News Analysis: Russia's crucial year

09:00, January 10, 2011      

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For Russia, one of its top priorities in 2011 is to keep economic growth. Meanwhile, political infighting might gather steam ahead of the upcoming parliamentary and presidential elections.

How will President Dmitry Medvedev and Prime Minister Vladimir Putin perform in this crucial year? Analysts said that economy and elections will be their focuses.


Russians hope that their economy will achieve sustained and healthy growth this year, but the uncertainty of the outside economic environment and the lack of endogenous impetus are clouding the country's economic development.

In 2009, Russia's economy was smashed by the international financial crisis and saw its worst recession in decades with gross domestic product (GDP) shrinking 7.9 percent.

In 2010, although Russia's GDP achieved a 3.8-percent growth, experts still believed that Russia faced an uphill task to maintain a steady economic growth.

In order to achieve steady growth, the Russian government has to effectively handle two tough tasks, namely curbing inflation and cutting deficit.

However, the federal statistic service Rosstat announced Wednesday that preliminary data indicated that Russia's inflation rate was 8.7 percent in 2010, due to the unprecedented summer drought that affected a third of Russian crops.

In his annual address to the Federal Assembly, Medvedev vowed to lower the inflation rate to 4 percent and 5 percent in the next three years.

With regard to deficit, Russian authorities have reiterated efforts to balance the budget and cut the deficit to zero by 2015. However, Russia's budget deficit in 2010 amounted to 4.2 percent of the GDP, portending a difficult task.

Moreover, relying heavily on resources sectors, such as oil and natural gas, is the long-time evil of Russian economy. Therefore, the government is to carry out an innovation-oriented economic development strategy and seek new launch pads for economic growth.

According to the government, Russia is to reform and modernize major industries, especially innovating in energy conservation, aerospace, nuclear power, medicine, communications and other sectors.

The government has also been improving its investment environment, wooing foreign investment and introducing cutting-edge technologies.

In addition, Russia's "economic diplomacy" is expected to bring more chances to the country in the coming years.

Local media predicted that Russia's accession to the World Trade Organization (WTO) will further boost the country's economic development and improve its relations with the United States, the European Union and other countries.


Another topic on the country's agenda in 2011 is the elections. The Russian government has to make good preparations for both the parliamentary election and the presidential election, slated respectively for late 2011 and 2012, and different parties have also been gearing up.

The ruling United Russia party, the Communist Party of the Russian Federation, A Just Russia and the Liberal Democratic Party of Russia have been keeping a close eye on regional elections.

In 2010, United Russia won the March and October regional elections by a landslide. Its New Year's resolution is to win the upcoming March local elections and prepare for the year-end parliamentary election.

Also last year, the Putin-led party changed its mechanism of annual national congresses to quarterly meetings in central cities of the federal districts.

Putin has visited four cities and discussed strategic development issues with local authorities in order to gain more support from these regions.

Moreover, local media believed that the recent appointment of Moscow Mayor Sergei Sobyanin was another clever move. The ruling party chose Sobyanin to govern the capital city with an aim to lay a foundation of social politics for the elections.

Another move of the ruling party -- naming Vyacheslav Volodin to replace Sobyanin as deputy prime minister -- was expected to help better organize election campaigns.

In December, Putin said he did not rule out the possibility of leading United Russia in the parliamentary election. Local media said that in that case, the party may win more supporters.

Serving as a weathervane of current Russian politics, the parliamentary election is likely to be dominated by United Russia no matter whether the party is led by Medvedev or Putin, because both have adopted policies welcomed by Russians, especially the anti-crisis programs.

Besides, who will be the next Russian president is also an eye-catching headline for Russia and the world. Both Medvedev and Putin have said they do not rule out the possibility of participating in the 2012 election, but the two have also reiterated they will "consult" with each other on the topic.


Although both Medvedev and Putin are popular in Russia, the two are facing several problems in the 2011.

Severely affected by the financial crisis, Russia's economy is still anemic, with some 5 million people unemployed. Corruption and judicial injustice are also rampant.

Moreover, riots of soccer fans have revealed a worrisome division between native Russians and immigrants. The lingering tensions in Chechnya and other regions are also threatening the country's stability.

Some critical parties have also protested the work of the government and asked Putin to step down.

Against such a backdrop, Medvedev and Putin have to try their best to revive the economy, resolve social conflicts and promote social harmony in 2011.

Source: Xinhua
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