Wagner’s 24-hour coup

This is an audio transcript of the FT News Briefing podcast episode: ‘Wagner’s 24-hour coup’

Marc Filippino
Good morning from the Financial Times. Today is Monday, June 26th, and this is your FT News Briefing.

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An abandoned coup attempt in Russia leaves a lot of unanswered questions. And Greece’s run-off elections ended in a landslide. Plus, Turkey is finally raising interest rates, but does that mean foreign investors are confident in the country again? I’m Marc Filippino and here’s the news you need to start your day.

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The Wagner group’s coup attempt in Russia ended as quickly as it began. The mercenaries had been fighting on behalf of Russia in Ukraine. But this weekend, the head of Wagner, Yevgeny Prigozhin, pushed his troops toward Moscow. By Saturday night, Prigozhin and his troops withdrew, ending the short insurrection. Here to talk more about what happened is the FT’s Moscow bureau chief, Max Seddon. Hi, Max.

Max Seddon
Hi.

Marc Filippino
So what exactly happened that sparked this insurrection?

Max Seddon
So Yevgeny Prigozhin, he’s a Kremlin’s former caterer and now a warlord running Wagner Group, the biggest, most important paramilitary force fighting in Ukraine. And they have been spending as much of their time verbally feuding with the Russian defence ministry. And that boiling point on Friday night in Russia, when Prigozhin said that the Russian army had done an air strike on a Wagner base camp. And he declared what he called a march of justice, which he said was going to overthrow his two biggest rivals, the defence minister, Sergei Shoigu, and the commander of the invasion force, Valery Gerasimov.

Marc Filippino
OK, let’s back up a bit. What is this beef between Prigozhin and the Russian defence ministry?

Max Seddon
What it’s really about is money and power because earlier this month Shoigu signed a decree ordering all of the irregular militias fighting in Ukraine for Russia to sign contracts with the defence ministry, essentially making them subordinate. And this would have meant the defence ministry control all the money going to Wagner and could have told Wagner what to do. That would have been just, you know, death for Prigozhin. So what he did was he basically started a coup to try to get rid of the defence ministry, which looks like it was this kind of desperate attempt to convince Putin because Putin backed the defence ministry that he should leave, leave Wagner be and it got a little out of hand. And you’re at the point where these guys are marching through Russia and they were, you know, pretty close to Moscow before suddenly on Saturday night they announced that Belarus had brokered a deal to end the revolt. The Wagner fighters will go back to fight in Ukraine and not be prosecuted. And Prigozhin will go to some sort of weird sinecure in exile in Belarus.

Marc Filippino
Now what does this mean for the Wagner group’s relationship with Russia, do we know?

Max Seddon
What happens to Wagner right now is unclear. Firstly, a lot of these guys, thousands of these guys, they participated in an armed uprising. They shot down a number of Russian army helicopters and the plane killing between 13 and 20 people, we don’t know the exact numbers. The members of Wagner who did not take part in the uprising are going to sign contracts with the defence ministry. And it’s still an open question, especially with Prigozhin not in Russia anymore, whether it continues to exist as any kind of fighting force. You have to remember that Wagner doesn’t, you know, just fight in Ukraine before the full scale invasion last year, its main job was that it fought as mercenaries in conflicts where Russia could have some plausible deniability by using Wagner and not the regular Russian army in places like Libya, Mozambique, Syria. Whether that will still go on now that Prigozhin’s been kicked out of Russia is also an open question.

Marc Filippino
Do we have a clear sense of what this means for the actual war in Ukraine now?

Max Seddon
I think in the short term, not very much, because Wagner weren’t on the front lines anyway. But what it does do is absolutely devastating for Putin’s authority and the power of the Russian state, because this all comes from Putin personally, because Putin was the one who created Wagner, he empowered Wagner, when things started going badly, he was the one that brought Wagner in. He was the one who signed the pardons personally for tens of thousands of convicts to be released from prison so they could fight in Wagner. He is reaping, you know, what he has sowed. And I think it just shows you how disastrous this war has been for Russia, how you know, all the blame, you know, lays at Putin’s feet and how it could get even worse. You know, it could happen again, even if it’s not Wagner, but someone else doing it.

Marc Filippino
Max Seddon is the FT’s Moscow bureau chief. Thanks so much, Max.

Max Seddon
Thanks, Marc.

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Marc Filippino
Greek prime minister Kyriakos Mitsotakis won yesterday’s run-off election in a complete landslide. Mitsotakis and his centre-right party called New Democracy, will be able to form a government without a coalition partner. Here to talk more about the outcome is the FT’s Eleni Varvitsioti in Athens. Hi, Eleni.

Eleni Varvitsioti
Hi, Marc.

Marc Filippino
So, Eleni, we should note that the votes are still being counted as we’re reporting this but we do know a few things. One, that Mitsotakis and his New Democracy party did well, but two, it’s not just that they did well, it’s that the main opposition party, the Syriza party, did very poorly, right?

Eleni Varvitsioti
Exactly. With more than half of the votes counted, because still votes are being counted at the moment, Syriza fell behind New Democracy by more than 22 points. And that, as you can understand, raises questions about Alexis Tsipras, its leader, and his political future. Usually in such big defeats, the leader quits and there’s a new procedure in a party to elect a new leader. But because Syriza is a relatively new party in a sense that got power only once in 2015 and it’s mainly attributed to the power of Tsipras, it’s still not clear if Tsipras will remain the leadership or he will have to resign soon.

Marc Filippino
It’s a, it’s quite a fall for the country’s former prime minister. Eleni, another big theme of this election was the emergence of fringe parties. What did we see there?

Eleni Varvitsioti
A significant number of small fringe parties from the extreme left to the extreme right, are now gonna be part of the new Greek parliament. And what is kind of interesting and shocking for me is that one in three voters chose anti-systemic, anti-democratic parties. And I think, Marc, this indicates the level of resentment in a significant part of the society that they think Mitsotakis will really have to take into account in the next four years. One surprising entry, which I want to talk about, is a new far-right party, it’s called the Spartans. It’s super new. It was founded in May and backed by a jailed MP of the former neo-Nazi Golden Dawn party. So this pardons, which got close to 5 per cent of the vote, are expected to be a polarising power in parliament. And they’re gonna be a divisive force in issues including migration.

Marc Filippino
Eleni Varvitsioti is the FT’s Athens correspondent. Thanks, Eleni.

Eleni Varvitsioti
Thank you, Marc.

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Marc Filippino
Turkey might be able to build back confidence with foreign investors. Years of unorthodox policies like keeping interest rates low during high inflation has made investors worried. But last week, Turkey’s central bank finally raised rates by six and a half percentage points. Here’s the FT’s Turkey correspondent, Adam Samson.

Adam Samson
So I think foreign investors see this as an important first step. One person who I talked to this week referred to it as sort of a baby step in the right direction. Interest rates are now 15 per cent, but inflation’s running almost 40 per cent. So if you’re an investor, that’s still a really, really bad inflation adjusted interest rate. So I think people were happy to see it, but they’re definitely waiting to see quite a bit more before they even really think about getting into Turkey’s markets.

Marc Filippino
But Adam says that it’s not a guarantee that President Recep Tayyip Erdoğan will allow this kind of monetary policy to continue.

Adam Samson
I think that’s a really open question on sort of the positive side, Erdoğan has definitely put good people in place. The problem is everything is decided by the president and he can and has in the past changed his mind really, really rapidly. In 2021, there was a central bank chief who started raising interest rates, which was seen by almost everybody as very important. And he was fired just literally months into the job because the president is a big opponent of high interest rates. And the other thing is there’s local elections here coming up next year. And it’s a real question as to whether he’s going to be OK with undertaking what are gonna be almost definitely very painful adjustments ahead of a really important set of elections.

Marc Filippino
Adam Samson is the FT’s Turkey correspondent.

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You can read more on all these stories at FT.com. This has been your daily FT News Briefing. Make sure you check back tomorrow for the latest business news.

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