Medvedev reminds business of its responsibilities
Published: 21 October, 2009, 16:20
Edited: 21 October, 2009, 23:00
TAGS: Meeting, Medvedev, Russia, Crisis, Politics, Crisis Chronicle, Regional development, Russia and the global economy, Economy, Finance
The Russian economy needs a modernization strategy to stop relying on raw materials to pull the country out of the current financial crisis, Dmitry Medvedev stated, speaking at a meeting with Russian business leaders.
Russia’s big business should take the most active part in shaping the general strategy to pull Russia out of the economic crisis.
The President warned that the current raw-material oriented economy simply cannot last for long because “we either change or the next crisis will bury many of the companies represented here now," he said.
At the same time he stressed that those companies present at the meeting have generally passed the crisis test which means that the government anti-crisis program really worked and saved many of them.
Russian business must make greater investments within the country, stressed President.
“Russian society has the right to expect you to be active in the domestic market," the president said. "Most of the capital earned in Russia ought to stay at home."
Kirill Dmitriev, President of Icon Private Equity said that in the past, Russian business was actively investing overseas. “Now it’s a very critical time when capital is also needed in Russia. New work places have to be created here. So I think the president expects Russian business to think how we can be more productive…and how business can partner with the government to make progress and achieve good results,” Dmitriev told RT.Speaking about finance, Medvedev could not but mention the current situation with the Russian banking system.
“We need an independent and developed banking system which cannot be limited by state-owned banks, even considering the importance of their role during the last [crisis] year.
Once again, Dmitry Medvedev crucified corruption and reminded businessmen that “it is their civic duty to report on all cases of blackmailing offenses directly to the prosecutor’s office, Ministry of Internal Affairs or FSB.”
The Russian President denounced the Chinese model of economy. “China’s experience is very interesting and nice, but this is not our way.” Medvedev reminded businessmen of a “different mentality”, particularly in questions of personal “responsibility of administrative officials and business.”
Dmitry Medvedev promised that his future address to the Federal Assembly will be to a large extent dedicated to diversification of economy and introduction of advanced, modern and innovative technology – including mining and extraction operations, since the Russian state is the owner of mineral resources.
Medvedev also promised that, despite a delay, Russia will enter the WTO, which will mean that Russian companies have to compete with the most technically-advanced companies in the world.
Overall 33 top managers were invited to Kremlin for an annual meeting with the President, including heads of the leading Russian companies Rosneft, Gazprom, Lukoil, Basic Element, AFK System, Renova and Russian Railways. Part of the meeting was conducted behind closed doors.
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Let's get it simple and straight. We do buisness to make money, we do investment to make money. The job of government is to make the conditions so that it is advantageous for me to do buisiness here and advantageous to invest here. I will fight and die for Russia, but I do buisness for myself. So it is quite simple, keep the tax low, keep the investment return high, and keep and increase the opportunities for doing buisiness and investment. Then low and behold I am a happy Tavarish. So tax is easy, leave it where it is, now for return and opportunity. Well keep on reducing the paperwork and governance hurdles, take out the mafia and make sure we have citizens who can address the broad economy, profilled in terms of education and skills. This will free up the economy and allow an anything goes approach to doing business legally, instead of the heads of 'families' mafia approach. Now start adding some carrots and sticks, on the carrots add some grants, specify a percentage of government contracts that must go to startups, put tarrifs on imports based on the concept of civilised conditions - sweat shop taxes... On the sticks, well you actually don't need them if you can ram enough carrots down my throat! Now we've got the economy pumping, lets be a government and make sure our people are not treated like slaves. Maintain and improve the minimum wage, go for lifelong learning and improvement, provide the health and social net (but no benefit culture!!!) off ncreasing revenue based on fixed tax rate. We inflate the private economy with a fixed choke to the public purse. So government is dependent on success, not able to cope with failure with variable tax. Run the government like a business with KPIs - Armed strength, Growth, disposable income, reserves, crime against people, trade balance, longevity.. make them visible and simple for all the people to know how government is doing.