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    Russia needs to improve private property protection, Igor Shuvalov, the country's powerful first deputy prime minister in charge of anti-crisis management, said on Thursday.

    Russia needs to improve private property protection, Igor Shuvalov, the country's powerful first deputy prime minister in charge of anti-crisis management, said on Thursday.

    "The [global] crisis has reminded us about the need to improve the protection of private property," Shuvalov said speaking at an international conference in Moscow. "Otherwise, the economy can only count on short-term investment."

    "Investment in high technology is possible only with solid protection of private property rights. Therefore this problem is directly linked to the course of modernization," Shuvalov said.

    Respect for property rights, although it has improved somewhat, has remained a key concern for foreign investors in Russia, along with a complex legal system, corruption, rule of law and corporate governance.

    "Strong reliance on raw materials exports and foreign financial markets determined the scale of the collapse in [Russian] manufacturing and the stock market," he said.

    Shuvalov warned about dangers of the "business-as-usual" strategy that means waiting for prices for Russian core export commodities oil, natural gas and metals to rise again after recession instead of diversifying the economy.

    Russia's government, which had promised to end its anti-crisis program in 2010, decided to continue it as a modernization effort. The anti-crisis committee headed by Shuvalov proposed a post-crisis development plan comprising both steps to "ease the effects of the crisis and modernization efforts."

    The 2010 budget includes 195 billion rubles ($6.63 billion) for anti-crisis measures, while another 233 billion rubles will be spent on economic stimulus measures approved in 2009.

    Observers have criticized the plan for lacking in measures to promote competition and encourage the private sector.

    MOSCOW, January 21 (RIA Novosti)

     

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