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Russia's Putin to seek presidency, finance chief to go

Sep 25, 2011, 12:15 a.m.
Russia's President Dmitry Medvedev (R) and Prime Minister Vladimir Putin walk along tha stage to address the audience during the United Russia congress in Moscow September 24, 2011. REUTERS/Denis Sinyakov

By Timothy Heritage and Lidia Kelly

MOSCOW/WASHINGTON (Reuters) - Russia's finance minister announced on Sunday he would step down next year if President Dmitry Medvedev becomes prime minister following Vladimir Putin's expected return to the presidency.

Prime Minister Putin said on Saturday he would reclaim the presidency in an election next March that could open the way for the former KGB spy to rule until 2024.

But in comments likely to worry foreign investors who have praised his guardianship of Russia's economy, Finance Minister Alexei Kudrin made clear he was unhappy with Putin's decision to ask Medvedev to be prime minister after the election.

"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, who has hinted he would like to be prime minister, has won the respect of investors by saving windfall oil revenues for a rainy-day fund which helped Russia through the 2008 global economic crisis.

Putin's decision to return to the post he held from 2000 to 2008 is also 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.

Washington said it expected to keep making progress in the "reset" toward better relations with Moscow, whoever was the next Russian president.

But many in the West are wary, and economists fear economic stagnation under Putin.

"This (announcement) shows that Russia is far away from open, democratic competition for the presidency," said Ruprecht Polenz, chairman of the foreign affairs committee in the German Bundestag, the lower house of parliament.

James Goldgeier, a Russia expert at American University in Washington, said: "There will be a businesslike relationship (between Washington and Moscow), but not a warm one."

POWER-SHARING AGREEMENT

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

Putin accepted a proposal by Medvedev to return as president at a carefully choreographed congress of Putin's ruling United Russia party on Saturday.

"I want to say directly: (Medvedev and I) reached an agreement between ourselves long ago, several years ago, on what to do in the future, on who should do what," Putin said.

Over 11 years in power, Putin has cultivated the image of a vigorous leader and been filmed riding bare-chested on horseback, scuba diving and showing off his judo skills.

His policies -- crushing a Chechen separatist rebellion, taming super-rich businessmen and bringing wayward regions to heel -- have similarly won him popularity among Russians.

But critics say his return to the Kremlin, virtually unopposed, could bring back memories of the economic and political stagnation 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.

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