Heatwave threatens Russian recovery

Russia's deadly summer heatwave could wipe up to €10

Russia's deadly summer heatwave could wipe up to €10.6 billion off economic growth, economists said today, as wildfires raged on in several provinces and forecasters said sweltering weather won't abate this week.

Prime Minister Vladimir Putin, who has sought to burnish his action-man image and minimise political fallout from wildfires and drought, flew in a firefighting aircraft that dropped water on a blaze southwest of Moscow, state media reported.

State-run television showed Mr Putin wearing headphones in a cockpit, pressing buttons on a handheld control panel.

The worst heatwave on record could knock 1 percentage point off gross domestic product, according to estimates, weakening a recovery from a 2009 slump due to the global financial crisis.

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Before blistering temperatures parched crops and stoked wildfires that have shrouded Moscow in smoke, the economy had been expected to grow about 4 percent in 2010 after dropping by 7.9 percent last year - the first contraction in a decade.

The drought also threw up a fresh barrier to the Kremlin's dream of cutting dependence on oil and commodities by developing and modernising other sectors such as agriculture.

With elections in the next two years, Mr Putin and President Dmitry Medvedev are eager to avert a repeat of the fires that have killed at least 52 people and provided fuel for critics who accuse them of mismanagement.

The government backed a proposal by Emergencies Minister Sergei Shoigu late yesterday to pump €1.3 billion over the next three years into the firefighting force, whose weaknesses have been exposed by the wildfires. Critics called the investment too little, too late, warning it would not fix a fire-protection system they say has been gutted by shortsighted legislation and sorely lacks equipment.

The Emergencies Ministry said the area covered by wildfires was unchanged today, with firefighters battling 557 fires covering 1,740 square km. A spokeswoman said 42 aircraft and almost 166,000 people were fighting the blazes.

Acrid smoke has hung over the sweltering Russian capital for weeks, and the city's top health official said yesterday twice as many people were dying every day as in normal weather.

Moscow mayor Yuri Luzhkov, whose absence on holidays last week drew opposition demands for his resignation, said nobody was to blame but the forces of nature. However, the Kremlin scolded Mr Luzhkov, saying he should have returned earlier.

Agriculture Minister Yelena Skrynnik has fired the head of forest management for Moscow and the surrounding province.

The heatwave - probably the worst in Russian history, according to the state weather forecaster - has aggravated a drought that has driven world wheat prices up at the fastest rate in over 30 years and raised the spectre of a food crisis.

Temperatures in Moscow reached a record 34.7 degrees yesterday, and the city was again blanketed in choking smog from the burning forests and peat bogs that surround it.

Flights were disrupted by the thick smoke and many Muscovites sought air or rail tickets out of the city, while those who remained were advised to stay indoors and to wear face masks if they ventured outside.

Pressure is increasing on officials at all levels over their handling of the crisis and an apparent lack of plans and equipment to deal with the wildfires.

Reuters