[gambling ban in russia] connected to the sochi olympics

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The first thing to remember about Russia is that the Russian mind is at once tortuous, simplistic and prone to sudden implementation of Russia wide legislation, a legacy of Soviet Times.

An example of the latter was when all foreign workers on extended registration were summarily booted out in 2007/8 and told they could come back later through the usual channels [that is, pay out huge money to embassy approved certifiers at three or four points in the process].

Another example was the tax stamps fiasco when someone in Moscow, seemingly after a sozzled night, slurred that Russian alcohol was better than the foreign muck, the price of a foreign bottle skyrocketed and within a week, supermarkets shelves from Kaliningrad to Vladivostok were free of foreign alcohol. This one lasted a few weeks but the pressure from the upper echelons of society, who very much like foreign liquid sustenance, saw the legislation collapse.

Now we see the banning of gambling across Russia, the closure of casinos and dens of vice, which, of course, will drive it underground because if there's a market for this type of thing, there's a market for this type of thing. The thinking though is a bit more tortuous than that.




The starting point is the Sochi Olympic Games of 2014. The Krasnodar region, a thousand kilometres south of Moscow, has long been the getaway retreat, the haven of the rich and powerful, the movers and shakers of Russian society and by association, it has drawn millions of other Russians as well over the years. Here is a brief profile of the mountainous terrain which looks out over the Black Sea, a sort of mecca for beach worshippers in summer.

Back to the gambling:

Under a 2007 law designed to curb gambling in major cities and boost economic growth in poorer regions, casinos and other gaming establishments are to be relocated from Moscow and other cities to four remote Russian centers - in the Baltic exclave of Kaliningrad, Siberia, the Pacific coast and southern Russia - by July 1 this year.

"Our company is reluctant to move business to special areas in regions. Nobody feels like moving there, besides there is no infrastructure in those special zones, and nothing has been built there yet," Lavrenty Gubin from Storm International told RIA Novosti, adding that all the big industry players felt the same.

Cosmo girls, summer in Sochi

Gubin may feel that way but it does not accord with what is going on in the region. Huge tracts of land, huge areas are having infrastructure laid in these years now, for example, mobile phone services such as MTS:

The Krasnodar region is one of the most prominent federal districts in Russia in terms of economic development and growth. MTS is the leading mobile operator in the region with around four and a half million subscribers as of the second quarter of 2008. MTS is one of the biggest investors in the region, with plans to invest over seven billion roubles in the development of telecommunications infrastructure, including 3G networks, during 2008-2010.

As part of its investment program, MTS is planning to lay around 300km of fiber optic cable on the bed of the Black Sea to connect key cities on its shores. In addition, the Company will develop a Transcaucasian fiber optic network that will connect Krasnodar region with all the federal subjects of the Russian Federation in North Caucasus.

A few years back, I took my lady of the time to Sochi for my birthday and even without the infrastructure planned for today, it was still mightily impressive. The scenery is second to none, we stayed at the Radisson Lazurnaya, with swimming pool, I remember, looking out over the Black Sea, very good cuisine and excellent excursion deals which saw us hire a Volvo, with driver, for the day for some ridiculously low price and we went up into the mountains to Krasnaya Polyana and skied the day, with good equipment hire services, throwing in a couple of lessons for her, dining out then returning for a spot of shopping in Sochi.

On the way to the resort, we'd stopped at vendors of honey by the roadside and bought local produce, so the rural and rustic still existed in the middle of the flashier lifestyle. We couldn't help thinking that a few billion sunk into this area might see it rival any of the great resort areas of the world, e.g. Kitzbuhel.

When we returned and I waxed lyrical to a few Russians about it, they smiled and said yes, there will be great money found and put in - in the wrong places, in the wrong order and with no part coordinating with the other. That was the Russian way.

I'd like to think they'd learn from the way the west does its development and it seems the Russian government plans to learn from the 2010 Vancouver Olympics.

They will learn, no doubt but will they learn everything they need to remember? And so Sochi is also mentioned in the same breath as the ban on gambling or rather, the redirection of gambling to the four regions. The Russians are leaving no stone unturned to get Sochi up and running and it does take something like this to get projects moving over there.

On the other hand, the deep cynicism of the average Russian sees a legacy of sustained, prohibitive price hikes after the event, precluding the average holiday to the area and anyway, we're in recession 2008-12, aren't we? Who will turn out to be correct?


James Higham spent twelve years, from 1996 to 2008, in the centre of Russia, where he was a Professor of English at a pedagogical university.