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11 Sep, 2009 12:55

PM Putin sees economic stabilization

Prime Minister Vladimir Putin said on Friday that the Russian economy stabilised in June, showing slight growth.

Speaking with members of the international Valdai discussion group, in Novo-Ogarevo, the PM said the economy is beginning to stabilize.

"We can say that recently, starting in June, some stabilization can be seen in Russia and the economy is growing, albeit modestly, at 1% per month."

The Prime Minister added that the main economic priorities are to bring down inflation and to limit Rouble volatility.

Putin admitted that the Central Bank had, in the past, failed to control inflows of foreign capital – the key problem in the run up to the crisis.

"The main pre-crisis problem was the same as it is now: our economy did not and does not have "long term money". It was due to our failure to control expenses and deal effectively with the huge investment inflows into Russia."

In the talks the Prime Minister noted that he expected that there would be a decrease in the number of Russian banks, but emphasized that the reduction would be managed in such a way is to help rebuild trust in financial institutions by the general public.

"We forecast a lower number of banks in Russia. This will be a gentle, positive process that will allow citizens to increase trust in our financial institutions and economy and to use these resources,"