Economic crisis threatens Kremlin control of North Caucasus

Analysts say Islamist extremists have infiltrated the region and that worsening poverty may drive people towards the rebels who have previously sent kidnappers and suicide bombers to attack Russian cities.

Financial support is a tool for the Kremlin to dampen support for the rebels but Russia's cash reserves have shrunk by some 40 percent to about $385 billion (270 billion pounds) since last summer.

In Russia's original budget for 2009, Chechnya's government said it had been promised around 24.5 billion roubles (474 million pounds) -- worth about $1 billion before the currency devalued by about a third. The other North Caucasus regions were also promised billions.

But Russia's finance ministry will soon announce a revised budget based on an average oil price for the year of $41 per barrel, less than half the initial price. Some of the shortfall will be covered by a budget deficit.

Chechnya's pro-Kremlin president, Ramzan Kadyrov, has voiced concerns about funding.

"We're feeling the crisis like everywhere else," he told the state-owned Rossiskaya Gazeta newspaper last week. "However, I have written a letter to Moscow and I hope to defend the budget from being reduced."

Chechnya has been the main focus of the Kremlin's drive to restore its control in the north Caucasus.

Former President Vladimir Putin, now a powerful prime minister, handed the Kadyrov family power in exchange for a pledge of loyalty to Moscow and help battling the rebels.

Using Kremlin money Kadyrov has presented himself as the saviour of Chechnya, rebuilding the region.

But financial problems threaten that relative stability, said Garry Kasparov, a Kremlin critic and former world chess champion.

"The only reason he (Kadyrov) is still staying with Putin is because we are paying him a ransom," he told Reuters.

Russia can't afford to pay tribute to its Caucasian muslim overlords anymore?

Didn't they plunder enough booty during their genocidal jihad against the Christian nation of Georgia to satisfy the muslim Chechen "ex-terrorists" in the Red Army?

1 posted on 02/17/2009 12:32:26 PM PST by Tailgunner Joe

I don't know what Russia's waiting for. Start a war somewhere, especially near the M.E..

Gas prices will jump. Instant cash influx.

2 posted on 02/17/2009 1:10:33 PM PST by mountn man (The pleasure you get from life, is equal to the attitude you put into it.)

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