Viktor Zubkov lectured government ministers and defined targets for the next five months

Prime Minister Viktor Zubkov scolded cabinet ministers yesterday at their first meeting this year. He criticized their plans as declarative and gave instructions to prepare concrete measures to achieve the targets set. The government is likely to receive more criticism as the time nears for Putin to take over as Prime Minister, experts say. Dmitry Medvedev, who is expected to succeed Putin, escaped criticism as he embarked on his regional tour yesterday.

Putin attended a cabinet on the eve of the New Year to remind government officials that the coming presidential elections should not prevent them from working “reliably and rhythmically.” “Zubkov should ensure such intensity of work in the cabinet that even my possible arrival as Prime Minister should be like a blessing,” Putin joked.

Zubkov used the long Christmas holidays to scrutinize development plans prepared by ministries, and came to the conclusion that they lacked real mechanisms to implement their ideas, instead offering purely declarative calls. “The goals are correct, but I cannot see mechanisms to achieve them, I can only see declarative calls to strengthen, reduce, increase and so on,” Zubkov noted.

He gave cabinet ministers three months to prepare and submit concrete measures to achieve the targets set. To refresh their memory, Zubkov cited some figures, saying that a GDP growth of 6.7 percent was expected in 2008, while industrial production was projected to increase by 5.7 percent, and investment was to rise by 14 percent. He also mentioned problems such as the declining balance of trade, spiraling inflation and the widening gap in incomes between the top and bottom sections of society.

Some of the targets outlined by Zubkov are quite feasible, analysts say. Their projections for GDP, industrial and investment growth correspond with official estimates. But inflation is going to be a problem. Unlike in the past few years, economic growth in 2008 will be driven by high budget spending, according to Anton Struchenevsky, at Troika Dialog. “Private investment is being replaced by government investment, which will fuel inflation,” he warned. Inflation is expected to rise above the government’s target of 7.5 to 8.5 percent. Deutsche Bank projects a 10.4 percent inflation rate for 2008, Troika Dialog expects 10 percent, and ING Bank forecasts 9.1 percent.

To keep the cabinet in working order until a new government is appointed in May 2008, Zubkov’s criticism will strengthen. “He could also resort to show trials and even dismissals, to stir ministers into action,” believes Dmitry Badovsky, at the Social Systems Institute. “During this period, ministers will try to deserve a seat in the new government,” he added.

Source: RIA RosBusinessConsulting