Newspaper article International Herald Tribune

Putin Pitches Russia to Wary Investors

Newspaper article International Herald Tribune

Putin Pitches Russia to Wary Investors

Article excerpt

The Russian president promised to improve relations with global businesses, which have been pulling money out of the country.

After a series of hard-line moves and statements following his re- election this spring, President Vladimir V. Putin has softened his approach during a speech to foreign investors.

The Russian president, speaking at the St. Petersburg International Economic Forum on Thursday, which was sponsored by the government, promised to continue business-friendly overhauls begun by his predecessor, Dmitri A. Medvedev.

The appeal to investors, whom Russia will need to balance a trade and budget deficit if oil prices fall further, included a rare admission that political opposition could play a constructive role - - as long as it was expressed legally.

Mr. Putin said that "the thirst for change is a natural, driving force of progress" but dangerous when it threatened civil peace.

The speech to the audience of investors and executives -- which included Lloyd C. Blankfein, the chief executive of Goldman Sachs, and Rex W. Tillerson, the chief executive of Exxon Mobil -- was a switch from a series of hard-line statements by Mr. Putin and senior aides since his re-election in March.

Mr. Putin may have been trying to address signs of deterioration in relations between Russia and the United States, which pose a risk to foreign investment with potentially dire consequences for the economy.

Investors are jittery. They have been pulling money out of Russia since March as oil prices have fallen and concerns have mounted that the European debt crisis will erode demand for oil and natural gas in Europe, harming Russia's balance of payments.

Even if oil prices remain at their current historical highs, Russia will need an inflow of foreign investment to balance a projected trade deficit later this decade. …

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