Building an international financial center in Moscow is one of the Russian government’s key ambitions, which is justified by the growing interest among global investors. Russia's economic revival helped restore the country's role as a major player in the global economy and created fertile ground for the development of a world-class financial center in the country. Russia’s economy is maturing and provides a solid and appealing investment opportunity in the post-financial crisis world. The profile and activities of Russian companies in capital markets have significantly increased over the past few years and Russia’s growth is now the highest in the G8 (GDP).
The goal of making Russia an attractive destination for international investment enjoys widespread support at the highest levels of the country’s business community and government, both of which are committed to enhancing the ease of doing business and providing the highest quality infrastructure, support services and business culture. President Medvedev recently ordered the formation of a special fund to attract foreign investment to the country, while in his latest address to the Duma, Prime Minister Putin stated the major role he wanted foreign investors to play in accelerating Russia’s economic development and growth.
Moscow is home to more than a half of all banking institutions currently operating in Russia. Moreover, nearly 80 percent of the country’s financial resources pass through the city’s financial system and the leading Russian stock exchange is also located in Moscow. According to data collected by the National Association of Securities Market Participants (NAUFOR), a Russian self-regulatory organization that unites professional securities market participants, more than 2000 foreign funds are currently investing in Russia with a total investment volume of about $90 billion.
Building upon regional framework agreements, such as the Common Economic Space and regulations pertaining to the CIS and EurAsEC, Moscow is taking steps to establish a regional financial center to service Russia and neighboring countries. According to recent World Bank studies, Russia has already established itself as a regional financial center that has played a strong role in international trade relations through its Customs Union with Kazakhstan and Belarus and position within the Eurasian Economic Community.
Russia is also in a good position to push for greater use of the ruble in trade transactions with CIS countries. The ruble’s emergence as an international reserve currency is one of the main indicators of our vision that an international financial center in Moscow is on its way to becoming reality.
Modern global financial centers like London or New York weren’t built in a day. The same process will of course take time in Moscow, but we believe it will pay off in the end.
Question: How do you believe developing an international financial center in Moscow will impact Russia’s economic development?
Yuri Soloviev, First Deputy President and Chairman of the Management Board of VTB Bank, Chairman of the Board of Directors of VTB Capital holding companies moderated a session on “Establishing an International Financial Center” at the St. Petersburg International Economic Forum (SPIEF) this week that can be viewed here.
A banker with a long track record, Yuri leads VTB Group’s corporate and investment banking business. Yuri moved to VTB in April 2008 to build the new investment banking arm for the VTB Group. Having a wealth of experience of working in the leading international companies, Yuri was Head of the Local Markets Trading Department in American investment bank Lehman Brothers in London and later he served First Deputy Chairman of Deutsche Bank in Russia, heading its global banking activities in Russia and the CIS. Yuri graduated from the Plekhanov Academy of Economics in Moscow and London Business School and holds Executive MBA.
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