Financial ministers of the Group of Eight industrialized countries will arrive in Moscow to attend the financial G8 summit

Financial ministers of the Group of Eight industrialized countries will arrive in Moscow to attend the financial G8 summit scheduled for Saturday February 11. Afterwards, they will meet President Vladimir Putin, said Finance Minister Alexei Kudrin. "I am positive that an informal exchange of opinions will take place in the Kremlin, where everyone will be able to raise an issue of interest, draw attention to a global problem or make a proposal," he said. This will contribute to further work on the G8 agenda under Russia's presidency.

The Saturday meeting will address such issues as development of the global economy, the oil market, the economic aspect of fighting contagious diseases and developed country's donations to this cause, support to the least developed countries, including writing off their debts to international financial organizations. Also, finance ministers will be able to take some time off to go sightseeing and admire the Kremlin's architecture, to visit the Diamond Fund and a performance of Russia's best opera singers, Kudrin said.

Ahead of the meeting, the Russian minister made several statements. The Russian financial market is being liberalized faster than in other emerging economies, he said. Russia has already made the key move towards liberalization of financial flows: investment in the country is not restricted by any entrance deposits, and Russian investors have the right to export as much money as they need to invest in any projects abroad, he said.

"This means that the Russian ruble is becoming convertible. Formally, it will happen on January 1, 2007," he said. "Confidence in the ruble is growing, because it has a positive outlook for strengthening and has already become a reliable and predictable currency both for Russian and foreign investors, including foreign-currency settlements on foreign markets." Within the next three years the ruble may become a reserve currency for some countries, although its share will be relatively small, Kudrin added.

In this sense, Russia can claim practical membership in the G8 already today, he believes. This claim is also supported by its high growth pace, which is higher than the global average. "The pace can be even higher if the price on Russian oil will exceed the forecast $46 per barrel," he said.

Russia's initiative to join the financial G8 is supported by some other members, Kudrin said. But since "they have not announced it yet", he did not want to do it for them. "Apparently, Russia will become a full member of the financial G8 within a few years," he added.

This issue is also influenced by "Russia's involvement in the global economy, ," he said. "Russia intends to join the WTO. We plan to complete the accession talks this year."

Russia has joined the initiative to write off least developed countries’ debt on a bilateral basis, Kudrin said. He said Moscow was going to write off $688 million to 16 countries later this year. The state budget already has sufficient funds allocated and an order to the government to work out a procedure for this.

“We will look at G8 countries for experience. They have not just written off these debts but earmarked the money for solving problems, including health and education,” he said.

The Russian finance minister said other G8 members had fully honored their bilateral commitments on the write-offs. He said the finance ministers would also discuss relieving least developed countries’ debt to international institutions like the International Monetary Fund, World Bank, and African Development Bank by $37 billion.

The Russian Finance Minister said the capital of those institutions needed additional buildup to go ahead with new debt relief efforts.

“This initiative is still in the process of implementation. Not all countries have stated their decisions,” he said.

Kudrin promised to address the G8 ministerial meeting with a draft procedure of capital replenishment for debt relief agencies. Russia has its own vision for the future funding of the International Development Association (IDA, part of the World Bank that helps the Earth’s poorest countries reduce poverty), he said.

Another important topic the G8 is going to take on is transparency, more accurate classification of and accounting for energy reserves, he said.

“Russia, the G8 chair country, will facilitate higher transparency of energy markets and access of other – mainly producing – countries to those markets,” the Russian official said.

The summit will seriously address the problem of global energy supply, he said, describing the issue as having to do as much with energy as with the rules of energy business and alternative sources of power.

He said energy supply diversification dictated by high oil prices was “a pressing topic on the global agenda.”

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