What's in gain in Doing Business ranking for Russia?

What's in gain in Doing Business ranking for Russia?

Russia has risen to the 28th position in the Doing Business 2020 rating of the World Bank and the International Finance Corporation from the 31st position it occupied last year.

The WB said in the report that it happened thanks to innovations in power distribution and taxation and to protection of rights of minority investors.

In the previous year, Russia conducted three reforms, including reforms to speed up power purchases and simplify compliance with tax requirement. Better corporate transparency regulations also strengthened protection of rights of minority investors, the report reads.

The former deputy chairman of the Russian Central bank, head of the finance, monetary circulation and credit department at RANEPA, Alexander Khandruev, speaking to Vestnik Kavkaza, noted that the rating's significance is very limited for Russia.

"The Doing Business rating is very popular worldwide, it reflects the state of the regulatory framework that determines the business environment. Moreover, the country's growth in the rating does not mean an improvement in the investment climate, business environment and opportunities for attracting foreign capital," he said.

"We must keep in mind that this indicator is calculated only for one city, in the case of Russia - for Moscow. It does not even reflect the legal and regulatory conditions for business and entrepreneurial activity throughout the country or in its individual regions," the former deputy chairman of the Russian Central bank added.

"In general, of course, the increase in the position in Doing Business is a positive fact, indicating that more comfortable conditions for business are created here. But there is no automatic link between creating conditions and real improvement in the business environment," Alexander Handruyev emphasized.

The vice-rector of the Academy of Labour and Social Relations Alexander Safonov was more optimistic about this improvement. "For Russian business, it means that, nevertheless, the image of Russia as a country, which is moving towards creating conditions for business development, is improving. The result will be the possibility of receiving additional bonuses in the nationwide rating of doing business and the growth of attracting business from abroad," he noted.

"Until now, it was quite problematic to implement any joint projects, as potential partners saw that we were not on the first lines in this ranking," Alexander Safonov concluded.

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