Putin reshuffles economic team amid slowdown

Last Updated: Monday, June 24, 2013 - 15:36

Moscow: Russian President Vladimir Putin reshuffled his top economic aides in a move analysts said was aimed at giving the Kremlin more control to spend its way out of a looming recession.

Putin`s former top economic advisor Elvira Nabiullina took over as Governor of the Russian central bank from the retiring Sergei Ignatyev in a shift that had first been announced in March.

Meanwhile, the Kremlin said that Economy Minister Andrei Belousov had been named to replace Nabiullina as the top Kremlin Economic Advisor.

Deputy central bank governor Alexei Ulyukayev is taking over as economy minister, according to a decree signed by Putin posted on the Kremlin website.
Belousov, 54, has in recent months emerged as one of the government`s most vocal supporters of more state action to rescue the economy from a slowdown that some officials have warned could become a recession.

Nabiullina is also seen as a close confidante of Putin who is unlikely to stand in the way of the Kremlin`s desire to see a more relaxed monetary policy to help stimulate the economy.

Keeping a watchful eye on persistently high inflation, the central bank under Ignatyev had defiantly resisted pressure from some officials to cut interest rates.

"The reshuffles could be interpreted as strengthening the axis of economic power around President Putin," said Ivan Tchakarov, Chief Russia economist at Renaissance Capital.

He said in a note to clients that Belousov had been firmly behind the recent calls for a "more dirigiste approach to supporting the flagging economy".

"With the appointment of Belousov and Nabiullina one may argue that Putin is creating a more united and focused nerve centre to tackle the recent economic slowdown."

Ulyukayev`s departure from the central bank had been widely expected by analysts who did not believe that the hawkish economist would be able to work successfully with Nabiullina.
Putin said last week that up to 450 billion rubles (USD 13.7 billion) could be used from a sovereign wealth fund for infrastructure projects to help stimulate the economy, including a high speed railway between Moscow and the Volga city of Kazan.

AFP



First Published: Monday, June 24, 2013 - 15:36

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