Hello and thank you very much Mr. Andrew for joining us here on the show. What are your impressions of the first day of this major event?
I think what’s been impressive today is reporting back of the Russian presidency on the G20. We’ve seen a number of very practical measures headline this morning to promote growth, employment, innovation and the financial system. So, a number of meetings in smaller groups and getting a very set of practical measures as to what to implement in the next 12 months.
Do you think that the Russian Government is doing a lot to improve the country’s investment climate? Have you noticed any positive signs or trends?
I think the very fact that the Russian presidency is leading on a lot of these global policy initiatives is creating a very positive impression in the minds of international investors. The very fact that issues like the anti-corruption, transparency, infrastructure are at the very forefront of the agenda is giving global investors a lot of confidence about the transformation that’s beginning to happen in the Russian economy.
On the whole, how would you evaluate Russia’s investment climate? We know that the outflow of capital from Russia doubled between April and May. That’s according to the First Deputy Chairman of the Central Bank. What is your impression?
The impression is that this is a country with huge potential. And obviously it is an oil-based economy. But in a sense it also has a rising middle class, it is increasingly looking at the economic reforms. And I think most of the international investors that I’ve been listening to this morning actually had very positive messages to say about the agricultural sector in Russia, certainly entrepreneurial ability. And we’ve got some very positive messages this morning from some of the private equity investors about the potential to continue invest and develop in all the segments of this economy.
And what is your attitude Mr. Andrew towards the so-called deoffshorisation policies – a subject so extensively discussed at the G8 summit?
Well, the capital will flow to those markets where there is favourable investment climate. Basically, I think what you’ve got to do is to make sure that capital is transparent, is measured and is productive. And I think too often, where the G8 focus is, that has gone to very unproductive uses, has been hidden from the global taxation environment, the global money laundering environment and increasingly the countries are being called to account for big governance and make sure that what capital we have is employed productively to living standards for all of the citizens in these countries. So, I support this thrust of policy initiatives.
Michael, correct me if I’m wrong. As I understand most of the European countries, both members of the Eurozone and members of the European Union, agreed to exchange information on tax payers between each other. And the most recent announcement made by Vladimir Putin was that Russia is also joining into this effort to help exchange information to make the financial exchanges more transparent, banking operations more transparent. As I understand, Switzerland is not ready to join in. What does it look like now with Russia getting into this with other European countries? Well this help provide a change?
It will help provide a change, I mean Russia is an economy that historically has been regardless the low peak and not that cooperative, but I think its admission to the WTO, the potential admission to the OECD, the very fact that it is starting a new gage in global discussions – I think it is something to show that Russia is a major economic and political force at the table discussing positively these particular policy measures. The fact that it’s come onboard so readily to where the G8 wants to be on this I think is seen as a very strong positive sign by investors, and particularly in those G8 countries.
Absolutely! Also the United States and the EU we know are preparing now a free trade agreement. In your opinion, will such free trade zones promote business development, help stabilize the world’s economy? Or they might bring in even more bureaucracy?
I’d certainly hope they don’t bring in more bureaucracy. I hope in fact it brings greater transparency of issues like subsidies, tariffs, standardization of products. And I think free trade agreements facilitate common investment, common products and common trade flows. And I think the very fact that we have been unable to achieve this at a multilateral basis in Doha is now being replicated by a series of bilateral and important multiregional trade zones. So, I think we are absolutely on the right path. It is pleasing to see Russia advocating a regional free trade zone which I think will introduce much more private sector investment and confidence into these economies.
What do you personally expect from this forum? Do you believe there will be a change of all, a change of speeches regarding what’s going on in the world? Definitely, the economy of the world doesn’t look the same as it did during the previous forums, so many things have changed globally. What do you expect?
There are three things I expect from this forum. The first most important is that the crisis is passed, but there we’ve got to actually get back into a growth pattern. That means people are going to focus on new markets, new products, new technologies and how we can promote things like free trade.
Second, I think we’ve seen the business community in particular start to articulate some very important policy initiatives that can be adopted globally by the G20 which would significantly promote economic returns to both developed and developing nations. And I think Russia is to be commended for its presidency of this.
Third, I think the very fact that Russia is taking a leadership role in these issues can transform a lot of international attitudes towards Russia and I think promote a greater understanding that its economic interests are aligned with those of other similar size nations.