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. Last Updated: 07/27/2016

Chubais Viewed as Boost for Reforms

President Boris Yeltsin's appointment of one-time reformist deputy premier Anatoly Chubais as head of his personal staff should be a major boost for economic reform in Russia, financial analysts said Monday.

Yeltsin, who earlier set alarm bells ringing by rescheduling a meeting with U.S. Vice President Al Gore and checking into a sanatorium, signed a decree bringing Chubais, whom he sacked in January, back to the center of power.

"It could be a big victory of liberals around Boris Yeltsin and [Prime Minister] Viktor Chernomyrdin. It will have a very big impact on the implementation of radical economic reforms," said analyst Sergei Markov of the Carnegie Endowment in Moscow.

Chubais, 41, was a key architect of economic reform as privatization minister and first deputy prime minister and spearheaded Russia's huge privatization campaign.

He replaces the hawkish former chief of the administration in charge of the Kremlin's everyday affairs, Nikolai Yegorov.

Analysts noted that tough former general Alexander Lebed, appointed secretary of the Security Council and Yeltsin's national security adviser after a strong showing in the first round of the presidential election, will be responsible for economic issues where they affect security.

He has listed stopping the flight of capital out of the country, a key problem for the economy, as among his duties.

"We are in a period of considerable administrative flux. The government is being formed. Lebed is being bedded into the administration so it is too early to say what the precise constellation of influence is going to be," one analyst, who declined to be named, said.

Chubais championed a tight monetary policy that helped slash inflation to a post-reform low of 1.2 percent a month in June.

However, the same tight policy made him unpopular. Yeltsin blamed him publicly for the poor showing by government-linked parties in December's parliamentary election and fired him in January.

But Yeltsin has repeatedly pledged to press on with economic reform, although with a new emphasis on boosting production and on social protection.

Despite the loss of his cabinet post, Chubais, renowned for his organizational skills, was instrumental in Yeltsin's successful re-election campaign. After the first round of the election, Chubais played a role in removing hardliners from Yeltsin's immediate entourage and polishing Yeltsin's image before the second round.

"Chubais has proved himself to be an outstanding administrator both in government and the campaign," said one analyst, who wished to remain anonymous.

"The main center of policy-making remains the prime minister and the team of people he liaises with in the government ... but one would certainly expect that Chubais, given his background and his direct interest in economics, would want to advise in economic matters," he added.