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Russia Country Presentation one of the biggest crowd-drawers at the Business Forum

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Sergei Kolotukhin, Hubert Pandza, Svetlana Ganeeva, Ilka Salonen,and Azat Shamsuarov.

In any year, the Russia country presentation is traditionally one of the biggest crowd-drawers at the Business Forum that is a regular feature of the EBRD Annual Meeting. This year was no exception.

The main presentation was made by deputy finance minister Sergei Kolotukhin, who represented Russia at this year’s meeting of the Bank’s board of governors. The main focus was on how the EBRD could help Russia diversify its economy away from an excessive dependence on oil and gas and how Russia could increase Foreign Direct Investment (FDI) flows.

Kolotukhin stressed the remarkable strength of Russia’s economic performance, the record size of its gold and foreign exchange reserves and the fact that for the fourth year in succession, the country will record a budget surplus. He also outlined the government’s intentions of easing the tax burden in order to stimulate economic growth and the priority it is giving to structural reforms.

Frankness was welcomed

A senior official of the Ministry for Trade and Economic Development, Svetlana Ganeeva, also unveiled some of the ideas the government is considering over for a new medium-term plan to ensure that growth is not hampered by structural problems. Her frankness in listing some of the impediments to growth in Russia – including low productivity, inefficient government, excessive secrecy, an underdeveloped financial system and poorly performing education and health systems – were particularly welcomed by the audience.

“There is no sense in only drawing a rosy picture. We know there is a lot of good news but that there are still some deficiencies on the macro level and that corporate governance continues to be an issue for foreign investors,” said Russia & Central Asia BGD Hubert Pandza, who was moderating the panel discussion.

"The rules of the game have been clearly defined"

Speaking as a businessman, Azat Shamsuarov, a senior vice-president of Lukoil Overseas Holding, praised the stability and predictability of government in Russia and the fact that the rules of the game had been clearly defined, saying this would make the country more attractive for investors. Ilka Salonen of International Moscow Bank, in which the EBRD is a shareholder, made the point that funding issues were becoming less and less of a problem for companies in Russia, but jokingly added that it was at the same time that the job of bankers in Russia was getting increasingly difficult.

There were a lot of questions from the audience, ranging from environmental issues such as Sakhalin to the future of gas sector reform and whether or not foreign direct investment was really useful to a country unless it brought with it advanced technology and know-how.

4 May 2003