Volume of investments in Russia less than last year -- IMF


MOSCOW, June 3 (RIA Novosti) - Investments slowed in the course of 2004, and although they have recovered somewhat, they are still running at a rate below the one of a year ago, head of the International Monetary Fund's mission in Russia Paul Thomsen said at a press conference today.

Thomsen said specifically the Yukos case had influenced the investment climate in Russia.

This case, whether it is right or wrong, fair or unfair, testifies to the continually increasing interference by some bodies of power and the heavy-handedness of some regulatory agencies, he said.

To improve the investment climate in Russia, Thomsen said the government should give a positive signal about accelerating structural reforms as well as a statement that regulatory acts will be implemented without bias.

At the same time, in the past three to four years Russia's macroeconomic policy was pursued successfully enough, he said.

The IMF also noted the practical lack of progress in carrying out structural reforms in Russia, he said.

Since the mission's visit to Russia last September, there has been improvement only in the banking sector, where the Bank of Russia has been working to ensure the entry of banks into the deposits-insurance system, he said.

Thomsen also said most of the reforms that are government priorities, including the reform of housing and public utilities, the health services, and education, are considerably lagging behind schedule, and no progress at all was observed in a number of reforms.

The government understands that the acceleration of reforms, specifically those that will result in improvement of the investment climate, is the principal problem, Thomsen said.

He said the lack of direction in political reforms, as well as the Yukos case, adversely affected the progress of structural reform.

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