Medvedev Chooses Sobyanin as Moscow Mayor After Firing Luzhkov

President Dmitry Medvedev nominated Sergei Sobyanin, Prime Minister Vladimir Putin’s chief of staff, to run the Russian capital 2 1/2 weeks after firing the former mayor, Yury Luzhkov.

Sobyanin, 52, was governor of his native Tyumen region in the Ural Mountains for four years before Putin, then president, brought him to Moscow as Kremlin chief of staff in 2005. When Putin became prime minister in 2008, he took Sobyanin with him.

The new mayor will have to focus on issues such as traffic and corruption, Medvedev said today after announcing Sobyanin’s nomination. Medvedev ousted Luzhkov after media reports accusing him of corruption and favoritism toward his wife, billionaire developer Yelena Baturina. The couple denied the allegations.

Sobyanin should work to make “the economic life in Moscow more transparent and competitive,” Medvedev said at a meeting broadcast by state-run Rossiya 24 television. “Unfortunately, few steps have been taken in this direction lately. In some cases, schemes that raise legal questions have been used.”

Medvedev cited a “loss of confidence” in Luzhkov when he dismissed the former mayor after 18 years in office. Luzhkov, 74, said he was fired because Medvedev couldn’t be sure of his support in a possible power struggle with Putin before the 2012 presidential election, when Putin will be eligible to seek a third term as president.

‘Right-Hand Man’

“Sobyanin is Putin’s right-hand man,” Mikhail Remizov, president of the Moscow-based Institute for National Strategy, said today before the nomination was announced. “If Medvedev doesn’t nominate Sobyanin now it will reveal another crack” in his relationship with Putin.

Remizov said Sobyanin is acceptable to both Putin and Medvedev, as well as to “the financial and industrial groups that matter to both men.” He is considered an “effective leader and manager,” Remizov said.

Sobyanin will assume control of Moscow’s budget of more than 1 trillion rubles ($33.3 billion). The city accounted for 23.8 percent of Russia’s gross domestic product in 2008, the last year for which data is available, according to the Federal State Statistics Service.

One of the issues facing Sobyanin will be the capital’s worsening traffic, Medvedev said.

Moscow drivers suffer the longest traffic jams of the world’s 20 major cities, and an average Muscovite motorist spent 2 1/2 hours stuck in traffic at least once in the last three years, International Business Machines Corp. said in a study this year.

‘Difficult to Move’

“Everyone talks about it; it is very difficult to move around in Moscow,” Medvedev said. “Despite growing population and an increasing number of cars, I am sure the traffic situation in Moscow can be improved even if the problem cannot be removed completely.”

Moscow’s city council must approve Sobyanin’s nomination. Putin’s United Russia party, which submitted a list of four candidates from which Medvedev made his selection, holds 32 of the chamber’s 35 seats.

The announcement of Sobyanin’s appointment came a little more than 12 hours after Rossiya 24 reported Sobyanin’s appointment on its website. The Kremlin had said the station made “a technical mistake” in reporting the news and that the president hadn’t chosen from among four candidates as of this morning.

Putin’s United Russia on Oct. 9 proposed three candidates in addition to Sobyanin: Transport Minister Igor Levitin, Nizhny Novgorod Governor Valery Shantsev and Moscow First Deputy Mayor Lyudmila Shvetsova. Medvedev had 10 days to make his decision.

To contact the reporters on this story: Anna Shiryaevskaya in Moscow at ashiryaevska@bloomberg.net; Patrick Henry in Moscow at phenry8@bloomberg.net.

To contact the editors responsible for this story Willy Morris at wmorris@bloomberg.net; Will Kennedy at wkennedy3@bloomberg.net.

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