Russia's economic slowdown mainly due to internal problems: Putin

Russian President Vladimir Putin said Thursday that "internal problems" have been the main reasons for Russia's economic slowdown in recent years.

Although Russia has been confronted with an unfavorable situation in the world market and Western sanctions, the main reasons for the sluggish economy were primarily internal problems, Putin said in his annual state of the union address to the Federal Assembly.

He said these problems include a shortage of investment resources, modern technologies, and a professional labor force, insufficient development of competition, as well as shortcomings in the country's domestic business climate.

Putin said the remedy measures by the Russian government have made a difference, as he believed Russia is "close to reaching economic stability."

"Currently, the decline in the real economy has stopped and there is a small industrial growth," Putin told the assembly.

Putin expected inflation to decline to around 5.8 percent this year from 12.9 percent in 2015, which means the country could reach the targeted inflation figure of 4 percent next year.

"This is a very good background for reaching substantial growth," he added.

However, he warned that stabilization did not signify an automatic transition to a stable rise.

"If Russia does not solve basic problems in its economy and doesn't launch new growth factors to the full extent, it will hover at a level close to zero for years," he said. Endi