Medvedev vows to end Russian protectionism

Last Updated: Saturday, November 14, 2009 - 15:40

Singapore: President Dmitry Medvedev Saturday promised that protectionist measures imposed by Russia would end after the economic crisis, saying Asia-Pacific leaders were obliged to remove trade barriers.
Medvedev, whose country controversially hiked tariffs on imported vehicles to protect the Russian car industry in the crisis, said restoring global trade volumes was key to recovery.

He said leaders from the Asia-Pacific Economic Cooperation (APEC) forum meeting in Singapore this weekend had to "do anything we can to refrain from protectionism in any sphere".

Two days after he set out a vision to modernise Russia`s economy in a state-of-the nation address, Medvedev warmed to the theme in a speech to a business forum.

"Russia is well aware of the harm of protectionism, especially in the crisis period," he told delegates, stressing that any recent trade barriers "are of short-term nature and will come to an end".

Japanese Trade Minister Masayuki Naoshima had said at the APEC meetings that he was concerned by Russia`s move in January to drastically hike tariffs on imports of both new and second-hand cars.

The Russian car industry, hit by slumping sales, is deep in the mire and officials have warned its biggest carmaker Avtovaz is on the verge of bankruptcy. Russia`s neighbour Finland has also expressed frustration over increases on export duties for Russian timber -- on which Finnish paper mills are heavily reliant -- aimed at encouraging Russia`s own timber processing sector.

Medvedev said Thursday that the Russian state had injected over one trillion rubles (35 billion dollars) into companies to help them overcome the financial downturn.

But he said in future the state would only help firms with effective business plans and those that could not adapt would simply have to "disappear from the market".

The President also said in an article for the Economist that Russia hopes in 2010 to conclude 16 years of talks on joining the World Trade Organization that have been mired by confusion and accusations of foot-dragging.

APEC finance ministers this week expressed their backing for Russia`s WTO accession, without setting a prospective timeframe.

Medvedev told Asia-Pacific business leaders that there was reason "for cautious optimism" over the world economy although it was too early to say that a complete recovery had started. He also underlined Russia`s ambition to become a "strong financial centre" in the coming years, as it gears up to host the 2012 APEC summit in the Far East city of Vladivostok.

But Russia, whose economy is forecast by the World Bank to contract 8.7 percent this year, has been thumped harder by the economic crisis than most other nations in Europe and Asia.

Analysts blame Russia`s worse performance on its failure to impose structural reforms when it was riding high on the back of booming oil prices, and have applauded Medvedev for vowing to overturn its shortcomings.

But while Medvedev appears to be laying more emphasis on the importance of economic reform than his presidential predecessor Vladimir Putin, analysts warn that concrete action has yet to come.

Oz urges region to back Asia-Pacific Community

Singapore: Australian Prime Minister Kevin
Rudd pressed Asia-Pacific nations today to back his proposal
for a more powerful regional group that will embrace
political, security and economic issues by 2020.

"Our proposal for an Asia-Pacific Community seeks to do
this," he said ahead of the 21-member Asia-Pacific Economic
Cooperation (APEC) summit that includes US President Barack
Obama and his Chinese, Japanese and Russian counterparts.

Rudd said no existing institution was designed to address
the full range of issues facing the region.
Political and security issues are not part of the mission
of APEC, founded 20 years ago to promote free trade and
investment among Pacific Rim nations.

"It makes sense for us as we think of ourselves for the
next quarter of a century as a region to have America
inextricably involved in what we are doing, however our debate
about regional institutions may unfold," Rudd said.

Rudd said his proposal "seeks to bring together in a
single institution over time the economies and countries of
our region with an agenda which covers the entire space, not
just part of it."

APEC is "just a gathering of economies" and the East
Asian Summit, built around the Association of Southeast Asian
Nations (ASEAN), excludes the United States, Rudd noted.

Bureau Report



First Published: Saturday, November 14, 2009 - 15:40

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