I am on a road-trip at the moment, going around some Russian regions for an article for Euromoney magazine. I have never traveled so intensively in all my life. Euromoney wanted me to visit three regions and write the piece by Wednesday, so I had to do it in ten days. I’ve basically been on the move every day – flying from Moscow to Krasnodar, then from Krasnodar to Sochi, then from Sochi to Krasnodar, then back to Moscow and on to Krasnoyarsk, then from Krasnoyarsk to Karabula by night-train, then from Karabula to Boguchanskaya by jeep, over dirt-tracks. Now I’m in Krasnoyarsk for a few hours, before flying back to Moscow tonight. I’m fairly exhausted. However, it’s on to Tatarstan tomorrow.

Everything’s beginning to blur in together – I have trouble remembering whether the excellent café I found in an airport was in Krasnoyarsk or Krasnodar (actually, it’s in Krasnodar airport – well worth a visit!).

But the predominant impression I have is of a gigantic remont taking place around the country.

I first flew to Krasnodar. The city, once mocked by the rest of the Krai as being little more than a village, is undergoing a $20 billion face-lift. New streets, new squares, new statues, new sewage system.

On to Sochi, where the coastal resort is attempting to re-invent itself as an all-year-resort, with alpine skiing as well as water-skiing. The government wants Sochi to win the bid for the 2014 winter Olympics, so it will be another high-profile event like the G8, to put Russia back on the map.

Thus there is a $12 billion ‘federal programme on alpine resorts’, involving federal money side-by-side with hefty contributions from the main corporate structures – Interros is building a whole resort, as is Gazprom, while other oligarchs like Oleg Deripaska are buying up newly-built infrastructure assets like Sochi airport.

The local administration has massive plans for the area. They lead me around, gesturing at deserted mountains –‘Here’s where the Olympic village will be!’ They wave at a coastal plain dotted with palm trees and wooden huts –‘Here’s where we’ll put the skating rink and ice hockey pitch!’ They’ve got such big plans for construction, they’re having to build a new cement factory in Novorissiisk.

On to Krasnoyarsk. The city’s construction bears the scars of the 1990s. There’s a metro system begun in the Soviet era, but never finished. The money ran out in the 1990s. The tallest building in the city – meant to be the office of the mining ministry – was also interrupted by Perestroika, and never finished. Local businessmen talk about Perestroika as we would talk about the plague, or an attack of locusts. ‘We were going to build a new road here, but then…Perestroika!’

But now the wound of Perestroika is being healed, thanks to United Russia. The Boguchanskaya hydroelectric dam nearby (as in a mere 700km away) was started in 1984, but then never finished, because the money slowed to a trickle in the 1990s. But now construction is back underway, thanks to a new Public Private Partnership, involving Russian Aluminium, UES and the government. The dam will cost a further $3 billion or so, mainly provided by Rusal, who are building a big new aluminium smelter nearby, which will use most of the dam’s electricity.

That’s just the tip of the iceberg. The local administration, headed by United Russia top honcho Alexander Khloponin, plan to develop the whole region of the lower Angara river, centred around the new dam. They want to build a timber factory ($200m); a gas refinery ($2.2bn); a chemical plant ($687m); a metallurgical complex ($1.5bn); three smaller dams ($5bn); plus they plan to develop the Yurubchen oil fields (currently owned by Yukos) and the Vancor oil field (owned by Rosneft). Massive plans are underway.

The local politicians are energized. I ask them what the ideology of United Russia is. One politician, from the Krasnoyarsk Krai assembly, says: “We don’t have an ideology as such. We just get things done. If we get things done, the people will continue to vote for us.” It sounds very reminiscent of the Communist Party – it’s not really a party as such, more a vehicle of action. Why waste time with competing parties? Do it the Russian way – one party, one direction, all together, heave!

The model I see at work reminds me a little of National Socialism. I don’t mean to offend anyone, I mean that I see a tight contract between a dirigiste government and big business, yoked together to drive an economic transformation of the country, building highways, dams, factories etc etc. Obviously, the difference is that National Socialism was geared towards war, whilst United Russia’s model is geared towards international domination through economic might (at least at this stage…)

This model, it seems to me, works well on enormous projects, like hydroelectric dams, highways, ski resorts etc, projects where the president says ‘Let us do this!’ and his minions salute, and go off to do it. Projects that foreigners like me can come and visit, and marvel at the economic might of the new Russia. You might call it Monumentalist Economics. It is not so far from the tradition of Soviet mega-projects, but it’s done via a corporate-state embrace, which the Kremlin calls PPP but seems more like National Socialism to me.

The drawback of such an approach, of course, is that it’s very much top-down, and very politicized. At the beginning you have a big fanfare, the government announces this huge list of projects with billions and billions of dollars in investment, everyone goes ‘Wow!’, but then five years down the line, how many are finished?

And, in such a top-down model where everything depends on the president’s support, what happens if the president changes, if the new president has his own pet projects he wants to order, with a big fanfare etc? Then the monuments stand rusting and incomplete.

Meanwhile, there are all the other regions which don’t manage to put forward such headline-grabbing projects. What happens to them? Are they getting investment too? This is not a rhetorical question, I honestly don’t know. I’ll go to some more backward regions next, like Hakassia, and see for myself.

And what this monumentalist model does not produce is SMEs. It’s all organized right at the top, with one-on-one meetings between President and oligarchs. I have seen a few local companies who grew up from nothing and have made it big – like Magnit, for example, a Krasnodar supermarket chain which is now the biggest chain in the country. Their management don’t give a damn about politics. They go their own way, do their own thing. But such big companies are rare. Most big regional companies I have seen are controlled by some oligarchic group or other, all of whom doff their cap to United Russia. So I don’t see much hope of an alternative political power base emerging, because I don’t really see SMEs emerging. That’s just my impression.

Still, perhaps monumentalism is better than nothing. Things are on the move, jobs are being created, projects that have long stood idle are being taken up once more. It’s too early to criticize. Let’s applaud the ambition of the government’s reconstruction plans, and wait and see how they develop.

Julian Evans, a British freelance journalist based in Moscow.

August 7, 2006