Russian President Vladimir Putin on Tuesday sought to woo wary Japanese investors, promising to enact structural reforms and ensure the rule of law in Russia's chaotic economy.
Addressing a meeting of Japanese business leaders, Putin conceded that the failure of Russian authorities to enforce legislation was the biggest stumbling block to securing a greater flow of funds from abroad.
"Not only do we not have adequate legislation but even those laws which exist are not enforced. It is the main problem we face," the Russian leader said, speaking on the final day of a three-day visit to Japan.
But he promised his audience of top business chiefs from Japan's Federation of Economic Organizations (Keidanren) that the government in Russia "is devoting much of its efforts to resolving this issue."
Japan accounts for less than one percent of global investment into Russia, occupying 13th place among investor nations, Putin remarked.
Direct Japanese investment in Russia totaled a meager 152 million dollars in 1999 compared to world investment in Russia of 12.8 billion dollars -- slightly over one percent of the global total -- according to official Japanese figures.
"Despite all the problems that we recognize exist, this is too low," said the Russian president.
"There are good opportunities for joint business activity, it would be a shame to let that chance slip by."
Putin highlighted three areas where Russia was hoping for more Japanese investment: oil and gas offshore development in the far eastern island of Sakhalin, nuclear power stations in the Far East and development of the trans-Siberian freight network.
Russia had already become a more attractive destination for foreign capital, with a set of healthy economic indicators, he asserted.
"The Russian economy is increasingly gathering pace," said the president, pointing out that the growth in gross domestic product (GDP) had jumped to 7.5 percent in the first half of this year from 3.2 percent in 1999.
The country was also repaying its foreign borrowings without help from international financial institutions, was on course for its first deficit-free budget in 2001, had inflation under control and a rising trade surplus, he added.
The head of the Keidanren, Takashi Imai, regretted that economic relations between the two eastern neighbors had declined since Soviet times.
But he said he hoped that this "young, energetic, president in Russia" -- Putin took office in May -- could turn the situation around - TOKYO (AFP)
© 2000 Al Bawaba (www.albawaba.com)
