RUSSIAN President Vladimir Putin was under pressure to show he has a prescription to cure Russia’s rapidly growing economic ills in his annual state of the union address Thursday.

    Western sanctions over the Ukraine crisis, sharp falls in global oil prices and the ruble’s slide against the dollar culminated in an acknowledgement by government officials this week that Russia will enter recession next year.

    Putin’s popularity ratings are sky high, and he has not faced any big protests over the economic decline, but questions are being asked about whether he has a plan to pull the US$1.4 trillion economy out of crisis.

    “The greatest danger for the president is the economy, under the double pressure of sanctions and falling oil prices,” commentator Kirill Rogov wrote in the business daily Vedomosti, which said this week the economy was seriously ill and Russia’s leaders were refusing to admit it or do anything about it.

    The annual state of the union address, which Putin delivered in the Kremlin to members of both chambers of parliament, the government and other top officials, provides the 62-year-old leader with a chance to answer his critics.

    Opponents say that in previous years the speech has produced more promises than substance.

    Putin has given little hint of what he might do next, often preferring to send the message that Russia will “tough it out.”

    He has also diverted attention from the economy by whipping up patriotism, including by annexing the Crimea peninsula, and blaming the United States and the European Union for many of Russia’s problems as well as the crisis in Ukraine.

    U.S. President Barack Obama has said the tough economic situation could eventually help change Putin’s course in other areas.

    Analysts say Putin has avoided budget cuts in some areas, such as social spending and defense, because he does not want to look weak internationally or provoke unrest.

    He is mindful of street protests against him in the winter of 2011-12, which critics say led to a clampdown on the opposition, and will be anxious to avoid more.

    This week, Russian ruble shaken in biggest one-day fall against dollar since 1998.

    Ruble has been left shaken by falling oil prices and sanctions related to ongoing tensions in Ukraine.

    The ruble has been left battered and bruised against the dollar.

    A combination of plunging oil prices and a continued barrage of sanctions imposed upon the country led to a slide in its currency Monday.

    The ruble dropped by as much as 6.5 percent against the dollar, dropping to as low of 0.01864 versus the U.S. currency.

    Russia is among the countries most vulnerable to falling oil prices, singled out by analysts as particularly vulnerable to the decision by Organization of Petroleum Exporting Countries (Opec) not to cut supply in the face of sinking prices.

    The lower oil prices fall, the weaker the Russian Government’s budget position is likely to become.

    According to an analysis by Deutsche Bank, the country will be unable to maintain a budget surplus as Brent — a key oil benchmark — has fallen below US$70 a barrel.

    Anton Siluanov, Russia’s finance minister, warned a week ago that the country could enter a recession next year if the price of oil fell to US$60 a barrel.

    Neil Shearing, chief emerging markets economist at Capital Economics, said that the “sharp fall” in the ruble signals that the country’s central bank will yet again hike interest rates when its board meets next week.

    “The obvious trigger for the latest slump in the ruble has been the renewed drop in oil prices following the recent OPEC meeting,” Shearing added.

    Shearing said that Capital Economics believes that “a weaker currency has actually become an important part of the government’s strategy for dealing with lower oil prices, and in particular limiting the damage to the public finances.”

    Putin has previously suggested that the decline in global prices has been engineered by political forces.

    In early November, he said, “The obvious reason for the decline in global oil prices is the slowdown in the rate of [global] economic growth, which means consumption is being reduced in a whole range of countries.”

    “A political component is always present in oil prices. Furthermore, at some moments of crisis, it starts to feel like it is the politics that prevails in the pricing of energy resources,” he added.

    Putin has suggested that the fall in global oil prices that is hurting Russia’s economy was caused in part by political manipulation.

    In an interview with Chinese media published in early November, Putin did not blame any particular country for the price drop, but some Russian political commentators have depicted it as a Saudi-U.S. plot against Moscow.

    Underlining Russia’s growing interest in building ties with Asia to ensure it is not isolated by the Western sanctions, Putin said the Asia-Pacific region was seen by Moscow as an increasingly important energy market.

    “The steps taken by us ... envisage further diversification of the structure and growth sources of the Russian economy as well as the decrease of over-dependence on the European hydrocarbon market, among other things due to the growth in oil and gas exports to the countries of the Asia-Pacific region,” Putin said.

    Russia supplies Europe with a third of its gas needs. It has already started pumping more oil to China and aims to double the volumes this decade.

    Russia’s top gas producer, Gazprom, has also agreed to start shipping gas via a pipeline to China from 2019 and to eventually ship up to 38 billion cubic meters a year — more than any single European country is buying from Russia.

    Putin said Russia’s relations with China had reached “the highest level of comprehensive equitable trust-based partnership and strategic interaction in their entire history.”

    By contrast, relations with the United States are at their lowest ebb since the Cold War because of the crisis in Ukraine.

    Both countries are members of APEC and the G20, but Washington says no formal face-to-face talks are scheduled between Putin and Obama.

    In a new barb aimed at Obama, Putin criticized the proposed Trans-Pacific Partnership (TPP) free-trade trade pact that the U.S. administration is negotiating with a group of Pacific countries that includes Japan, but not China or Russia.

    “Obviously, the Trans-Pacific Partnership is just another U.S. attempt to build an architecture of regional economic cooperation that the U.S.A. would benefit from,” Putin said.

    “At the same time, I believe that the absence of two major regional players such as Russia and China in its composition will not promote the establishment of effective trade and economic cooperation.” (SD-Agencies)