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31 Jul, 2008 00:20

Revealed: how corruption still blights Russia

Russia’s small businesses are calling for action to combat corruption, which they say is damaging their potential for growth. The appeal comes as the government prepares to unveil a raft of measures to tackle a problem which continues to blight modern Rus

Among those wanting change is Vitaly Petrov, who has been running his own business in consumer goods since 1991. After the collapse of the Soviet Union he says there was plenty of opportunity to make money, but things soon changed and the mafia moved in. He was forced to pay the price in bribes and claims he is still doing so.

He says it is very difficult for a businessman to defend his rights to operate and counteract controlling authorities. “If you don’t pay bribes you have to abandon business and go to court,” he explains.

For Vitaly, it is the constant inspection and regulation which is the biggest challenge, but for others the headache comes in a different form.

Katya Evlentieva recently set up her own PR company, but says she didn’t expect to face so much bureaucracy. She often has to spend up to four hours in a queue to have a paper signed by an official because it’s impossible to do it with an attorney. But in business time costs money.

There are, however, signs of hope as authorities appear to be recognising the problem. Vladislav Korochkin, Vice President of the Association of Small Businesses Opora Rossii, admits that in recent months the government has given indications it is aware of the problem and what measures are needed to tackle it.

Russian President Dmitry Medvedev has expressed his ambition to support small businesses, saying they are fundamental to future development. Speaking at an economic forum in St. Petersburg in June he said curbing corruption, endemic in the country, was among his priorities, as this was the first step in easing the burden.

Also, during a meeting about support for small business, he made remarks regarding a national plan which envisages increased enforcement and greater disclosure of officials' personal finances.

“The first step has been made. Unfortunately the same problems remain. Audits and checks are grinding down businesses. It is important that law enforcement bodies drop attempts to cause nightmares for business,” Medvedev said.