Helsinki (13.03.1999 - Juhani Artto) "Before the August 1998 economic collapse the Russian trade union movement warned of the threat", said Yevgeni Makarov, president of the St. Petersburg and Leningrad region trade union federation, speaking on a recent visit to Finland as a guest of the three central trade union confederations SAK, STTK and Akava.
"What the government did was a bit like building a financial pyramid which was bound to collapse sooner or later. It financed its debt servicing by issuing more and more government bonds, but then on 18 August it suddenly stopped the spiral and announced its inability to manage the debt. The bond market stopped operating and is still out of service", Makarov explains.
The exchange rate of the rouble fell sharply. In three days the dollar became three times more expensive. As a result, prices of imported goods grew rapidly, causing a dramatic fall in the standard of living of workers.
In the St. Petersburg and Leningrad region 70 per cent of consumer goods are imported. "Over the last five years Russia has lost the ability to feed its population."