Speaking at the forum's opening, Prime Minister Vladimir Putin suggested creating new global economic architecture. He warned that it is not worth relying on the state's all-powerful role in the economy.
The current global economic crisis, the worst since WWII, has become so protracted, deep, and systemic because the whole world is enveloped in economic ties.
The majority of the WEF participants attribute the crisis to the failure of the market's self-regulating mechanism that did not cope with this new economic reality. Many of them associate the shaping of the post-crisis world with a new international system of market regulation, and hope that it will be elaborated by the 20 leading economic powers (G20).
At the same time, many businessmen are still perplexed and do not have any guide for action. Speaking at the forum, Putin mentioned guide lines.
He said that one of the main causes of the crisis was the failure of a global economic system that was characterized by the poor management of tremendous financial risk, enormous imbalance between the scale of financial transactions and the fundamental costs of assets, and dependence on what is actually a single reserve currency, the U.S. dollar.
Putin suggested that a more just and effective economic system should be based on the following principles: on par with assisting major companies in disposing of desperate debt, Russia suggests reforming international accounting standards. Business should be appraised by its fundamental value, that is, its ability to produce a new cost. Additionally, Putin proposed gradually switching to several strong regional currencies in international settlements and national reserves.
He emphasized that the unipolar world economy should be replaced with a system of several major centers. Therefore, it would be necessary to consolidate a system of global regulators in a multipolar world.
At the same time, Putin warned against the state's excessive interference in the economy. Such interference is a natural reaction to the failure of market self-regulation, but blind faith in the state's omnipotence may lead to excessive concentration of assets in its hands.
This may lead to the total loss of competitiveness, as the Soviet experience bears this out. Putin believes that the government should improve market mechanisms.
The Russian prime minister noted that national governments should not allow themselves to display economic egotism by protecting their producers from foreign competition.
The opinions expressed in this article are the author's and do not necessarily represent those of RIA Novosti.