While Western governments delude themselves that their economic sanctions are hurting the Russian economy, the reality behind the surface is very different. The decisions taken by the European Union, the United Kingdom and North America are not sufficiently coordinated and reduce the ability of the cunning Russian oligarch to evade them, especially in such vital sectors of the global economy as food.
The question is not just whether oligarchs can still enjoy luxury housing or mega-yachts, though there is plenty of evidence of that: for example, the Tel Aviv suburb of Herzliya has a $65 million Roman Abramovich-designed villa and billions of dollars worth of luxury. The property of fertilizer businessman Moshe Kantor. Abramovich and Kantor are certainly not sitting in the rubble of their homes left without water and with intermittent electricity due to Russian bombing. The worst consequences of the war they have suffered is that the penalties imposed on them lead to a temporary loss of social prestige, even unscrupulous charities feel remorse.
Cantor, who had been president of the Congress three times, had to be reluctantly given up by the European Jewish Congress, as did many Holocaust memorial charities. Presumably, the King and Tony Blair aren’t too thrilled about Cantor’s donations to their favorite causes. But you don’t have to have the ingenuity of a lawyer to turn your holdings into large corporations in a way that makes actual ownership appear to vanish. Otherwise, how could Abramovich have been able to buy a Dutch football team (Vitesse, ed.) when he already owned Chelsea?
Fertilizers are very big business, worth US$250 billion globally. Russia and Belarus are important players in this industry, especially in nitrogen and potassium. Fertilizer giant Akron, led by Cantor, still operates potash mines in Canada, though his name appears on that country’s list of sanctioned oligarchy. In fact, his mine is right across the road from where the Canadian military conducts training programs for Ukrainian soldiers.
Joint ventures are another way to evade penalties. The Rio Tinto Group’s annual report reveals a partnership with an innocent name – “CanPacific Potash Inc” – which has a $500 million mine under development in Albany. Although Kantor transferred its controlling stake in Akron to three associates, it still owns 40% of the company. Under UK sanctions, dealing with frozen funds or economic assets owned, owned, held, or controlled by a sanctioned person is prohibited. Is it by the UK and Canadian governments to plug this leak?
Cantor may be annoyed that he can’t visit his multimillion-dollar home in the Hampstead garden suburb, but nothing has been done to curtail his earnings because two governments that support Ukraine are not working together. While we hear a lot about Russia having to redirect oil and gas exports to India and China, work continues in other sectors regardless: fertilizers but also nuclear services.
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