Russia's economy is unlikely to improve under new Prime Minister Vladimir Putin and will only pick up after next year's presidential election, leading liberal politician Grigory Yavlinsky said.

Yavlinsky, speaking on the first anniversary of Russia's economic crisis, said significant improvements were not possible under President Boris Yeltsin, whose final term is due to end next July.

He said Russia needed to liberalize the foreign investment climate, establish clear and stable private property rights, improve monetary and budget policies and boost tax collection.

"I don't believe that the new government and president are able to do such things," he told Reuters Television.

Yavlinsky, leader of the parliamentary opposition Yabloko group, said nothing much had been achieved in the year since Russia effectively devalued the ruble and defaulted on state treasury bills.

"We are still in a state of crony capitalism and we are still in a state of stagnation," he said.

"Changes can be expected only after the presidential elections a year from now ... I would be happy if the situation a year from now would not be worse than today."

Russia's economy was gutted by the fall of the ruble, now worth 25 percent of its dollar value a year ago, which nearly destroyed the banking system, impoverished the nation and sent foreign investors packing.

Yavlinsky said the country had to fight to make sure Yeltsin handed over power peacefully.

"We have two fights - to have the elections, then to win the elections. Russia is still moving from the communist past to the democratic future, but it's a very difficult path."