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A Declaration of Good Intentions
// Dmitry Medvedev Promises that Government Will Pull Out of the Economy
On Saturday Russian First Deputy Prime Minister Dmitry Medvedev laid out his political and economic program at the World Economic Forum in Davos, Switzerland. The basic premises of his position include a "pragmatic role" for the government in economics, keeping taxes as low as possible, and offering no tax breaks for foreign investors.
Dmitry Medvedev's address yesterday in the Swiss alpine resort of Davos promised to be the most interesting of the Russian offerings on the program at the World Economic Forum (WEF). The first deputy prime minister, who is seen by many at the conference in Davos as a possible Russian presidential candidate in 2008, laid out his "credo" governing the relationship between government and business in a well-attended speech on the day before the conference ended.
In comparison with the usual balancing act in Russian politics between the ideology of government capitalism and government regulation, "the Medvedev program" was significantly closer to the political declarations of newly-elected President Vladimir Putin, circa 1999-2000, than to Mr. Putin's speeches in 2004-2006 on similar topics, which led many in the audience to interpret Mr. Medvedev's 40-minute report, which he gave partly in English and partly in Russian, as a fairly empty declaration.
In his opening remarks, Mr. Medvedev defined the essential role of the state in the economy as "utilitarian and pragmatic." "The role of the government is not at all to show any given businessman in any given field how to carry out diversification," he said, explaining that the state should be prepared to intervene directly only in the case of "closure" of a private business in individual fields of industry.
The second cornerstone of Mr. Medvedev's "declaration" concerned tax policies, where the deputy prime minister's views are concrete: "Taxes should be as low as possible," he said. "And I mean for everyone." He explained that Russia will not be offering tax breaks either to Russian or to foreign companies, since they "distort the rational distribution of resources in the economy."
His third thesis touched on the essential status of state-owned companies in the economy. "Even when the government retains a controlling stake, we are striving for the creation of public companies with significant fractions of private investors," asserted Mr. Medvedev.
Towards the end of his speech, Mr. Medvedev also had something to say about the government's attitude towards democratic institutions in Russia. "We understand very well that not a single undemocratic government has truly prospered. And for one simple reason: freedom is better than no freedom," he said. However, many of the participants in the forum had little patience for declarations of freedom that ran well over the typical 15 minutes allotted to each speaker, and so many in the audience had left the auditorium by that point – thus missing Mr. Medvedev's fine words.
Dmitry Butrin
All the Article in Russian as of Jan. 29, 2007
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