MOSCOW (dpa) – Russia will experience economic difficulties for up to two years but will use the time to diversify its oil and gas-dominated economy, President Vladimir Putin said Thursday.
During his annual marathon press conference in Moscow, Putin brushed off critical questions and argued that state coffers were full enough to weather the crisis, albeit with budget cuts.
“I am convinced that we will easily solve the main social issues, we will diversify the economy and no doubt the situation will normalise,” he said.
The Central Bank of Russia’s foreign currency reserves presently amount to 419 billion dollars, Putin said, praising the Central Bank and the government for “making the right decisions” this week to fight the ruble’s collapse.
The Russian currency crashed Tuesday against the dollar and euro, despite a massive interest rate hike to 17 per cent.
The ruble stabilised Wednesday but briefly fell Thursday after Putin said that the central bank should not “senselessly burn money” to defend the currency. It later rose again from 62 to 60 rubles to the dollar.
Putin said that Russia’s economic growth is likely to be 0.6 per cent this year. He did not make predictions for 2015, when economists fear a Russian contraction of up to 4 per cent.
The president’s approval ratings soared to above 80 per cent after Russia annexed Ukraine’s Crimea peninsula in March and have remained high during the ensuing conflict between pro-Russian separatists and government forces in eastern Ukraine.
Putin said that Western sanctions imposed in response to the crisis in Ukraine were to blame for almost a third of Russia’s economic losses.