Russian economy solid enough to ride out global crisis: Putin

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Moscow, Sep 17 (UNI) Russia's Prime Minister Vladimir Putin has said the Russian economy is strong enough to withstand the current global financial crisis.

"We have no doubt that the safety nets that have been put into place in the Russian economy over the past few years will work to good effect," Mr Putin said during a meeting with the Azerbaijani President Ilham Aliyev yesterday.

He was referring to the markets unsettled by the fallout from the mortgage crisis in the US and the collapse of investment bank Lehman Brothers, with Russian stocks plummeting.

Earlier yesterday, Russia's benchmark RTS and MICEX indexes plunged 11.47 per cent and 17.45 per cent respectively, compounded by the withdrawal of capital from the country.

"We are studying the possibility of using long-term instruments by the Central Bank," Mr Putin said, stressing "we will act carefully and judiciously".

He said the Finance Ministry had injected 6 billion dollars into the Russian financial market in liquidity provided to domestic lenders through repo auctions, while the Central Bank contributed 13 billion dollars to the repurchase auctions.

"Tomorrow (Wednesday) the Finance Ministry plans to more than double the figure, offering 14 billion dollars," he said.

President Dmitry Medvedev said on Monday the Russian market was not in danger and ordered the government to boost liquidity.

Russian Central Bank deputy chairman Konstantin Korishchenko said yesterday there was no need to boost lending to banks.

"There is no need to expand lending to banks, at least for the time being," he said, adding the Central Bank's current priority was to sustain liquidity levels in the banking sector to enable its smooth operation.

The Russian Cabinet met late yesterday to discuss Russia's financial markets and what measures should be taken to stabilise the situation.

The meeting was chaired by First Deputy Prime Minister Igor Shuvalov, but no details of the discussions were disclosed, RIA Novosti reported.


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