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Simeon Mitropolitski is a Canadian analyst, of Bulgarian origin, and a former syndicated columnist with the Bulgarian News Agency (BTA). He is the author of several hundred articles dealing with hot political and economic topics, both national and international.

He was part of the first group of Bulgarian intellectuals and students that began the opposition movement that finally put an end to the communist regime in this country in 1989, and in 1996-1997 participated in international observation teams during the elections in several Balkan countries - Romania, Albania and Bulgaria.

In 2002 Simeon and his family moved from Bulgaria to Canada where they live now in Montreal, province of Quebec. Simeon is a Master of Political Science from McGill University and a B.A. of Political Science and History.

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• Russia 2000
  
• Russia 2000, 2
  
• Russia 2001
  
• Russia 2001, 2
  
• Russia 2002
  
• Russia 2002, 2
  
• Russia 2002, 3
  
• Russia 2003
  
• Russia 2004
  
• Russia 2005
  
• Russia 2006
  
• Russia 2006, 2
  
• Russia 2007
  
• Russia 2007, 2
  
• Russia 2007, 3
  
• Russia 2008
  
• Russia 2008, 2
  
• Russia 2008, 3
  

At the beginning of 2001 we also suggested that the real estate market in countries like Russia is not a result of the relationship between the supply and the demand, but mainly is an outcome of the government policy. That also proved to be true in the last 12 months. Using the bigger than expected incomes from selling oil and natural gas abroad, Russian government through the Russian Central Bank intervened on the currency exchange market. With the official inflation of more than 20 percent and Russian Ruble devaluation of less than 10 percent against the US dollar the real estates were made artificially more expensive by more than 10 percent in nominal dollar terms. If God allows, Mr. Putin will try to repeat this trick in 2002.

What will come next everyone knows well looking at the Russian experience from the middle of 90s and also at the present crisis in Argentina. You can't indefinitely to suppress the dollar on the currency market and at the same time to have internal inflation bigger than that in the US. With the oil prices above 30 dollars per barrel Russia can divert tens of billions of dollars to keep the Ruble from devaluation. Another thing is when the oil drops below the bar of $20 per barrel. The financial crisis in Russia in 1998 occurred when the oil dropped below $15 per barrel.

So what we should expect in Russia in 2002. I guess that the President Putin is trying to erase all the traces from the financial crisis in 1998. To do so he must keep the dollar under control, which means to use the ever-bigger share of the dollar incomes for buying inflationary Rubble. Given the huge dollar reserves accumulated in 2000-2001 the Kremlin will have a partial success in 2002 even if the oil prices keep around the level of $20 per barrel or less.

Even with the partly artificial increase of the real estate prices in dollar terms in 2001 they stay at 80 percent of the pre-crisis levels of August 1998 in Moscow and even less in other major Russian cities. Thus to surpass the pre-crisis levels will take another 12-24 months for the capital and many more for the rest of the country. The point is whether the President Putin will have in that period favorable international economic conditions like in 2000-2001 and the answer is rather negative.

One year ago we also predicted that the main goals of the Russian President toward the western powers would be to stop paying on foreign obligations and at the same time to try to attract as many as possible foreign investors. And that the extra money will be directed for the military purposes. In this case we can say that he failed on both fronts. He failed after trying to push Western governments one against the others in order to gain maximum space for moving. The terrorist attacks on 9/11 united the West as never before and the Russian President was the first to acknowledge that.

But will he turn down his policy of hidden antagonism with the West; will he accept that every country situated between NATO and Russia has a right to be a part of the West? Definitely no. We should expect that Moscow use every possible mean - political, economic and even military (towards some former Soviet republics) to stop that process. In Russia this drift to increase the country influence abroad is very popular. Most Russians still believe that their country represents a particular kind of civilization that can't be built-in within the western political and economic structures. They also believe that their country as a legitimate successor of the former Soviet Union has a right at least to try to occupy his place in the world.

One joking example of this anti-western mentality is the fact that Russia still celebrates the Christmas on 6th January. When asked these days whether they want to change from the old style (Julian calendar) to the western style (Gregorian style), more than 50 percent of Russians said "No" and only 30 percent were ready to change their habits under some conditions. When asked why they don't want to change the Orthodox Christmas from January to December these 50 percent of Russians said simply 'Because the West celebrates in December'.

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