Russian President Vladimir Putin speaks during his meeting with workers after taking a train on the bridge between Russia and the Crimean Peninsula at Taman Station on December 24, 2019 near Anapa, Russia.
Mikhail Svetlov | Getty Images News | Getty Images
Improving the standard of living of Russian citizens is President Vladimir Putin’s main concern at the moment, he told CNBC on Wednesday, offering rare insight into the concerns of one of the world’s most powerful leaders.
“Our main problem, our main problem and our goal is to increase the incomes of our citizens,” Putin told CNBC’s Hadley Gamble on Wednesday. His response came after he was asked what his biggest concern was today, whether it was inflation, stagflation or the gas crisis in Europe or tensions in the South China Sea.
“This is our main challenge (…) we must ensure economic growth and increase its quality. These are our long-term tasks,” he said.
Putin added that the government “will improve the social situation to increase the incomes of our citizens and take care of the second very important task is the demographic situation. And that involves a lot of social, health, education, support issues for families with children. “
“So these two very important questions, [the] demographic growth and increasing the incomes of our citizens and improving their quality of life … must be resolved on the basis of economic growth. This is what we are going to do in the near future, ”he said.
Russian President Vladimir Putin attends a plenary session of the Russian Energy Week International Forum in Moscow, Russia, Oct.13, 2021.
Sergei Guneev | Sputnik | Reuters
His comments come as Russia’s GDP per capita, a key indicator of economic performance and commonly used as a broad measure of average living standards or economic well-being, remains below that of its peers in the OECD and of the EU.
Chris Weafer, CEO of Moscow-based strategy consultancy Macro-Advisory, told CNBC in September that “the real problem frightening the Kremlin is demographic change,” with a growing number of Russians born after the end of the decade. the Soviet Union and demanding a better standard of living.
??[They] want an improved lifestyle, income, social supports and a better future for themselves and their families, ”said Weafer. “The big challenge for President Putin and the so-called Russian ‘elites’ will be how to meet these expectations while retaining power. The failure of the first will more seriously undermine the second during the next presidential term, whoever that president is. “
Prosperity under Putin
During his two decades in power, Putin undoubtedly oversaw a period of growth in the Russian economy. Likewise, politically, Russia still stands firmly on the global geopolitical arena.
Like any economy, however, Russia has not been immune to global and domestic events. – both under and outside the control of Russia – that have reversed its growth trajectory and caused financial hardship to its citizens.
Learn more about CNBC’s interview with Vladimir Putin:
This was particularly evident in 2014, when a drop in global oil prices, combined with Russia’s decision to annex Crimea to its neighbor Ukraine, put massive pressure on the economy and society. This was due to declining government revenues for oil-exporting Russia and newly imposed international sanctions on the country for its land grab in Crimea. The sharp drop in the ruble led to soaring inflation and commodity prices soared, severely affecting Russian consumers.
More recently, the Covid-19 pandemic has also hit the Russian economy hard, although it has fared better than some developed economies. The World Bank noted that Russia’s gross domestic product (GDP) fell 3% in 2020, compared to contractions of 3.8% on average globally and 5.4% in advanced economies.
“Several factors have helped Russia to do relatively better: in recent years, Russia has undertaken significant macro-fiscal stabilization efforts, which have helped improve its fiscal position. “the bank said in a report in May.
Read more: 5 charts show Russia’s economic ups and downs under Putin
Yet the pandemic remains a serious public health crisis in the country with high cases and slowing vaccinations; Russia reported its highest daily death toll since the start of the pandemic on Wednesday, breaking a previous record on Tuesday.
People walk on Red Square on a sunny autumn day in Moscow on October 9, 2021.
DIMITAR DILKOFF | AFP | Getty Images
World Bank economists last week predicted that Russia’s GDP would grow 4.3 percent in 2021, before falling back to grow 2.8 percent in 2022, then 1.8 percent in 2023 as the the output gap is closing. The Bank noted that “a continued global economic recovery, relatively high oil prices and an improving Covid situation should help consolidate the nascent recovery in domestic demand.”
Does the public want Putin?
President Putin has declined to consider whether he will run for office in 2024, although Russia’s constitution was controversially amended in 2020 to allow him to do so.
If he stands for re-election (with an almost guaranteed victory unless there is a seismic change in Russia in the next few years, given the oppression of opposition parties and politicians, like Alexei Navalny imprisoned), then Putin, who is now 69, could be in power until 2036.
When asked if he had a succession plan on Wednesday, Putin said “I’d rather not answer such questions, that’s my traditional answer. We’ll wait until the next election for that.”
“The conversation in this regard is aimed at stabilizing the situation. The situation must be stable and secure for power structures and global structures to function in a safe and responsible manner,” he said.
With a flag representing President Vladimir Putin, pro-Kremlin activists gather in Red Square in Moscow on March 18, 2014 to celebrate the incorporation of Crimea.
Dmitry Serebryakov | AFP | Getty Images
Geopolitical events both at home and abroad have caused Putin’s popularity to fluctuate considerably since 1999, according to polls conducted by the independent Levada center.
When Russia annexed Crimea, Putin’s popularity rose from 61% to 85%, for example, but since then his rating has steadily declined to its current level of 64% in September.
Whether the Russians believe Putin can solve the country’s internal problems or should remain in power after 2024 is another question.
Levada’s latest survey of Putin’s position with the Russian people, among 1,634 adults at the end of September with the results released this week, showed that 47% of Russians would like Putin to remain president after 2024, while 42% would not. not wish – the highest rate since 2013.
Putin’s concern for growth and its ripple effect on ordinary Russians was just one of the topics he discussed with CNBC during Russian Energy Week on Wednesday. The president also commented on a wide variety of pressing issues, from the gas crisis in Europe to the outlook for oil prices, as well as rising tensions between Russia’s ally, China (President Xi Jinping said a day that Putin was his best friend) and Taiwan.
Putin also discussed a range of energy issues alongside BP CEO Bernard Looney, TotalEnergies CEO Patrick Pouyanne, ExxonMobil CEO Darren Woods and Daimler CEO Ola Kallenius during a panel.
Read more: Putin says “total nonsense” Russia uses gas as geopolitical weapon, ready to help Europe
Russia is an influential force in both Europe and Asia given its position as a global exporter of oil and gas, although in recent years Putin has spoken of the need to diversify Russia’s economy and not depend more on energy exports, an objective that was prioritized after the 2014 oil crash.