Russian finance minister out after Medvedev spat

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Russian finance minister out after Medvedev spat

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Alexei Kudrin was forced to resign following a televised confrontation with President Medvedev.

27 September,2011 04:59 am

Russias influential finance minister was forced out Monday following a televised confrontation with President Dmitry Medvedev, who had angrily demanded that Alexei Kudrin immediately explain his criticism of Medvedevs policies or resign.The open conflict within Russias leadership follows the announcement over the weekend that Prime Minister Vladimir Putin plans to return to the presidency next year and Medvedev would then take his old job as prime minister. Russia will have a presidential vote in March, but Putin is sure to win.The departure of Kudrin is likely to unsettle investors and further shake Russias markets. A close Putin ally, he has been finance minister since 2000 and his tight hold over the budget has been seen as key to Russias economic stability.It is difficult to see how Mr. Kudrins resignation can be anything but market-negative, said Neil Shearing, chief emerging markets economist at Capital Economics Ltd in London. With oil prices starting to slide and financial markets still jittery, now is not a good time for the government to lose its arch fiscal hawk.On Saturday, Kudrin said he would refuse to serve in the government if Medvedev was made prime minister because of policy disagreements he had with him, including plans to substantially boost military spending.Addressing Kudrin on Monday, Medvedev called the ministers remarks irresponsible chatter and improper, especially since they were made while the minister was in Washington for meetings of the International Monetary Fund and the World Bank.