Business 20 concentrates on stimulating investment
Kirill Dmitriyev, CEO, Russian Direct Investment Fund, Chair of the Business 20 Task Force on Investments and Infrastructure, spoke of the role of crossborder and infrastructure investments in promoting global economic growth at a briefing at the G20 International Media Centre.
Economic slowdown is the main challenge facing the world today, he said. This affects the level of crossborder investment and investment in infrastructure projects. Five years ago, crossborder investment - that is, the money which economies channeled to each other - totaled $12 trillion; now this figure is down to $5 trillion. About $60 trillion is needed for infrastructure investment around the world until 2030. At the same time, about $1 trillion is spent ineffectively each year. "These are serious losses for the global economy," Dmitriyev said.
The Business 20 Task Force on Investments and Infrastructure has prepared three sets of recommendations for the G20 Leaders. "We believe that these recommendations will help significantly increase the inflow of investment, dramatically accelerating global economic growth," he added.
First of all, barriers that hamper the flow of capital need to be removed. "Much is being said about free trade, but freedom of investment is not so widely discussed. Unimpeded movement of capital needs to become as important an international political issue as freedom of trade," Dmitriyev said. He also said it is important to develop joint investment instruments for several countries.
The second set of recommendations proposed by the task force is aimed at stimulating private investment in infrastructure projects. "Standard banking and insurance instruments are in place in G20 countries. Now they also need to develop standard mechanisms for private investments in infrastructure projects," the speaker said.
Finally, he noted the importance of making investment more effective. "We think it imperative to arrange a sharing mechanism to exchange experience in the area of infrastructure investment amongst the G20 countries," he said. "We plan to establish a center in Moscow to study the best practices and compare the best solutions for various infrastructure problems."
He also said that Russia would soon launch major infrastructure projects with an emphasis on transparency and attracting international investors. The projects will be implemented jointly by private investors and state agencies, because many infrastructure projects turn into loss-makers without government support, and private investors are reluctant to join unprofitable projects. "Infrastructure investments are a very important issue. The government is proposing effective and high-quality steps for attracting international investors to these projects," Dmitriyev concluded.