Vladimir Putin has probably never looked forward to any year as much as he is looking forward to 2017. With Donald Trump settling into the White House and Europe in political disarray, the Russian President will feel that his decision to face down the west over Syria and Ukraine has been vindicated. His fortunes will continue to rise if, as expected, the French Presidential election in May becomes a run-off between two pro-Putin right-wingers, François Fillon and Marine Le Pen. With a bit of luck he might even see the back of his staunchest opponent, Angela Merkel, when Germany votes in the autumn.
After two years of recession, Putin has reason to hope that at some point this year western economic sanctions imposed after the annexation of Crimea will be eased, if not lifted altogether. Yet any euphoria would be misplaced. At best, sanctions relief will help Russia to return to the state of economic stagnation that prevailed before the Ukraine crisis when annual growth had already slumped to 1.3 per cent, despite high oil prices. The World Bank is currently projecting growth rates of 1.5 per cent to 1.8 per cent over the next three years – well below the global average and nowhere close to the 7-8 per cent growth that was typical of Putin’s first two terms in office. This will limit his ability to restore the domestic bargain by which Russians accepted the loss of political freedom in exchange for a rapid expansion of living standards.
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