13 hours east of Moscow - how a business trip to investigate financial potential from an investment in a Siberian gold mine reveals what is wrong with Russia's economy

SIBERIA is not an obvious place to go at a moment's notice--but early this spring a friend asked me to help him look at a gold mine in one of the autonomous regions bordering on Mongolia. It was a 13-hour flight east of Moscow, and the Soviet Union's answer to the Lear Jet--a Yak-40--was supposedly already standing by for takeoff. So, one day we were lunching in a French restaurant in South Kensington, and the next, our van was wading through snowdrifts on an airfield an hour's drive past the remotest outskirts of Moscow. We passed vast, seemingly abandoned, military transport planes, helicopter gunships with their rotor blades tied with ropes to their wheels, and several large civilian Tupolevs, some still with the old Soviet flag on their tail. The van could not make it all the way to the snowbound jet, and so the whole team--my friend, two other investors, two Belgian geologists, a translator, and an Australian bodyguard--waded through the last hundred yards of snow carrying our own luggage.

Amazingly, the jet--a dark, icicle-dripping lump of metal--worked, and it even managed to ram its way out of the snow. Its fuselage sported the logo of one of the private companies into which the old Aeroflot has been broken up.

The Yak-40 is slow but spacious, and its owners had had the interior transformed according to what they thought were Western standards. Seats had been removed and nasty black leather sofas moved in; a video and a large-screen television stood, not bolted down, on a table--we were to be regaled with not-so-soft porn movies. The refrigerator had been stuffed with the most expensive delicacies Moscow had to offer: vacuumpacked slices of meat, cheese, and German sausage. Fortunately, we had brought massive amounts of smoked salmon and several bottles of champagne, which had chilled thoroughly on our way through the snow. I spent the first few dozen miles in the air holding onto a sofa arm, trying not to think of what would happen if we hit turbulence and the television flew off its stand and struck the fuselage.

The last time I had talked about Siberian gold was years before, at the Oxford Union, when an aging Polish couple came up to me after listening to my speech about the Soviet Union. "Look," he said, showing his hands, "we are married, but we don't wear gold rings. I spent two years digging gold ore at Kolyma. I vowed that if I ever got out alive, I would never touch gold again." They had been lucky to be among those led out of the Gulag by General Anders into British-occupied Persia, a remnant of over one million packed into cattle trucks by the NKVD in Poland's Eastern marches in 1939-40.

We now know that Kolyma was the Soviet Union's Auschwitz, where three million are estimated to have been worked to death. But even before I met that Polish couple, the very word "Siberia" always gave me a frisson of horror. It evokes the specter of Russian troops bursting into eighteenth-century Polish parliament sessions to whisk off recalcitrant senators; and of nineteenth-century insurgents being chased to places of banishment, thousands of miles on foot. It is associated with the word kibitka, a coffin-like box in which the more important prisoners were locked up while they were dragged east, interrogated and tortured at transit prisons along the way. To this day, there are communities of Polish exiles deep in the former empire, as far as Kazakhstan and Sakhalin. I was torn between the memory of those who had been to Siberia before me and the innocent zest of present company.

Two refueling stops later, we landed to experience the trip's first surprise: contrary to expectation, the weather was warmer than in Moscow. Snow still lay on the tarmac, but spring was in the air. There was also a disappointment: the helicopter that was supposed to take us to our destination was unavailable; it had gone to the rescue of a crashed airliner, the Airbus flown to disaster by the pilot's teenaged son, as it turned out later.

We tend to think of Siberia as Russia's hinterland, a once-empty space colonized by Russian settlers over the centuries. Siberia is indeed vast--accounting for 75 per cent of Russia's land mass--but it is far from homogeneous. Over thirty peoples claim bits of it as their original habitat, and the region we landed in was no exception. Out of a population of 200,000, 60,000 were natives, descended from a Turkic tribe that boasts Attila the Hun as its most famous member. The rest are prishlie--"newcomers," mainly Russians, who dominate the politics and have the best jobs. Typically, the natives in this region are employed in the scrawny collective farms tilling the region's poor soil, where wages are 10,000 to 20,000 rubles ($6 to $12); only the prishlie worked at the gold mine, where wages averaged ten times more.

The region has proclaimed "independence" from Russia and a new flag now flutters from its public buildings, but it was hardly a case of the Hegelian national will stirring itself after centuries of oppression. In fact, the proclamation of independence was devised by the region's Russian prime minister. The Russians and the natives seem united in trying to lay their hands on the revenues from their region's fabulous mineral wealth, which used to be sucked away by Moscow's faraway bureaucrats. This, presumably, explained why we had been invited to explore their "free economic zone."