St. Petersburg Economic Forum officially opened

Dragging Russia from its dependency on oil to an economy driven by innovation is President Medvedev's top priority, and he wants foreign capital and know-how to help achieve it.

The St. Petersburg Economic Forum is an event built to re-launch Russia on the road to economic recovery.

This is the reason that world business heavyweights have gathered in St. Petersburg.

After two tough years, the war in Georgia and global financial crisis, business leaders are preparing to sign major deals in St. Petersburg which could lead to the country’s economic recovery.

The official slogan of the event is “Laying the Foundation for the Future”.

“During the next decade Russia should become a country in which the welfare and the good quality of life is ensured by its intellectual, rather than natural, resources, its innovative economy,” Dmitry Medvedev said in his opening speech. “An economy which creates unique knowledge through exports of modern technology and products of innovation.”

“Russia should become a country which will attract people from all around the world to fulfill their dreams, in a quest for opportunities and self-fulfillment. Russia will be able to offer that to anyone who is ready to rise to that challenge and love Russia as their new home,” the president added.

Dmitry Medvedev’s opening speech at St. Petersburg Economic Forum

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Watch Dmitry Medvedev greeting the participants of St.Petersburg Economic Forum

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In his speech at the Forum, President Medvedev talked about the need for energy diversification in Russia and about the need for raising energy efficiency, relating that to environmental responsibility.

He used the US Florida Coast oil spill as a reference point, saying that even state-of-the-art technology breaks down sometimes.

Dmitry Medvedev called for the continuation of innovative work in areas of science and technology.

Ahead of the forum, Medvedev met America’s biggest venture capitalists, companies that look for the best untapped opportunities around the world to make money. The Russian President invited them to invest in Russia’s hi-tech project Skolkovo on the outskirts of Moscow.

The Russian government shows a proper academic-style approach to modernization: it identifies the problem, sees the opportunity and now builds the infrastructure to set up a proper process and attract interested parties in it, acknowledged Dr. Vladimir Ismailov – chief financial officer at the Moscow School of Management, Skolkovo.

“In the end of March, the President put two draft laws to the Duma for consideration. One of the laws proposed tax advantages and special status for participants of the Skolkovo Innovation Center. If these laws will be adopted, there will be incentives for foreign investors to come to Skolkovo and help us with innovations,” he said.

Watch full interview with Vladimir Ismailov

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President Medvedev admitted that the issue of corruption is one of the weakest areas in Russia and in the Russian economy.

“I can tell you two things: firstly, we are aware of the scale of corruption and we believe that until we suppress corruption on a mass scale – and at all levels – we won’t have any kind of investment future. And secondly, we must work together to ensure that corruption cases are suppressed at the source, because corruption is a system, and it’s not just those who take bribes, but those who give them, and they are representatives of business,” Dmitry Medvedev said.

Watch Dmitry Medvedev's meeting with business partners

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Overcoming the crisis

The economic forum is taking place as Europe faces the potential of another damaging debt crisis.

There is mounting speculation that Spain is about to follow Greece and ask for a whopping bailout from the EU.

Speaking on the eve of the forum, Dmitry Medvedev said such measures are helpful, but only if applied carefully.

“In any case, you need to find a happy medium. You cannot destabilize economies; you cannot extend aid blindly in a situation where all has been lost anyway. You have to be sober in your reasoning,” Russian President warned.

On the other hand, Medvedev went on, “You should take some reasonable measures to support a number of weak economies in order to save the general idea. And the general idea is the common European market and the common supranational European currency, the euro.”

“Yet indefinite solidarity and ineffective aid is, of course, a dangerous strategy. Eventually, it can undermine anything, even the European Union. Then even those countries that are not in danger today may face problem with solvency later. So what you need is a happy medium,” he concluded.

Member of the Russian Council on Defense and Foreign Policy, Sergey Brilev, is certain that there is a hidden message in President Medvedev’s speech.

“During the crisis months, the European share in the global GDP has fallen,” Brilev told RT. “Russian is more-or-less stable, but there is absolutely nothing to be proud about, because of the raw material exports and the economy is just the same – that’s why the modernization slogan. But then, how is Europe going to improve the situation and to defend its stance in the world other than by an alliance with Russia, which is a peculiar country, but which is a nearest neighbor, a major source of oil and gas?”

“He [President Medvedev] just mentioned terrible problems that Russia has experienced in these last two years, since the war and since the beginning of the crisis, but having said that – there is four per cent growth this year, which is a major achievement, which is something impressive,” Brilev said. “But what’s going on in Europe? If you put these things together, there is a newly-created intrigue in this Forum. It’s not just a forum in the midst of the crisis. It’s a forum which looks towards the future, and I see a shared, if not a united, future between Russia and the West, Russia and the European Union in particular, following Mr. Medvedev’s speech here.”

Watch full interview with Sergey Brilev

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