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Putin Stresses Foreign Policy and Economic Goals After ‘Difficult Year’ Putin Stresses Foreign Policy and Economic Goals After ‘Difficult Year’
(about 2 hours later)
• In annual speech, President Vladimir V. Putin made a strong defense of Russia’s annexation of Crimea.
• Mr. Putin used an aggrieved, angry tone in pronouncements on foreign policy.
• He said Russia should overhaul its struggling economy and help small businesses.
MOSCOW — President Vladimir V. Putin said on Thursday that Russia had endured a “difficult year,” but he pledged that the country would pursue its independent foreign policy and economic objectives despite dogged Western efforts to weaken it.MOSCOW — President Vladimir V. Putin said on Thursday that Russia had endured a “difficult year,” but he pledged that the country would pursue its independent foreign policy and economic objectives despite dogged Western efforts to weaken it.
Mr. Putin used his annual state of the nation speech to both reaffirm the Kremlin’s intention to make Russia a great power again and to try to reassure the Russian people that he was addressing troubling economic developments. Mr. Putin used his annual state of the nation speech both to reaffirm the Kremlin’s intention to restore Russia's great power statrus and to reassure the Russian people that he was addressing troubling economic developments.
Standing on a dais in a vast white marble Kremlin hall filled with the country’s political elite, the president called Crimea the country’s Temple Mount and said that its annexation in March confirmed that Moscow could protect Russian people everywhere. On a dais in a vast white marble hall at the Kremlin filled with the country’s political elite, Mr. Putin called Crimea the country’s Temple Mount and said that its annexation from Ukraine in March confirmed that Moscow could protect Russian people everywhere.
Before the speech, there had been widespread speculation in Russia on whether Mr. Putin would favor conservatives who want to pursue a confrontation with the West despite the economic costs or liberals who think that attitude brought disaster to the Soviet Union.Before the speech, there had been widespread speculation in Russia on whether Mr. Putin would favor conservatives who want to pursue a confrontation with the West despite the economic costs or liberals who think that attitude brought disaster to the Soviet Union.
Mr. Putin did a little of both, taking a defiant stand on foreign policy but vowing to put in place policies that would help small and medium businesses. Most liberals believe that unshackling the private sector is the key to solving Russia’s economic problems, given that the state controls 55 percent of the economy.Mr. Putin did a little of both, taking a defiant stand on foreign policy but vowing to put in place policies that would help small and medium businesses. Most liberals believe that unshackling the private sector is the key to solving Russia’s economic problems, given that the state controls 55 percent of the economy.
The Russian leader used the same aggrieved, angry tone he has often adopted in his public pronouncements since the Ukrainian crisis erupted in March. The West has reacted to the annexation of Crimea and the conflict in Ukraine by imposing sanctions, but Mr. Putin said those events were just a pretext.The Russian leader used the same aggrieved, angry tone he has often adopted in his public pronouncements since the Ukrainian crisis erupted in March. The West has reacted to the annexation of Crimea and the conflict in Ukraine by imposing sanctions, but Mr. Putin said those events were just a pretext.
“This is not just a nervous reaction of the United States and its allies to our position with regards to events and the coup in Ukraine,” he said near the beginning of the 70-minute speech. “This is not just a nervous reaction of the United States and its allies to our position with regards to events and the coup in Ukraine,” he said near the beginning of his 70-minute speech.
“If all that had not happened, they would have come up with a different mode to restrain Russia,” he said, accusing the West of pursing the same policy for “decades if not centuries.” Whenever the West feels that Russia is becoming too strong, it resorts to such measures, he added. “If all that had not happened, they would have come up with a different mode to restrain Russia,” Mr. Putin said, accusing the West of pursing the same policy for “decades if not centuries.” Whenever the West feels that Russia is becoming too strong, it resorts to such measures, he added.
Mr. Putin again dismissed the idea that the popular uprising in Kiev, the capital of Ukraine, was sufficient to topple a president close to the Kremlin. He accused Washington of manipulating events there, saying that when it came to negotiations about solving the crisis, he was never sure whether he should address Ukrainians or the United States.Mr. Putin again dismissed the idea that the popular uprising in Kiev, the capital of Ukraine, was sufficient to topple a president close to the Kremlin. He accused Washington of manipulating events there, saying that when it came to negotiations about solving the crisis, he was never sure whether he should address Ukrainians or the United States.
Mr. Putin sprinkled the speech with numerous references to his standard line that Russia would remain the global standard-bearer for conservative values. He sprinkled the speech with numerous references to his standard line that Russia would remain the global standard-bearer for conservative values.
But he also said that Russia did not want to restore the Iron Curtain, that the country was open to the world and that it would never “pursue paranoia, suspicion and looking for enemies.” This will come as a surprise to some, especially employees of nongovernmental organizations who have been labeled “foreign agents” over the past years and whose groups were shuttered or pursued to pay huge new tax bills.But he also said that Russia did not want to restore the Iron Curtain, that the country was open to the world and that it would never “pursue paranoia, suspicion and looking for enemies.” This will come as a surprise to some, especially employees of nongovernmental organizations who have been labeled “foreign agents” over the past years and whose groups were shuttered or pursued to pay huge new tax bills.
The initial part of the speech focused on foreign policy issues, with Mr. Putin still riding a popular wave of support for the annexation of Crimea.The initial part of the speech focused on foreign policy issues, with Mr. Putin still riding a popular wave of support for the annexation of Crimea.
Mr. Putin made a passing reference to clashes overnight in Grozny, the Chechen capital. Russia was capable of facing the threat from such terrorism, he said.Mr. Putin made a passing reference to clashes overnight in Grozny, the Chechen capital. Russia was capable of facing the threat from such terrorism, he said.
But the bulk of the speech focused on the economy.But the bulk of the speech focused on the economy.
After 15 years of prosperity under Mr. Putin, Russians are increasingly worried that their living standards will suffer as tumbling oil prices compound the problems brought by Western sanctions imposed in response to Russia destabilizing Ukraine.After 15 years of prosperity under Mr. Putin, Russians are increasingly worried that their living standards will suffer as tumbling oil prices compound the problems brought by Western sanctions imposed in response to Russia destabilizing Ukraine.
Mr. Putin said that his country should use the current confrontation with the West to try to overhaul its economy, and to depend more on itself for food, medicine and technology. Just as Russia once broke boundaries in space and atomic energy, he said, it should also become a leader in creating goods the world wants.Mr. Putin said that his country should use the current confrontation with the West to try to overhaul its economy, and to depend more on itself for food, medicine and technology. Just as Russia once broke boundaries in space and atomic energy, he said, it should also become a leader in creating goods the world wants.
His economic proposals included a no-questions-asked policy toward anyone who brought home their offshore wealth, a reprieve from government inspections for small and medium businesses, and a four-year freeze in the tax rate.His economic proposals included a no-questions-asked policy toward anyone who brought home their offshore wealth, a reprieve from government inspections for small and medium businesses, and a four-year freeze in the tax rate.
Mr. Putin said that the fall in the price of the ruble, from about 33 to the dollar at the beginning of the year to around 53 now, was caused in part by currency speculators. The government is aware of who they are, he said rather ominously.Mr. Putin said that the fall in the price of the ruble, from about 33 to the dollar at the beginning of the year to around 53 now, was caused in part by currency speculators. The government is aware of who they are, he said rather ominously.
The Russian leader acknowledged that inflation was a problem, and he called on regional governments to help control the price of food. While not ignoring the current economic problems, Mr. Putin did not go into details that would highlight their severity.The Russian leader acknowledged that inflation was a problem, and he called on regional governments to help control the price of food. While not ignoring the current economic problems, Mr. Putin did not go into details that would highlight their severity.
The economy is definitely sinking, with the government conceding for the first time this week that Russia faces a recession next year. The economy is expected to contract by at least 0.8 percent instead of growing by the previously projected 1.2 percent. Independent economists say they believe the contraction could well be 2 or 3 percent.The economy is definitely sinking, with the government conceding for the first time this week that Russia faces a recession next year. The economy is expected to contract by at least 0.8 percent instead of growing by the previously projected 1.2 percent. Independent economists say they believe the contraction could well be 2 or 3 percent.
Each week brings a welter of new bad economic developments. The Russian economy is heavily dependent on oil exports, with the budget constructed on a price of at least $100 per barrel. It is now trading at around $70.Each week brings a welter of new bad economic developments. The Russian economy is heavily dependent on oil exports, with the budget constructed on a price of at least $100 per barrel. It is now trading at around $70.
The ruble has fallen sharply against the dollar and the euro, losing a third of its value. Inflation, creeping up toward 9 percent overall, has hovered around 20 percent for food after Russia cut off imports of staples like meat, seafood, dairy products, fruit and vegetables from the West.The ruble has fallen sharply against the dollar and the euro, losing a third of its value. Inflation, creeping up toward 9 percent overall, has hovered around 20 percent for food after Russia cut off imports of staples like meat, seafood, dairy products, fruit and vegetables from the West.
Capital flight is expected to reach $128 billion this year.Capital flight is expected to reach $128 billion this year.
But economists said the worst problem was that Russian corporate debt was enormous at around $650 billion as sanctions have blocked companies from Western credit markets.But economists said the worst problem was that Russian corporate debt was enormous at around $650 billion as sanctions have blocked companies from Western credit markets.