#12
Financial Times (UK)
16 July 2002
Gulag's prisoners glimpse chance of escape
By Andrew Jack in Moscow

If the city of Magadan in Russia's remote north-east is at the end of the world, Susuman is 630 kilometres beyond. A 12-hour drive north along a dirt road towards the Arctic Circle, the district with its eponymous main town is a crumbling symbol of Soviet-era technical determination and political ruthlessness in defiance of market economics and extreme environmental conditions.

Susuman, once one of the most horrific parts of the Gulag, where millions of prisoners were sent into forced labour in the 1930-1950 purges, survived as a gold mining centre.

After a decade of painful post-Communist economic restructuring, its fortunes may be about to turn. Susuman's inhabitants are set to benefit from a pioneering $80m World Bank pilot migration programme - approved by the federal government this month - that gives them the opportunity to escape their economic prison.

The cluster of settlements make up one of three isolated and uneconomic districts in Russia's "Northern" territories that symbolise the painful legacy of its development policy. Russia's North, home to 12m people, accounts for about half of the surface of the world's land above 60 degrees latitude. In the past, Susuman's harsh climate, which dropped to minus 60 degrees centigrade last winter and rose above 40 degrees in summer, was compensated for by a package of incentives, called the Northern shipment, which represented up to 6 per cent of Soviet gross domestic product.

Young specialists were lured by a spirit of adventure, backed up by salaries and pensions up to double those they could receive elsewhere, free apartments, longer holidays, subsidised food and an absence of the kind of shortages in the "materik" or mainland.

Where the inhabitants were once Stalin's political prisoners, now they are captives of liberal reforms. "I constructed these buildings," says Anatoly Belov, a retired builder who moved to Susuman in 1966 from western Russia, gesturing to battered five-storey residential blocks. "The money was good then, but how can I pay for medicine today? You can't survive on kopecks. We're under arrest here."

Yevgeny Rupasov, an administrator of the pilot programme, says: "In the late 1980s, some of the richest people were in the north. Today they have become the greatest victims. Fifteen years ago, they could return to a better city than they came from, buy an apartment, a dacha, a car and furniture. Now their savings have been burnt, and they are stuck without money."

More than a third of the Magadan region's population has left in the past decade - mainly the employed, the young and the better educated. A significant number of those remaining - pensioners, the sick and vulnerable groups - struggle, on meagre supplementary incomes, to survive against market prices at least double levels elsewhere.

Many cannot afford the cost of transport out. Once there were up to eight flights a week to Magadan city. Now the airport is closed. The daily bus journey to the regional capital costs Rbs 780 ($24.7), or nearly half the average monthly pension. And a one-way flight to the mainland costs Rbs 12,000.

A handful of survivors of the Gulag and their children remain. But many who arrived more recently feel just as trapped. "They talk about a special economic zone in Magadan city. Here we just live in a zone," says Vladimir Chekhovskikh, a journalist, playing on the Russian word for prison camp.

Although local gold is becoming scarcer and more costly to extract, the rise in international gold prices has helped. Susuman can still sustain a seasonal industry of miners, who work round the clock in summer before flying home each October. But the taxes they provide are not sufficient to cover the costs of a local administration over-burdened with expenditure.

Past federal relocation programmes have had mixed results. Apartments earmarked for residents from the North have been constructed elsewhere, only to be appropriated by local authorities seeking them for their own population. Others move, and then find they are remote from the network of family, friends and hospitals which sustained them. A few have even gone back as a result.

Andrei Markov, the World Bank co-ordinator, says one aspect of the new pilot programme is to link the financial support for those who leave with efforts to save on municipal services by regrouping those who remain. He estimates costs can be recovered in this way within six years.

Many are sceptical of the programme. And officials criticise the World Bank and the Russian g overnment for the modest amounts of money available and the bureaucratic delays.

But Sergei Zanin, a retired bulldozer driver, who moved to Susuman in 1966, is enthusiastic about any chance. With a despairing look skywards, he says: "It's useless living here for the last years of my life. I'm ready to leave tomorrow."

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