Pro-reform economic liberals in Russia breathed a sigh of relief when the new cabinet was announced on March 9. Qualified economists, who are described in Russia as time-tested pro-market liberals, have retained key posts in the economic block. Alexei Kudrin has been re-appointed as the finance minister, if not vice-premier. And he is not alone. As part of the administrative reform and the cabinet reshuffle, the number of ministries has been cut sharply to 17 from 30, as has the number of vice-premiers. In fact, Russia now only has one deputy prime minister.
Kudrin, who has been in the government for many years, is associated by political analysts with "hard-nosed" federal budgets, primary surplus, regular foreign debt payments, increased wages for public sector workers, and the stabilisation fund.
The Economic Development and Trade Ministry will, as before, be headed by German Gref. This ministry formulated all the systemic market innovations: tax and customs reform, a law on free economic zones, health reform, pension and even judiciary reform. It is worth noting that under Gref economic growth started and continued, the West recognised Russia as a market economic country and gave it an investment rating, while WTO membership talks were re-energised. And although all the credit for this should not be given to Gref alone, his re-appointment symbolises the continuity of economic philosophy in Russia.
Another long-surviving member of the executive branch is the well-known pro-market economist Viktor Khristenko. Now in the capacity of a minister, but stripped of his "vice-premier" brief, he will be responsible for industry and power. Khristenko's remit is of exceptional importance, when one considers the often-reiterated emphasis on Russia's priority for the next ten years: a breakthrough in high technologies. This is especially true when one remembers that the second part of his brief, the power industry, is still the country's main provider and driving force of economic growth.
The three "old/new" appointments should dispel any fears in the country and abroad about an alleged change of economic policy. Logic suggests: since the above-mentioned ministers presided over the drafting of all the current liberal reforms, and the Russian economy demonstrated successes in 2000-2004, the horses need not be changed in the mid-stream.
Moreover, if one bears in mind that Alexander Zhukov has been named the only vice-premier to oversee the liberal-minded economic ministers, it becomes clear that the government's economic block has been reinforced, rather than weakened. As the long-time chairman of the parliamentary committee for economic policy, Zhukov became known as a highly educated pro-market economist, who promoted liberal reforms not only in the last pro-presidential, but also in the left-leaning opposition Duma.
And last but not least, it is most important that new prime minister, Mikhail Fradkov, is also from a group of experienced economic ministers who held the fort of economic reforms in Russia in the most difficult years - the 1990s. In short, economic reform in Russia is in safe hands, which has been confirmed by the market's positive response to the latest Russian government appointments.