News / Europe

Behind Putin’s Surprise Release of Khodorkovsky: Sochi and Self-Confidence?

Russian President Vladimir Putin smiles as he takes part in a televised news conference in Moscow, Dec. 19, 2013.
Russian President Vladimir Putin smiles as he takes part in a televised news conference in Moscow, Dec. 19, 2013.
James Brooke
Two weeks ago, Russian prosecutors told reporters they were preparing a third case against Mikhail Khodorkovsky, the Russian oil tycoon who had already spent a decade in jail.

Then, unexpectedly, President Vladimir Putin on Friday pardoned the man who was once his biggest political rival. Within hours, Khodorkovsky received a foreign travel passport, was whisked by helicopter from his penal colony near the Arctic Circle, and flown by private plane to Berlin.

Why did Putin suddenly release a man long seen as Russia’s most prominent political prisoner?

Ben Aris, executive editor in Moscow for Business New Europe, a financial magazine, said Russia’s president is preparing the country for the spotlight, as the world is about to descend on Sochi for the Winter Olympics.

“Mr. Putin wants to present the best of the face of Russia to the future, to encourage people: ‘Here is the new Russia, we are growing, and we are emerging as an economic power in Europe. And we want to deal with you, on a commercial basis at least,’” said Aris.

'Christmas amnesties'

Khodorkovsky is the most prominent of what are known here as “the Christmas amnesties.”  By January 7, Russian Orthodox Christmas, Russia’s new amnesty law is expected to free from jail two women from the punk rock band Pussy Riot and drop charges against the 30 people arrested aboard a Greenpeace ship following a protest in the Russian Arctic last September.

Chris Weafer, a partner with Macro-Advisory, a Moscow-based investment consultancy, said Putin is trying to remove high-profile irritants with the West.

“A great focus from the Kremlin over the next couple of months is to try and project a more positive image, to deflect some of the criticism that has been coming its way, for this year and for many years,” he said from London.

With Russia’s economy stagnating, the Kremlin may feel it is paying a high price for constantly irritating the West. Two years ago, Putin campaigned for election promising 5 percent annual growth; but, growth this year and next year is forecast to be around 1.3 percent.

While foreign investment levels have fallen, domestic capital flight from Russia continues at a high rate. This year, capital flight is to hit $75 billion - making for a total exodus of $400 billion since the recession of 2008.

Khodorkovsky was the richest man in Russia when he was jailed and his oil company taken over by the state. The impact on foreign investors was big.

Drawing investors

Of Khodorkovsky's release Friday, Aris said, “It is hugely significant, since he has come to personify a lot of the problems that investors have, or face, when they come to do business with Russia. It’s the insecurity, the lack of property rights, and the fear that you have your assets taken away by the state if you fall afoul of the government.”
Weafer sees it only as a step down the road to the rule of law, greater protections for private property, and cutting bureaucratic controls,

“This does not in any way change the investment climate,” he said. “This is not going to result in investors queuing up with their checkbooks to invest in the economy - absolutely not.”

In 2003, when Khodorkovsky was jailed, Putin believed the businessman was building a political base to challenge him. Since then, Khodorkovsky consistently criticized Russia’s president in newspaper articles and interviews. He charged that Putin was needlessly dragging Russia down an authoritarian road.

At the same time, public attitudes in Russia gradually shifted, from seeing Khodorkovsky as a 1990s robber baron, to respecting him for spending years in jail and sticking to his principles. Now Khodorkovsky is out of jail and has access to the part of his fortune that he had moved overseas.

Aris said he believes that Putin’s decision to release Khodorkovsky reflects “how confident Putin now feels in terms of running the country.”

“The fact that he is willing to let someone, who could turn out to be a major and well-funded political enemy, to let him out of jail,” demonstrates Putin’s political self-confidence. Skeptics note, that barring a third trial, Khodorkovsky would have to have been released from jail next August, the end of his term.

Praising release

On Friday, Russia’s democratic opposition hailed Khodorkovsky's release.

Lyudmila Alexeyeva, who heads the Moscow Helsinki Group, told Interfax on Friday, "I am convinced that Mikhail Borisovich is well-equipped to play the role of a spiritual leader who will provide moral guidance. No matter what Mikhail Borisovich decides to do, he will become an unconditional spiritual leader, whom our society needs so urgently. Gandhi, Sakharov and Havel were such leaders."

After his release, Khodorkovsky released a statement from Germany saying that his top priority is to rejoin his family.

Weafer recalls similar statements in recent years. “He intended to live a quiet life. He did not want to get involved in politics. He did not want to be any sort of opposition figurehead.”

Khodorkovsky turned 50 last June. Many here believe that after a year or two, he will be drawn back into politics, lending his prestige and financial resources to Russia’s largely leaderless democratic opposition.

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