Russia targets hi-tech, privatised economy
November 13, 2009
By Vladimir Isachenkov Moscow
Russia needed to shed its dependence on exports of raw materials and build a new hi-tech economy to survive, President Dmitry Medvedev said yesterday.
In a challenge to his predecessor and mentor, Vladimir Putin, Medvedev also called for reducing state involvement in the economy and promised to offer support to civil society.
The country had continued to rely on an aging Soviet industrial base and to draw most of its revenues from exports of energy resources, he said.
"The nation's prestige and welfare can't depend forever on the achievements of the past," he said.
Medvedev said Russia's oil, gas and other production facilities as well as its nuclear arsenals were built during Soviet times. "All that has kept the country afloat, but it is rapidly aging," he added.
Medvedev said that years of burgeoning energy prices had stymied efforts to modernise the economy and created an illusion that structural reforms could wait.
He added: "We can't wait any longer. We need to launch modernisation and renovation of the entire industrial base. Our nation's survival in the modern world will depend on that."
The economic downturn hit Russia more severely than other countries, he said, but refused to shift the blame onto the US as Putin, now Russia's powerful prime minister, did.
"We shouldn't be looking for the guilty party abroad. We haven't done enough."
Medvedev stressed that the government should be helping out only those companies that were ready to provide plans for increasing their efficiency.
He said: "Inefficient enterprises must go through the bankruptcy proceedings or leave the market. We won't be protecting them forever."
Unlike Putin, who methodically increased the state role in the economy during his eight-year presidency, Medvedev said that Russia needed to reduce the share of the state, which now controls up to 40 percent of the economy.
He lashed out at a key part of Putin's legacy - giant state corporations that have been granted broad privileges and widely criticised for inefficiency. "I believe this form has no future in the long term."
He said that some of the state corporations should be given deadlines to complete their tasks and cease operations, while others should be turned into stock companies and eventually be sold into private hands.
He also urged an independent audit of state firms, saying pay for senior management should be pegged to their companies' efficiency. - Sapa-AP
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