Thought June 12, 2020 / 10:21 am UTC

Will this be Putin's Pinochet Moment?

By Francesca Beausang

COVID-19 has only delayed the inevitable: Russian President Vladimir Putin is finally going ahead with a referendum set over seven days in the week leading up to July 1. It proposes changes to the Constitution that would see Putin extend his rule until 2036. But what if the vote backfires?

Putin believes that an early summer referendum with the momentum of lockdown relaxation and rising oil prices will play in his favor. With this goal in mind, key pieces of propaganda are Prime Minister Mikhail Mishushtin’s recent Economic Recovery Plan, the Victory Day Parade finally taking place on June 24 and the 2 million vouchers worth up to RUB 4,000 each for voters to spend on restaurants, shops and other businesses. 

Putin has conveniently combined the question of term limits with a vote on economic reforms, which must be voted on as a single package. Given that it includes improved minimum wage guarantees and constitutional rights to pensions linked to inflation, Putin is clearly stacking the odds in his favor. And while it is perfectly fine for voters to face COVID-19 for voting purposes, opposition rallies are still banned. 

While Putin would not go ahead with a referendum if he did not expect to win and this remains the most likely scenario, there is no guarantee that his gamble will pay off. Even if the referendum does not prove to be a measure of Putin’s demise, divisions have never been starker between the national security champions and the economic technocrats who support him. 

With Putin’s ratings at an all-time low, there exists the marginal possibility that Putin is having a Pinochet moment. Sure of his victory, the Chilean dictator famously introduced a referendum in 1988 asking Chileans whether they wanted him to rule for another eight years. It turned out they did not. 

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I, Francesca Beausang, the lead analyst certify that the views expressed herein are mine and are clear, fair and not misleading at the time of publication. They have not been influenced by any relationship, either a personal relationship of mine or a relationship of the firm, to any entity described or referred to herein nor to any client of Continuum Economics nor has any inducement been received in relation to those views. I further certify that in the preparation and publication of this report I have at all times followed all relevant Continuum Economics compliance protocols including those reasonably seeking to prevent the receipt or misuse of material non-public information.