Russia’s Fundamental Business Problem Lies in Poor Infrastructure – Kudrin

ST. PETERSBURG, May 23 (RIA Novosti), Daria Chernyshova – Russia’s poor infrastructure is a fundamental problem for local businesses and needs to be improved, former Russian Finance Minister Alexei Kudrin told RIA Novosti on the sidelines of the St. Petersburg International Economic Forum (SPIEF) on Friday.

“We need to make structural changes. The main problems are with infrastructure. We have a very weak infrastructure – roads, ports, pipelines. This is what we need to change substantially, make it cheaper for enterprises, businesses. This is a global problem,” Kudrin said.

According to the Russian Transportation Ministry, poor roads are holding back the country’s economic output by 7-9 percent. Russian regions suffer the most, as businesses choose to operate in Moscow and St. Petersburg.

The ministry’s transportation program for 20 13-2020 is to spend nearly 7 billion rubles ($204 million) to fix the most urgent problems.

During last year’s forum in St. Petersburg, Russian President Vladimir Putin signed a $13 billion investment plan to build new roads and railways, including work on the Trans-Siberian Railway.

The annual economic gather, aimed at attracting foreign investment, is taking place for the 18th time in Russia’s northern capital and is being attended by top government officials and businessmen, as well as dozens of foreign delegations.

This year, however, the business climate has worsened, with several Western companies withdrawing from the forum in a sign of strained economic and political relations between Russia and the West, mostly due to the crisis in Ukraine.