Radical economic re-structuring awaits Russia in the coming decade, as the country’s brightest economic minds have come up with a new development program.
Called “Strategy 2020”, the program primarily aims to reduce the government’s involvement in the business and economic infrastructure.
Its authors say Russia needs to lessen government influence in what are currently the country’s major state-owned corporations. As a result, some of them will end up in private hands – for the symbolic price of one ruble.
Among the companies are major players on Russia’s economic market – VTB bank, the Russian agricultural bank, and the Russian Railroads. Even Aeroflot is reported to be on the list.
“The law restricts the privatization of corporations dealing with oil exploration, natural resources, precious metals, and aerospace,” Aleksandr Verenkov, a senior partner from the BDO Group, told RT.
The program also suggests preventing state-owned companies from branching out into fields in which they may not have expertise. Thus, the heavy machinery industry should not be dealing with agriculture, and vice versa.
“There are not too many state corporations in Russia, but they all are too big and too special,” Verenkov told RT. “On the one hand, they are directing cash flow in the right direction. On the other hand, they spoil fair competition in the market. And they are very effectively using their state power to beat the competitors – not with efficient production, but with state resources.”
The program’s authors also want a moratorium implemented on the creation of new state-owned corporations, and Russian President Dmitry Medvedev has already signed such a document. As for the strategy, it will be implemented in early 2012.
This is the second version of “Strategy 2020.” Prime Minister Vladimir Putin ordered the program to be drawn up in January 2011, and shortly after, 21 working groups were created – each focusing on a specific field such as macroeconomics, healthcare, investment, and others.
That first version of the strategy, drafted in August 2011, was sharply criticized by the country’s the Audit Chamber. The auditors claimed that the strategy failed to take into account the lessons of the 2008-2010 financial crisis, lacked a systematic approach and was “too optimistic.”
Now that Putin is to run for the presidency, Strategy 2020 is being regarded as his election program, with the responsibility for its implementation on his shoulders should he become president.