(Moscow, September 27, 2004)
The session was addressed by Mr. M. E. Fradkov, Chairman of the Government of the Russian Federation.
In his address, Mr. Fradkov congratulated members of the Foreign Investment Advisory Council in Russia on its 10th anniversary, summarized the results of its work, provided an overall assessment of the state of the Russian economy, and outlined the key tasks in national economic and social development.
It was stressed that the Advisory Council plays a major role in establishing a favorable investment climate in Russia, and its recommendations and proposals are used in drafting laws and other regulations.
The Russian economy in recent years has been characterized by high growth rates. In the period from January to July 2004, gross domestic product grew by 7.4 percent year-on-year. Industrial output increased by 6.9 percent over the eight months and investment in capital assets grew by 12.2 percent. Foreign investments in the Russian economy in the first half of 2004 totaled $19 billion, an increase of 49.9% against the first six months of last year, and accumulated foreign capital exceed 66 billion US Dollars.
The real personal income continues to grow, while the rate of inflation in 2004 is estimated at approximately 10 percent.
In recent years, Russia has made positive progress in implementing the social and economic policy, which has reinforced country's favorable investment image in the global community.
It was noted that, to resolve the strategic task of securing high economic growth rates, further enhancement of investment appeal and activity and accelerated renewal of fixed capital are required.
The measures envisaged by the Principal Areas of Activity of the Government of the Russian Federation for the Period to 2008 will further enhance investment activity and economic development based on technological modernization.
The Government of the Russian Federation will continue work to raise the efficiency of government agencies aiming to establish the optimal environment for business activity. Administrative reform has been launched, and the budgeting process is being improved. Measures are being taken to reduce administrative barriers to business activity, and to improve tax policy and tax administration. Structural reforms are underway, as well as efforts designed to develop anti-monopoly legislation and ensure fair competition.
The members of the Foreign Investment Advisory Council in Russia hold in high esteem the efforts of the Russian Government aimed at establishing a foundation for high and sustainable economic growth and enhanced investment activity.
To improve the environment for intensified investment processes and increased direct investment in the Russian economy, and enhance the contribution of investments to economic growth, members of the Foreign Investment Advisory Council in Russia deem it necessary to concentrate efforts in the following areas:
I. Administrative reform, including:
II. Tax Policy and Accounting System Improvement in Russia, including:
III. Bank reform in Russia, including:
IV. Enhancement of Russia's investment image, including:
Session participants also discussed issues relating to more efficient use of natural resources, development of the food industry, agriculture; the manufacturing, construction and high technology industries, and deem it advisable to consider, inter alia, the following:
The members of the Foreign Investment Advisory Council in Russia reaffirm their readiness to continue participation in the Russian Government's efforts aimed at creating conditions for high-paced economic development and making direct investments a key economic growth driver.
The Government of the Russian Federation expresses gratitude to members of the Foreign Investment Advisory Council in Russia for assistance in the resolution of Russia's essential tasks in instituting and developing market relations in the economy and creating a legal framework for investor activity.
It is planned to step up the work of federal executive bodies in considering the recommendations put forward by session participants and preparing proposals concerning their implementation.
The Bank of Russia will be instructed to consider recommendations regarding further development of the banking system.
The next, 19th session of the Foreign Investment Advisory Council in Russia is scheduled to take place in Moscow on September 26, 2005.