Gaidar Forum Opens on 14 January

Gaidar Forum, one of the major annual international-level events in Russia in the field of economics, started in RANEPA. This significant event is annually organized by the Russian Presidential Academy of National Economy and Public Administration and Gaidar Institute for Economic Policy. ACIG Group of Companies is a strategic partner of the Forum.

The participating experts will discuss the key trends of the national and global economy and policy as well as the problems related to understanding the position and strategic role of Russia in the world during these three days of the Forum. The speakers will give their special attention to the current issues of financial and economic policy.

Leading Russian politicians discussed economic development on the first day of the Forum. Aleksey Kudrin, Dean of the Faculty of Liberal Arts and Sciences at Saint Petersburg State University and Chairman of the Board of Trustees at Gaidar Institute for Economic Policy, moderated the panel discussion, entitled A Healthy Future Economy.

“We are living in the interesting times when the economic growth is slowing down. We have certain consequences of the sanctions introduced against Russia. There are problems present in a range of industries including the institutional development. We have to discuss these issues during the Forum days,” he said.

The experts highlighted some ways to handle the downturn, specifically, reformation of public administration and public services, improvement of investment environment, building more trust on the part of business to authorities, better diversification of economy, higher competitiveness, cutting down on budgetary expenses and their higher efficiency, raising funds from the Reserve Fund, during the discussion.

“We have to determine the key expenses––primarily social expenditure––and reject those we cannot bear right now. This is the minimum goal for 2015,” Anton Siluanov, Minister of Finance of the Russian Federation, said.

“We need a radical turn as regards economic policy which will lead to a shift in paradigm and will break the stereotype and will dramatically increase the trust to authorities on part of business. Without this trust, it will be impossible for us to implement any policy,” German Gref, President and Chairman of the Board in Sberbank talked about radical changes the Russian economic policy needs.

“Our policy, our measures should not be flexible in terms of external factors, and be more oriented to these deep problems, both structural and institutional, and recurring one that we are facing not only now, but also faced before,” Aleksey Ulyukayev, Minister of Economic Development of the Russian Federation, said, adding that it is important to understand “the nature of the phenomenon that we are going to combat”.

“We now have a lucky chance to change the structure of employment in our economy,” Olga Golodets, Deputy Chair of the Russian Government, said, adding that the downturn has brought some good results.

The discussion continues during the plenary session opened by Prime Minister Medvedev. He emphasized that Gaidar Forum carries on being an authoritative platform for discussions about the current issues in the field of economics.

“A lot has happened in the previous year, which made the world change: Politics intervened economy, which resulted in an all-out distrust, mutual sanctions, losses suffered by not only us but also by the whole range of states,” Prime Minister said.

“Russia is not going to shut itself from the rest of the world. We have come a long way to become a large economy of the Western type. Returning back to the past would be a mistake. The authorities will not give up free conversion of the ruble. The policy of the Central Bank is the correct policy, and we are not going to ‘eat through’ our foreign exchange reserves,” he said, adding that Russia is going to carry on being a reliable creditor and will meet its international commitments.

“Sanction come and go, and the reputation of the state remains,” Medvedev said, emphasizing that the Government is not planning on restriction of freedom of enterprise.

Medvedev named building of trust in the trigone of people, state and business as the premium effort for putting the economy back on a sound footing under the circumstances.

“Business needs more freedom than it has now. We have to lift internal restriction, and if the business community feels different, nothing will cure the ‘business anemia’ of the economy,” Medvedev said. He nibbled at the subject of combating inflation. “Our goal is not to pour the downturn with money, but to put business initiative at ease, to make legal defense truly a defense, to build a more predictable regulatory system,” he said.

Clyde Tuggle of The Coca-Cola Company emphasized the role of business. “Business can become a tool to build communication. Russia entered WTO and maintains trade with the US. Business is capable of ‘keeping a two-way street’. I am constantly asked whether it is difficult to do business in Russia, whether they should invest into it, whether multinational companies should come to Russia. Where exactly in the world is it simple to do business? I analyzed operations on over 200 markets, and it is difficult to work everywhere. The Russian market is very dynamic. It is important what investors bring in with themselves when they come to a given country. Every investor faces risks and has no guarantees. But if one plays a long-term game, one has a higher chance of success,” he said.

“There are far too many arguments regarding economic growth now. I believe that growth is not the most important thing. Unemployment rate is playing a key role now, and it is growing at a very alarming rate. We seriously underestimate the unemployment rate, meaning we are taking underemployment into account not to its fullest extent. I believe we are going through the times of unpredictable changes. For states it is important to adapt their policies based on these circumstances,” Immanuel Wallerstein, Professor at Yale University, said.

Christopher A. Pissarides, Regius Professor of Economics at the London School of Economics and Nobel Prize winner in Economics, proposed to increase inclusion of citizens and to combat inequality which caused the downturn.

“Inequality is the topic of research in the coming years. Human nature is such that we think of how to make our life better above all and only then how to make better lives of the other. There is indeed the understanding of the problem of inequality, but inequality itself is not diminishing. If we see the end of capitalism, it will be caused by the fact that it leads to inequality,” Professor Pissarides said.

Vladimir Mau, Rector of RANEPA, was moderating the plenary discussion. He said that Gaidar Forum—despite global instability—has doubled the number of its participants compared with the previous year. The number of experts from the US has also doubled, he said. “Gaidar Forum is the opening of the business season and a platform for single-minded people to meet. Considering the current economic circumstances, this is a great opportunity to share one’s ideas, meet partners and friends, align the actual ideas related to tackling general economic problems with further activities throughout the year,” Victor Tolmachev, Chairman of the Supervisory Board at ACIG and Member of the Board of Trustees of RANEPA, said.

Official Gaidar Forum website: http://www.gaidarforum.ru/eng/