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Subject: Reuters: Putin still to show true colors

Russia's Putin still to show his true colours

By Timothy Heritage

MOSCOW, March 27 (Reuters) - Will the real Vladimir Putin please stand up!

The former KGB agent won Russia's presidential election on Sunday without a clear economic or political programme, largely thanks to his image as a tough guy who has waged war against rebels in Chechnya and is ready to crack down on corruption.

Now the hard part begins.

In the coming weeks and months, Putin will have to show his true colours as he tackles the huge political, economic and military challenges that lie ahead in his impoverished and demoralised country.

No one is expecting miracles and Putin is promising none.

"The question remains what does Mr Putin really want to do. He ran on no platform in effect other than a strong state and stability," Charles Blitzer, a London-based economist who used to work in Moscow, told Reuters Television.

"It's still an open question what he wants to do...My guess is nothing is going to change very quickly."

HUGE CHALLENGES

The challenges Putin faces are immense. On the political front, there is war in Chechnya, an opposition Communist Party still able to muster nearly 30 percent at the polls, crime and corruption are rampant and ordinary people are demoralised.

Russia is desperately in need of stability. Governments have come and gone with alarming regularity in the past few years, some regional leaders have become fiercely independent of the Kremlin and foreign policy has often been criticised as weak.

The economy is stronger than at any time since the rouble crashed in August 1998, but recovery remains fragile. Western investors say a small group of businessmen -- the so-called "oligarchs" -- who have political influence beyond their economic weight still impede reforms.

Tax evasion deprives state coffers of vast amounts and the the International Monetary Fund says structural reforms, such as a new law on bankruptcies and a reduction of barter trade, are needed before it unfreezes a $4.6 billion loan package.

Putin has pledged commitment to democracy and market economic reforms, but has not said how he will do it.

Analysts expect some government changes, including appointment of a loyal prime minister who is unlikely to challenge his authority. The defence, interior and foreign ministers' posts could be reviewed but a major change of direction is unlikely.

Foreign policy is also unlikely to change dramatically, but is expected to focus more on Russia's economic interests.

"Much depends on what exactly he does in economics and foreign policy, and much will become clearer now," said Yevgeny Volk of the Heritage Foundation think-tank in Moscow.

"Mr Putin will be more pragmatic. He will try to protect Russian national interests, but he will refrain from rhetoric that would cause a deterioration in relations with the West."

PLATFORM TO LAUNCH REFORMS

Putin gave few clues about his plans on Monday but made clear he expects a long and hard struggle.

"A lot of things that will lead to many controversies need to be done," he said.

His absolute majority in Sunday's poll, making a second round runoff unnecessary, gives him a solid platform to launch his reforms.

But reformers have a scratchy record in Russia. Putin's predecessor, Boris Yeltsin, found it difficult to push through reforms despite success at the polls.

Former Soviet leader Mikhail Gorbachev's reforms in the mid-1980s at first raised high hopes among the population but eventually helped bring about his downfall.

"Putin is a level-headed man who is aware of his mission. One cannot envy this mission," Gorbachev said. "Much will depend on how Putin evaluates the past, who he invites to join his team and what goals he sets."

Another question mark over Putin is his lack of experience in public office, although he was for several years a senior aide in Russia's second city of St Petersburg.

His 16 years as a KGB security police agent, including as a spy in Communist East Germany, and the absence of a coherent programme also alarm economists and political experts alike.

Some people fear a return to strong-arm tactics to restrict dissent and more restraints, overt or covert, on the media.

WEST LOOKS ON ANXIOUSLY

Western leaders will focus particularly on whether he errs on the side of authoritarianism to push through reforms.

U.S. Secretary of State Madeleine Albright said she could understand Russians wanted order. "But the question is whether it's order with a small or a capital 'O'," she added.

Western leaders will also watch him on Chechnya, hoping he will end a military drive which they say has used indiscriminate force. But many analysts say he will be unable to end the war fast and that it will long remain a thorn in his side.

"Chechnya will be a serious headache for Mr Putin for a long time," Volk said. "Problems will emerge in Chechnya that will cause economic problems because they will have to spend a lot of money on the war and restoring the economy there."

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