By Michael Stott and Oleg Shchedrov
MOSCOW (Reuters) - President Vladimir Putin accused theUnited States of unleashing a new arms race on Russia's borderson Friday in a speech that is likely to provide a blueprint forhis successor's policies.
Laying out his legacy three months before he is to stepdown, Putin said Russia had to wean itself off energy exports,compete in the world economy and stand up to the West.
In an address containing long passages of tough rhetoricaimed at the West, Putin said NATO expansion and U.S. plans fora missile defence shield in eastern Europe had touched off anarms race.
"It's not our fault, we didn't start it. ... funnellingmultibillions of dollars into developing weapons systems.
"NATO itself is expanding. It's approaching our borders. Wedrew down our bases in Cuba and in Vietnam. What did we get?New American bases in Romania, Bulgaria. A new third missiledefence region (the U.S. defence shield) in Poland, where it'sbeing built," Putin told the State Council.
"It's already clear that a new arms race is being unleashedin the world ... We must not allow ourselves to be drawn intothis."
Putin's address to the State Council, which gathersminister, regional governors and lawmakers, will be one of hislast keynote speeches before he steps down.
It was also widely regarded as a manifesto for DmitryMedvedev, the man he has endorsed to succeed him.
Medvedev, a 42-year-old first deputy prime minister andloyal Putin ally, said this week he was not issuing his ownprogramme because it would be no different from his mentor'spolicies.
Putin, 55, opened his speech by emphasising how far Russiahad come in the eight years he had been in power.
In 2000, Russia was reeling from economic collapse,insurgents were marauding through the country and the Kremlinwas being manipulated by tycoons, he said.
"Wealthy Russia had turned into a country of impoverishedpeople. In these conditions, we started to implement ourprogramme to take the country out of crisis," he said.
"We have been able to rid ourselves of the practice oftaking state decisions under pressure from financial groups andmedia magnates."
BOOMING ECONOMY
He hailed the strength of the Russian economy, pointing toa boom in investment, state coffers which are now full andgross domestic product growth of more than 8 percent a year.
But Putin also said Russia needed to develop its humancapital if it was to compete in the global economy and reduceits dependence on oil exports.
He proposed tax breaks for companies investing inemployees' training and healthcare and said the governmentshould help promote scientific research and innovation.
Putin also touched on Russian democracy, which has comeunder close international scrutiny three weeks before thepresidential election.
Opposition parties say the vote is a farce and slanted inMedvedev's favour. Europe's main election watchdog announced onWednesday it was pulling out of monitoring the March 2 votebecause of Moscow's obstruction.
Putin said democracy was a cornerstone of Russian societybut that political parties who took money from foreigngovernments were guilty of "immoral" behaviour and "demeaningthe Russian people."
(Writing by Christian Lowe; editing by Robert Woodward)
