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Kudrin resigns as finance minister

by at 26/09/2011 21:53

Alexei Kudrin resigned on Monday as Russia's finance minister and deputy prime minister after a dispute with President Dmitry Medvedev.

The president has already signed Kudrin's resignation request, RIA Novosti quoted the presidential spokeswoman as saying late on Monday.

Medvedev told Kudrin earlier in the day that he should resign. He invoked the head of state’s wrath after saying he would decline a job in a future Russian government that Medvedev is likely to head.

Kudrin cited disagreements with the president on economic policies, in particular, on considerable defense expenditures, as the reason.

President Medvedev said on Saturday at a United Russia party congress that he believed Prime Minister Vladimir Putin should stand in March presidential elections. Medvedev will head United Russia’s ticket at December’s polls and is likely to be named prime minister in the event of Putin’s return to the Kremlin.

Kudrin, 50, has served as finance minister since 2000, during which time the Russian government has paid off most of its substantial foreign debt and created oil wealth funds to soften the blow of the global slump.

Kudrin said earlier in the day that before making a decision on whether to resign, he would consult with Putin.

"You may consult with anyone, including the prime minister,” Medvedev replied, “but I am still the president and such decisions are taken by me.”

He ordered Kudrin to make a decision on his resignation “today,” adding: "Nobody has revoked discipline and subordination in the government.”

Analysts said that Kudrin's possible resignation could see a negative response from investors, who see him as a guarantor of the country’s financial stability.

Some experts have also suggested that Kudrin’s resignation will weaken Russia’s fiscal policies.

"Kudrin has always been a staunch supporter of conservative fiscal policies,” Sergei Karykhalin, an analyst on macroeconomic policies at TKB Capital investment firm, said. “He pioneered the Stabilization Fund and his departure from the government could lead to a more risky fiscal policy if his successor is less cautious and plays less independent role in decision-making.”

Mikhail Zadornov, who served as Russia’s finance minister in 1997-1999, described Kudrin’s resignation as very “regretful” and “untimely.”

“Kudrin was one of the most professional people in the government,” he said. “The country will be left without its finance minister at a time when the world is facing an [economic] crisis, and half a year before presidential elections. This is unlikely to please anyone.”

“The main thing that we need now is to be able to make quick and non-standard decisions as the worsening of the global and Russian [economic] situation is inevitable,” he added. “Kudrin’s resignation puts this quick decision-making mechanism into serious question.”

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