Vladimir Putin on his way back to the Kremlin comes as little surprise. The mentor of current President Dmitri Medvedev never lost his de facto title of strong man of Russia. This coming March Putin intends to begin a third term in the highest office.
Addressing some of his most faithful supporters, Putin said: “I would like to express my gratitude for your positive reaction to my candidacy for the post of president of the country. This is for me a great honour.”
The role of prime minister would swing back to Medvedev if their tag-team-like arrangement holds. This is aimed at keeping Russia politically stable, however humbling it might be for Putin’s one-time protegé.
Yet the political plates are shifting, as demonstrated by the resignation at Medvedev’s suggestion of Deputy Prime Minister with finance portfolio Alexei Kudrin. Well-respected in international circles, he brought Russia round when it went broke in 1998, and steered it through the 2008 crisis unscathed. Foreign investors will be among those wondering or worrying how long he may remain in the grey zone of politics.
Putin has several major challenges ahead of him. He has to reduce dependence on fossil fuel exports. With a global recession skulking on the horizon, for lack of a more diversified economy the country is at the mercy of fluctuating energy prices.
Russia must also renew its ageing infrastructure. This has been demonstrated again and again lately, what with four air crashes and a river cruise boat going down, claiming many lives.
The fight against corruption is another big problem. Corruption scares investors, discourages a lot of Russians and is a drain on state resources. In its corruption rankings, Transparency International places Russia as low as Cambodia, Kenya and Laos.
By no means the least of the country’s worries is demographics. It is projected to have ten million fewer people of working age by 2025. That would bring an economic slowdown, and more strain on social security costs to care for the elderly.