Identifier
Created
Classification
Origin
09MOSCOW555
2009-03-06 13:23:00
CONFIDENTIAL
Embassy Moscow
Cable title:  

YAROSLAVL: AUTHORITIES CONTAIN SOCIAL UNREST IN

Tags:  PGOV PREL PHUM PINR ECON ELAB SOCI RS 
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RR RUEHDBU
DE RUEHMO #0555/01 0651323
ZNY CCCCC ZZH
R 061323Z MAR 09
FM AMEMBASSY MOSCOW
TO RUEHC/SECSTATE WASHDC 2268
INFO RUCNCIS/CIS COLLECTIVE
RUEHXD/MOSCOW POLITICAL COLLECTIVE
RHEHNSC/NSC WASHDC
RUEAIIA/CIA WASHDC
C O N F I D E N T I A L SECTION 01 OF 02 MOSCOW 000555 

SIPDIS

E.O. 12958: DECL: 03/05/2019
TAGS: PGOV PREL PHUM PINR ECON ELAB SOCI RS
SUBJECT: YAROSLAVL: AUTHORITIES CONTAIN SOCIAL UNREST IN
WAKE OF MASSIVE LAYOFFS

Classified By: Political Minister Counselor Alice Wells. Reason: 1.4
(b),(d).

C O N F I D E N T I A L SECTION 01 OF 02 MOSCOW 000555

SIPDIS

E.O. 12958: DECL: 03/05/2019
TAGS: PGOV PREL PHUM PINR ECON ELAB SOCI RS
SUBJECT: YAROSLAVL: AUTHORITIES CONTAIN SOCIAL UNREST IN
WAKE OF MASSIVE LAYOFFS

Classified By: Political Minister Counselor Alice Wells. Reason: 1.4
(b),(d).


1. (SBU) Summary: Despite massive layoffs and public
sentiment worries in one of the economic crisis' hardest hit
areas, for now, authorities in Yaroslavl have managed to
defuse the potential for social unrest in the region. Prime
Minister Putin's December visit to the area to promote job
development notwithstanding, Yaroslavl is bracing for further
economic turbulence as an estimated 20,000 people out of the
city's 600,000 have already been sacked from their jobs, and
more cuts are anticipated. End Summary.


2. (SBU) A February 25-26 visit to Yaroslavl, an historic
Golden Ring city north of Moscow, that relies on the
manufacturing of aircraft and car parts, revealed a region
impacted by the economic crisis. Discussions with
journalists, opposition party leaders, and NGO officials all
maintained that, despite the deteriorating economic
situation, there was little concern that social unrest was
imminent.

Putin's Visit Highlights Regional Woes
--------------


3. (C) The deteriorating employment situation in Yaroslavl
was the focus of Prime Minister Putin's first session of the
government commission on regional development, held in
December, when he visited two industrial enterprises in the
region. Journalists Tatyana Kolesova and Andrey Orlov told
us that Putin visited the aircraft production company,
Saturn, to reassure people in the wake of major job cuts of
government support. Tatyana Borodina, the Head of the Center
of Social Partnership, told us that Putin visited another
struggling factory, Ryabinski Motori, 70 km from Yaroslavl.
Ryabinsk heavily depends on this factory, as 60 percent of
the workforce from this town of only 30,000 is employed
there. The company was unable to pay salaries and, since the
employees were working for free (with wage arrears growing),

Putin allocated token amounts of state funds to the company.
Borodina told us that Putin's visit "was like a show."
Yaroslav Yudin, Deputy of the Yaroslavl City Duma, stated
that Putin went to Yaroslavl "because he had to, but there
were no big results."

Massive Factory Layoffs
--------------


4. (C) In the past three months, Yaroslavl has endured the
loss of over 20,000 jobs, generally in the form of massive
factory layoffs. Additionally, many other factories have cut
their working weeks from five to three or four days.
Kolesova and Orlov worried that the combined population of
three industrial areas, Yaroslavl, Ryabinsk, and Cherepovets,
is about a million people and that since all are experiencing
significant job losses, people are bracing themselves for a
very difficult year. In June 2008, Communists launched
protests at the factory in Motorni Zavod, 30 km from
Yaroslavl, the only enterprise in the town and one that
employed many people from nearby Yaroslavl as well.
Protesters complained about job cuts and cost of living
expenses. According to Kolesova and Orlov, the United
Russia-dominated local and regional governments have refused
permission to the Communists for further public protests;
nevertheless, on January 18, 2009 demonstrations did take
place in Tutaev, about 60 km from Yaroslavl in response to
massive job cuts at all plants in the town.

Other Potential Factors for Unrest
--------------


5. (C) Despite these signs of deepening economic hardship in
Yaroslavl, widespread social unrest has yet to manifest
itself. Borodina told us that the main trade center in
Yaroslavl used to be bustling, but is now tiny; small and
medium-sized businesses are going bankrupt, particularly
since a few monopolies dominate the market; inflation has
increased roughly 25 percent in the past six months (a high
figure compared to other areas that are also experiencing
inflation); communal services have increased in the new year;
and corruption is rampant. Kolesova and Orlov said that
small businesses that pay bribes to bureaucrats will have
difficulty surviving if they are no longer able to afford the
bribes.


6. (C) Right Cause Representative Aleksandr Kubayev told us
how construction plans for Yaroslavl's 1000 year anniversary
in 2011, have ground to a halt. He also stated that "there
is a sense of panic in Yaroslavl, a crisis of trust among

MOSCOW 00000555 002 OF 002


businessmen." He cited recent incidents of bandits stopping
trucks on the road and robbing drivers. He also mentioned
anecdotally that unemployed people appear to be consuming
more vodka as a means of coping when they are unable to find
work.


7. (C) Kolesova and Orlov said they fear that a budget
crisis will occur as revenues fall. In turn, they fear that
the government will not be able to meet its social
obligations. Much like in other parts of Russia, workers in
Yaroslavl lack diverse skill sets since they have worked in
factories in Yaroslavl all their lives and, therefore, have
neither the skills nor the mobility to seek either different
work or work in a new location. Yudin added that there is a
serious credit problem since banks do not want to take a risk
and loan interest rates are extremely high. He was
disappointed that the government has been discussing
unemployment, but has not implemented a concrete anti-crisis
program. Since his government job is unpaid, Yudin, himself,
works a second job at a travel agency. Although at first he
appeared composed behind his expensive Roberto Cavalli tie,
he then confessed that the tourism business was so bad that
he, himself, was looking for a new job!

Opposition Groups Keep Low Profile
--------------


8. (C) Aside from the Communist protest and some minor
protests in outlying areas, opposition groups are not robust
in Yaroslavl. According to Borodina, "opposition groups are
not very active" in the area. As an example of the town's
stability, she told us how the mayor has been in power for 20
years. The newly-formed Solidarity Movement held a small
gathering in the end of February to discuss the financial
crisis, but it was a peaceful and non-confrontational event.
Kubayev and Yabloko Deputy Chair Marina Kandybina both said
that they would not participate in the event since they do
not have close relations with the other opposition parties in
the area. They both agreed that opposition groups would not
make waves in the area, even during economic upheaval.
Deputy Yudin said that people are afraid about the state of
the economy, but that they are just sitting at home and are
not protesting. He told us that "the opposition does not
have any power so there are no protests."

Lack of Media Access
--------------


9. (C) Journalists Kolesova and Orlov both complained that
there is very little information in Yaroslavl about the
crisis. They maintained that people are unaware of the
deepening crisis and are only able to obtain news via
Moscow-based, state-run election media outlets. Borodina
said that the number of media outlet correspondents in
Yaroslavl has been cut due to the lack of advertisement
revenue. Her organization runs a small, free newspaper with
a circulation of 2000, which the National Endowment for
Democracy and Soros funded. She has faced considerable
harassment and her young daughter who works with her was
arrested twice in connection with her research for this
newspaper. Yudin stated that the media is unable to write
what it wants regarding the crisis, but that there are still
some stories in the more expensive publications.

Comment
--------------


10. (SBU) Yaroslavl may be typical of many Russian regions
feeling the economic pain of the sharp downturn. Despite
layoffs, tight governmental controls, limited information,
and negligible social movements or opposition political
parties to take advantage of citizen upset have kept
prospects of mass social unrest low for now.
BEYRLE