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Russia: Putin's Reshuffle Indicates No Major Kremlin Shakeup

Russian acting President Vladimir Putin has reshuffled his government and removed a key Kremlin official implicated in a bribery scandal. RFE/RL correspondent Floriana Fossato reports it's not yet clear whether the changes signal a major change in Kremlin policy.

London, 12 January 2000 (RFE/RL) -- Vladimir Putin has reshuffled top ministers in the Russian cabinet, giving a first look at how the acting president's administration will differ from that of his predecessor, Boris Yeltsin.

In changes announced yesterday, Putin elevated Finance Minister Mikhail Kasyanov to the post of first deputy prime minister. At the same time, he demoted Nikolai Aksenenko.

Kasyanov has won admiration both in Russia and abroad as the country's chief negotiator with international financial institutions, including the London Club of private creditors and the Paris Club of foreign governments. He has a reputation for being a competent and tough negotiator.

The appointment was immediately praised as a sign of Putin's determination to improve the economy and relations with foreign investors. Margot Jacobs, a financial analyst at United Financial Group in Moscow, told The New York Times: "It is important for Western investors to have somebody with a familiar face."

Arnab Das, an emerging markets debt strategist for the financial firm JP Morgan in London, told The Moscow Times that Kasyanov's appointment seems to be a sign Putin wants a government of technically proficient experts, rather than one filled with politically motivated appointees.

In another important move, Putin transferred the Kremlin's powerful property manager, Pavel Borodin, to the largely ceremonial post of state secretary of the Russia-Belarus Union. Borodin controlled the Kremlin property empire, worth many billions of dollars.

Borodin had gained notoriety as a key figure in an ongoing international bribery scandal involving both Swiss and Russian prosecutors. They are looking into allegations a Swiss construction company bribed Kremlin officials, including members of Yeltsin's family, to obtain lucrative Kremlin contracts. Borodin, the Kremlin and the Swiss company (Mabetex) have dismissed the allegations.

Borodin's dismissal follows the removal from power of Yeltsin's daughter, Tatyana Dyachenko, formerly a top presidential aide.

Both moves were greeted as a sign that Putin intends to have his own stamp in the Kremlin and may be taking tentative steps toward eliminating corruption in the Kremlin.

Our correspondent reports, however, that praise for the reshuffle may be premature.

Nikolai Petrov is a senior associate with the Carnegie Center in Moscow. He told RFE/RL's Russian service there is ample ground to believe the reshuffle is no more than a "game of musical chairs" so as not to alienate anyone ahead of the presidential election:

"I think what is happening now in the cabinet is, naturally, a political move. It's also a tactical move, associated with preparations for the upcoming presidential elections. The changes and are being carried out in such a way as to not to alienate a part of his wide-ranging electorate and those who are prepared to support him in the elections."

Petrov says, for one, the reshuffle should not be considered the beginning of a major fight against corruption in Russian state structures. He also says the real changes may come only after the election -- which Putin is highly favored to win.