Results of International Investment Forum Sochi-2008, Russia

Updated September 22, 2008

The financial crisis didn’t frighten the investors, since within two days of the VII International Investment Forum Sochi-2008, Russia’s regions managed to attract €14,4 billion. However, there are no any grounds to think that all problems are settled.

On September, 18, the participants and guests of the VII International Investment Forum Sochi-2008 from 40 counties of the world came to Adler airport. Sochi welcomed the guests of the Forum with rain and thunder.

The major events of the Forum were planned for September, 19. The key event was the speech of the Russian Federation’s Prime Minister Vladimir Putin during the Plenary Meeting, and later the participants discussed it. The meeting was private, therefore it was possible to watch it on the huge TV screens set in the press centre and in the core business event locations.

Two topics were prevailing in the talks of the participants and guests of the Forum - the oncoming Olympics 2014 and the problems of Russia’s financial sector. The deputy governor of the Krasnodar Territory Ivan Peronko said that he got the impression that everyone wanted to invest money in the construction of the Olympic objects.

The roundtable discussion was devoted to the problems at the financial market, and Valery Fadeev, the chief executive of Expert media holding, chaired it. According to his own assessments, the speeches of the participants were frank, since nobody denied the fact that the severe financial crisis had affected Russia already. The managing director of Troika Dialog Company Andrey Sharonov marked that Russia’s authorities underestimated how the crisis was serious. However, Mr. Putin had emphasized one issue within this speech - the own strong financial system should be constructed, Mr. Fadeev underlined. The chief executive of the media holding explained that it had been considered earlier that Russia didn’t require its own financial system, since the foreign financial institutions would provide services due to the import of financial ones. In the light of this, the president of the Association of Regional Banks of Russia Anatoly Aksakov has enumerated the major problems that should be settled to execute the tasks the Prime Minister set. One of them is the issue of the financial resources, since the loans are long-term and the banks’ liabilities are short; the legislative aspect, the establishment of Russia’s mass investor and the problem of attracting the population’s facilities. As for the last issue, the agreement about the amount increase of the insurance compensation on deposits to RUR 700 000 has been reached already to settle it, Mr. Aksakov declared.

All participants of the round table came to the understanding that if Russia’s authorities undertook some measures earlier, the crisis would be averted. It is obvious that the financial sector was the first to suffer. However, it will affect the overall economy very soon, since the liquidity shortage in the real sector will lead to the suspension of projects, and that will result in the reduction of salaries and the increase of unemployment, Mr. Sharonov marked.

According to the results of the Forum, Russia’s regions inked 114 agreements and memorandums with the Russian and foreign investors for the total sum of €14,4 billion. It is better to remind that within the XII St. Petersburg International Economic Forum held in June the total sum of the reached agreements attained $14,6 billion. As the press service of the Krasnodar Territory’s administration reported, the governor Alexander Tkachev settled 35 agreements for the total sum of RUR 165 billion (€4,6 billion), moreover, the third part of the agreements was reached with the foreign companies. The Forum received high assessments. "There is no precedent for this case, when within two days, the regions signed so many investment contracts", the head of Russia’ Regional Development Ministry Dmitry Kozak marked at the press conference. The head of Russia’s Ministry of Economic Development and Trade Elvira Nabiullina underlined that the foreign business assessed positively the prospects of the cooperation with Russia.