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7 Jun, 2008 17:44

Medvedev blames U.S. for world financial crisis

The aggressive financial policies of the United States push more and more people into poverty around the world, according to the Russian President Dmitry Medvedev. He made the statement during a speech at the 12th International Economic forum in St. Peter

The Russian President noted that for the global financial markets, 2007 was one of the most challenging years of the past few decades.

“And, if we trust the experts, it may have been the most difficult period since the Great Depression of the 1930s. The underestimation of risks by major financial companies, combined with the aggressive financial policies of the largest economy in the world, resulted not just in losses for major corporations. Unfortunately, most people in the world have become poorer,” Medvedev said.

While mulling over the reasons for the global financial crisis Medvedev stressed the discrepancy between America’s role and capabilities.

“No matter how big the American market or how reliable its financial system may be, they are unable to substitute global commodity and financial markets,” said Medvedev.

“It is an illusion that one country, even the most powerful, can act as a global government. International institutions responsible for global financial policies, the IMF in the first instance, have had virtually no influence over those strategies pursued by market players,” he added, saying that this was a major factor in the current global financial crisis.

Also the President mentioned that Russia is willing to work together with other countries to overcome the global food crisis.

Russia’s Finance Minister Aleksey Kudrin, speaking at the Forum, said: “Global institutions are lagging behind in their reactions to modern challenges.”

“I am not talking about organizations like NATO. I think this particular institution should cease to exist. If someone is supporting it, that fact itself might create new challenges and new risks. I would be very cautious about institutions such as OPEC. Cartels are not the sort of institutions that can reduce market risks, including the risks of changing oil prices,” he said.

Main targets of economic policy

The President also addressed a more select gathering of industrialists later in the day. He outlined some of the main points he is going to stick to in his economic policy. These are investments in all spheres and particularly regulations of these investments.

“For quite a while we have discussed the probation of a special law on strategic targets for investment, and just recently on April 29 the federal law was adopted on the procedure for foreign investment into companies that have strategic importance for the nation. This law is very concrete which was something foreign investors expected from us. It applies to 42 types of activity,” the President stated.

Among other priorities Medvedev mentioned the renovation of the country’s tax and legal systems. He noted that Russia is obviously not satisfied with some parts of its legal system; he raised the question of property rights protection.

To watch Medvedev’s speech at the meeting with foreign investors please follow the link.

And the Economic Forum is also a place for a good laugh. A minor slip of a tongue with a political flavour put a sunny smile on even the President's face.

Russia as a global financial centre

President Medvedev says Russia will use all its resources to reshape the global economic game. He’s stressed the need for investment in human capital and innovation.

“Russia is a global player today. Understanding our responsibility for the fate of the world, we wish to participate in forming new rules of the game, not because of the notorious ”imperial ambitions“ but because we have official opportunities and resources here,” Medvedev stressed in his address to thousands of delegates.

“Turning Moscow into a major global financial centre and making the ruble a leading regional reserve currency are the key components in ensuring the competitiveness of our financial system,” he said.
The President stated that liberalising the Russian gas market and easing the tax burden on the country's oil sector will be important steps towards stabilising the global energy market.

“It has become fashionable to say: Russia needs victories. We have witnessed a lot of them throughout Russia's history. But we need new crucial wins in economic, technological and social spheres – in all the spheres important to our citizens. There have been not so many victories in recent years. But in recent weeks, we were delighted to see our athletes' win. Sports people know the price of winning – this is a hard job,” stated Medvedev.

To watch the full version of Medvedev's address, please follow the link

Meanwhile, President Medvedev has continued his one-on-one meetings with CIS leaders. On Saturday he had a comprehensive conversation with Kyrgyz President Bakiev. During the meeting Bakiev emphasised that the countries’ economic ties have recently reached a new level – earlier plans and projects in the economic sphere have begun to be implemented.

Saturday morning’s plenary session has been followed by a series of conferences dealing with climate change, energy, foreign investment and financial challenges.

The president will also award the Global Energy Award to Russian academics Eduard Volkov and Oleg Favorsky, and Prof. Clement Bowman of Canada.

The most remarkable events of the forum’s cultural programme will include a concert of the National Philharmonic Orchestra conducted by Vladimir Spivakov, gala concerts by ballet dancer Ulyana Lopatkina in the Mariinsky Theatre, and a gala show of world styling art stars in the Mikhailovsky Castle.

According to Russia’s Interior Minister Rashid Nurgaliyev, 13,000 policemen and servicemen of the Interior Troops enforce security at the forum.