Who Is Vladimir Potanin, a Russian Nickel Oligarch Close to Putin, Who Escaped US Sanctions Until Now?
And above all, why does it escape sanctions?
At the beginning of March 2022, the White House announced a complete list of sanctions targeting Russian oligarchs close to Vladimir Putin. These sanctions were in addition to those taken against Russia. Their purpose was to leave no respite to Vladimir Putin and his close guard.
Among those sanctioned were billionaire oligarchs such as Nikolai Tokarev, Boris Rotenberg, Arkady Rotenberg, Sergei Chemezov, Igor Shuvalov, Yevgeniy Prigozhin, and Alisher Usmanov.
Among the twenty or so Russian oligarchs sanctioned, many were surprised to see Vladimir Potanin absent from the list. Close to Vladimir Putin, this nickel oligarch seems to be the perfect candidate for American and European sanctions.
And yet, none have been taken so far. In the following, I will draw a portrait of this 61-year-old businessman and try to understand why Potanin has been spared.
A businessman
Vladimir Potanin is officially the richest man in Russia. If I take the precaution of specifying officially here, it is because there are insistent rumors about Putin's hidden treasure abroad which would make him one of the richest men on the planet beyond 200 billion dollars. But this remains only conjecture.
Potanin's fortune amounts to 25 billion dollars. At the beginning of 2022, it was still at $30 billion. The sanctions have somewhat devalued his assets. Vladimir Potanin is active in nickel and palladium. At the Versailles summit in mid-March 2022, European leaders announced that they would impose metal sanctions, but these seemed to be aimed mainly at steel and iron, initially.
Russia is a major producer of nickel. Potanin is the CEO and principal shareholder of Nornickel, the largest company in the sector on a global scale. It operates mines in Norilsk, a former gulag that is now the most polluted city in the world. It is also one of the world's leading suppliers of palladium. Both metals are essential for the manufacture of semiconductors and electric car batteries, and this may be one of the reasons why these metals are not subject to sanctions at the moment. Extending this hypothesis, one can imagine why CEO Potanin is not targeted by the sanctions. Roman Abramovich, on the other hand, owns shares in Nornickel and has been sanctioned.
Besides nickel, Potanin also operates a conglomerate in the name of Interros, which has interests in real estate, mining, energy, and pharmaceuticals. He has also been active in finance: the bank he co-created, Onexim, quickly became the largest bank in Russia after its launch in the early 1990s.
A political career
Vladimir Potanin worked for eight years in the Soviet Ministry of Foreign Trade, after studying international relations.
As a private person, he was the initiator of the “loans for shares” program, launched in 1995, which allowed wealthy people and banks to get their hands on shares in state-owned enterprises that exploit the country's resources. These shares were used as collateral for loans they gave to the government. But the government could not always repay the loans, and the shares went to the rich and the banks. Many oligarchs went through this program (like Potanin for Nornickel), and still hold these shares today, which make their fortune and power.
After the launch of this program, just after the re-election of Boris Elstine, Potanin was appointed Minister of Energy and Economy and Deputy Prime Minister and served from March 1996 to August 1997.
A close friend of Vladimir Putin
Potanin has been photographed many times with Putin, since at least the 2000s. He is also close to Medvedev, with whom Putin has exchanged the office of President and Prime Minister on several occasions.
The two Vladimir also share a passion for skiing. For the Winter Olympics in Sochi in 2014, Potanin put his hand in the wallet and financed ski slopes to the tune of 3 billion dollars. The idea came to him during a winter vacation spent with Putin in Austria earlier. Having ski slopes in Russia would be a matter of heritage, he indicated in 2013. Later, however, he admitted that he did not have much financial return from the 80 kilometers of slopes and various sports centers he had financed.
He is also a great fan of ice hockey, a pastime for which he sometimes crosses paths with the autocrat Vladimir Putin.
Luxurious tastes like his other oligarch colleagues
Many yachts of Russian oligarchs are seized by the West. Like other oligarchs, Potanin has a taste for superyachts. The first one, named Anastasia and 75 meters long, was sold in 2018, for $75 million. He owns two others still today, namely the Nirvana and the Barbara. The latter is 88 meters long, has a three-meter deep indoor pool, and is worth $165 million.
A philanthropist
In 2010, Potanin indicated in interviews that he did not want to leave his money to his children, but to charity, to spare them the pressure of wealth:
“My capital should work for the good of society and continue to work for social goals.”
He also created a foundation in his name for cultural and educational projects in Russia. His donation of 250 Russian and Soviet artworks to the Pompidou Center in Paris in 2016 earned him the Legion of Honor in France. He was also a member of the Guggenheim Foundation but retired in early March 2022.
He was also the first Russian to sign the Giving Pledge, a charitable organization created by the former Gates and Warren Buffett couple. Wealthy signatories pledge to donate the majority of their wealth to a good cause.
Vladimir Potanin has escaped all American and European sanctions so far
Despite all these elements, such as the links with Putin or the business sector, which brings a lot of money (Nornickel's revenues were, for example, almost $18 billion in 2021) to Russia (and thus to the financing of Putin's war in Ukraine), Potanin has so far escaped Western sanctions.
The West's fear of no longer having access to the basic metals for the energy transition, if it punished the oligarch, seems in any case to be a reasonable lead. In the immediate term, and perhaps even in the long term, it seems complicated to free ourselves from this dependence on Russian metals.
The same question always comes up in the West: how to sanction Putin's Russia without sanctioning ourselves even more strongly?
This is what probably allows Vladimir Potanin to continue not to be worried. We will see how long this can last.
Some reading
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