Russia's ruling tandem sacrifices finance minister for unity

Russia's ruling tandem sacrifices finance minister for unity

Russian President Dmitry Medvedev's strong reaction to recent defiant remarks of Finance Minister Alexei Kudrin was unexpected but understandable, because the president wanted to demonstrate that he was not a "lame duck," said local analysts.

They also believed that Russia's ruling tandem -- Medvedev and Prime Minister Vladimir Putin -- tried to uphold unity by sacrificing Putin's long-time heavyweight ally Kudrin, who resigned Monday under pressure from Medvedev.

REASONS BEHIND

Local analysts believed the most reasonable excuse for Kudrin's resignation is to safeguard the stability of the ruling tandem.

Before Putin's Saturday announcement of rerunning for presidency, the stability of the tandem was widely doubted by domestic and international political analysts, but the swap of their roles was full proof that cooperation between the two was not an expedient policy.

Thus, no obstacles are allowed in their way to the elections and safeguarding the tandem was a priority.

Against such a backdrop, Kudrin's remarks would disrupt the morale of the Russian political forces, analysts said.

Alexander Khramchikhin, deputy director of the Moscow Political and Military Analysis Institute, told Xinhua that Putin "by no means is eager to let anybody test Medvedev's ability to rule the country independently."

The expert recalled a similar situation in 2010 when Medvedev dismissed another long-living politician Moscow's mayor Yuri Luzhkov.

Another reason causing Kudrin's departure was his disagreements with the tandem on economic policies.

According to Kudrin, the bone of contention between him and Medvedev has been economic policy, primarily concerning high military spending which Medvedev supported.

Kudrin argued that the Russia's budget, which is based on the assumption that oil prices would not fall below 100 U.S. dollars per barrel, has been risky as it left the government with no "safety airbag."

Even Putin's spokesman Dmitry Peskov admitted that Kudrin, "as a real professional economist," has always defended his viewpoint, which frequently differed from Putin's and Medvedev's on particular economic issues.

Khramchikhin believed that Kudrin deliberately picked up the time to voice his disagreement, as he did not want to share responsibility for an "inevitable" shift to the country's unrestricted financial expenditures on the run-up of the elections.

"Kudrin did not want to be associated with the policy of giving money away," the expert said.

WHO WILL BE NEXT FINANCIAL MINISTER?

The 50-year-old Kudrin has been finance minister since 2000 and during his tenure the Russian government has paid off most of its substantial foreign debt and created oil wealth to soften the blow of the global economic slump.

For his calls for austerity measures and less populist social policy, Kudrin has earned respect among the center-right wing of Russia's political spectrum.

Local media said Kudrin's resignation was a "big blow" to the Russian economy, and the Vedomosti daily said "experts are already forecasting a new wave of capital flight, a fall in the ruble rate and inflation growth."

After Kudrin's resignation, some market analysts said the move might cause a negative response from investors, as Kudrin's reputation in international investment community was an attractive factor for foreign investors.

However, some other analysts believed there will be no changes in the Russian financial market as the country maintains enormous investment potentials compared with poor performances of Europe and the United States.

According to local media reports, there will be four possible candidates for the post of financial minister: Tatyana Golikova, 45, social development and health minister; Sergei Ignatyev, 63, head of the Central Bank and former deputy financial minister; Mikhail Zadornov, 48, head of VTB-24 retail bank and former financial minister; and Sergei Shatalov, 61, deputy financial minister in charge of taxes.

Khramchikhin believed that whoever replaces Kudrin, the government's financial policy is unlikely to make a U-turn, because the current financial policies have performed well and yielded good results in recent years.

Editor: Xiong Tong

English.news.cn   2011-09-27 20:57:17 FeedbackPrintRSS
by Zheng Haoning, Igor Serebryany

MOSCOW, Sept. 27 (Xinhua)