The OECD sounded a sharp warning note over state intervention in the Russian economy and the slowdown of reforms in the country in a highly critical report presented Monday in Moscow. "The actions of state bodies too often contradict stated reform goals," said the report by the Paris-based Organisation for Economic Co-operation and Development (OECD), entitled "Russia: building rules for the market."
"There has been evidence recently of a drift towards more interventionist, less rule-governed state behaviour," stated the report, pointing also to an acute need for "a wide-ranging and coherent regulatory reform strategy" to encourage investment. "The priorities are state reform in the broadest sense... and the lowering of barriers for entrepreneurship," said OECD head Donald Johnston, who highlighted the problem of informal pressure by public officials on the business community.
The report issued a particularly stinging attack on Russia's gas giant Gazprom, in which the state is set to buy a controlling stake before the end of the year, analysts say.
Gazprom was acting "as if it were an arm of the state," combining commercial and regulatory functions and keeping a tight grip on information in the sector, said the report.
"The absence of real progress on gas-sector reform must surely be counted one of the government's major policy failures of recent years."
More competition in the natural gas, electricity, rail transport and banking sectors would have a positive knock-on effect for the rest of the economy, said the report. The sense of drift in the reform process had put investor confience in doubt, said OECD economist William Thomson, emphasising the problem of "aggressive" tax inspectors and other officials putting pressure on businesses.
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