Putin Triumphs in 2013 Yet Tough Challenges Loom

Displaying the killer instincts of a chess grandmaster, Vladimir Putin rang out 2013 with an exceptional list of accomplishments.

The Russian president humiliated the United States by sheltering NSA leaker Edward Snowden, brokered a Syrian chemical weapons deal that averted a seemingly inevitable U.S. military strike and outmaneuvered the 28-nation European Union in the wrestling match for influence over Ukraine.

Putin also surprised both his own people and the world by pardoning his old foe, former oil tycoon Mikhail Khodorkovsky, and allowing an amnesty that got Pussy Riot punk band members and Greenpeace anti-oil drilling activists out of prison.

"It's Putin's moment. He should feel quite happy," said Gleb Pavlovsky, a political strategist and onetime adviser to the Kremlin.

But as the 61-year-old leader prepares for his pet project - the 2014 Winter Olympics in Sochi - to begin in February, dark clouds are hovering. Two terrorist attacks in the southern city of Volgograd this week raised the specter of continuing violence in the run-up to the games. In addition, the Sochi Olympics are still dogged by fierce criticism over the Russian law signed by Putin that bans so-called "gay propaganda" for minors.

And beyond the Olympics, bigger risks loom.

Russia's ailing economy continues to depend almost entirely on oil and gas. Even though energy prices have remained high, the country is on the brink of recession with growth at just over 1 percent, not enough for Putin to meet his generous social obligations.

Russia's rampant official corruption and its politically tainted justice system have spooked foreign investors, while its smoldering ethnic tensions and widening gap between rich and poor are increasing social instability.

James Nixey, head of the Russia and Eurasia program at Chatham House, said while Putin has had a "spectacularly good year," it has masked the almost "insurmountable problems" facing Russia.

"Absent major league reform and an entire removal of the Russian elite who do not desire any significant structural change - because it would be fundamentally contradictory to their interest - you're just not going to see a Russia which moves on," he said.

But for now, Putin is basking in the limelight after a series of political victories.

"Putin looks like a man who controls developments," said Fyodor Lukyanov, editor of the Russia in Global Affairs magazine and head of the Council for Foreign and Defense Policies, a top expert group. "That makes him different from many other leaders, who have to react to somebody else's actions."

By providing a refuge to Snowden despite U.S. demands for his extradition, Putin dealt a painful blow to Washington.

"It turned out that Russia was the only country capable of resisting the (U.S.) pressure," Lukyanov said.

Putin has insisted that Snowden isn't being controlled by Russia, but many observers doubt that Russian security agencies would have missed the chance to rustle through the massive trove of secrets in Snowden's possession.

Annoyed by years of Western criticism of Russia's human rights record, Putin clearly relished the chance to highlight the U.S. National Security Agency's questionable surveillance of citizens and foreigners alike.

"I feel jealous because he can do that unpunished," Putin said this month about President Barack Obama, commenting on the Snowden case.

Obama canceled a Russia-U.S. summit amid the Snowden fallout, but he attended September's Group of 20 summit in St. Petersburg, where he had a brief conversation with Putin. The meeting took place as Obama was considering a military strike on Syria over its use of chemical weapons against civilians and Putin used the occasion to play his Syria game.

He proposed that Moscow and Washington pool their efforts to persuade Syrian President Bashar Assad to surrender his chemical arsenal and have it dismantled under international control. Syria quickly agreed, the U.S. called off the strike and Assad became a party in the deal that eased international pressure for his removal.

A year ago, Putin "was seen as the villain on Syria" while "this year he has appeared as the person who was right on Syria," said Pierre Lorrain of France's Institute of Social History, noting that Putin had warned about the rise of Islamic extremists in Syria and pushed for a peace conference that the West has now agreed to sponsor.

Nixey said Putin succeeded thanks to his relationship with the Assad regime and the Western reluctance to go to war.

"The combination of the two meant he could produce a quick diplomatic two-step, which confounded the West," he said.

Another tally in Putin's win column came in November, when Ukraine's president abruptly spiked a pact with the EU that would have made the ex-Soviet nation closer to the West and limited Moscow's influence over its neighbor. Realizing that Ukraine was on the verge of bankruptcy, Putin circumvented the EU by offering Ukraine a $15 billion bailout and a price discount for gas supplies. The EU, in contrast, was coy about any financial assistance.

Lorrain said the EU misunderstood the situation "until too late." He likened Putin's strategy to that of a "good judo combatant, using the adversary's arguments against him."

Nixey said Putin put the symbolism of reclaiming Ukraine above Russia's economic realities, which could come back to haunt him.

"Ukraine is a basket case run by some very nasty oligarchs and a president who is weaker than a newborn baby. It is to Russia's disadvantage that it takes it on," he said.

Putin was so confident in 2013 that he could announce on television that he was divorcing his wife of three decades and not fear any political fallout.

That hubris contrasts sharply with a tense period two years ago, when massive demonstrations in Moscow made Putin look cornered and nervous.

He responded to the urban, middle-class protests by consolidating his support base of blue-collar workers and state employees, branding the opposition as Western stooges and accusing Washington of fomenting unrest in Russia. After his victory, the Kremlin squashed the opposition with a series of draconian laws and arrests and unleased a campaign against non-government organizations.

Russia's image abroad darkened further after a ban on adoptions of Russian children by U.S. parents and the passage this year of a law banning "homosexual propaganda among minors." Gay rights groups say the law gives authorities and others a green light to harass the country's LGBT community and have called for a boycott of the Winter Olympics.

Putin may have pardoned his most visible foes but that doesn't weaken his tight control over Russia's political scene.

Khodorkovsky, who spent more than 10 years in prison in what is seen as a vendetta for challenging Putin's rule, flew to Germany where he said he had no immediate plans to return to Russia, engage in politics or try to reclaim his assets. And while the two Pussy Riot members denounced Putin's amnesty as a political stunt and called for a boycott of the Olympics, their activism poses much less danger to the Kremlin than keeping them in prison.

Obama and several other Western leaders are not attending the Sochi Games - a painful jab but one the Kremlin and Putin have tried to ignore.

"Their refusal to come is an important signal, but it won't hurt the Olympics too much," Pavlovsky said.