World Economy

Russia Returning to Growth

Russia Returning to GrowthRussia Returning to Growth

The Russian economy, thought to have suffered significant losses after sanctions were imposed by the EU and US in 2014, is now returning to growth, Russian President Vladimir Putin said on the sidelines of the St. Petersburg International Economic Forum.

 “We have almost overcome the period of recession and the economy is enjoying all the conditions necessary for growth,” Putin said at the SPIEF meeting with investors and members of the Russian Direct Investment Fund on Thursday, Tass reported.

“The economy has adapted to the new circumstances,” Putin went on, adding that the country’s macroeconomic situation is stable and the level of inflation has decreased.

Volumes of Russia’s gold and foreign currency reserves have remained high thanks to the Central Bank’s efforts, the president noted.

“Moreover, after introducing a flexible national currency rate, it (economy) now has competitive advantages,” Russia’s leader stressed.

“The Russian financial market is one of the most open among the developing markets,” Putin said.

He praised the Russian Direct Investment Fund for what has been achieved so far and stressed the importance of its cooperation with other countries, including the UAE, Saudi Arabia, and Qatar which shows their trust not only in the fund, but in Russia on the whole.

“Over this time (five years), the fund has made significant progress. It has raised more than 760 billion rubles (over $11.5 billion] for the Russian economy.”

The fund has recently received the status of a sovereign wealth fund, which provides it with a wider set of financial instruments and “will give it a more independent and stable character," Putin said, also stressing that the initiative is set to attract investment to Russia.

The 20th International Economic Forum in St. Petersburg kicked off on Thursday, June 16 welcoming political and business leaders from all over the world, who have come to sign new contracts and discuss deals.

100 Nations Present

According to the event’s organizers, the Forum is attended by politicians and businessmen from over 100 countries. Among them, there are a vice president of the Council of Ministers of Cuba, Ricardo Cabrisas Ruiz, a vice chancellor of Austria, Reinhold Mitterlehner, President of the European Commission, Jean-Claude Juncker, the ex-president of France, Nicolas Sarkozy, 11 foreign ministers and six members of governments of the CIS countries.

Secretary-General of the United Nations, Ban Ki-moon, delivered an opening speech at the meeting. He reminded the participants about the signed international agreements, including the one on climate change, which are to be ratified as soon as possible.

In the prepared speech circulated by the United Nations, Ban said Russia as a veto-wielding permanent member of the UN Security Council has "a critical role to play" in addressing "pressing global issues, from ending the conflicts in Ukraine and Syria, to safeguarding human rights and controlling the proliferation of weapons of mass destruction."

President of the European Commission, Jean-Claude Juncker, emphasized that the differences between Russian and European Union will cost much. In this connection, both parties must overcome the existing differences.

Deals, MoUs

Italian companies have signed deals and memorandums worth €1.4 billion ($1.58 billion) with Russian partners, Tass reported the Conoscere Eurasia Association as saying.

“On the first day of the SPIEF, a whole package of agreements was signed between Italian and Russian companies with regard to various sectors of the economy—construction, the crediting of start-up businesses, technologies, designing and cooperation in the implementation of infrastructural projects,” the association said in a statement.

Total CEO Patrick Pouyanne told RT that the company’s investments in Russia include the $30 billion Yamal LNG project.

“We have just finalized the financing of it with the Russian and Chinese banks, so it’s a big commitment for our company. It’s the largest project that Total has today in the world and in Russia. So, despite the sanctions, we are moving on,” he said, adding that Total is investing in the Yamal project for 40 years.