RUSSIA - Profile - Boris Nikolaevich Yeltsin

Described by some as a "drunken despot" and by others as a "successful tactician", President Yeltsin has been stunning the world since he was elected to a second term on July 3, 1996. On March 23, 1998, he fired the entire cabinet of Victor Chernomyrdin, 60, and brought in Sergei Kiriyenko, 36, to form a government. On Aug. 23, in the full blaze of Russia's financial crisis, he fired the cabinet of Kiriyenko and re-appointed Chernomyrdin as "interim prime minister" with "extra powers". But Yeltsin, now aged 67, may not last long.

What happened between the two events will not influence developments ahead. On July 13 the IMF announced a $22.6 bn loan package for Russia; the share and bond prices boomed. On July 17, the Duma failed to pass most emergency measures recommended by the IMF; the financial markets fell again. On Aug. 17, the Kiriyenko government announced it will default on some of its debt and let the rouble fall in value. The oligarchs, or "robber barons", were furious.

Kiriyenko then offered to resign but Yeltsin ordered him to remain in office and stay the course. The young premier had earlier told the Duma: "We were faced with a choice of whether to first pay investors and banks, both Russian and foreign, who invested in GKOs (treasury bills) or to pay wage arrears" - with unpaid coal miners still camped outside the government house. "We have just entered a serious financial crisis. In these conditions we cannot afford the luxury of being a popular government". When Duma's calls for Yelstin to resign grew louder in the subsequent, with Chernomyrdin having formed a strong alliance, and the oligarchs moved decisively to back the latter, Kiriyenko was fired.

Chernomyrdin said on Aug. 23: "The first thing I am going to tackle as interim prime minister is an analysis of the situation on the financial and stock markets". The analysis will take time and rumours will continue to swirl around that Chernomyrdin would be in place to take over as acting president, according to the constitution, should Yeltsin be forced out before his term expires in 2000. Presidential elections would be held within three months. It would be a new cycle of uncertainties for both Russian and foreign investors.

Yeltsin was born to a peasant couple in the Urals mountain village of Butka, near Sverdlovsk (now again called Yekaterinburg) on Feb. 1, 1931. He had a childhood marked by mistreatment from a stern father. As a boy, he spent long hours caring for his siblings while his parents toiled.

During World War II, Yeltsin broke into a church that was being used as an armoury and stole two hand grenades which he and a group of friends wanted to take apart to examine. One of them exploded as Yeltsin attempted to dismantle

it by hitting it with a hammer, resulting in the loss of his thumb and forefinger on his left hand - a physical disfigurement which still embarrasses the Russian leader today.

That situation illustrated Yeltsin's lifelong attraction for situations fraught with risk but promising big rewards if capped with success. However, he was not an exceptionally intelligent man. He certainly was not as cunning as other apparatchiks like Arkady Volsky who rose to higher ranks through their intrigues in the industrial sector.

In 1985, Mikhail Gorbachev called Yeltsin to Moscow to head the Moscow branch of the Communist Party. With Gorbachev's backing, Yeltsin got a seat as an alternate member of the party's ruling Politburo. But Yeltsin's calls for fast-paced reforms alienated him from Gorbachev who, in 1987, ousted him. Yeltsin was reinstated three years later and, eventually, became head of the Russian parliament.

On June 12, 1991, Yeltsin was elected president of the Russian federation, receiving almost 60% of votes cast by the Russians, together with his running mate Alexander Rutskoy as vice president. That was the first free presidential election to be held in Russia's history. Chechen-born Ruslan Khasbulatov gave Yeltsin much support during election campaigns, having become acting speaker of parliament. Yeltsin installed his presidency at the parliament building called White House, with the office of the Soviet President Gorbachev then in the Kremlin.

(The then 44-year-old Rutskoy, a former air force colonel and hero of the Afghan war, had his political birth in late 1990 when he joined Volsky's centrist Civic Union. Volsky had formed the CU in parallel with the Union of Industrialists which he headed. Rutskoy previously aligned himself to the "Free Russia Party", another centrist group. Under a deal between Volsky and Yeltsin, in June 1991 Rutskoy became Yeltsin's running mate. From Yeltsin's standpoint, this was done also to ensure the support of the military, with whom Rutskoy was popular. But Rutskoy was among nationalist and Communist rebels whom Yeltsin crushed in October 1993. He was released from jail in 1994, together with the others).

When Communists staged the coup on Aug. 19-21, 1991, Yeltsin foiled their move. One of the key figures who backed Yeltsin was Gen. Pavel Grachev, then 44, who commanded elite airborne troops. He led the force which defended the White House, together with elite troops from the interior ministry. When he formed his cabinet, Yeltsin made Grachev defence minister and gave other allies "power portfolios": General Viktor Yerin as interior minister, Viktor Barranikov as minister of state security, and Andrei Kozyrev as foreign minister. (Yeltsin dismissed these allies in the subsequent years. He sacked Grachev after Rtd Gen. Alexander Lebed, his arch-enemy, came third in the first round of presidential elections in June 1996 - see chronology of Russian events in Vol. 47's OMT, DT & Gas Market Trends).

On Dec. 8, 1991, Yeltsin and the presidents of Belarus and Ukraine, meeting in Minsk, announced the creation of the Commonwealth of Independent States (CIS), a grouping which eventually was joined by all FSU states with the exception of the three Baltic republics. On Dec. 31, 1991, the Soviet Union was dissolved. In the subsequent years Yeltsin tried to boost his power base through radical reforms.

Events since 1991 have had a momentous effect on people throughout the FSU. The energy sector in Russia was already suffering from inefficiency, lack of equipment and spare parts for the oilfields, and other problems. Russian oil production, which peaked at 11.14m b/d in 1988, was falling steadily to reach 6.1 b/d in recent weeks, although gas production and exports remained stable. Deficiencies in the distribution system meant refineries in oil importing republics like Ukraine ran well below their capacity.

Yeltsin suffered a political setback in December 1995, when the Communists won the biggest number of seats in the Duma. He was no longer the radical reformist people in the West thought he was to become after he crushed his opponents' Moscow uprising in October 1993. He was put in a position engineered for him by moderate centrists from the events of late 1992, when they forced him to bring Chernomyrdin to the premiership. The latter then took over from Yegor Gaidar, a Western-influenced reformist. Gaidar resigned in January 1994 as deputy premier in charge of the economy. Other radical reformists left the government subsequently. But Chernomyrdin backed Yeltsin in every crisis.

In the first round of presidential elections, on June 16, 1996, Yeltsin got 35.28% of the votes. Communist Party leader Gennady Zyuganov got 32.04% and Lebed came third with a surprising 14.53%. Yeltsin needed Lebed and gave him the key post as head of the National Security Council.

On June 18, as he made Lebed head of the security council, Yeltsin sacked Grachev as defence minister. Within hours, Lebed announced that he stopped a coup attempt implicating Grachev, five generals and the Georgian defence minister. On June 20, on Lebed's recommendation, the president fired three close aides: first deputy premier for industry Oleg Soskovets, presidential guard commander and an old Yeltsin friend Gen. Alexander Khorzhakov, and chief of the federal security service Gen. Mikhail Barsukov.

Yeltsin left Moscow suddenly on June 29, having suffered two heart attacks in the second half of 1995. In the second round on July 3, Yeltsin won the election with 53.8% of the votes and Zyuganov only got 40.3%. On July 4, the president asked Chernomyrdin to form a new cabinet. He returned to the Kremlin on Aug. 6, in time for his inauguration.

At the Aug. 9 ceremony, called "inauguration" in Russian for the first time to underline the unprecedented event, the music was that of the tsar's coronation. Yeltsin walked stiffly as he entered the Kremlin Palace. His face was drained of expression throughout the truncated 17-minute ceremony. He appeared in more lively form at a later celebration. He thanked the 3,000 Russian guests, the CIS leaders and foreign diplomats "for sharing the joy of today with me". Yeltsin added: "We want prosperity and order in every town and village so that every Russian home will be better off, so that power will serve the people, and everyone will say to themselves with pride: I am a citizen of Russia". Vladimir Zhirinovsky, the ultra-nationalist among the guests, said: "We have just sworn in a very good emperor".

Eventually Lebed succeeded in a mediation that ended the Chechen war. But Yeltsin fired him after power struggles between the former general and close presidential aides. The president made Anatoly Chubais chief of the

presidential staff and, gradually, the latter became more powerful and assumed the post of 1st deputy PM.

After spells of illness and absence from office, Yeltsin made young Boris Nemtsov 1st deputy PM in April 1997. Later Nemtsov, a Jewish nephew of Yeltsin's wife, recalled that when he was given the job he asked the president: "Boris Nikolaevich, how do you want to go down in history?". He said Yeltsin's reply was: "As a good and great tsar who led Russia out of troubled times into a period of normal democratic development with a growing economy and without social conflict. Or do you want the contrary?" Nemtsov vowed he will work on fulfilling the president's dream.

Nemtsov and Chubais rode high and, together with other young technocrats like Kiriyenko, tried to break the gas monopoly Gazprom. Chernomyrdin countered them until the events took a sharp turn by March 21, 1998, when Yeltsin held a private chat with his premier at a wooded retreat outside Moscow, Gorky-9. Yeltsin was recovering from another illness. The Kremlin, then under Valentin Yumashev as chief of staff, issued a routine statement saying the president and Chernomyrdin had talked about financial matters. What was not said publicly was that, after the March 21 meeting, Yeltsin exploded. He summoned Yumashev and insisted that Chernomyrdin be fired on the spot. Yumashev persuaded the president to wait until March 23 because they had no replacement for Chernomyrdin. It was Nemtsov who found a replacement: Kiriyenko, his assistant (see profiles in DT).

On March 30, Yeltsin repeated what he had promised on Sept. 1, 1997, that he would not run for a third term in 2000. But Yeltsin made clear that Chernomyrdin, who had declared himself a candidate in the 2000 presidential elections, could not count on the Kremlin's support. Yeltsin added to Chernomyrdin's humiliation by insisting that his sacking of the prime minister had been a unilateral decison. "When he (Chernomyrdin) said he had taken the decision (to resign as premier), that is not quite right. It is I who took the decision to sack the government".