Putin reiterates tough stance against western pressure

President Vladimir Putin reiterated on Thursday that Russia will not bow to external political pressure and will stay firm to protect the national interests.

Meanwhile, he urged the country to restructure its economy, as Russia is currently experiencing an economic slowdown and a rapid depreciation of the country's currency ruble partially due to high economic reliance on energy exports.

PUNCH WALLS VS OPEN DOORS

"The Berlin wall never really came down," Putin said at his 10th annual year-end press conference, adding the West has been erecting new barriers in the way of equitable ties with Russia.

"They think they have won, they consider themselves to be an empire and that others are vassals who must be oppressed," said the president.

Meanwhile, Russia's tough stance even in crisis should let the foreign partners realize "the best way is to stop building the walls but to build a common security space instead."

He noted that international relations are threatened by many already existed or newly emerged dividing lines, while slamming the United States and the NATO for their military presence approaching to Russian borders.

Russia wants equal relations with the rest of the world and always believes in the World Trade Organization rules, Putin said.

"But we have been sanctioned unilaterally and illegitimately," he added.

Comparing Russia to a bear, Putin said the country should not lower its guard, or it will lose its teeth and claws and become a hunter's trophy.

"Once the teeth and claws are ripped out, the bear will lose its significance and become nothing but a stuffed animal," he said.

"This is about the protection of our independence, our sovereignty and our right to exist," Putin said, adding that Russia is not attacking the West politically but protecting its own national interests at an increasingly robust pace.

He said Russia has been seeking to cooperate with the Asia- Pacific Region, as the region develops faster than any other part of the world.

The president further illustrated that Russia's turn towards the East comes due to the global economic situation rather than political reasons.

Answering questions from Xinhua, Putin said the cooperation with China is one of the cornerstones of Russia's economic recovery and prosperity in future.

He added that the pipeline project with China "will allow us, concentrating on large resources at the beginning phase, to not only push this pipeline through, but to begin the energy construction of the Far East, to unite the gas transportation infrastructure of the east and west, to shift the gas flows from the east to the west depending on the changes in needs for them."

On the Ukraine crisis, Putin said Russia is willing to mediate political talks, adding that the crisis should be settled as soon as possible and only through political ways.

Ukraine's military moves in the country's southeastern regions have no perspectives and "are detrimental to the statehood of Ukraine and its people," he said.

DIFFICULTIES SPUR ECONOMIC RESTRUCTURING

Russia's current difficult economic situation is primarily caused by external factors, but also reflects the Russian economy' s insufficient diversification, Putin said.

It's rather difficult to reshuffle the economic mechanism, he said, as businessmen would try to invest where they could get the maximum and quickest profits under a favorable investment environment.

"We have been applying various instruments for several years to create more favorable conditions for developing the manufacture industry and increasing production. But the process is getting more difficult, especially when it is more profitable to invest in the energy sector," said the president.

Admitting Western sanctions against Russia seriously damaged its national economy, Putin insisted that the current situation can be used to offer additional conditions for production businesses, which would be a start to diversify the economy.

"External conditions would urge us to be more effective and shift to more innovative development ways," he noted.

Putin specified that for the successful development of Russian economy, businesses should be provided with a favorable and free environment, as property right should be guaranteed and preferences for production be enhanced.

Relevant measures mentioned in his state-of-the-nation address on Dec. 4 would be the concentration of Russian government for a period of time and be consolidated with practical and effective policies, Putin said.

He noted that it would take at most two years for the Russian economy to rebound under the most unfavorable scenario.

"I said that even given the most unfavorable internal market condition, this situation may last for about two years...But the situation may start improving even earlier...in the first, second quarter, in mid-2015 or at the end of next year. No one can say for sure," according to Putin.

Subsequent growth and recovery from the current situation is " inevitable" amid the overall growth of the global economy, Putin said. "Additional energy resources will be consumed as the world economy expands."

The president reiterated that the government should do much more to diversify the Russian economy, as "it would simply be impossible to function otherwise."

COORDINATION NEEDED FOR RUBLE STABILIZATION

Putin supported Russian Central Bank's recent move to raise the key interest, saying that the act was conducted to stabilize the country's macroeconomy.

The economy can only be healthy amid a stable macroeconomy, Putin stressed while "optimistically" declaring that sooner or later Russia will enter a positive economic trend.

Russia's Finance Ministry Wednesday began selling its leftover currency reserves on the market to stabilize domestic foreign currency market and prop up the ruble, while the Central Bank on early Tuesday morning announced to raise its key interest rate by 6.5 percentages to 17 percent.

Meanwhile, the raise of key interest rate has failed to quell market jitters as demonstrated by the almost 20-percent nose-dive of the ruble Tuesday afternoon, with the euro briefly hitting 100 rubles and the dollar 80 rubles in Moscow trade.

Putin urged the Central Bank to act "a half step quicker," although it is not the only one who should be responsible for the current economic situation.

He added that the actions that the Russian Central Bank and the government have so far taken to stem the ruble crisis are " adequate" and in the right direction.

Putin expressed his hope that Thursday's strengthening tendency of ruble will continue, as the government is planning a series of measures that proved successful back during the 2008 financial crisis.

In addition to raise the key interest rate, the Central Bank is trying to squeeze and lower ruble liquidity and give accesses to foreign exchange liquidity, Putin said.

"Rather than handing out the foreign reserves and burning them out on the market, the bank provides credit resources," according to the president.

Moreover, Putin called for more government work to coordinate with the Central Bank on economic and currency strategies.

"The government needs to work with exporters who have sufficient foreign currency revenues," Putin said, adding that some progresses have been made after Prime Minister Dmitry Medvedev met with heads of Russia's major export companies.

While admitting he himself, as Russia's leader, should also take responsibility for the current economic situation in the country, Putin stressed that only a strong Russia could be the most ardent defender of the interests of Russian citizens.

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