Putin sacks his government in pre-election shuffle

Russian President Vladimir Putin sacked Prime Minister Mikhail Kasyanov and his Cabinet today, saying he made the move in order to reshuffle the government ahead of next month’s presidential election.

He went on TV to say: “This decision bears no relation to any assessment of the performance of the former composition of the government.

“ It was dictated by my desire to once again delineate my position on the issue of what development course the country will take after March 14, 2004.”

However, speculation had been rife for months that Kasyanov, the last remaining major government figure from Boris Yeltsin’s years as president, was on his way out.

Kasyanov had said that the intense government probe of the Yukos oil giant, including the jailing of its head Mikhail Khodorkovsky, had set a bad precedent for the country’s recovering economy.

The Yukos probe is widely believed to have been Kremlin-driven and Kasyanov’s criticisms likely irritated Putin and his aides.

The sacking of the prime minister also means the dismissal of the rest of the government ministers, although any of them potentially could be reappointed.

Deputy Prime Minister Viktor Khristenko was named acting prime minister.

The announcement sent shares tumbling on the Russian stock market, with dips of 3% to 5% within minutes of Putin’s statement.

Kasyanov served in the Soviet-era state planning agency Gosplan during the 1980s and after the Soviet collapse in 1991 began a steady rise through economic and financial posts.

As deputy finance minister in 1996 he worked out a deal for repaying debts that Russia inherited from the Soviet Union and two years later was a key figure in Russia’s efforts to retain stability and credibility after Russia defaulted on foreign debt payments and the rouble’s value plunged.

He became finance minister under Yeltsin in 1999 and one of his main achievements in that post was persuading the Paris Club of creditors to reschedule more than £5 billion in Soviet-era loans.

After Prime Minister Vladimir Putin became acting president following Yeltsin’s resignation in December 1999, he appointed Kasyanov first deputy prime minister, effectively making him Russia’s number two official.

After Putin was elected president in the spring of 2000, he appointed Kasyanov prime minister.