2009-10-28

On 21 October, President Dmitry Medvedev held a meeting with representatives of Russian private business. The most important subject discussed concerned a joint criticism by the entrepreneurs and the president of how state corporations (goskorporatsii) are functioning in the Russian economy. The president once again called for more state control over these structures. The demonstrative criticism of goskorporatsii during the meeting may be interpreted as the president's lobbying for a modification of the way state corporations operate, which will not be possible without PM Vladimir Putin's approval.

The six goskorporatsii were created in 2007, in the final period of Vladimir Putin's presidency. They were granted broad autonomy and control over enormous state-owned assets. Dmitry Medvedev has repeatedly criticised the state corporations' freedom, and ordered an audit of their finance this summer (the results are to be presented on 10 November). The president argues that some goskorporatsii should be wound up, and that the remaining ones should change their legal form (that is, to be transformed into joint stock companies).

The meeting with entrepreneurs who, like the president, are critical of the goskorporatsii, can be viewed as a way to make the case for a modification in how state corporations function, and to find allies to support such a move. The goskorporatsii are also opposed by some members of the ruling elite itself (including the finance minister Alexei Kudrin). Another argument for a change in their status comes from their inefficiency, and the fact that they need to be subsidised during economic crisis. However, even if the president's proposal are implemented, this will not entail any limitation of the state's presence in the Russian economy, but will only restore the state bodies' control over those assets which have been lost to the directors of goskorporatsii (especially Sergei Chemezov, head of the Rostekhnologii corporation). <iwo>

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