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Opposition campaigner attacks Putin over Sochi costs

Reuters
General view of Bolshoy Ice Dome in the Adler district of Sochi
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A general view of the Bolshoy Ice Dome in the Adler district of Sochi, January 26, 2014. REUTERS/Alexander …

By Thomas Grove

MOSCOW (Reuters) - An anti-corruption campaigner said on that Monday Russia was spending far more on the Winter Olympics than President Vladimir Putin has estimated and accused politicians and businessmen of profiteering.

Alexei Navalny, who led anti-Putin street protests in 2011-2012, published data culled from government budgets and construction companies on a website (sochi.fbk.info) that he said highlighted overspending and corruption.

"Russia's overall expenses have already reached $50 billion, which makes the Russian Olympics five times more expensive than the Vancouver Olympics (in 2010)," said Navalny's report on the Games that open in the Black Sea resort of Sochi on February7.

Navalny accused Putin - who has staked personal and political prestige in the Games - of helping enrich friends by awarding them contracts to build Olympic venues at a cost several times more than those of similar facilities elsewhere.

"The whole Sochi project was conceived not only to produce the Olympic Games but also enrich a small number of Putin's close friends," Navalny told Reuters.

Putin has dismissed accusations of corruption.

"We don't see any large-scale instances of corruption during our preparations ... in Sochi. If anyone has any information about corruption in Sochi, please hand it over, we will be glad and grateful," Putin said in a broadcast interview with Russian and foreign media this month.

DIVERGENT COST ESTIMATES

Putin said this month that Russia had spent some $6.5 billion on preparations for the Games.

But there are huge differences in the estimated cost of the Games even within the government. Deputy Prime Minister Dmitry Kozak said last year that Russia would spend some $50 billion, including the infrastructure projects around Sochi as well as the venues themselves.

Navalny's report, which won little attention in Russia's tightly controlled media, also contradicted government statements that private companies had financed more than half of the investment in Sochi.

It said funds channeled through state-controlled companies had been portrayed as private, rather than public investment and that the private sector had really put in less than 4 percent of the overall cost.

"In their statements, officials referred to investments of Gazprom, Sberbank, Russian Railways and other government-affiliated entities as private investments," the report said, adding that under international accounting standards such investments would be considered state money.

More than $12 billion in state funds had been divided between two companies - Olimpstroy and Russian Railways - to build venues and roads, according to the report.

It said $8.7 billion had been spent to build a railroad and motorway, around 50 km (30 miles) long, to the Rosa Khutor ski resort.

Russian Railways declined to comment on the report and Olimpstroy was not immediately available for a reaction.

(Editing by Robin Pomeroy)

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