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Old 18th June 2010, 09:55 AM
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Russia to Help Found ‘New World Economic Order,’ Medvedev Says

June 18 (Bloomberg) -- Russia will help lead efforts to recast the global economic hierarchy as the world emerges from the financial crisis, President Dmitry Medvedev said.
“We really live at a unique time, and we should use it to build a modern, prosperous and strong Russia, a Russia that will be a co-founder of the new world economic order,” Medvedev said at the annual St. Petersburg International Economic Forum today.
Russia will use tax incentives and other free-market economic policies to turn the country into a destination for innovators from around the world, Medvedev told an audience including Citigroup Inc. Chief Executive Officer Vikram Pandit and French Economy Minister Christine Lagarde.
Medvedev, in the third year of his presidency, is promoting modernization to transform Russia from an oil-and-gas economy into a magnet for high technology. Russia’s reliance on natural resources exacerbated the steepest contraction among emerging markets last year, when the economy shrank a record 7.9 percent.
Russia is on the road to recovery after the decline, Medvedev said. Sovereign debt is “minimal,” foreign reserves are growing again and inflation is at its lowest level in 20 years, according to the president. The country boasts government debt of about 10 percent of gross domestic product.
“Flexibility and adaptability are words that have become much more popular than stability and predictability,” Medvedev said. Russia should become a “dream” for foreigners bringing ideas and capital, he said.
Regional Ties
Medvedev said he will continue to seek economic integration on a regional level with former Soviet republics such as Kazakhstan and Belarus, a development he said doesn’t conflict with Russia’s aspirations to join the World Trade Organization.
In areas where it lags behind, Russia will adopt foreign practices, such as the European Union’s technical standards, according to the president.

http://www.businessweek.com/news/201...edev-says.html

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Russia to scrap profit tax for foreign investors

By NATALIYA VASILYEVA and SIMON SHUSTER (AP) – 56 minutes ago
ST. PETERSBURG, Russia — Russia will scrap the capital gains tax on long-term foreign investment next year in order to create a much-needed "investment boom," President Dmitry Medvedev told a gathering of foreign businesses Friday.
Medvedev also vowed to loosen the state's stranglehold on the economy by introducing more competition and — in a sharp reversal to the policies of his predecessor Prime Minister Vladimir Putin — reducing the number of state-controlled enterprises fivefold.
The decisions are timed to attract massive foreign investment, without which Russia's oil-and-gas dependent economy — which shrank by nearly 8 percent last year — is doomed to stagnate, the Russian president said.
"Investment activity is one of the factors for investment development and successful modernization of our economy," Medvedev said. "Russia needs a real investment boom."
The 44-year-old president stopped short of addressing such widespread concerns as corruption, red tape and the judicial system, which investors pointed to as the main obstacles to doing business in Russia.
Still, Medvedev decried the state's predominant role in Russia's economy, which increased dramatically during the eight years of Putin's presidency, and he resorted to vivid imagery to bring home his point.
"People often think that the person who picks apples does the main job, but in fact it is the one who plants the apple tree whose job is crucial," he said.
"The state should not always pick the apples on its own. In a free economy there will always be people who will do it better and faster," Medvedev said.
The president hopes to use innovation and high-technology to diversify Russia's economy and prepare it for future generations.

http://www.google.com/hostednews/ap/...Lp42wD9GDJ8M00
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