Putin hoping to secure economic legacy with reshuffle: sources
Skip to main content
  • Home
  • Economy
  • Stocks
  • Analysis
  • World+Biz
  • Sports
  • Features
  • Epaper
  • More
    • Subscribe
    • COVID-19
    • Bangladesh
    • Splash
    • Videos
    • Games
    • Long Read
    • Infograph
    • Interviews
    • Offbeat
    • Thoughts
    • Podcast
    • Quiz
    • Tech
    • Archive
    • Trial By Trivia
    • Magazine
    • Supplement
  • বাংলা
The Business Standard

Saturday
August 20, 2022

Sign In
Subscribe
  • Home
  • Economy
  • Stocks
  • Analysis
  • World+Biz
  • Sports
  • Features
  • Epaper
  • More
    • Subscribe
    • COVID-19
    • Bangladesh
    • Splash
    • Videos
    • Games
    • Long Read
    • Infograph
    • Interviews
    • Offbeat
    • Thoughts
    • Podcast
    • Quiz
    • Tech
    • Archive
    • Trial By Trivia
    • Magazine
    • Supplement
  • বাংলা
SATURDAY, AUGUST 20, 2022
Putin hoping to secure economic legacy with reshuffle: sources

World+Biz

Reuters
22 January, 2020, 10:00 pm
Last modified: 22 January, 2020, 10:00 pm

Related News

  • How Russia gets advantage for geographical location?
  • Russian duo hail Stars Coffee as successor brand to Starbucks
  • Putin tears a giant hole in a critical German balance sheet
  • Xi, Putin to attend G20 summit in Indonesia
  • Russian Jews head for Israel as Kremlin targets emigration group

Putin hoping to secure economic legacy with reshuffle: sources

The plan envisages breathing new life into Russia’s stagnant economy by spending more than 25 trillion rubles ($404 billion) between now and 2024 on major projects in 13 areas

Reuters
22 January, 2020, 10:00 pm
Last modified: 22 January, 2020, 10:00 pm
FILE PHOTO: Russian President Vladimir Putin and Prime Minister Mikhail Mishustin meet with members of the new government in Moscow, Russia January 21, 2020. Sputnik/Aleksey Nikolskyi/Kremlin via REUTERS
FILE PHOTO: Russian President Vladimir Putin and Prime Minister Mikhail Mishustin meet with members of the new government in Moscow, Russia January 21, 2020. Sputnik/Aleksey Nikolskyi/Kremlin via REUTERS

A Russian government reshuffle that brought in a new first deputy prime minister and a new economy minister is an attempt by President Vladimir Putin to secure his economic legacy, say two sources close to the government, but it also carries risks.

The reshuffle, which remodeled the government's economic decision-making bloc, is fuelling concerns about higher state spending and inflation risks, though analysts say they expect Russia's robust fiscal framework to survive.

Putin approved the new government on Tuesday and described it as a break with the past.

The sources said Putin hopes the reshuffle will help accelerate implementation of a vast state spending plan seen as the centerpiece of what may be his final presidential term.

The plan envisages breathing new life into Russia's stagnant economy by spending more than 25 trillion rubles ($404 billion) between now and 2024 on major projects in 13 areas, including health, education and infrastructure.

In the reshuffle, Andrei Belousov, Putin's economic adviser since 2013 and a key architect of the spending plans, was appointed first deputy prime minister, replacing Finance Minister Anton Siluanov who had held that role since May 2018.

Maxim Reshetnikov, a former regional governor, was appointed Russia's new economy minister, replacing Maxim Oreshkin.

Putin, 67, is due to step down as president in 2024, though many say a proposed constitutional shake-up he is pushing through at the moment is designed to allow him to continue wielding influence in another role.

Dmitry Medvedev, Russia's prime minister since 2012, had been in charge of implementing the economic plan until Putin abruptly replaced him last week with former tax chief Mikhail Mishustin.

"Putin could see (Medvedev) wasn't doing anything, it was infuriating that he was just sitting and waiting for the presidency to fall to him again," said one of the sources who regularly meets Russian officials.

Medvedev served as Russia's president from 2008 to 2012 as the constitution barred Putin for a third consecutive term.

VISIBLE REBOOT

Putin had grown unhappy with Medvedev's failure to deliver at a time when falling real wages and declining government popularity risked deepening public anger, another source close to the government said.

The second source said Putin was concerned about the impact of falling living standards and a plan to hike the pension age, and wanted a visible reboot to assuage public anxiety and speed up the roll-out of his national projects.

"We need to realize the national projects more actively so that people feel changes to their lives and around them soon," Mishustin, Putin's new prime minister, told his cabinet at their first meeting on Tuesday.

However, the promotion of Belousov, who has a reputation as a proponent of state capitalism, is causing concern among some investors.

His appointment "implies a shift from the economic agenda and tight fiscal policy to spending and the National Projects," Alfa Bank said in a note to clients.

Higher state spending could create inflationary risks, which will limit room for further rate cuts by the central bank while wiping out Russia's budget surplus.

In the old set-up, Finance Minister Siluanov had been crucial in implementing a prudent fiscal policy, known as the budget rule, designed to shield the economy from swings in the price of oil.

But his demotion and Belousov's elevation open the door to possible change.

"The appointment of Belousov raises concerns about a softening of fiscal policy," said Kirill Tremasov, a former economy ministry official who heads research at Locko Invest firm.

However, Moody's credit rating agency said Russia would be able to cope with higher state spending, given its low public debt and the rebuilding of fiscal reserves following the implementation of its fiscal rule in 2018 and some spending under-execution in recent years.

Russia / Vladimir Putin

Comments

While most comments will be posted if they are on-topic and not abusive, moderation decisions are subjective. Published comments are readers’ own views and The Business Standard does not endorse any of the readers’ comments.

Top Stories

  • Stories beneath the trade data
    Stories beneath the trade data
  • India also will be ashamed of FM Momen’s statement: Quader
    India also will be ashamed of FM Momen’s statement: Quader
  • Logo of BNP
    BNP slams Momen for 'asking India to keep PM Hasina's govt in power'

MOST VIEWED

  • Ukrainian service members are seen at a position near a frontline, amid Russia's attack on Ukraine continues, in Zaporizhzhia Region, Ukraine August 18, 2022. REUTERS/Dmytro Smolienko
    Explosions rock Russian-held areas far from Ukraine war front
  • Supporters of the Coordination Framework, a group of Shi'ite parties, gather during a sit-in, amid a political crisis, near the Green Zone, in Baghdad, Iraq August 13, 2022. REUTERS/Alaa al-Marjani
    As Iraqi protesters rally, political deadlock leaves families without cash
  • Test tubes labelled "Monkeypox virus positive" are seen in this illustration taken May 22, 2022. REUTERS/Dado Ruvic/Illustration
    EU backs changing monkeypox vaccine injection method to boost supply
  • FILE PHOTO - Russian President Vladimir Putin attends a meeting with acting Governor of Kirov region Alexander Sokolov via a video link at the Kremlin in Moscow, Russia August 9, 2022. Sputnik/Mikhail Klimentyev/Kremlin via REUTERS
    Putin agreed to send IAEA mission to Ukraine plant, Macron's office says
  • Semiconductor chips are seen on a circuit board of a computer in this illustration picture taken February 25, 2022. REUTERS/Florence Lo/Illustration
    Taiwan says it has not been informed of 'Chip 4' meeting
  • Traders work on the floor at the New York Stock Exchange (NYSE) in New York, U.S., November 18, 2019. REUTERS/Brendan McDermid
    Nasdaq leads Wall Street lower as rate hike worries spark tech rout

Related News

  • How Russia gets advantage for geographical location?
  • Russian duo hail Stars Coffee as successor brand to Starbucks
  • Putin tears a giant hole in a critical German balance sheet
  • Xi, Putin to attend G20 summit in Indonesia
  • Russian Jews head for Israel as Kremlin targets emigration group

Features

Illustration: TBS

China-Bangladesh currency clearance agreement can increase trade by 'an unimaginable scale': Li Jiming, Ambassador of China

15h | Interviews
Postcrossing (which connects people through its website) is a system built for postcard enthusiasts, where anyone can sign up and create an account for free. Photo: Noor A Alam

Postcrossers: Reviving a lost art with strangers and postcards

14h | Panorama
We will be facing massive, recurring challenges in the coming years no matter what. Photo: Reuters

Holes in the recession story

1d | Panorama
Illustration: Bloomberg

What nonmonogamy can teach moonlighters and job jugglers

1d | Pursuit

More Videos from TBS

Amazing folding smartphone

Amazing folding smartphone

6h | Videos
How Russia gets advantage for geographical location?

How Russia gets advantage for geographical location?

8h | Videos
Is textbooks enough for students?

Is textbooks enough for students?

8h | Videos
134-year-old traditional sandwich of New York

134-year-old traditional sandwich of New York

13h | Videos

Most Read

1
From left Afzal Karim, Murshedul Kabir and Mohammad Jahangir
Banking

Sonali, Agrani and Rupali banks get new MDs

2
Russia now offers Bangladesh finished oil
Energy

Russia now offers Bangladesh finished oil

3
Photo: TBS
Bangladesh

5 crushed to death as BRT girder falls on car in Uttara

4
Photo: Collected
Economy

Bangladesh is not in a crisis situation: IMF

5
Migrant workers. Photo: UNB
Migration

Can Bangladesh benefit from Canada’s 10 lakh job vacancies?

6
Eight more banks make unusual gains from forex dealings
Banking

Eight more banks make unusual gains from forex dealings

EMAIL US
[email protected]
FOLLOW US
WHATSAPP
+880 1847416158
The Business Standard
  • About Us
  • Contact us
  • Sitemap
  • Privacy Policy
  • Comment Policy
Copyright © 2022
The Business Standard All rights reserved
Technical Partner: RSI Lab

Contact Us

The Business Standard

Main Office -4/A, Eskaton Garden, Dhaka- 1000

Phone: +8801847 416158 - 59

Send Opinion articles to - [email protected]

For advertisement- [email protected]