Ahead of the Presidential elections and ongoing protests in Russia, there is increasing speculation that United Russia will be dissolved or change significantly.
Now here’s a map and an article on the rising governance and business risk in Russia from Maplecroft.
Speculation that Russia’s dominant political party, United Russia, could be dissolved or undergo radical reformation after the presidential election on 4 March follows its continued decline in support amongst the public. Media reports interpreted comments made by vice-speaker of the Duma Andrey Vorobiev on 10 February that the party will be rebranded, as a nod towards more substantial alterations to Russia’s ruling party. Spokeswoman for United Russia Natalia Virtuozova said she was unaware of plans to reform the party. Comments made by Vladimir Putin at a meeting with supporters on 7 February indicate changes to the ruling party are imminent, however. The prime minister and presidential hopeful said the loss of its two-thirds majority was a result of “deep-rooted problems” within the party. Speculation comes as Putin seeks to recover his reputation with the electorate and ensure a first-round win in March elections to avoid a substantial erosion of legitimacy.
The party’s declining popularity during Medvedev’s presidency which culminated in its poor performance during the December 2011 legislative elections has limited its ability to act as a force for political mobilisation. United Russia’s parliamentary majority was reduced from 64% to just below 50% of the votes, and although it maintained a slim majority with 238 seats in the 450-seat Duma, the results represented an embarrassing blow to the Kremlin’s political standing. Opposition activists argue that without vote-rigging the United Russia result could have been as low as 35%. The party has been coined as the “party of crooks and thieves” since blogger and anti-corruption activist Alexei Navalny used the phrase as part of his online campaign against United Russia ahead of the legislative elections. Tens of thousands of protestors took to the streets in anti-government rallies following the elections, which were viewed to be rigged, to demand a re-run. Reports that party officials gave money to local organisations in return for votes also contributed to mounting public distrust of the party.
Putin, who heads United Russia without being a member, has distanced himself from the party for some time, and for this reason the party has not played a significant role in his campaign for the presidency. Mounting distrust amongst the public and fatigue at regular reports of corrupt party practices means the party is no longer able to garner support to reinforce policy decisions set by the Kremlin. Putin has long seen United Russia as largely discredited and no longer able to guarantee high levels of support in many regions. There have been a number of high profile cases where the Kremlin has sacked regional governors for failing to secure a United Russia victory in the December parliamentary elections. For example, Anatoly Brovko, the Governor of Volgograd Region, only gained 29.74% of votes and finished his work at the post early “on his free will” according to the Kremlin’s press service.
Putin’s essentially guaranteed return to the presidency after the March election is almost certain to prompt at least limited changes to the ruling party. Former head of the party’s Duma faction, Alexander Vorobyov, conceded before his resignation on 11 February that the party was willing to consider some form of rebranding, including changes to its logo, in order to strengthen its position. However, Putin is likely to prompt a more fundamental transformation in order to create a new power-base to bolster support during the first months of his term as president. A widespread purge and reappointment of officials across the country’s regions will allow for decision-making on economic and political changes demanded by protestors.
Significant political changes are unlikely to lead to major changes for the internal composition of the ruling party, however. In May 2011, Putin founded the All-Russia People’s Front, a political organisation aimed at broadening the party’s electoral base with non-party supporters including NGOs, business associations and youth groups. One scenario would see this loosely formed organisation replace United Russia. However, this would not be a substantial change in practice as all the front’s leaders are members of United Russia. This situation would still allow room for manoeuvre in terms of designating new recruits to positions within the party. For instance, Putin may wish to reinstall former finance minister Alexei Kudrin to the cabinet. There is speculation Kudrin could be asked to serve as prime minister for an interim period in place of a largely discredited Dmitry Medvedev, although there is doubt to whether he would accept the appointment.
Others speculate that rumours of a new political formation to replace United Russia is a deliberate move to assuage public discontent and disassociate his campaign further with the party ahead of the presidential vote. Speculation could be a deliberate effort to boost Putin’s popularity rather than any sort of radical reformation. In this case, Putin has used the situation as an opportunity to portray himself as a moderniser, willing to accept news faces into the party.
Reform is likely given the party’s poor reputation. The president will need to rely on a strong political party in the Duma to strengthen support throughout the regions. Speculation of such changes ahead of the March presidential vote may be a welcome endorsement for Putin that changes demanded by the urban middle-class are in the pipeline. Investors may also welcome change, signalling an end to United Russia’s conservative, non-reformist policy outlook.
Continued uncertainty will sustain a dampened investment climate in the short term. High levels of capital outflow continued in January, reaching an estimated US$11bn, comparable to inflated levels seen in November and December 2011. However, with Putin’s popularity rebounding to 58.6% just weeks before the vote, according to Kremlin affiliated pollster VTsIOM – a result which will return him to the presidency in a first round – Putin will not be looking to make any definite announcements before the election period is over.