Germany says role of Russian state is topic for G8
ONDON (Reuters) - The increasing role of the Russian state in the economy could be discussed when the country hosts the summit of the Group of Eight (G8) nations in July, a senior German government official said on Sunday.
Russia's newly found assertiveness as a global energy superpower has provoked U.S. criticism that it has backtracked on democratic progress and used energy supplies to blackmail its neighbours.
But German Deputy Finance Minister Thomas Mirow, speaking to Reuters on the sidelines of the annual meeting of the European Bank for Reconstruction and Development, said the EBRD meeting was not a proper forum for such a debate.
Mirow said issues such as energy price disputes between Moscow and its neighbours, or wider questions of political and economic reforms, went beyond the EBRD's mandate.
"This is a very fundamental and overarching debate exceeding the framework of the EBRD. It will be the topic of the G7 and G8 summit," he said.
"Germany's point of view has always been that desirable developments in Russia are more likely if we co-operate rather than if we tried to isolate and stigmatise it."
The London-based EBRD, established in 1991 to help the countries of the former Soviet bloc complete the transition from communism to a market economy, has a remit to encourage democracy as well as economic reform.
The development bank said this month that by 2010 it will cease to invest in eight central and eastern European countries that joined the European Union in 2004, and shift its activities to Russia, the Balkans and former Soviet republics in the Caucasus and central Asia.
It has said Russia, awash in windfall profits from oil exports, still needs help in developing its infrastructure and market institutions.
In an interview due to appear in the Monday edition of French newspaper La Tribune, EBRD President Jean Lemierre said Russia had to ensure a balance between opening up its markets and the role of the state in the economy.
Asked if he was concerned by the Kremlin taking more control of some key sectors of the economy, Lemierre said its stronger hand in energy matters was not surprising as western European governments also often kept control over infrastructure.
"On one hand the Russian state is without doubt intensifying its intervention in the economy," he said.
"On the other hand, there is all the same a diversification of the economic fabric, with the emergence of a private sector and an opening up to imports. It is this balance which must be ensured."