Yuri Alekseyev: Industry in Latvia was ruined deliberately

A multi-story building of the former Radiotekhnika RRR is Riga is being demolished currently. Instead, a Depo shop-warehouse of house and gardening materials will be erected shortly. One of the flagships of the Latvian industry, Radiotekhnika RRR has faced the fate of most plants and factories inherited from the Soviet Union. A well-known journalist from Latvia, Yuri Alekseyev, who had worked at Radiotekhnika Design Bureau for many years, shares his views in an interview with EADaily.

After the interview was recorded, it became known that Alekseyev was detained by the Latvia Security Police over allegations of “stirring national strife.” His apartment was searched and live ammunition was found there – the journalist says the police flaked him.

Pro-governmental publicists in Latvia claim the former Soviet industry in the country has died out, since it was outdated and non-competitive…

Well, pro-governmental propagandists try to make it sound like “the Soviet industrial enterprises were outdated and non-competitive” and have died out over time. I have a question: Why hasn’t Czech Skoda died out? Why haven’t Belarusian MAZ and BelAZ died out? What about the Russian GAZ and KamAZ? I can list hundreds of former Soviet enterprises that have survived and developed into world-known brands.

I admit that equipment at many Latvian enterprises became outdated by 1991, but equipment is just “iron.” It would not cost them big money to replace machine-tools. Meantime, training a staff of highly-qualified engineers and workers is much more expensive process that takes decades. Educated people is the major capital globally.

Take for example our design bureau. A staff of two hundred highly-qualified engineer-designers worked there in addition to one hundred workers at the design development shop. A unique staff!

When our factory was left idle, we began seeking design orders elsewhere. And we used to find enough orders to work and earn money…To work independently, we tried to privatize our design bureau.

However, we were not allowed to do it. They said it was the property of the Latvian people. Some six months later, representatives of that very people actively took our unique gauges to non-ferrous metals receiving centers. As a result of those “reforms,” we were left jobless and tried to integrate into the changed life on our own. Some proved lucky, while others not…

In Riga, they are now demolishing the last building of Radiotekhnika RRR – the administrative one. This is the last step…the Central Assembly Shop has been transformed into a store for a long time already. In the premises of my former Design Bureau located in Gorky Street (now Krisjan Valdemar) there is an art school now.

Once I visited it to see how children make clay pots and sew ornaments on clothes. “Progress” is evident: the place used for design of ultimately complex devices is now used to foster folk crafts. In some ten years, they will be making stone axes there…

So, you disagree with the views that the loss of enterprises was a natural process…

It is bla-bla-bla. In fact, those few high-tech enterprises that survived in early 90s work perfectly now.

Here is a spectacular example: Electrotechnical Plant after H. Pegelmann in Tallinn that produced mostly microchips for military industry. They managed to privatize and save their design bureau in hard times. I learnt that story firsthand, since two my relatives worked there.

In mid-90s, the Bureau already had a million-strong turnover due to its design projects! About fifty people worked there, but they manufactured products that were highly in demand. Nokia, Motorola and other well-known firms ordered various engineering designs from them.

Later, Texas instruments, an American semiconductor giant bought the controlling stake in the plant for a very good price – millions. Now, the former design bureau of the Soviet plant after Pegelmann has moved to U.S., Silicon Valley. My relatives-engineers develop microchips for iPhones and make good money. Whereas, here, unique specialists were simply put out on the street…

In November, bankruptcy process of Riga Carriage Building Plant was launched. Is it logical for once high capacity plant to go bankrupt?

Frankly speaking, what we see now is just the shadow of the Riga Carriage Building Plant. They were going to close it down for several times, the premises were used as warehouses and shops, the staff was reduced…

They have suffocated the plant deliberately – a large Russian staff worked there… It is worthy to note that RVR electric trains still run in some post-Soviet countries. I travel much and have seen them even in Tashkent!

What is electric train? It is a rolling stock with about fifty-year service life. However, it needs repair and modernization once in five-seven-eight years. Actually trains made in Riga that need regular maintenance still run from Kaliningrad to Vladivostok, from Murmansk to Tashkent.

Only an idiot would close a plant in such state of affairs, when there is workload for fifty years to come! Even if there are no orders for new products, they could operate for fifty years on repairs alone!

Yet, nothing held them from developing new models – railway transport is always in demand. However, we are speaking about “outdated Soviet industry” instead of managing properly what we had…

VEF (Latvian acronym for Valsts elektrotehniskā fabrika) State Electrotechnical Factory is the most famous enterprise in Latvia. It was lost forever too…

How it happened? Here, in Latvia, the key communications operator is Lattelekom. In early 90s, the government sold forty percent of its shares to TILTS Communications for future investments of about 500 million dollars.

Investors started rebuilding the telephone network in Latvia, shifted from analogous to digital system. I’d like to note that the state-run enterprise VEF still managed to operate somehow then! What was VEF engaged in in the Soviet times? It produced equipment for telephone stations…

Eventually, during its modernization, the state-run enterprise Lattelekom did not make a single order to VEF from those 500 dollar-worth orders. If VEF had at least 10 percent of those orders, it would survive and will be prospering company now.

Could VEF produce up-to-date digital stations then?

Not ready-to-operate, of course. However, digitization is not just “a smart processor” that VEF could not produce then, it is thousands of names of auxiliary equipment. Various distribution frames, shelves, “iron” in simple words. To be clear, a home computer consists of “a smart circuit pack,” but there are cables, jacks, adapters and a case around it.

EF could easily produce those cables, jacks, cases for digital telephone network and would do at a much lower price. Later, it would learn to make also “smart circuit packs” – not a rocket science for FEV engineers. If they were funded a little…After all, in those unforgettable 90s, the Chinese were yet “digging soil with sticks.”

What has that collapse of enterprises resulted in for Latvia?

Large-scale brain-drain. Good engineers, physicians, teachers have left the country. Highly-qualified hard-working people have migrated. Smart and active youth have left. Let them be happy in foreign land. We here in Latvia have nothing to do but hope that after a collapse of the European Union, various Britains, Irelands, Germanies, Swedens will organize a great deportation of our former compatriots back to their homeland. In freight cars and in commercial quantities…