Winter Olympics in spotlight at today's Sochi forum
The forum has attracted a record attendance and is expected to produce deals worth around $US 24 BLN.
Friday was the first official day of the forum, entitled “Infrastructure Day” – that was the main theme of yesterday’s plenary session.
Russian President, Vladimir Putin, has stressed that the mainstream course of the state economic policy will remain unchanged, and the government will continue efforts to create the appropriate conditions for private initiative.
First of all the President stressed the need of massive investment into Russia’ infrastructure, meaning the development of road networks, sea ports and other transport links. Also the President spoke about communications links. Mr Putin also spoke about the necessity to develop the Northern Caucasus region and the Baikal area, considering the lack of infrastructure in these areas at the moment.
Mr Putin drew attention to the rising deficit of power generation in the country, and called for speeding up changes in the power industry. He spoke about investments in the electricity sector, several billion roubles are expected to be invested into this area with a massive re-figuration of the state energy provider of electricity in Russia.
The same applies to other segments of the infrastructure like transport, the poor state of which is badly felt in the south of the country, where Sochi is situated, he added.
The President stressed that the lack of good construction sites equipped with the proper infrastructure, limit the economic development in the Sochi region and in the south of Russia, as a whole.
Another key issue of Mr Putin's speech was that Russia welcomes private investors into Russia and invites them to work hand-in-hand with the state ones to improve the economic situation. The President also named some macroeconomic figures to illustrate that, overall, the economy is doing rather well. He spoke about foreign direct investment as a key indicator of that.
Notwithstanding the problems, the economic development in the south of Russia is twice as quick as the national average.
“A year ago we already met with many of those who are present here today, discussed the details of development of the South Russia. In this period much has been done. And in certain vectors we have achieved truly not bad results. The capital investments in the economy have increased by 15%. The rate of industrial development for the second year in a row is above the average for Russia. This is a very good indicator, a very good trend. On the whole, the investment attraction aspect of Russia is becoming better.”
On the other hand, Mr Putin underscored that the 2014 Olympics in Sochi will to large extent stimulate the development of the region and attract investments.
He stressed that there will be no difference between national and foreign investors as far as the Olympics are concerned – price/quality ratio will be a decisive factor.
“We are ready to closely co-operate with private investors, including the foreign ones. I would like to emphasise that for the government of the Russian Federation and for those who will be selecting contractors, there should be no difference according to their nationality. Only two components are important here – the cost and the quality. I think it is unnecessary to remind that the efficiency of those plans’ accomplishment depends on the co-operative efforts of the state and business, and certainly on the local authorities’ support,” President Putin underlined.
The session has been moderated by Russia’s acting Economic Development and Trade Minister German Greff who opened it with a speech, which was followed by another address from Deputy PM Sergey Ivanov.
“Russia has become a reliable and firm partner. Gold and currency reserves have reached more than $US 416 BLN. Russia's role in the world economy will also grow. The main condition for that to happen is an active economic policy. Its main element is the establishment of a new, modern infrastructure,” Mr Ivanov said.
Russia's acting Deputy PM, Sergey Ivanov
The forum is an opportunity for politicians and businessmen from across Russia and the Globe to come together for three days and discuss how to invest into Russia’s regions with maximum results.
10,000 delegates are expected to visit the forum this year. Twenty four foreign countries are represented, including the U.S., Germany, Austria, Turkey, Japan and China.
3,000 thousand volunteers are helping the organisers, and 3,000 policemen are keeping order in the city.
The Governor of the Krasnodar region said that the aim of this year’s forum is to improve the regions infrastructure which includes roads, transport, engineering projects, communications and tourism. 2,300 agreements, worth a sum of $US 23,8 BLN, are expected to be signed.
The money will be spread throughout all Russian regions, but Krasnodar region is expected to receive a larger part of the sum. $US 11,2 BLN will help the region prepare for the Winter Olympics of 2014 in Sochi.
Dmitry Sredin of Troika Dialog Investment Co., spoke to Russia Today about investments in Russian North Caucasus republics.
“There are obviously political risks investing into this region. The image of the region is not very good as well as the transparency of most of the companies. Almost always, how people do businesses in those regions is not clear for most investors. So, those risks are there, and a lot needs to be done to ensure that these risks are mitigated through more information, more conferences, more meetings with the international investor base, with the local investor base.
Obviously the returns of investing into this region maybe very good, but unfortunately until most risks are eliminated or mitigated, it will be difficult to attract a lot of investments into Krasnodar region.”
Bernard Meunier, President of Nestle Russia underlined that “we were very happy to hear that President Putin and the Acting First Deputy Prime Minister, Sergey Ivanov, addressed with so much emphasis the increase and the improvement of the infrastructure of the country.”
He also gave valuable advice to the future investors in Russia. “If you apply the sensitivity to your work and understand the peculiarities of the people and economy surrounding you I think you'll be successful,” said he.
Andrey Stroev, CEO of Krasnaya Polyana ski resort noted that “main objective of this economic investment forum is to bring the attention of private investors, private companies to come to Sochi and to establish their business associated, of course, with investments on Sochi land.”
Entertainment programme for the forum guests
Meanwhile, the forum is not all about work. As its first day has come to an end and the work is over for the delegates for the time being, there is an entertainment programme is offered to them. Two mega stars are performing at one of Sochi’s stadiums on Friday night.
Some major skating stars and Olympic champions take part in the programme “Sochi: time to win”, Evgeny Plushchenko being one of them. He took the Sochi Olympic bid very much to heart and did a lot to promote it, flew to Guatemala in July and now he is back to Sochi to perform in tonight’s programme.
Another mega star to entertain the forum guests and locals Friday night is Sir Elton John.
Thousands have gathered at the stadium to watch the ice show and to listen to the world-famous pop-singer.
There are more entertainment events planned: a beer festival, a festival of local food and wine, a disco show, fireworks, a lot of fashion shows and other activities are planned for the days of the forum. Sochi is Russia’s favourite summer resort and it’s got to live up to its reputation.