INSOR Chairman Speaks at CER Seminar

February 16, 2011

INSOR Management Chairman Igor Yurgens delivered the keynote speech at a seminar organized by the Centre for European Reform in London on February 16. In line with the seminar’s broad theme – the future of Russia – Yurgens’ remarks covered a wide range of issues – from obstacles for Russia’s modernization to the country’s WTO prospects and cooperation plans with the EU.

Mr. Yurgens noted that Russia’s modernization is influenced by two divergent forces: those seeking stability and an easy life and thus unprepared to take on uncomfortable reforms required for modernization; and those who assert that modernization is essential to maintain economic growth. Of these two groups, the first appears to have the most support.

Analyzing the political situation, Mr. Yurgens said that the lack of clarity regarding who will lead the country following 2012 is creating uncertainty. This is particularly important for business, which requires clear rules and needs to know what kind of government will be in charge.

Positive developments can be seen, as foreign companies have recently announced some major investment deals in Russia spanning a wide variety of industries for the hi-tech and aviation to energy and transportation. One particular area of improvement has been the protection of intellectual property rights, where Russia is doing more than its peers India and China, Yurgens said.

“After 17 years we are almost there,” Igor Yurgens said, commenting on Russia’s WTO membership efforts. “We should join because (a) we are a great nation and we should not let global rules be set without us; and (b) WTO encourages FDI, by offering some protection to investors.”

He was also hopeful about the prospects for EU-Russia cooperation as a part of the Partnership for Modernization. He expects a number of specific projects to come out of the EU-Russia Summit this summer. “There may be some flagship projects – like cleaning up the Don, building the fast train to Moscow, and boosting energy efficiency in Yekaterinburg,” Yurgens suggested, and such projects are likely to go forward regardless of who sits in the Kremlin.