Russia's new PM could stand for president

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MOSCOW, Sep 13 (Reuters) Russia's surprise choice for new prime minister, Viktor Zubkov, told lawmakers today he planned changes to the cabinet line-up and he even held out the possibility of running for president next year.

President Vladimir Putin yesterday nominated Zubkov, the little-known head of a money laundering watchdog, as the new premier in a move that confounded analysts who had expected a political heavyweight to be named.

Speaking to reporters after he met legislators who must confirm his nomination, Zubkov was asked whether he planned to run in an election next March to find for Putin's successor.

''If I achieve something as prime minister then I do not rule out that possibility,'' Zubkov told reporters. The parliament, dominated by Putin loyalists, is expected to confirm Zubkov's appointment tomorrow.

However, an official who did not want to be named, played down the significance of Zubkov's comments, saying the prime-minister designate may have been flustered by television cameras and the huge media attention.

Zubkov, a 65-year-old former collective farm boss who worked alongside Putin in the 1990s in the St Petersburg City Hall, pledged changes in the cabinet.

''The government structure is not ideal,'' he said. ''The administrative reform has not been very effective. There will be structural changes for sure.'' The Izvestia daily quoted Economy Ministry sources as saying that the liberal-minded economy minister, German Gref, could leave the cabinet. The daily said he might be replaced by Andrei Kostin, CEO of state-controlled VTB Bank , which recently floated on the London stock market.

Financial paper Vedomosti, citing sources in the business community, said Gref could take a private sector job and that his ministry could go to Arkady Dvorkovich, head of the presidential Directorate of Experts.

Gref has been a standard-bearer for efforts to open up the Russian economy to private investors, fighting with more hawkish officials who favour a bigger role for the state.

But he has been powerless to stop the growing influence of state corporations like Gazprom and Rosneft. Rosneft is chaired by Igor Sechin, Putin's deputy chief of staff and a key figure in the ''siloviki'', a powerful grouping of officials with close ties to the security services.

GUESSING GAME Most observers had been expecting Putin to name First Deputy Prime Minister Sergei Ivanov as prime minister as a prelude to Ivanov becoming president when Putin steps down next year.

The consensus today was that Putin wanted to keep everyone guessing about the identity of his favoured successor.

''The president has carried out a very elegant manoeuvre: as expected he has changed the government but he has not created a rival for himself,'' Vedomosti said.

Investment bank Renaissance Capital said Zubkov was an unlikely president and a more probable interim figure.

''Zubkov (is) very well positioned to handle the potentially unstable period during which there is a transition of power from Vladimir Putin to the new president,'' it said in a commentary.

''Zubkov's appointment ... is the clearest indicator so far that the Kremlin is determined to handle this period very strongly and confidently, thereby avoiding instability.'' Some Russian newspapers said Zubkov's previous position running a financial market watchdog charged with fighting money laundering gave him extraordinary access to detailed information about who in Russia's elite had moved what amount of money out of the country potentially very valuable information.

Reuters SS GC1548

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