Putin to consolidate his hold on power

By Henry Meyer

MOSCOW (AFP): Vladimir Putin will be sworn in as president of Russia on Sunday, and is expected to move swiftly to consolidate his hold on power to allow him a free hand in pushing through vital economic reforms.

The first task of the 47-year-old former KGB spy, who won a comfortable election victory on March 26, will be to nominate a prime minister and cabinet.

The top candidate for the PM post is Mikhail Kasyanov, the country's de facto cabinet chief since Putin, who currently holds the post, became acting president on the snap resignation of Boris Yeltsin on Dec. 31, 1999.

The first deputy prime minister, who could win cross-party support in the State Duma lower house of parliament, which must approve the president's nomination, said Wednesday the new government should be in place by the end of May.

The Duma is expected to hold a confirmation vote on the candidate on May 19.

Some of the suggestions put forward provided for "fairly large changes" in the cabinet line-up, said Kasyanov.

Putin, a political unknown when he was catapulted into the prime minister's seat nine months ago, is seen as likely to concentrate on stamping his political authority in Russia before embarking on overhauling the economy.

"Real power will remain vested in the Kremlin, and with a tame Duma and little real opposition, the key word will be centralization," commented Eric Kraus, chief strategist at NIKoil Capital Markets.

If Putin has learned one thing from Yeltsin's era, it is that under Russia's current chaotic political system it has proven all but impossible to devise, implement and enforce a coherent program of reform.

Pressing though the economic agenda is, analysts thus expect Putin to start by consolidating his power, bringing Russia's robustly independent governors to heel, placing his own men in strategic posts in the government White House, the Kremlin administration and law enforcement bodies.

The Kommersant newspaper leaked an internal Kremlin memo on Wednesday which set out plans to boost the powers of the presidential administration and increase the role of the secret services in running the nation's affairs.

"Russia will become an even more presidential republic. The government will be restricted to a modest role: carrying out economic tasks and not straying from the political line," the business daily commented.

"Russian liberal economists will be immune from criticism, just like in Chile under Pinochet," it added, describing Putin's approach as relying on "totally KGB methods of control".

Putin's greatest challenges are crushing inequality, corruption, economic muddle and habitual political anarchy that has allowed a clutch of shadowy business tycoons to pull the strings of power.

So far the new Kremlin chief has not set out his economic platform in any detail.

But the government has already promised sweeping tax cuts next year and Putin has vowed to cut the country's swollen bureaucracy, which has grown to 2.7 million, as well as improve the legal climate for foreign investors.

Analysts point to the choice of ultra-liberal Andrei Illarionov as a top economic adviser to Putin as proof of his intentions.

On the foreign stage, Putin will face his first big test at the beginning of June when U.S. President Bill Clinton visits Moscow for a summit that will be dominated by the two countries' dispute over arms control.

Moscow is continuing to threaten to pull out of nuclear disarmament talks should Washington press ahead with a plan to build an anti-nuclear shield that would violate the 1972 Anti- Ballistic Missile Treaty.

Meanwhile tensions with the West continue to simmer over the brutal Russian crackdown in breakaway Chechnya, although the war remains popular at home despite mounting casualties from rebel ambushes.