Russian finance minister rebels over Putin plan

CZAR PUTIN::Alexei Kudrin’s refusal to serve in the next government with Dimitry Medvedev as PM follows news that Vladimir Putin will run for the presidency next year

Reuters, MOSCOW and Washington

Mon, Sep 26, 2011 - Page 1

Russia’s finance minister rebelled yesterday against Russian Prime Minister Vladimir Putin’s plan to make Russian President Dmitry Medvedev his prime minister if he returns to the Kremlin by saying he would not serve in the next government.

Foreign investors were alarmed by Russian Minister of Finance Alexei Kudrin’s snub after Putin announced he would run for president in March next year in an election that could extend his rule until 2024.

Kudrin, a Putin ally, has prime ministerial ambitions and said he had “disagreements” with Medvedev, who may now struggle to establish his credibility as prime minister after being forced by Putin to renounce his dream of a second term as president.

“I do not see myself in a new government,” Kudrin, 50, said in comments released in Washington, where he was meeting global policymakers. “The point is not that nobody has offered me the job; I think that the disagreements I have [with Medvedev] will not allow me to join this government.”

Kudrin won the respect of investors as a guardian of financial stability by saving windfall oil revenues for a rainy-day fund, which helped Russia through the 2008 global economic crisis.

“Kudrin personifies Russia’s macro and fiscal stability. His departure would be a major blow to the Russian investment case,” said Roland Nash, chief strategist at Russian investment manager Verno Capital. “But I don’t think you should count him out quite yet. He is as close to Putin as Medvedev. Perhaps this is a bid for the role of prime minister.”

Putin, 58, and Medvedev, 46, have ruled in a power “tandem” since Putin was forced to yield the presidency in 2008 after serving the maximum two consecutive terms.

Putin won a standing ovation by accepting a proposal by Medvedev to return as president at a choreographed congress of the ruling United Russia party on Saturday.

Medvedev agreed to lead United Russia’s list of candidates for a parliamentary election on Dec. 4 in a move intended to help the party retain a two-thirds majority in the lower house.

Putin looks certain to be elected president in March. Opinion polls show other potential presidential candidates, such as nationalist Vladimir Zhirinovsky or communist Gennady Zyuganov, have little support and liberal opposition leaders have only limited appeal nationwide.

However, although Medvedev’s personal ratings are high, the strength of his prime ministerial credentials is unclear after he failed to carry out many of his reform promises as president.

“Medvedev’s usefulness runs out on Dec. 5,” one economist said, referring to the day after the parliamentary election.

Medvedev has failed to emerge from Putin’s shadow since they started sharing power. By contrast, Putin has in more than a decade in power cultivated the image of a vigorous leader and his policies — crushing a Chechen separatist rebellion, taming super-rich businessmen and bringing wayward regions to heel — have buttressed his popularity among Russians.

However, critics say his return to the Kremlin, virtually unopposed, bring back memories of the economic and political sclerosis under Soviet leader Leonid Brezhnev in the 1970s and early 1980s.

“It’s a sign of growing stagnation in the Russian political elite and it means that Mr Putin, if elected, can rule for another 12 years until 2024,” said Yevgeny Volk, deputy director of the Yeltsin Foundation think tank.

The US government said it expected to keep making progress in the “reset” toward better relations with Moscow, whoever was the next Russian president.

Putin’s decision is likely to cause some nervousness in the West, where he is considered less liberal than Medvedev and more outspoken in his criticism of Western policies.