Putin wants to work with Trump as equals to restore relations

Russian President Vladimir Putin said he's ready to work with U.S. President-elect Donald Trump's new administration on an equal basis, as he urged joint efforts to fight terrorism in his annual state-of-the-nation speech.

"We are ready for cooperation with the new U.S. administration," Putin said in the Kremlin on Thursday before an audience of both houses of parliament and top officials as well as religious and business leaders. "It is important to normalize and start developing bilateral ties on an equal and mutually beneficial basis."

Trump's election has raised hopes in Moscow for better ties after he said he'd be willing to consider lifting sanctions imposed over Russia's 2014 annexation of Crimea and the conflict in eastern Ukraine. With Russia's economy mired in its longest recession in two decades, plunging millions into poverty and battering the middle class, Putin's immediate hopes of returning the economy to strong growth rest largely on higher oil prices and progress in removing the sanctions imposed by the U.S and the European Union.

The front-runner in France's presidential elections in April, former Prime Minister Francois Fillon, has been critical of the EU's sanctions. Russia, the world's largest crude exporter, got a boost from a deal Wednesday among OPEC members on their first production cuts in eight years, which sent oil prices almost 10 percent higher.

Putin, who's welcomed Trump's offer of partnership in fighting Islamic State in Syria, where government forces backed by Russia are advancing against rebels in Aleppo, also expressed hope of a better relationship with European countries.

"Unlike some of our foreign colleagues, who see Russia as an opponent, we aren't looking for enemies and never have done, we need friends," Putin said. "But we won't allow our interests to be infringed."

His conciliatory tone marked a sharp contrast with last year's speech, when Putin lashed out at Turkish President Recep Tayyip Erodogan after his air force shot down a Russian warplane near the border with Syria.

The tide has now turned in the Syrian conflict in favor of Putin's ally, President Bashar Assad, whose grip on the Middle East country is increasing as Trump seems set to cut back support for rebel groups and focus U.S. efforts on fighting Islamic State.

The Russian leader, who devoted much of his more than hour-long speech to the economy as he prepares to seek re-election in early 2018, blamed domestic factors for holding up growth, including a lack of investment, inadequate competition and shortcomings in the business climate.

There'll be an "insignificant" decline in Russia's economy this year after a contraction of 3.7 percent in 2015, Putin said. Inflation should end the year at a record low of less than 6 percent, then slow to the central bank's 4 percent target in 2017, he said. The country's difficulties over the last two years have only made it stronger, he said.

Putin ordered the government to produce an economic development plan to 2025 by May, which by 2019-2020 should already enable the country to "grow above the global level and thus to boost Russia's position in the world economy."

Russia's economic recovery is likely to be "subdued," with growth of 1.1 percent in 2017, the International Monetary Fund said this week. Expansion of gross domestic product in Russia may reach 3.5 percent annually by 2025, Finance Minister Anton Siluanov said Thursday, state news service TASS reported.

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