UPDATE: Russia needs structural reforms to restore econ growth – PM

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MOSCOW, Jan 12 (PRIME) – Restoring Russian economic growth is impossible with only monetary and budget policy measures, because the country needs structural reforms, Prime Minister Dmitry Medvedev said Thursday at the Gaidar Forum.

“It is evident that there is a common problem which has been spoken about here, and this is a risk of long-term stagnation. It is obvious that we cannot restore normal growth simply with measures of the monetary and budget policy, we need serious structural reforms. Even though we have been speaking about it for the last 15 or so years,” he said.

“Nevertheless, given all the aspects of our country, these priority directions are almost identical and they are connected with the development of human capital, development through education and healthcare, improvement of the business climate, and development of infrastructure in the first place.”

Russia will not be closed for other countries, it plans to use global trends to solve its own tasks. Russia “is also aimed at development of foreign trade and creation of own added-value chains, and at more active development in external economic unions and agreements,” he said.

He said that the G20 mechanism has almost replaced with G7. “It is obvious what does that very ‘Big Seven’ mean without other largest economies. It means nothing,” he said.

But Russia also has to continue cutting participation of state in the economy and change the state management system. “We have to develop competition…decrease excessive presence of state in the economy, increase investment activity of regions, and, of course, reshape the system of state management,” he said.

The country should also constantly upgrade technologies and professional skills. “I think that the risk of widening of our country’s technological lag is one of the most serious or even the most serious challenge that our economy faces. I think we definitely have to discuss and make decisions in this regard,” he added.

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