is a paradox of the crisis that the governing elites of Europe’s nations are probably the most pro-European in history, but the least able to win support for the integration Europe needs. Since the beginning of the crisis, trust in the EU has fallen from +10 to -22 in France, from +20 to -29 points in Germany, from +30 to -22 points in Italy, from +42 to -52 points in Spain, from +50 to +6 points in Poland and from -13 to -49 points in the UK. What is striking is that everyone in the EU has lost faith in the project: both creditors and debtors, would-be members and ‘opt-outs’. As a result, many established parties are under the political assault from such ‘new kids on the block’ as the Freedom Party in the Netherlands, the True Finns Party, the Danish People’s Party, the UK Independence Party or Italy’s Five Star Movement. Their response has often been to


number 48 july/august 2013

progressively adopt their own anti-European positions and postures, and even criticise their own coalition governments for being excessively pro-European. The second division is between the periphery and the core. To be in or out of various cooperative frames seems no longer a matter of sovereign choice, but stems from various vulnerabilities and discriminatory policies. The term “periphery”, applied to fully-fledged member states of the EU, is now in frequent use in political discourse, generating fear and distrust. The EU has de facto assumed a role of executioner of the creditor states’ blueprint undermining the position of pro-European politicians in the debtor states – but it has failed to reassure citizens in creditor states that their money will be well spent. There are major anxieties outside the Eurozone with new member states such as Poland fearing that the emerging Europe of two or more speeds will relegate it to a peripheral status. They view plans to create a separate eurozone budget as depriving them of access to EU resources, while separate meetings of eurozone MEPs would deny them the

access to key decisions. Meanwhile, some political countries like the UK risk marginalising themselves with chimerical campaigns for a ‘renegotiation’ of their position within the EU. The third dimension is about fracturing the core. Although the new power centre has shifted from Brussels to Berlin this has not necessarily resulted in a more coherent, let alone hierarchical, system of governance. A potentially unbridgeable gap has emerged between Paris and Berlin. Germany has been seen by many as the key player, but Germany feels more like a victim of other states’ misconduct than as a leader imposing its will on the others. In France, President Hollande seems convinced that no European treaty reform could currently formulated that would pass the test of a referendum in France, and so has resisted German pressures towards it. Instead, the president is advocating what he calls “integration solidaire”, arguing that the way forward for the EU must be a gradual process of deeper political, economic and social integration, where new forms of supranational solidarity – such as Eurobonds – are agreed on first followed by with institutional changes to manage them. This is the opposite of the vision of Mrs. Merkel, who insists that the order should be reversed. Meanwhile, the most crucial decisions over the past two years have been taken with little input from the European institutions. This leads to a fourth division in Europe. Instead of a common shared vision for European integration, there is a clash emerging between four different political projects of European integration. The first project is the euro, where leaders are rightly exploring how to create an integrated banking union, fiscal consolida-


11-13_E Leonard-Goulard BIS_Layout 1 19/06/13 13.28 Pagina 12



marginalisation that is being pursued by the current British government. Whereas in the past people talked about a multi-speed or even a multi-tier Europe – today there seem to be trade-offs between different visions. It may be possible to avoid progress on one project being at the expense of another, but in order to do that there needs to be a shared determination to that and a continent-wide debate about how to reinvent Europe for a new generation. A reinvented European project will need to focus on the problems that are important for ordinary citizens rather than for the elites working within the Brussels bubble. European leaders will also need to design a structure for the whole of Europe rather than just the eurozone – showing how the necessary process of integration for the eurozone can be made compatible with the other European visions of a continentsized single market, a pacified neighbourhood, and a European pole in a multi-polar world. But having this kind of conversation will require a revolution in the approach of Europe’s leaders – they will need to engage in political debates about the future of their continent, rather than taking refuge in the technical details of institutional reform.

tion, and measures to legitimate pooled policy decisions. The second project is the single market, which, as Sebastian Dullien has argued, could be an unwitting casualty of efforts to save the eurozone. A full eurozone breakup would shatter the euro, while a great leap toward political union could see shrinkage of the single market, as countries such as the UK or Sweden withdraw from the heart of Europe. Even muddling through the crisis seems likely to diminish the depth of the single market, as banks in the eurozone withdraw from trans-border business, and spreads in borrowing rates force companies to focus on domestic markets. The third project, the


quest to pacify Europe through enlargement and a neighbourhood policy based on the idea of transforming unstable neighbours through open markets and porous borders, is also a casualty of austerity and the inward-looking politics of the crisis. The fourth project is the idea of a global Europe, where European countries pool their collective economic, diplomatic and military assets to take a place in the cockpit of global affairs rather than simply responding to decisions taken in Washington and Beijing. This would obviously be much more difficult to realise if the drive for deeper integration in the eurozone goes handin-hand with the myopic politics of self-

east european crossroads

11-13_E Leonard-Goulard BIS_Layout 1 19/06/13 13.28 Pagina 13


Demos and Democracy Is it worth dreaming of a European democracy? Is there such a thing as the ‘European people’? And if not, how come we talk about democracy without unity? The answers to these highly legitimate questions are often superficial. by Sylvie Goulard European MP (ALDE group, France)

or those opposed to a united Europe, there is no such thing as the people, or ‘the demos’. Therefore it is impossible to imagine an overarching democracy beyond sovereign states. The historical truth is different. In Athens, belonging to a pre-existing demos was not a justification for exercising democratic privileges, it was the reverse: it was commonly-shared decisions that gave rise to a new demos. It was thanks to a farsighted politician in the sixth century BC, Cleisthenes, who started to free Athenian politics from family ties, previously considered as ‘natural’, to finally create a new people. Of course it’s no surprise that ‘tribal’ instincts were opposed to the emergence of an open society. In a rapidly changing world, however, it is not possible to continue viewing the people as an unchanging entity, an eternally fixed point. As the French historian Pierre Rosanvallon writes, in the collective interest, to exclude “a human grouping that is only contemplated in terms of a given homogeneity (...) is not only undemocratic but is also not even political... Compared to the concept of identity, the notion of community is generally reduced to a catalogue of nostalgia and clichés. (...) This is how it becomes passive, conservative, unable to enlighten a future and give meaning to a new world”.


number 48 july/august 2013

Viewing identity as a given is also strange when considering the history of Europe. “The majority of national histories”, wrote Emmanuel Berl, a French historian from the last century, “are mythologies, which were bestowed with an incredible lyrical power and an extraordinarily effective emotional appeal in the 19th century. Not only did they serve to glorify the nation but also to justify and rekindle rivalry between countries (...)”. Nationalists are convinced that Europe is an “artificial” entity. As if our national histories were not literally teeming with lies and staged events. It’s not just the Italians who were ‘made’: the French and German nations also emerged thanks to propaganda peddled in schools and in the army. The purpose of two books like Cuore [Heart] by Edmondo De Amicis and Le tour de France par deux enfants by Augustine Fouillée (published under the pseudonym of G. Bruno), both published in the 1870s, was very similar. Since we live in this context, we are convinced it will be difficult to ‘build’ Europe. In actual fact it is difficult to dismantle the enduring myths and the occasional shortsighted prejudice that blinds us to the existence of these myths. To quote Berl again, to create Europe “there is no need to hide the truth, you just need to say it out loud”. National boundaries have not

put paid to this continent’s great adventures, like the construction of the abbeys, the splendours of gothic cathedrals, the Protestant Reformation and the baroque excesses of the Counter-Reformation. It does not make much sense to separate Flemish from Italian painting when they mutually stimulated each other. Antonello da Messina and Jan Van Eyck would have found it strange, to say the least. At the time of the French Enlightenment, exchanges between philosophers knew no national boundaries. In any case, there is a very simple reason that should push the European people towards union: the euro. If we want to keep the single currency, if it is true that this currency necessitates convergent economic, social, fiscal and budgetary policies, then these areas of interest must also comply with democratic needs. The Council of Europe is providing clear factual evidence that, without a democratic debate about the crucial choices to be made, without the management team being held accountable before a parliament, Europe cannot be effective and will lose legitimacy over time. The emergency of the financial crisis meant quick decisions had to be taken. But one cannot handle a social crisis over the long term, as EU Member States are trying to do. If nothing happens in European governance, not only does Europe risk destruction, but national democracies would also be in danger too. Asking citizens to elect a national-level government where decisions are no longer taken and not allowing them to elect those making the real decisions (in this case the European Commission) can only generate frustration and populism. I think Europe’s number one challenge is not economic, but political.


14-15_E Germania Guerot_Layout 1 18/06/13 18:08 Pagina 14


Germany in the hot seat All eyes in Europe are on the next German general elections. The vote scheduled for the 22nd of September may represent a key event for the future of the European Union, like the construction (in 1961) and fall of the Berlin Wall in 1989.

by Ulrike Guérot



he next German national elections on 22nd September 2013 could trigger another ‘all-eyes-on-Germany’ event. These elections are likely to shape Europe’s future, they will be pro or against Merkel, and will be viewed as a vote on austerity vs. growth. The world will be watching them with one question in mind: will Germany change its European policy? Will it become a little less ideological about the Bundesbank and inflation, a little more accommodating of the interests of its European partners? If Europe had a vote in these elections, Merkel would stand little chance of being reelected. However, only Germans can vote in what could de facto be considered as the first European elections. And the point is that roughly 70% of Germans – never severely hit by the crisis – are in favour of Angela Merkel. It has been jokingly remarked that Germans would love to have a red-green policy run by Merkel. As weird as it may seem, for Germans Merkel is one thing, German policy is something else. So the outcome of the elections is extremely hard to predict – and many in Europe certainly overestimate the likelihood that Merkel might be voted out. German citizens have been living in a mainstream media bubble which has nurtured a pretty superficial account of the Euro-crisis, namely that it’s mainly a problem of an overspending South – an argument that deliberately overlooks the interconnection between Euro-

pean economies and the German co-responsibility for the – disastrous – economic situation in Europe as a whole. If all countries, so the argument runs, behaved like Germany and carried out the same reforms, they’d all be as well off as Germany. A great part of Angela Merkel’s popularity is built on this German success story, with 70% of Germans approving her crisis management and her highly pragmatic stance. The figures seem to prove Germany right: Germany is the only country in the EU with its public finances in the black; where consumer behaviour and export figures show a positive trend and where the crisis seems to have had the least impact. Germans in actual fact see themselves more as victims of the current crisis management in the sense that they are now having to fork out for the other countries, which didn’t do their ‘reform homework’. So the public protests in Germany against continued bail-out packages for Greece or Cyprus, or the necessity to enter a so-called ‘transfer’ union are hardly surprising. Against this backdrop, the ‘Alternative für Deutschland’ anti-Euro party was launched back in April. Yet populism hasn’t curried much favour in Germany so far: the main political parties all support the euro and back pro-European programmes. Recent polls have shown that roughly 2/3 of Germans wants to stay with the Euro. And even though a survey in March this year has it that 26% of Germans might consider voting for the Eurosceptic party in September, at best it will obtain 2% of the votes. Hence, even if this new protest party does not clear the 5% hurdle in the forthcoming elections, it may change the electoral outcome by stealing some 2-3% from the current conservative-liberal majority. In the Berlin chat-rooms, the most likely outcome is a grand coalition, meaning the conservative CDU governing with the Social-Democrats (SPD), as was the case between 2002 and 2005. Although the SPD’s candidate for chaneast european crossroads

14-15_E Germania Guerot_Layout 1 18/06/13 18:08 Pagina 15



cellor has announced he will not govern with Merkel, and the fact that the SPD got little change out of the last ‘grand coalition’, it could happen – but outside of Germany they seem to be overplaying this hand. For example, many French Socialists claim that if only the SPD were in the German government, its policy on Europe might change. True to a point: a grand coalition would surely put more emphasis on social Europe; and the SPD’s election program does not completely rule out debt mutualisation. Plus, a grand coalition might be able to secure the 2/3 majority required for constitutional change essential to introduce a banking union or more. So a grand coalition might not be the worst option for Germany. However, to expect it to lead to a radical shift of German economic policy away from its export focus, its emphasis on price stability or its insisting on both structural reforms and sound public finances, is a recipe for disappointment. A more interesting exercise is considering the chances of other outcomes. Everybody on the Green and on the CDU side still vigorously rules out a conservative-green coalition – though many have been tacitly or openly dreaming of combing the powerful conservative (industrial) establishment with Germany’s progressive forces. The tax increases recently proposed by the Green party have certainly sent shivers down CDU voters’ spines. Furthermore, the arithmetic of German elections is a complicated one due to the two vote system– one for the candidate, the other for the party. Plus, the electoral outcome largely depends on the performance of the smaller parties and whether they manage to overcome the 5% hurnumber 48 july/august 2013

dle: the Liberals (FDP); the internet-party Pirates, very ‘hipster’ still some months ago when earning more than 10% in the local elections of Berlin, but virtually dismantled since then; the ‘Left’ – they could end up with a kingmaker role. A this stage, nothing can definitely be ruled out: not a black-green coalition (though highly unlikely); nor an ‘Ampel’ coalition, meaning the SPD governing together with the Greens and the Liberals, often good for real surprises and possibly prepared to sell their soul to stay in government. The safest bet seems to be that the big tanker Germany will continue to cruise through the European storm after the elections, accommodating a little, but not much. Yes, many Germans have noticed the social uprisings in the South; many have understood that their government’s policy has come under European pressure. Nobody in Germany can ignore the posting of Hitler effigies in Greece or elsewhere and its getting a little uncomfortable. Nevertheless, politics in Germany is a long tranquil river, not about revolutions at all.

\ The elections in Germany in September will capture the attention of the whole of Europe. Today, 70% of the German population approves Angela Merkel’s crisis management and her pragmatic stance.


16-18_E Russia Gudkov_Layout 1 18/06/13 18:08 Pagina 16


Putin’s war against civil society The Kremlin’s initial reaction to the protest rallies against electoral rigging in December 2011 verged on panic. The Putin Administration almost immediately said that it was willing to make concessions, but in actual fact the changes made to the electoral law were merely cosmetic.

Z Two activists kiss during an unauthorised demonstration for gay and lesbian rights in Saint Petersburg. t After the protests that followed Putin’s third election as president, the Duma approved laws that clearly curtail freedom of assembly and association.



n a climate of growing discontent with the government, stagnation and the economic crisis, the numerous corruption scandals involving high-ranking officials that have come to light in recent months have seemed particularly intolerable. Civil society has reacted to the growing social and economic pressures by reporting a whole range of abuses of power, crimes and tax evasion to the press and on the Internet; as well as the dubious origins of assets belonging to influential members of parliament, party officials and politicians; and false academic and scientific credentials, which Russian bureaucrats love to flaunt. In the last year, articles have been published virtually every day about criminal trials and investigations launched by the Prosecutor General’s Office against corrupt officials working within various ministries and public institutions. The most sensational cases have included enquiries into misappropriation and corruption in the Ministries of Defence, Agriculture, Education and Health as well as in the aerospace industry and the Prosecutor General’s Office itself. The construction of facilities for the 2014 Sochi Winter Olympics and preparations for the Vladivostok Summit have also been linked


by Lev Gudkov

east european crossroads

16-18_E Russia Gudkov_Layout 1 18/06/13 18:08 Pagina 17


to scandals. As has the posthumous trial of Sergei Magnitsky, the lawyer killed in prison after blowing the whistle on high-ranking officials and judges. Opinion polls taken regularly since the autumn of 2011 show that confidence in the regime has begun a steep and seeming irreversible decline. The administration has responded not only by instinctively reinforcing bureaucratic cohesion at various levels, from investigating magistrates to top state officials, it has also toughened policies regarding independent movements and organizations and passed measures aimed at suppressing all criticism. In the wake of the imposing protest rallies against Vladimir Putin’s election to a third presidential term, the Duma hurriedly approved a dozen or so slapdash, contradictory and legally questionable laws, which expressly restrict the freedoms of assembly and association. Laws on extremist activity and national security are part of this bundle – and have helped to broaden and loosen the concepts of ‘extremism’ and ‘threat to national interest’ – as is a defamation law, which enables prosecution of anyone publicly criticising officials, politicians or members of parliament. This was followed by the anti-Magnitsky law (in response to the Magnitsky Act approved in the USA and other countries), which equates nonprofit organizations involved in international scientific or humanitarian projects to “foreign agents”; plus a few changes to the laws governing the press that tightened control over the mass media and Internet. The Duma and the president’s “asymmetric” response (according to Russian diplomats) to American measures taken against officials guilty of corruption and human rights violations involved a ban on foreigners adopting Russian orphans and a series of homophobic measures such as the so-called ban on ‘gay propaganda’. The wave of anti-Americanism number 48 july/august 2013

provoked by the propaganda, which has instilled in Russians the idea that children adopted by American parents are mistreated and sexually abused, used for organ transplants and even killed with impunity, was intended to play down the significance of anti-corruption restrictions for Russian officials. The new laws triggered a wide-reaching campaign of repression against civil organizations. Last summer, numerous Russian branches of US organizations (such as USAID) and international humanitarian foundations (including George Soros’ Open Society and the Ford Foundation) were shut down or ceased activities. ‘Inspections’ of non-profit organizations ordered by Putin and begun in February and March were in clear violation of the Constitution, Russian legislation and the Code of Civil Procedure. To date, these investigations – conducted by officials from the Prosecutor General’s Office, Ministry of Justice, Federal Tax Service, antiextremist police department and, at times, even the Public Health Office and the fire department – have concerned over 650 non-government organizations in more than 50 Russian regions. Based on the work carried out by the commissions, the Prosecutor General’s Office issued rulings calling the organizations “foreign agents” and warning them not to engage in political activities. Colossal fines have been imposed on all who have refused to admit to being “spies and subversive elements”, which effectively forces the closure of all activities. The non-profit organizations carry out their activities in all fields of civil society: from environmental protection to treating disabled and sick children, sociological analysis, scientific research, publishing, civil rights defence and the protection of historical records, including the database of the victims of Stalin’s reign of terror (compiled by the international human rights group Memorial). Also included are analytical 17

16-18_E Russia Gudkov_Layout 1 18/06/13 18:08 Pagina 18



think tanks, consumer protection organisations, the Committees of Soldiers’ Mothers of Russia (a network of regional organizations against abuse and torture in the military), women’s organizations and many others. In addition to Putin’s personal thirst for revenge (the day after he was sworn in he reportedly said, “They ruined my celebrations, I’ll ruin their lives”), this offensive stems from the desire to crush all independent associations and to ‘purge’ organisations that could become channels of Western influence, spreading democracy and introducing a controlling element over the authoritarian regime. 18

However, the Russian population is under no illusion as to the purpose of these operations. In spite of the censorship and propaganda, the bare-faced lies and disrepute cast upon the opposition, the majority of people polled for the surveys carried out at regular intervals by the Levada Centre believe that the purpose of these actions is to silence the opposition, isolate and imprison its leaders, and stem the spread of information about crimes and power abuses, in order to reinstate a closed regime in the country and a climate akin to that of a ‘besieged fortress’. However, far from achieving the expected results, these actions only

seem to delegitimize the regime all that much quicker. Putin’s United Russia party, which won the December 2011 elections, is now regarded by most Russians (51%) as “a party of cheats and thieves”. Society views the corruption scandals as a sign of the state’s total decline (according to 80% of people polled in March). Nor have matters been helped by the homophobic campaign promoted by members of parliament in league with the hierarchy of Russian Orthodox Church, or the aggressive anti-Western rhetoric that provokes isolationist and conservative attitudes in the provinces and in society as a whole. east european crossroads

19-21_E Russia Tosi_Layout 1 18/06/13 18:08 Pagina 19


Global Cosa Nostra Ever since Grandpa died, the family has been at war. The godfathers of organised crime in Russia are locked in a ferocious battle to fill the power vacuum left by Aslan Usoyan, a.k.a. Grandpa Khasan, the boss of bosses shot dead in a Moscow restaurant in mid-January.

by Cecilia Tosi


ccording to ‘ancient’ rules hewn by criminals in the prisons and gulags of the Soviet Union, the mafia’s new leadership is chosen at a skhodka, a plenary meeting of the highest ranking bosses, the vor-v-zakone (thieves-in-law). Yet ever since Usoyan’s death, the meetings have failed to yield results, in part because the list of participants is continually changing. Indeed, in today’s mafia it’s hard to determine who rightfully belongs to the criminal elite. Until the early 1990s, the vor coronation had to be held in prison, and the elders only conferred the status on the ‘worthiest’: those who showed the greatest resistance to pain, fiercest hatred of the police and total contempt for all things legal. Then with democracy came deregulation. The mobsters were free to do business above ground and many young men started buying vor positions without ever having set foot in prison. Nowadays, every criminal clan has these second-generation members, whom rival gangs use to discredit their enemies. Which is why the skhodka often resemble Partisan meetings where one boss tries to seize power from another, sometimes even spiralling into bloody shoot-outs between the guests. To avoid bloodshed or (admittedly rare) police raids, in recent years the vor have been organising their meetings abroad, taking advan-

number 48 july/august 2013

tage of the substantial criminal network they’ve built up worldwide. In February, for example, a big meeting was held in Athens, where a bigshot boss, Lasha (“Rustav”) Shushanashvili, was serving time. Shushanashvili was not only able to organise the meeting from jail (where it appears they’ve also built him a swimming pool and a gym), but he also assured the participation of his godfather of choice. In fact, according to Spanish press reports, Georgian gangsterZajhar Kalashov (known as Shakro Jr.) took part in the meeting by video conference call from a prison in Teixeira, Galicia, and was elected to lead the organisation. His fellow vor chose him because they thought he’d be coming home after being released from jail by this summer. But it seems that Kalashov would rather stay in Spain than serve the 18-year prison sentence awaiting him in Georgia. For now, Kalashov wields his power by masterminding clashes between rival groups, backing clans with the greatest chance of winning. Only it’s not easy to predict the victor now that the cards have been shuffled with Usoyan’s death. Before, there was only the historic rivalry between Usoyan and Tarel (“Taro”) Oniani of Georgia, two heavyweight mafia bosses worth $2 billion (€1.5 Bln) each. Today, however, war has broken out among Usoyan’s heirs. The power struggle actually began in 2010, when Oniani’s men tried to kill Usoyan. He survived but was wounded and decided not to take any more chances. Holed up at home, communicating with the outside world via his 30 mobile phones, he had no choice but to delegate public relations to his two most trusted henchmen: Dmitry (“Miron”) Chanturia and Eduard (“Osetrina”) Asatryan. It was the beginning of the end. In December 2010 a skhodka was convened in Greece, but neither Usoyan nor Oniani at19

19-21_E Russia Tosi_Layout 1 18/06/13 18:08 Pagina 20



\ Police forces patrol the centre of Moscow, close to where Aslan Usoyan was wounded. The heads of the mafias in Russia are fighting over who will take over from the dead mafia boss.


tended. The other bosses solved numerous problems on their own and labelled the meeting a success precisely due to the very absence of Usoyan’s who tended to stir up conflicts which most of the mobsters saw no need for. A “young” opposition faction comprising both Georgians and Slavs began to take foot, calling for a new broom in the upper echelons of the syndicates. From Spain, Kalashov joined the dissenters, but once again he turned to an ‘elder’, bringing Oniani back into the fold. Together with the Georgians, he wrote a malyava (criminal letter) that called for a moratorium on all of Usoyan’s appointments, meaning those he had chosen to be vor could no longer lay claim to the status.

Revolt was in the cards, the only thing missing was the trigger. In January, Usoyan was gunned down outside an exclusive Moscow restaurant. His death was welcomed as a liberation, especially by his henchmen, who began an acquisitions and election campaign. Chanturia set a bounty of five million dollars on the head of one of the men suspected of murdering Usoyan and started eliminating members of the opposing faction, killing some of them and getting others arrested. He also tried to convene a skhodka in Dubai, inviting 300 bosses, but what with the arrests and those not too keen, only a handful of vor turned up in the Arab Emirates. He therefore decided it was a better bet to turn his attention east european crossroads

19-21_E Russia Tosi_Layout 1 18/06/13 18:08 Pagina 21



to the businessmen and commercial ventures previously under Usoyan’s control. This is when Chanturia runs up against his old colleague Asatryan, who had fallen out with Usoyan in 2012 but had kept his old ‘rolodex’ of contacts. Asatryan knew all of Usoyan’s business partners and has begun recruiting them. In just two months, tensions grew sky high between the two former associates. On March 23, Asatryan invited his enemies to a reconciliation meeting at a garage he runs near Moscow. The two factions came armed to the back teeth. Asatryan had his son, a vor since the age of 23 even though he has no legitimate claim to the status, and 30 other men with him. Chanturia turned up with 50 gangsters. A fight broke out, with punches and bullets flying. number 48 july/august 2013

Asatryan’s gang fared worse; his men were decimated. So is that the end of it? Chanturia hopes so and is working to become a leader, but his rival still hasn’t given up. Today, Asatryan is very tight with the Georgians and is gathering support among Oniani’s associates. The big absentees in this power struggle are the Slavs. Caucasians – Georgians in particular – currently make up 80% of the active vor members, while the actual Russians, those who started to make money 20 years ago, no longer stoop to this kind of child’s play. They’ve become respectable businessmen , cleverly investing their dirty money in legal activities. Skhodke meetings in garages are beneath them. And honour among thieves has lost out to untold billions.

\ The Russian police take notes next to the body of the victim of an attack by a mafia murder squad in the centre of Moscow last January.


22-24_E Russia Elia_Layout 1 18/06/13 19:23 Pagina 22


Over the River and into Utopia Squeezed between the Dniester River and the Ukraine, Transnistria isn’t recognised by any of the world’s governments. Yet it has its own flag, currency, a capital and a Supreme Soviet with full powers. Welcome to the last of the Soviet socialist republics.

by Danilo Elia



couple of tourists emerge from the hostel in Tiraspol. They might be Dutch, or German. Timoti rubs his hands with glee, since this is his bisniz: sightseers roaming the Soviet amusement park that is Transnistria. “If tourists are happy gawking at hammers and sickles, statues of Lenin and the House of Soviets, why not take advantage of it?” he says. You won’t find it on a map, its capital city isn’t listed among Europe’s capitals and its flag doesn’t fly outside the UN headquarters. The Pridnestrovian Moldavian Republic, or Transnistria for short, is a breakaway territory, formed from the fragments of the USSR when it collapsed. It is, in effect, the last Soviet socialist republic in existence, a strip of land 400 kilometres long, squeezed between the Dniester River and the Ukraine. It’s officially part of Moldova, yet on the road from Chişinău to Tiraspol, the last Moldovan soldier sits in a rusty sentry box several kilometres before the river border. The bridge over the Dniester is garrisoned by the tanks of Russia’s 14th Guards Army, which has been peacekeeping since a 1992 ceasefire. And in the midst of potato fields as fertile as the banks of the Nile, there sits a border crossing that should not exist. Transnistria has dropped out of history. Back when the Soviet empire started losing its first pieces, Tiraspol proclaimed its independ-

ence as the 16th Soviet republic. Gorbachev had other things on his mind at the time, and the decree annulling the secession got lost in the tangles of red tape in Moscow. A few months later, while millions of people from Murmansk to Vladivostok surveyed the ruins of the empire in a daze, Transnistria hoisted its red-and-green flag with the Soviet emblem. It took another year for Moldova, an infant republic itself, to realise that it was missing a part and try to take it back through force. The Red Army, which had never left the region, sided with the 330,000 Russians living on the other side of the river. A few shots were fired, a few lives were lost, but the situation remained as it is today. Timoti doesn’t just manage the hostel; he also takes tourists on sightseeing tours of the east european crossroads

22-24_E Russia Elia_Layout 1 18/06/13 19:23 Pagina 23



\ A bust of Lenin outside the Palace of the Soviets in Tiraspol, the capital of Transnistria, the last soviet socialist republic, yet to be recognised by any government in the world. t Officers in Transistria. According to western police sources Transnistria is a crossroads for illegal trafficking.

small city centre that include “a visit to the House of Soviets, the Lenin monument and the Great Patriotic War memorial.” Tiraspol is a provincial town with pretensions of being a capital: the picture gallery which displays photos of local heroes (cosmonauts, nomenklatura notables and Red Army generals) is immaculate, the billboards have been replaced with Soviet-era effigies while the square once used for military parades nowadays sees nothing more than an old UAZ rattling across it from time to time. In his bestseller Siberian Education, which is set here in Transnistria, native son Nicolai Linin (now a naturalised Italian) describes a country run by gangs that fall into one of two categories: common criminals or honest criminals. Besides Linin’s novel, there have been

number 48 july/august 2013

countless reports from Western police alleging that Transnistria is a crossroads for illegal trafficking, ranging from drugs to heavy weaponry, which has earned the country the nickname of ‘Europe’s black hole’ in the Western media. “Not true,” Timoti swears. “It’s just the sensationalism of the foreign press. They come here for one day, hole up in their hotels and make it all up.” A basic tomato and cheese pizza at Andy’s Pizza in the centrally located 25 October Street costs at least 70 Transnistrian roubles [just under €5], and you’d better spend all you have before you leave the country, since no currency exchange outlet will take them. Anton works at the central bank where they print all the colourful bills used to pay salaries here, and as Monopoly money in the rest of the world. “I love my country”, Anton says. “It’s unique, you know. We’re actually in Moldova, and we can come and go there whenever and however we please. But we’re also Russian. Yet when those who’ve headed over to Russia to find jobs come back here, it smells different, it smell of home.” His enthusiasm is rather uncommon here in Transnistria, but Anton has a good job, unlike most of his compatriots. “People do a lot of waiting around here”, he admits. “We’re all waiting, for things to get better, for our country to become a normal country. But we’re optimistic, since we all voted for Shevchuk”. Yevgeny Shevchuk – the former president of the Supreme Soviet, considered a reformer – won the 2011 presidential elections with a 75% majority, putting an end to the uninterrupted 20-year reign of Igor Smirnov, a diehard Soviet throwback with Brezhnevian eyebrows. Shevchuk represents many people’s hopes for change. “The communist era is finally history, and we’re becoming a post-Soviet state, twenty years later than the other former USSR republics”,’ says Anton. What he 23

22-24_E Russia Elia_Layout 1 18/06/13 19:23 Pagina 24



doesn’t say is that it is not yet clear whether this change of president will make any difference, or what kind of difference at that. Shevchuk is a young technocrat who has forced the old nomenklatura into retirement, yet he does not support Moldova’s EU leanings and looks east instead. During the last Russian presidential elections, he invited all registered Transnistrian voters to choose Vladimir Putin, “to strengthen Transnistria’s ties to Great Russia.” In the late afternoon’s lengthening shadows, the centre of Tiraspol starts to look like a De Chirico painting. “Yeah, it’s pretty dead at night. For nightlife you have to go to Chişinău”, 24

says Dima, and he should know: his band plays plenty of gigs in town, but they prefer playing in Moldova. “There isn’t a lot for young people to do around here. And they don’t have much of a future here either.” Dima (stage name Daniel) plays heavy metal and, at 29, has pretty clear ideas about Transnistria: “This whole story about independence is one big mess. It’s just a game the pols in Moscow and Chişinău play. We young people couldn’t care less. What is Transnistria? The foreign newspapers call it ‘the country that doesn’t exist’, and you know what? They’re right, it doesn’t. It’s just a fantasy dreamed up by the politicians, and we’re all trapped in it.”

It’s evening now and Timoti’s tourists are back. They’ve had a special treat: a full-blown parade for Victory Day, to celebrate the 68th anniversary of the Red Army’s defeat of the Nazis. Under sunny skies, veterans dripping with medals, accompanied by young pioneers, placed wreaths before the eternal flame, as red flags flapped in the spring breeze. “They’ve had their ‘Back in the USSR’ day,” jokes Timoti, “and now we’re going to top it off with a few rounds of vodka. Tomorrow, they go back to the twenty-first century.” For most people around here, though, there’s no return ticket out of the Transnistrian utopia. east european crossroads

East 48 english  

Tigers of the Orient is the title of EAST 48, available at newsagents, in pdf format or from applestore from the 1st of June 2013. Emma Boni...