In his much-anticipated year-end address, Russian President Vladimir Putin did not make any major surprise announcements about Russian domestic or foreign policy. Instead, he focused on themes related to patience and stability.
Russian President Vladimir Putin is on a TV screen at a shop in Moscow, Russia, on Thursday, Dec. 4, giving his annual state of the nation address in the Kremlin. Photo: AP
The preparations for Vladimir Putin’s annual presidential address to the Federal Assembly were full of expectations. Given the hyperactivity of events this year, analysts and journalists were predicting a new “manifest destiny” – ranging from significant liberal reforms to further isolationism and ultra-patriotism. In an era of looming economic difficulties and an unfriendly external environment, the Russian elite was waiting for answers and a strategy, for a clear way forward.
This was an illusion.
It was clear from the very beginning that the address would follow the pattern of all major events in 2014. One may remember predictions about Vladimir Putin’s speech in Crimea or about the Russian Security Council meeting which was allegedly planning to introduce a ban on major Internet activities. None of these predictions came true. The presidential address was not an exception in this case.
The very nature of the annual address implies the need for balance and compromise. In recent years, it has always been a list of routine tasks with a minimal number of highly political statements. The President tries to keep a balance and move cautiously without rocking the boat. This tactic becomes even more important during times of bitter trials, when patience is the major virtue.
As a result, the address sets forth a number of technical assignments for the government and does not go into strategy, leaving the field for maneuvering in the current cloud of global uncertainty. The technicalities are decorated with the Valdai style of foreign policy analysis and some basic ideas about the social sphere, but more in the form of food for thought for the executive branch.
First, President Putin gave an extensive overview of the historic developments of this year, mostly connected with the situation in Ukraine. His major appeal to the rest of the world is the same as before: Russia will do its best to defend its sovereignty as the only basis for survival of the nation. Russian sovereignty, as he sees it, should be respected and this is the prerequisite for any constructive dialogue.
At the same time, Moscow does not strive for isolation and is open for developing fruitful relationships with all nations that are ready to talk, notably with Asian partners at the current moment. This message is not new and has been repeated several times, but it is important that Russia keeps sending it.
Another clear signal – there will be no negotiations on the status of Crimea. The issue is closed and Russia expects the rest of the world to accept it as a “fait accompli” – the comparison with the Temple Mount in Jerusalem was more than eloquent.
It is quite important that the address openly establishes the unprecedented level of mistrust between Russia and the West, especially the United States. It indicates the firm belief of the Russian elite in the global plots inspired to restrain Russia by all available means. Regardless of the truthfulness of such a view of the world, the approach will obviously impede any real dialogue and imply tough bargaining rather than the search for compromise.
The economic part of the address contains much good news for business – tax amnesty, limitations on checks by various authorities and no new taxes in the next four years. It has a flavor of economic liberalism, but in many ways, follows the logic and the measures proposed in 2012 and even in 2009. Hence, it gives the hope of eventual implementation, but at the same time, raises concerns: Will the dreams of the business community finally come true, taking into account poor execution in the past?
The same relates to innovation and productivity. The goal of raising productivity, which is three times lower than in Europe or in the United States was first articulated in early 2008. Since then the dream of 25 million new highly-paid jobs and doubling of productivity remains just that – a dream. So the current task for the government to take measures to ensure the growth of productivity by 5 percent a year looks more like a reminder. The same is true about the warning about more efficient expenditure – in state-funded construction, the defense industry and state-owned corporations.
What is more important is the appeal for a technological revolution. The new leitmotif is the stimulation of industrial growth and replacement of imported goods. The National Technological Initiative will help to look beyond the horizon and shape the industrial future, while banks will be encouraged to fund the appropriate industrial projects. The major constraint for businesses in this area is expensive capital and Russia no longer rests its hopes on foreign investment – it plans to invest its own reserves in the leading Russian banks, so that they can lend cheap money to the so-called “real sector.” Moreover, Russian and foreign investors will have the chance to use the benefits of the “territories of advanced development” – tax havens and investment hubs in Crimea, the Far East and small single-industry towns.
The social part of the address reaffirmed the previous commitments of the state to the systems of healthcare and education. The most important task here is to accomplish them all, so President Putin did not put forward any large-scale new initiatives, thus, somehow postponing the long-awaited social reforms. Somehow, this mission is slowly placed on the shoulders of civil society – through expansion of the role of socially-oriented NGOs and various means of public control (e.g. greater involvement of the Public Chamber in discussing the laws and supervising the executive branch).
Thus, the address did not bring any sensational appeals or new mobilization appeals. On the contrary, its routine style must comfort the nation and bring back the sense of stability, at least, in the minds of the Russian population. Now it is time to see whether such an approach of patience will pay off in the future.
The opinion of the authors may not necessarily reflect the position of Russia Direct or its staff.