x Abu Dhabi, UAESaturday 29 July 2017

Russian PM Putin faces warnings of crisis aftwr firing his finance minister

Alexei Kudrin's departure as finance minister on Monday exposes the high-level disagreements over Vladimir Putin's plan to swap roles with President Dmitry Medvedev in forthcoming elections.

Russia's president, Dmitry Medvedev, left, and finance minister Alexei Kudrin, who has resigned after a televised confrontation with Medvedev. AP Photo /RIA Novosti, Dmitry Astakhov, Presidential Press Service
Russia's president, Dmitry Medvedev, left, and finance minister Alexei Kudrin, who has resigned after a televised confrontation with Medvedev. AP Photo /RIA Novosti, Dmitry Astakhov, Presidential Press Service

MOSCOW // Vladimir Putin has risked harming Russia's economy by firing his finance minister, a prominent economist and business leader said yesterday, adding to scattered warnings of crisis since Mr Putin confirmed he would reclaim the presidency.

Anatoly Chubais, the architect of liberal economic reforms in the 1990s and Kremlin chief of staff under Boris Yeltsin, said the prime minister no longer had top-notch professionals running the economy at a time of dangerous global turmoil.

Other economists and business people have also voiced worries about the economic and political uncertainty caused by Alexei Kudrin's departure as finance minister on Monday and the high-level disagreements it has exposed over Mr Putin's plan to swap roles with President Dmitry Medvedev in forthcoming elections.

Though public dissent is patchy, some have gone so far as to say the return of Mr Putin, who succeeded Yeltsin as president in 2000, risks a stagnation that could create deeper conflicts.

Mr Chubais, who now heads the state high-technology group Rusnano, wrote in a blog that Mr Kudrin's departure could have dramatic consequences: "This event, whatever the reasons for it, creates serious risks for the country.

"There are no longer any professionals at such a high level who can work in the current political configuration.

"This is especially dangerous against the background of a looming second wave of the global economic crisis. In such unfavourable circumstances, the consequences of his resignation could be dramatic."

Mr Putin's announcement on Saturday that he will reclaim the presidency in an election in March, while Mr Medvedev replaces him as prime minister, was meant to end uncertainty over who will be ruling the world's biggest country for the next six years.

Polls show Mr Putin, 58, is all but sure to return to the post he held for eight years until 2008. But he unwittingly caused new uncertainty by triggering a revolt by Mr Kudrin, long regarded by investors as the anchor of financial stability.

Mr Kudrin said he would not serve in a Medvedev government and was forced to resign after attacking the president's economic policies in an unusually bitter and public dispute.

His interim replacement, Anton Siluanov, said on Tuesday he would implement spending increases that Mr Kudrin had criticised, but he added that further expenditure would threaten economic stability: "Additional spending may create risks," he said.

"We should not raise spending without finding corresponding sources of revenue."

Mr Chubais is despised by many Russians for allowing Russia's most valuable assets to fall into the hands of a small circle of businessmen who became super-rich after the collapse of the Soviet Union but his views are still respected at high levels.

His remarks followed a warning on Tuesday by Mikhail Prokhorov, one of Russia's wealthiest tycoons, that signalled Mr Putin will have to work hard to repair the cracks in unity.

Mr Prokhorov, recently ousted as leader of a Kremlin-backed liberal party, wrote in a blog: "I think we are on the verge of very important, perhaps tectonic, shifts in the consciousness of the elites, including the power elites."

Just how far the divisions go is hard to assess. No other leaders have joined Mr Kudrin in openly dissenting against Mr Putin's plan - doing so would be political suicide - and the ruling United Russia party rallied behind him at a weekend congress.

But although opinion polls show Mr Putin and Mr Medvedev are still more popular than any other politicians, their ratings have slipped and the internet has been full of criticism of how they have carved up power between them.

A portrait has been circulating on the internet showing Putin's face superimposed on a portrait of Leonid Brezhnev, whose rule of the Soviet Union from 1974 to 1982 is widely seen as one of economic and political stagnation.