OPEN RUSSIA

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THE GOVERNMENT PROMISES NOT TO ISOLATE RUSSIAN ECONOMY FROM GLOBAL

The Cabinet discussed future foreign economic policy.


Yesterday, Prime Minister Vladimir Putin spoke against self-isolation of Russia the rest of the world and proclaimed an open foreign economic policy. “The global financial crisis we are seeing makes simple decision look particularly attractive and therefore tempting,” Putin said at the Cabinet meeting where Russia’s future foreign economic policy was discussed. “We should be taking hard facts of life into account – as we’ve been doing – but isolationism in terms of strategy is not our choice.” Putin called limitation of the capital transfer unacceptable and harmful.

“We choose continuation of making Russia part of the global economy instead. Global economy is changing. It will become different. And yet, joint efforts are the only chance – both in overcoming the crisis and in making progress afterwards,” Putin said. He made a special emphasis on the necessity of fair and transparent rules in global economy.

“Russia is still interested in WTO membership, and Russia will continue working on it. Russia is also prepared for a dialogue with the EU over a new strategic partnership treaty. Matters of economic interaction have always been a core element of this treaty,” Putin said and promised thorough and well-argumented negotiations.

Speaking of the foreign economic strategy, Putin listed all maladies of the national economy – emphasis on raw materials in export, inability to compete with Western producers, artificial barriers in foreign economic activity, and so on. “It’s time we evolved the state support system into a convenient instrument of development for domestic manufacturers, particularly in the sectors of considerable export potential,” the premier said. Along with everything else, Putin warned that it was necessary to “safeguard ourselves from the already existing and potential risks.”

The Cabinet eventually adopted the document formulating foundations of Russia’s foreign economic strategy drawn by the Economic Development Ministry. Minister Elvira Nabiullina even announced that the government intended to concentrate on hi-tech export support.

The rest of the Cabinet meeting was spent in traditional efforts to placate the population and markets. Finance Minister Aleksei Kudrin announced that all amendments of the legislation needed to ensure support of the banking sector would be signed later this week and immediately come into force.

The premier told Nabiullina in no uncertain terms to enhance support of small businesses.

News-makers of the first echelon will be enlisted now to demonstrate equanimity and confidence in public. Senior Deputy Premier Igor Shuvalov, Kudrin, and Presidential Aide Arkady Dvorkovich will be updating society on the latest moves made by the president and government on a weekly basis now. It is supposed to become one of the distinctive features of open Russia.

Shuvalov promised no avalanche-like devaluation of the ruble after the Cabinet meeting. He added that it was wrong to listen to the speculations that the government wanted only some banks to survive and did not care about all others. “It’s wrong,” Shuvalov said. “Every bank will be given a chance, and the rest will be up to it. Some banks will probably have to up their capital, others to seek an agreement with shareholders, the third to apply for a merger…”

“It is not as large a sector of economy in the hands of the state as possible that we are after,” Shuvalov said. “Minimizing consequences of the crisis and earning money is what we are after. Should the state become the major shareholder at one point, no need to be afraid. We are after dividends, that’s all.”

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