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NEW YORK, April 19 (Itar-Tass) — Russia needs reforms to improve its business and investment climate, former finance minister Alexei Kudrin told an investment conference devoted to inauguration of the office of VTB Capital, Russia’s international investment banking leader owned by VTB Group, in the United States.
Kudrin noted that the measures that can take Russia from 121st to 20th position in the World Bank’s doing business rating are well known.
Russia needs to ensure macroeconomic stability and for this it has, first of all, to resolve the issue of using the oil and gas revenues, he said.
“It is necessary to switch to a strict, permanent budget rule that would clearly define how much the government spends from revenues it gets as a result of favourable conditions on the raw material markets, because all this exerts effect on the inflation and the national currency rate,” Kudrin said. “The use of oil and gas revenues is a part of the emission policy on the market, therefore all investors should realize how this will work.”
Among other macroeconomic factors he mentioned the tax burden that defines business conditions.
“If the government raises expenditures, undertakes new obligations, this means that sooner or later taxes will be increased. The tariff policy also cannot be connected with the political conditions and elections. It should be strict and clear,” Kudrin said.
Moreover, he stressed the need for conducting reforms to raise efficiency and decentralize public administration and for taking measures to democratize, improve infrastructure and reform social policy.
“These are just a few points, but they can be continued, they are well-known. Insistent and thorough efforts (in the implementation of these tasks) will determine our opportunities in transition to stronger competitiveness and better investment climate,” Kudrin said.