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Medvedev names Putin's man as Moscow mayor

MOSCOW (Reuters) - Russian President Dmitry Medvedev named a close aide of Prime Minister Vladimir Putin to run Moscow on Friday, asking him to deal with rampant corruption and improve the business environment.

Russia's President Dmitry Medvedev (L) talks with Deputy Prime Minister Sergei Sobyanin at the presidential residence Gorki outside Moscow October 15, 2010. REUTERS/RIA Novosti/Kremlin/Mikhail Klimentyev

The appointment of Deputy Prime Minister Sergei Sobyanin, 52, to run the city which accounts for a quarter of Russia’s $1.3 trillion (813.3 billion pounds) economy, will further strengthen Putin’s grip on power in the oil-rich country ahead of a 2012 presidential election.

Sobyanin will replace veteran mayor Yuri Luzhkov who ruled the city of 10.5 million for 18 years and oversaw its transformation from a grim Soviet capital into a bustling megapolis. Luzhkov was dismissed by Medvedev after a public row.

“This is a very tough job with a lot of responsibilities,” Medvedev told Sobyanin during a televised meeting at his country residence outside Moscow. Sobyanin’s candidacy will be rubberstamped in the city council next week.

Analysts say Putin will be the main beneficiary of the appointment, although Sobyanin is also on good terms with Medvedev, having run his headquarters during the 2008 presidential election campaign.

“The choice is a victory for Putin and will strengthen his control over Moscow. Sobyanin is clearly a Putin man,” analyst Leonid Radzikhovsky said on Ekho Moskvy radio. Both Medvedev and Putin have hinted they may run in the 2012 election.

Sobyanin governed the oil-rich Tyumen region comparable in size and influence with Moscow and also has experience of working both for the Kremlin and the government. His current boss Putin did not part with his aide easily.

“We very much regret that Sergei Sobyanin will no longer head the government’s staff. He is a wise leader and is very pleasant to work with,” said Putin’s spokesman Dmitry Peskov.


Moscow hosts the headquarters of Russia’s major firms and banks and foreign firms’ representative offices. It has a lucrative, if opaque, real estate market which was tightly controlled by Luzhkov’s administration.

Medvedev and Putin want to turn the city into a global financial centre rivalling London, Dubai and Singapore.

“There are many opportunities for doing business projects in Moscow but not all of them can be easily used. There are many reasons for it, one of which we are openly talking about is corruption,” Medvedev said.

Finance Minister Alexei Kudrin accused Luzhkov of spending a quarter of Moscow’s $36.5 billion budget on opaque financial schemes.

“In many cases such schemes were used and we at least need to check these schemes for their compliance with the law,” Medvedev said.

Russian prosecutors have launched an investigation into one of Luzhkov’s former deputies on bribery charges and analysts expect more heads to roll as Sobyanin takes control of the mayor’s office.

Medvedev also asked Sobyanin to deal with Moscow’s notorious traffic jams, a problem singled out by the business community as the biggest obstacle to the city becoming a financial centre.

“Everyone says that it is hard to move around Moscow but despite the growing number of cars I am sure that...the situation with the traffic can be if not solved then significantly improved,” Medvedev said.

Writing by Gleb Bryanski; Editing by Ralph Boulton