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(COMTEX) B: Soviet collapse 'greatest geopolitical catastrophe' of 20th century: Putin
( The Canadian Press )

MOSCOW, Apr 25, 2005 (The Canadian Press via COMTEX) -- Russian President
Vladimir Putin told the nation Monday that the collapse of the Soviet Union "was
the greatest geopolitical catastrophe of the century" and had fostered
separatist movements inside Russia.

In his annual state of the nation address to parliament and the country's top
political leaders, Putin said the Soviet collapse was "a genuine tragedy" for
Russians.

"First and foremost, it is worth acknowledging that the demise of the Soviet
Union was the greatest geopolitical catastrophe of the century," Putin said. "As
for the Russian people, it became a genuine tragedy. Tens of millions of our
fellow citizens and countrymen found themselves beyond the fringes of Russian
territory.

"The epidemic of collapse has spilled over to Russia itself," he said, referring
to separatist movements such as those in Chechnya.

Putin's statements were some of his strongest language to date about the Soviet
collapse and come a month before the country celebrates the 60th anniversary of
the end of the Second World War in Europe, a conflict Russians call the "Great
Patriotic War."

In the address, Putin also tried to boost business confidence in the nation,
reassuring skittish investors that rules governing the privatization of state
property and tax collection would not be constantly shifting.

Putin said tax inspectors do not have the right to "terrorize business," and he
called on the government to lower the time limit for challenging the results of
past privatization deals from 10 years to three.

Some foreign investors have been unnerved by recent government moves to give
massive back-tax bills to Russian businesses, attack a politically ambitious
business tycoon and allegedly backtrack on democratic reforms, analysts said.

But Putin emphasized Monday that Russia needs foreign investment, and the "rules
of the game" must be clear to attract it.

Ways must be found to collect taxes that "ensure the rights of state and don't
destroy the economy or drive business into a dead end," Putin said.

He also said rules on defining strategic sectors where foreign investment would
be restricted should be established.

Last month, Putin tried to reassure business leaders that a spate of back-tax
investigations, apparently spurred by the politically charged probe against the
Yukos oil company, would be brought under control.

Any reassurance was largely dispelled, however, when Anglo-Russian oil company
TNK-BP was slapped with a $1-billion US back-tax bill weeks later and antitrust
authorities blocked a planned investment by Germany's Siemens AG.

Analysts said the question was whether Putin would follow through on his words.
That was reflected in the fact that Russia's benchmark RTS index remained flat
following the speech.

"It's already been said," said Steven Dashevsky, head of research at the Aton
investment bank. "It's clear the Russian government wants to make life easier
and more predictable for business. The question is whether all these reforms,
all these improvements, get pushed down through the various levels of
bureaucracy."

In an apparent response to foreign allegations that Russia has been backtracking
on democracy, Putin said Russia's main political task was to develop as a free
democratic nation with European ideals. He stressed that individual freedoms
would not be compromised by strengthening the state.

"We are a free nation and our place in the modern world will be defined only by
how successful and strong we are," Putin said.

Critics have attacked Putin for slapping restrictions on independent media,
ending the direct election of governors, ensuring a compliant parliament and
attacking a politically ambitious tycoon, ex-Yukos chief Mikhail Khodorkovsky,
whose verdict in a fraud and tax evasion trial is expected Wednesday.

"The words of the president about stable and defined rules of the game for
investors sounds like a mockery coming two days before," said Sergei Mitrokhin,
deputy head of the liberal Yabloko party.

Putin said the nation's main political challenges included boosting the rule of
law and judicial institutions and deepening respect for individual liberties and
the activities of nongovernmental organizations.

Putin said the threat of terrorism in Russia remained high and that
parliamentary elections scheduled for later this year in Chechnya should lay the
basis for stability and democracy in the region.

Putin's popularity has been dented over the past year by street protests over
painful social reforms in Russia and unsuccessful attempts to head off a popular
uprising in the ex-Soviet republic of Ukraine. Putin is constitutionally barred
from seeking a third term, but many Russians assume the Kremlin will ensure that
a Putin loyalist wins the balloting in 2008.

ALEX NICHOLSON

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Copyright (C) 2005 The Canadian Press (CP), All rights reserved

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