March 18, 2016 / 6:13 PM / in 2 years

Two years after annexation, Putin seeks to bind Crimea by bridge to Russia

Tuzla Island, CRIMEA (Reuters) - President Vladimir Putin, marking the anniversary of Russia’s annexation of Crimea, on Friday exhorted workers building a bridge between the Black Sea peninsula and Russia to fulfil an “historic mission” first conceived by a Russian tsar.

People hold a giant Russian national flag during a festive concert marking the second anniversary of Russia's annexation of the Crimea region, in Red Square in central Moscow, Russia, March 18, 2016. REUTERS/Maxim Shemetov

Russia seized the majority Russian-speaking Crimea from Ukraine on March 16, 2014 after an uprising toppled Ukraine’s pro-Russian president, but the peninsula has since struggled with economic isolation.

The annexation unleashed a wave of patriotic euphoria in Russia and Crimea, but Putin needs to ensure public attitudes do not sour over the economic costs and avoid handing vindication to Western governments, who condemned the move as an illegal land grab.

Russia was hit with international sanctions over the annexation and Crimea remains largely cut off overland from Ukraine, depending on ships to keep it resupplied from Russia.

As cities around Russia prepared to celebrate the second anniversary of what Moscow calls the reunification of Crimea, which was part of Russia until 1954, Putin visited the construction site where the bridge is taking shape.

He said the bridge, which will span 19 km (12 miles) across the Kerch Strait from Crimea to southern Russia, would integrate the peninsula with Russia and help stimulate the economy.

“Our and your predecessors understood the importance of this bridge,” he told workers at an inspection of the site on an island just off Crimea’s coast, referring to aborted plans dating back to Tsarist Russia.

“Let us hope that we will fulfil this historic mission. Undoubtedly, it will create additional opportunities for economic growth.”

The bridge is being built by a company owned by Arkady Rotenberg, Putin’s judo partner, who was among the first in the president’s entourage to be slapped with Western sanctions after Crimea’s annexation.

PRO-RUSSIAN POPULATION

Russian officials say Crimea’s 2 million people voiced their desire to join Russia in a democratic vote in 2014, so there was no violation of international law. Given Crimea’s history within Russia, many residents feel closer to Moscow than to Kiev.

Crimea once prospered as a Black Sea tourist hub. Now its businesses are starved of tourists and international investment is barred by Western sanctions. A dependence on Ukraine for power supplies has also left them vulnerable to pro-Ukrainian activists who sabotaged electricity cables last year, subjecting the peninsula to weeks of rolling blackouts.

Putin’s approval rating among Russians is at its highest in four years and 95 percent of Russians support Crimea’s annexation, according to state-run pollster VTsIOM.

But these numbers could fall as patriotic fervor in Crimea peters out and Russia’s economic crisis deepens, eating into real wages and eroding living standards.

Building the bridge, at a cost of 212 billion rubles ($3.13 billion), and supporting Crimea will impose additional burdens on Russia’s shrinking state budget, which has been hammered by a collapse in global oil prices - the country’s main export.

Crimea will get 43.5 billion rubles in federal government transfers in 2016 and Moscow will provide an added 148 billion rubles as part of a state development plan for the peninsula, part of which will be used to finance the bridge.

The combined total is only a fraction of the 16 trillion rubles originally earmarked for the 2016 Russian state budget. But the costs of annexation will be much higher as sanctions - which the International Monetary Fund has said could cut Russian GDP by 9 percent - continue to exact their toll.

TSARIST-ERA BEGINNINGS

An idea first hatched under Russian Tsar Nicholas the Second in 1910, the bridge will now consist of two parallel road and rail spans capable of carrying 40,000 vehicles every 24 hours and connected by road to the Crimean capital of Simferopol.

Russian Transport Minister Maxim Sokolov said the bridge would be completed in December 2018 as scheduled, but critics have said the plans are too ambitious and will run over budget.

A number of other large-scale infrastructure projects in Russia, such as preparations for the 2018 World Cup and plans to build a new cosmodrome in Russia’s Far East, have been plagued by delays and had their funding cut to compensate for dwindling budget revenues.

Anti-corruption campaigners have also criticized the Russian government’s decision to award the construction contract to Rotenberg’s Stroygazmontazh, a company which specializes in gas pipelines and has never built a bridge.

“The annexation of Crimea was an obvious mistake, which the Kremlin and the majority of Russian people will not recognize for a long time. But we continue to pay for it,” Russian business daily Vedomosti wrote in an editorial on Friday.

European Union foreign policy chief Federica Mogherini reiterated on Friday Crimea’s annexation was illegal and the peninsula should be returned to Ukraine.

($1 = 67.6800 rubles)

Writing by Jack Stubbs; Additional reporting by Lidia Kelly and Jason Bush; Editing by Christian Lowe and Mark Heinrich

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