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Another one of ours06 July 2007 Translation By Amiram Barkat The relationship with President Nursultan Nazarbayev enabled Machkevitch and his partners to take hundreds of millions, and perhaps even more, out of Kazakhstan and into Swiss accounts. According to media reports, Nazarbayev did not stand to lose by this.
Business journalists hardly know who Alexander Machkevitch is, but he lays claim to an impressive slot on the list of Israeli billionaires and he also appears as such in “Forbes”, although he only rarely visits Israel. Machkevitch describes himself as an Israeli businessman and there is decisive proof of that: he is planning a large-scale IPO in London. First Interview. Alexander Machkevitch was born and raised in Kyrgyzstan. He lives in London and Brussels, from where he manages a business empire centered in central Asian nations. He does not speak a word of Hebrew, he has no business interests in Israel, and he is unknown to the Israeli public. Nevertheless, in the Forbes list of the world’s richest people, he is described as an Israeli billionaire, with US$ 1.9 billion in capital. Machkevitch may be the richest Israeli in the world. In an interview in MarkerWeek this week, while Machkevitch was on a visit in Israel, a partial answer was found to the question of how he joined the group of Israel billionaires. He immigrated to Israel in 1991 and, according to him, he defines himself “first of all as an Israeli. I think it’s obvious. Israel is the homeland of all Jews.” An attempt to determine Machkevitch’s Israeli identity left us with quite a few question marks. All of the attempts to obtain from him any memories or personal experiences from his immigration to Israel were met with a stone wall. “I came and went all of the time”, he explains. In recent years, he has been coming to Israel on his private jet for 2 or 3 visits a year. He has recently increased his donations to Israeli entities, such as the Organization for Soldiers, Keren Hayesod and hospitals. Nevertheless, he is not involved in any cultural or lifestyle aspect in Israel, except for a weakness for falafel and oriental restaurants. Of all Israeli politicians, Machkevitch is close to only one, Binyamin Ben Eliezer, whom he calls a friend. There are also two politicians for whom he has great respect: Ariel Sharon and Shimon Peres. Within the business industry, Machkevitch is seriously acquainted only with Benny Shteinmetz, who is active in Kazakhstan through Beitman Engineering. In addition, he is superficially acquainted with Idan Ofer. Nevertheless, in his businesses abroad and mainly in Kazakhstan, Machkevitch is often identified as an Israeli businessman, and he always makes a point of participating in the financings of the annual Israeli Independence Day celebrations organized by the Israeli embassy in Almaty, formerly the capital city of Kazakhstan. “Machkevitch is something of an honorary consul in Kazakhstan, although he has no business interests in Israel,” said one of his acquaintances. When Machkevitch is asked why he does not wish to invest in Israel, he laconically answers: “Competition here is too harsh and there is too much bureaucracy”. Gas, Oil and Jewish-Muslim Dialogue Machkevitch’s life history is very similar to that of other Jewish oligarchs. He was born in 1954 in Bishkek, capital city of Kyrgyzstan, son of a physician, Anton, and a lawyer, Rachel. His brother, five years his senior, chose a musician’s career and works as a conductor. Young Machkevitch began an academic career at a local university. “I was the only Jew out of 150 students that the university was willing to accept,” he says. “I studied education because it was one of the only professions that were available to Jews”. At 24, Machkevitch already had a doctoral degree and at 26, he was appointed dean. “It was the highest position I could attain at the university. Positions of rector or president were out of the question for me,” he adds. Their involvement with metals and natural resources led the Trio to Kazakhstan, a moderate Muslim republic in Central Asia, covering nearly 3 million square km. In the early 1990s, they established the Eurasian Natural Resources Group (ENRC), which developed, within several years, into the most dominant player in the mining business in the state, including oil, natural gas and various kinds of metal. One person who can testify to the Trio’s power in Kazakhstan is Indian steel mogul Lakshmi Mittal, considered to be the fifth-richest man in the world. In 2002, the BBC reported that Mittal was forced to pay the Trio a “brokerage commission” of US$ 100 million in order to acquire a large steel production plant in Kazakhstan. The success enjoyed by Machkevitch and his partners in Kazakhstan was largely based on the connections developed with Nursultan Nazarbayev – the almighty state president since 1991. Machkevitch’s people say that he does not hesitate to turn to Nazarbayev in order to promote Israeli interests. For example, several years ago and at the request of Machkevitch, Nazarbayev contacted former Iranian President Mohamed Khatami with regards to the bodies of the IDF soldiers kidnapped at Har Dov. Nazarbayev, on his part, turns to Machkevitch when he needs help on Jewish issues or doors to be opened in governmental agencies of Europe and the US. Last September, Machkevitch flew a large Israeli delegation, headed by Chief Rabbi Yona Metzger, to Almaty, for an inter-faith conference initiated by Nazarbayev and including senior Iranian and Saudi religious officials. Assets estimated at US$ 4-5 billion Machkevitch, whose partners are both Muslims, dedicates a large portion of his time to warm relations between Jews and Muslims in countries where he is active in Central Asia, North Africa and the Kosovo region of Former Yugoslavia. “Wherever I go, I see that the radical Musilims comprise only one percent of the population, and the remaining 99 percent just want to lead a quiet life”, he says. “How many operatives does Hamas have? 8,000?,” he asks one of his assistants. “About 30,000,” the aide replies. “There you have it,” Machkevitch answers, “exactly one percent of 3 million Palestinians”. “Because Hamas went from door to door giving people money. It is not difficult when you have billions. Abu Mazen lost because he does not have the budget that Hamas does. Believe me, if I had given out the money that Hamas gave to the Palestinians, they would have voted Machkevitch.” Machkevitch, a practicing Jew, donates his money to the establishment of synagogues. His partner, Ibragimov, a devout Muslim, contributes to the establishment of mosques. Machkevitch invites Ibragimov and his family over for the Passover Seder and New Year feast, and visits him during the Ramadan for fast-breaking meals. Beyond that, the partners take a shared ski vacation in Switzerland or France, in addition to a summer vacation in Nice, on the French Riviera. Including all of the family members, this small Judeo-Moslem tribe is comprised of approximately 20 people. The trio has all reason in the world to celebrate its success. In recent years, their business generated billions thanks to the vitality of the mining and metal sectors. In addition to steel mining and aluminum production, ENRC has established an electric company and train company in Kazakhstan. Beyond Kazakhstan, the three operate through the International Mineral Resources (IMR) Group, which owns nickel mines in Macedonia and Kosovo, a cobalt mine in Zambia and a chrome mine in South Africa. The third side of the triangle is the Eurasian Financial Industrial Comp (EFIC), which owns a bank, insurance businesses, a pension fund and additional financial services. The three groups are fully owned by the three partners and their value is unknown. “Forbes” estimates Machkevitch’s personal capital at US$ 1.9 billion, but a simple calculation demonstrates that the estimate is outdated: in early 2003, the American magazine valued ENRC alone at US$ 6 billion and the prices of most metals have since then increased by double digit percentage points. Those surrounding Machkevitch say that he is worth at least US$ 4 to 5 billion. Machkevitch laughs when he is asked about the scope of his businesses. “We are facing an IPO in London, so I cannot give you any details without permission”, he responds. “All I can say is that we are praying for the situation to stay as it is today.” According to him, the mining and metal market is volatile and unpredictable. “I recently checked what the forecasts were two years ago, in relation to the present. I found that all of the predictions were wrong,” he says. “China, for example, is a country whose measures cannot be predicted. They were the greatest importers of aluminum and then, within two years, they established aluminum production plants and shifted from import to export”. A Phone Call from Bronfman When he is not concerned with business, Machkevitch usually invests his efforts in Jewish public activities. “I believe that every Jew must ask himself, every morning, what he is doing for the Jewish nation”, he says. He owes his Jewish identity mostly to the Anti-Semitism that existed in the USSR of his childhood. “I didn’t really have a choice, no one asked me whether or not I wanted to be a Jew,” he says ironically. He does not wear a yarmulke, but he does keep kosher and prays at least once a day. Machkevitch heads the Euro-Asian Jewish Congress, which represents Jewish communities over one third of the globe – from Slovenia in the in the west to New Zealand in the east. The organization celebrated its fifth anniversary this week, and Machkevitch came to Israel to mark the event. Alongside the Jewish communities of Russia and the Ukraine, each of which is comprised of several hundred thousand Jews, the Congress is comprised of dozens of smaller communities located in some of the most remote corners of the world. Machkevitch recently visited the Jewish community in Myanmar and he is planning to visit the Jews of Mongolia. However, a visit to all Jewish communities under his patronage is a complex task, even for him. The presidency of the Euro-Asian Jewish Congress has given Machkevitch a standing in the small and prestigious circle of Jewish billionaires who exercise control over Jewish communities around the world. Machkevitch receives a telephone call from Brussels in the middle of this interview. Matthew Bronfman, son of billionaire Edgar Bronfman, who until recently served as the President of the World Jewish Congress, is on the line. Bronfman Jr. joined forces with billionaire Ronald Lauder in the elections last month, where Lauder was elected as his father’s successor. In return for his support for Lauder, Bronfman Jr. was given the second most important position in the organization, which claims to represent all Jews of the world. The conversation with Machkevitch deals with the presidential elections of the European Jewish Congress. The elections, conducted on the following day, led to the appointment of Russian billionaire Moshe Kantor, president of the Russian Jewish Congress, which is not represented in the World Jewish Congress. In the past, relations between Machkevitch and Kantor were quite tense because the both claim to represent the Jewish communities in Russia and Ukraine. Machkevitch was concerned that if Kantor was to be elected president of the European Jewish Congress, which is represented in the World Jewish Congress, he would try to extend his influence into Machkevitch’s territory. Bronfman Jr. wanted to allay his concerns. There is another billionaire active on Machkevitch’s turf, Lev Leviev, who holds the title of President of the Federation of Jewish Communities in the former Soviet Union. Leviev’s organization, affiliated with Chabad, is considered to have the widest coverage in nations of the former Soviet Union and it operates networks of schools, synagogues and community centers in dozens of field cities. In Kazakhstan, Leviev’s people make sure to leave the center stage to Machkevitch. Leviev himself has ceased operating in various Jewish congresses, stating that it is “a waste off time and money”. Perhaps that is why Machkevitch allows himself to speak nicely of Leviev. “I have a great deal of respect for Leviev”, he says, “and I greatly admire his Jewish activities.”
Translation provided by Fleisher PR, Israel
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