1991 – 1995 Russian Privatization and the Rise of the Russian Oligarchs

Boris Yeltsin became the first elected-President of the Russian Federation in 1991.  In an effort to raise money and redistribute badly managed state-owned companies in nearly every industry, the Yeltsin administration adopted a plan called “loans for shares,” whereby the government mortgaged some of the state’s most valuable assets to a few Kremlin-favored banks.  The banks ran auctions, and the small number of businessmen who controlled the banks manipulated the auctions to gain control of companies for a fraction of the market value.  These businessmen ended up owning the most significant resources in Russia and became the wealthy oligarchs.

By | 2017-05-04T20:50:20+00:00 May 4th, 2017|

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