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Russia's economy won't be fixed by the removal of sanctions

It is the country's capacity to change from within that will determine its economic prospects.

Vladimir Putin has probably never looked forward to any year as much as he is looking forward to 2017. With Donald Trump settling into the White House and Europe in political disarray, the Russian President will feel that his decision to face down the west over Syria and Ukraine has been vindicated. His fortunes will continue to rise if, as expected, the French Presidential election in May becomes a run-off between two pro-Putin right-wingers, François Fillon and Marine Le Pen. With a bit of luck he might even see the back of his staunchest opponent, Angela Merkel, when Germany votes in the autumn.

After two years of recession, Putin has reason to hope that at some point this year western economic sanctions imposed after the annexation of Crimea will be eased, if not lifted altogether. Yet any euphoria would be misplaced. At best, sanctions relief will help Russia to return to the state of economic stagnation that prevailed before the Ukraine crisis when annual growth had already slumped to 1.3 per cent, despite high oil prices. The World Bank is currently projecting growth rates of 1.5 per cent to 1.8 per cent over the next three years – well below the global average and nowhere close to the 7-8 per cent growth that was typical of Putin’s first two terms in office. This will limit his ability to restore the domestic bargain by which Russians accepted the loss of political freedom in exchange for a rapid expansion of living standards.

Although, like all countries, Russia is affected by global economic conditions, its biggest problems are homegrown. Chief among them is a business environment that stifles enterprises and deters investment. The impact can be measured in net outflows of capital running to tens of billions of dollars each year. Put simply, those who make money in Russia try to move it abroad as soon as they can, while foreign companies willing to invest in Russia are too few to make up the difference. The result is that Russia is starved of the investment and technology it needs to modernise its economy and reduce its dependence on natural resources.

A major challenge to improvement of the Russian business sector is the weakness of property rights and uncertainty over the rule of law. Entrepreneurs are often reluctant to establish new businesses or expand existing ones in case they attract the attentions of criminals and opportunists who use powerful connections to seize property in a widespread practice known as reiderstvo, or corporate raiding. In contrast to the western-style of corporate raiding, in which hostile takeovers are pursued by legal means, reiderstvo relies mainly on a post-Soviet mix of corruption and criminality.

The typical raid involves the arrest of a business owner on false charges of tax evasion or some other economic crime, facilitated with bribes to local law enforcement officials. While the victim is safely out of the way in pre-trial detention, ownership is changed with the help of forged papers and a corrupt judge prepared to certify them. Sometimes armed thugs are hired to take physical control of the targeted business. By the time the real owner is free, their assets have been taken and no legal remedy is available.

The scale of this problem is vast and apparently growing, affecting businesses of all sizes. As President Putin himself acknowledged, of the 200,000 economic crimes investigated in 2014, only 15 per cent resulted in a conviction while 83 per cent led to someone losing their business. He concluded: "The vast majority … got harassed, intimidated, robbed and then released." Of course, the Russian President is hardly blameless. The two most infamous examples of reiderstvo – the seizures of Yukos Oil and Hermitage Capital – were orchestrated at the highest levels of the Russian state. While Putin clearly understands that the national economic interest demands an end to this epidemic of property seizures, nothing will change unless an example is set at the top.

Increasingly, cases involving reiderstvo make their way into western courts and international tribunals where property rights can be effectively enforced. London has become perhaps the main international centre for hearing cases of this sort because many Russian business contracts include clauses allowing disputes to be settled in the English Commercial Court or the London Court of International Arbitration. Ireland is another jurisdiction in which major reiderstvo cases, historic and current, have recently come to court.

The US Congress has also recognised the challenge this presents, not just to the Russian economy, but also to international judicial cooperation. Last autumn, the Lantos Commission for Human Rights, an official arm the House of Representatives, organised a briefing on Russia’s misuse of Interpol arrest warrants to harass and demoralise victims of corporate raiding in exile. Despite President Trump’s declared willingness to remove sanctions and restore friendly ties with the Kremlin, Russia’s corrupt business culture will remain a serious impediment to economic cooperation with the US.

In economic terms, Russia is now at a fork in the road. Alexei Kudrin, the former Finance Minister who retains some influence as an adviser to Putin, has proposed a reform plan designed to achieve average growth rates of 4 per cent through an expansion of the private sector. Central to Kudrin’s vision is the creation of a judicial system capable of defending property rights. A rival plan supported by prominent conservatives calls for higher borrowing to fund state spending without any serious structural reform. As long as Russian businesses feel the need to outsource the rule of law to foreign courts in the absence of a better domestic alternative, there will be a cap on growth and Russia will be unable to recover its status as an emerging nation. It is Russia’s capacity to change from within, not the issue of sanctions, that will determine its economic prospects.

David Clark was Robin Cook’s special adviser at the Foreign Office 1997-2001.

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Is Google Maps discriminating against people with disabilities?

Its walking routes are not access-friendly.

“I ended up having to be pushed through a main road in London, which was really scary.” Three weeks ago, Mary Bradley went to London to visit her daughter Belinda, who is just finishing her first year at university there. Her other daughter joined them on the trip.

But what was supposed to be an enjoyable weekend with her two children turned into a frustrating ordeal. The apps they were using to find their way around kept sending them on routes that are not wheelchair-friendly, leading to time-consuming and sometimes frightening consequences.

Bradley has been using a wheelchair – when having to go longer distances without a vehicle – for over a year, due to a 45-degree curve in her spine, severe joint facet deterioration in her back, and other conditions.

She lives in Weston-super-Mare in Somerset, and has made the trip up to London to visit her daughter a handful of times. Each visit, they use Google Maps and the transport app Citymapper to find their way around, as neither of them know London particularly well.


Belinda and Mary Bradley. Photo: Belinda Bradley

“It was just horrible,” says Bradley of her most recent trip to the capital. “We’re following the maps, and we go along, then find we are faced with a footbridge, and realise there was no way I was going to get over it, so we had to go back the way we’d come. At one point, we were faced with a strip of narrow pavement the wheelchair couldn’t go down. That was something we found all weekend.”

While Google Maps did highlight accessible Tube stations, they found that once they had alighted to do the rest of the journey to their destination on foot, “it took us three times as long, because the route that it takes us just wasn’t passable”.

They ended up having to try different routes “having no real idea of where were going”.

“It meant that it took so much longer, the girls ended up having to push me for longer, I got more and more embarrassed and frustrated and upset about the whole thing,” Bradley tells me.

At one point, her daughters had to take her down a main road. “Being pushed on a road, especially in London, is scary,” she says. “It was scary for me, it was scary for the girls.”

When they returned home, Belinda, who is a 19-year-old Writing and Theatre student at the University of Roehampton, was so furious at the situation that she started a petition for Google Maps to include wheelchair-friendly routes. It hit over 100,000 signatures in a fortnight. At the time of writing, it has 110,601 petitioners.


Belinda's petition.

Belinda was surprised that Google Maps didn’t have accessible routes. “I know Google Maps so well, [Google]’s such a big company, it has the satellite pictures and everything,” she says. “So I was really surprised because there’s loads of disabled people who must have such an issue.”

The aim of her petition is for Google Maps to generate routes that people using wheelchairs, crutches, walking sticks, or pushing prams will be able to use. “It just says that they’re a little bit ignorant,” is Belinda’s view of the service’s omission. “To me, just to ignore any issues that big needs to be solved; it needs to be addressed almost immediately.”

But she also wants to raise awareness to “make life better in general” for people with disabilities using navigation apps.

Belinda has not received a response from Google or Citymapper, but I understand that Google is aware of the petition and the issue it raises. Google declined to comment and I have contacted Citymapper but have not received a response.

Google Maps does provide information about how accessible its locations are, and also allows users to fill in accessibility features themselves via an amenities checklist for places that are missing that information. But it doesn’t provide accessible walking routes.

“There’s no reason that they couldn’t take it that bit further and include wheelchair accessible routes,” says Matt McCann, the founder of Access Earth, an online service and app that aims to be the Google Maps for people with disabilities. “When I first started Access Earth, I always thought this is something Google should be doing, and I was always surprised they haven’t done it. And that’s the next logical step.”

McCann began crowdsourcing information for Access Earth in 2013, when he booked a hotel in London that was supposed to be wheelchair-friendly – but turned out not to be accessible for his rollator, which he uses due to having cerebral palsy.

Based in Dublin, McCann says Google Maps has often sent him on pedestrian routes down cobbled streets, which are unsuitable for his rollator. “That’s another level of detail; to know whether the footpaths are pedestrian-friendly, but also if they’re wheelchair-friendly as well in terms of the surface,” he notes. “And that was the main problem that I had in my experience [of using walking routes].”

Access Earth, which includes bespoke accessibility information for locations around the world, aims to introduce accessible routes once the project has received enough funding. “The goal is to encompass all aspects of a route and trip,” he says. Other services such as Wheelmap and Euan's Guide also crowdsource information to provide access-friendly maps.

So how long will it take for more established tech companies like Google to clear the obstacles stopping Mary Bradley and millions like her using everyday services to get around?

“You can use them for public transport, to drive, you can use them if you’re an able-bodied person on foot,” she says. “But there are loads of us who are completely excluded now.”

Sign Belinda Bradley’s “Create Wheelchair Friendly Routes on Google Maps" here.

Anoosh Chakelian is senior writer at the New Statesman.