MOSCOW President Dmitry Medvedev on Thursday outlined his vision of Russia as one of the world's leading innovative economies and a mature democracy, but gave few clues on how this could be achieved.
Public expectations of his state of the nation address were high after Medvedev published a blueprint in September, saying in a striking confession Russia had to tackle its "ineffective economy, semi-Soviet social structure and weak democracy."
The president had promised to listen to comments from a wide range of society and from political opponents when formulating his big annual speech -- but the contents turned out to be short of specific initiatives.
Market players were keen to learn where Russia would find money for reforming its economy, how it would improve its unfriendly investment climate and how it would encourage reluctant domestic businesses to put money into innovation.
Russia-watchers were also looking at how Medvedev planned to reform the Kremlin-dominated political system, which he himself has described as a source of red tape and corruption.
In his 100-minute speech to the country's political and economic elite, Medvedev named five priority areas for Russia to focus on: energy efficiency technology, the nuclear sector, information technology, space and pharmaceuticals.
Medvedev reiterated his attack on huge state corporations, created by his predecessor Vladimir Putin, saying they would have to reform into commercial companies or disappear.
He also ordered the government, led by Putin, to reduce the share of the state-controlled sector, now exceeding 40 percent, by the time of the next presidential election in 2012.
But his speech did not address the key issue of what would be the driving force behind innovation.
Medvedev confessed the biggest Russian businesses, involved in the lucrative export of oil, gas and metals, were reluctant to venture into the new economy.
"Businessmen prefer to sell things produced abroad, their competitiveness is shamefully low," he said without suggesting an alternative.
In his earlier statements, Medvedev has said small and medium size businesses were most responsive to innovation. But their share of the economy remains in single digits.
Medvedev has earlier said promoting small and medium size businesses was the government's priority. But the subject was completely omitted in his Thursday speech.
In his previous state of the nation address a year ago, Medvedev said the Kremlin's political role was excessive and that a mature democracy with working institutions and free public debates was a must.
He then outlined a series of political reforms aimed at giving some breathing space for the opposition parties suppressed under Putin. The Kremlin-controlled parliament was fast to translate his order into a series of laws.
But local elections, held in October, showed the old tactic of harassing opposition candidates continued in full, creating the impression that the declared reform was a little more than a smokescreen.
Medvedev on Thursday sounded more cautious describing his future political plans.
Reacting to the criticism of October polls, he promised to remove the obligatory gathering of signatures of support for candidates to register -- the strongest instrument for harassing the opposition -- and limit early voting, which opposition parties say is regularly used to forge poll results.
However, in contrast to his earlier confessions, he made clear no more dramatic changes were needed and issued a stern warning instead to the opposition: "Any attempts to rock the situation with democratic slogans, to destabilize the state and split society, will be stopped."