During his speech Friday at the St. Petersburg International Economic Forum, President focused in part on the idea of developing Moscow into an international financial center. This has emerged as a key component of the president’s broader program to modernize the country’s economy.
Efforts to improve the investment environment are to be lauded and encouraged, but Moscow has a long way to go before it could be called a global financial center. In a March study of global financial centers commissioned by the City of London that assessed the competitiveness of financial centers around the world, Moscow was ranked No. 68 out of 75.
From such a low base, Moscow should be able to improve its prospects and position. Very modest progress in strengthening property and ownership rights, improving corporate governance, cutting red tape and fighting corruption would be the best place to start. Any movement on legislation to limit insider trading and price manipulation and to adopt laws on exchanges, clearing and a central depository, would also boost Moscow’s ranking. Encouragingly, the Russian government appears eager to draw upon international experience to do it right.
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