The XI Gaidar Forum “Russia and the World: Challenges of a New Decade” ended in Moscow. The most discussed topic on the second day was the news that President Vladimir Putin introduced Mikhail Mishustin, Head of the Russian Federal Tax Service, as candidate to the post of Prime Minister. However, other important topics related to economic challenges of the new decade facing Russia and the world did not stand aside.
On the first day of the Gaidar Forum, Prime Minister Dmitry Medvedev announced resignation of the government after constitutional amendments proposed by President Vladimir Putin in his annual message. Putin proposed Mikhail Mishustin for position of a new Prime Minister and State Duma approved this candidacy on the second Forum day, January 16. A respective Executive Order on the appointment was signed by the President of the country on the same very day.
Several key speakers including Aleksey Kudrin and German Gref, members of the Gaidar Institute’s Board of Trustees, shared their opinion in the course of the Forum about new Head of the Government and possible changes on the country level associated with this nomination.
Aleksey Kudrin, Chairman of Accounts Chamber, noted in the course of the session “Trust as a factor and an instrument of economic development” that government’s resignation significantly increased hope that  a new team will be able to achieve more and proposed leader has a better sense of business situation, he is able to balance interests of business and the state. According to Kudrin, a new team always comes with new ideas and receives a mandate for reforms.
Chairman of Accounts Chamber also pointed out that Mikhail Mishustin managed to solve problematic issues of tax administration while heading Federal Tax Service. “They ceased to be in the first lines of business problems. He feels the nerve of digitalization and importance of new technologies for development of economy and, in my opinion, it is very important. A whole series of such factors proves that today we have more hope ahead of a number of reforms, ”Kudrin added. 
Answering to journalists’ questions at the sidelines of the Gaidar Forum, German Gref, Head of Sberbank, called Mikhail Mishustin one of the “absolutely logical” candidates to be the Head of the Russian government, able to achieve results and having tremendous experience. He also noted Mishustin’s human qualities: “He is a rare person, talented, a man of many accomplishments, there are few such people, he knows how to build a team, build relationships and does it very correctly, achieving result.”
According to Gref, he is “one of the most prepared and encouraging candidates”. As explained by economist, Mishustin possesses a unique competence: he is an engineer, understands modern technologies including blockchain and artificial intelligence, capable to get results, an excellent manager knowing how to build a team. Under Mishustin, FTS turned into a unique advanced platform, Gref noted. President of Sberbank expects reforms from new Prime Minister, first of all, including change of state management. President of the major Russian bank said: “I have no idea about his plans to a full degree but I think that he will start with this matter”.
второй деньMikhail Mishustin himself should have taken part in the Gaidar Forum and deliver a key presentation at the session “Taxes in digital world”. However, he changed his plans due to necessity to have meetings with representatives of fractions prior to discussion of his candidacy by the State Duma. Alexey Overchuk, Deputy Head of FTS, spoke at the session instead of Mishustin. He spoke in the course of his extensive presentation about digital transformation of tax bodies, in particular, introduction of a tax mode for self-employed and online cash desks. Alexey Overchuk advised: “Foreign colleagues look on what we managed to launch mobile application for self-employed with admiring envy”. However, according to Overchuk, this is only top of the iceberg.
According to Overchuk, subsurface part of this work intends to change the philosophy of civil service: a completely different organization of government agencies is required in order to support application as well as quality of services. “Traditional relationships recede into the past. Digital platform allows you to build new employment relationships that the state will not see. A similar picture relates to PIT. Only platform based solutions will make this all visible to the state, ”added Alexey Overchuk.
Sergey Sinelnikov – Murylev, Academic Director of Gaidar Institute, Rector of FTA, moderator of the discussion, noted positive tendencies in the taxation system. He said that system of tax administration put in place by Mikhail Mishustin at his position in the period of 10 years allowed to simplify  numerous procedures: it is not necessary anymore to visit tax service in order to pay taxes, all payments can be processed via online account. It will not work anymore to avoid paying taxes and it increases fairness of taxation.
Alexey Overchuk, Deputy Head of FTS, also spoke about common tendencies in the sphere of economy  digitalization: development of global and local digital services, methods of their taxation and challenges of their administration. Experts participating in the discussion agreed that not only Russian but also international tax administration is at the new stage of development. Those issues and risks that international taxation system faced, allow assuming that dramatic changes will take place in this area in the coming couple of years.
Business representatives spoke in the course of panel discussion. Tigran Khudaverdyan, Managing Director of “Yandex” Group, noted that achievement of trust and mutual understanding between digital platforms and the state helps them to develop together. Moreover, establishment of transparent transaction environment makes it possible to accumulate big data files being the basis for development of new products for users and improvement of existing ones. Case studies of this dialogue represent technologies of online cash desks and application for self-employed which allows the industry of services to become completely justified.
A good part of labor market turns from classical model towards freelance. Aleksey Gidirim, co-founder of said that 120 thousand people registered monthly during 2019 at this platform with the total number users exceeding 2 million. People try to monetize their free time or switch completely to flexible job schedule. Due to increasing demand, the property is planning to enter b2c market allowing more comfort to self-employed in their cooperation with companies. He also noted that tax mode developed for these citizens will help business to come out of the shadows while citizens get legal additional income.
Natalia Shagarina, founder of “Edadil”, shared her experience of integration platform containing application of tax service for verification of cashier’s register checks. Service aggregates sales of supermarkets and provides opportunity to find out places for a more profitable purchase of food in order to return part of their cost using cashback. She underlined that these business developments based on FTS technologies allow to establish free and transparent market and resist dishonest competition and gray economy.
Another discussion “Horizons of economic policy” took place on the sidelines of the Forum involving experts of the Gaidar Institute. Economists discussed trends of global economy as well as challenges and opportunities for Russia. Sergey Drobyshevsky, IEP Scientific Director, and Alexey Vedev, Head of Financial Studies Department, delivered presentations dedicated to the situation in Russia. Alexander Ivlev, CIS EY Managing Partner, moderated this session.
второй деньReplying to moderator’s question on preliminary results of implementation of national projects, Sergey Drobyshevsky noted that his position is twofold. On the one hand, he doubts the effectiveness of national projects and benefits of their implementation for Russian economy. “Contribution to GDP from national projects, even if they are fully implemented, will be quite modest, i.e. about 0.5-0.7% per year,” the expert noted. As explained by speaker, it is naive to assume that implementation of national projects in itself will help Russia to rise to 5th place in the world in terms of economy and reach a steady rate of economic growth.
At the same time, expert believes that national projects can play a different, signaling role in the economic development of the country. “In 2018, after presidential decree was issued, an economic model was selected based on the leading role of the state. In this sense, national projects will play a leading and systemic role. If private business supports the state initiative, growth rates of 3-5% per annum are realistic, ”economist said.
He also underlined that Russian economy has taken "a serious step towards moving away from dependence on oil prices in the past decade." “Although this happened in many respects by itself and not due to government actions,” concluded Drobyshevsky. He added that insignificant economic growth demonstrated by Russian economy at 1–1.5% is due to other areas rather than to raw materials sector.  Budgetary and consumer expenses contribute to this growth. According to Sergei Drobyshevsky, change of oil prices by $ 10-15 per barrel will not have any effect on economy: it will continue to develop in the same way and will not experience any difficulties.
Aleksey Vedev, in turn, noted risks of playing a weak Ruble. According to Vedev, statement “a weak ruble is a strong economy” is absolutely false. “Ministry of Finance is targeting Ruble using budget rule. It creates major demand for foreign currency. All market participants understand that it is realistic to move towards Rb 200 per dollar while RB 40 is impossible, ”said Vedev. “Someone says that this is supposedly good for economy but I do not believe in it. For example, a third of all imports is investment. That is, playing a weak Ruble means an automatic deduction from investment activity, ”expert said.
He also expressed his opinion, which he had repeatedly voiced earlier that state should reduce its share in economy. “Horizons of economic policy in Russia are determined by the President’s message. At present, there is a situation when economy is not growing, national projects are underfunded, budget policy is rather severe, investments have not grown since 2013. The key issue is the high share of state in economy, ”Aleksey Vedev said. He added: “What needs to be done in 2020? First of all, in my opinion, we have to balance monetary and budgetary policies. Russia is probably the only country in the world that is actually in stagnation while budget surplus is planned at the same time. ”
As a reminder, Gaidar Forum is the largest international expert forum that is taking place at RANEPA since 2010. It brings together leading world scientists and politicians, representatives of financial community and global business elite. This year, there were more than 80 discussion platforms, panel and expert discussions, open dialogs, presentations and meetings organized in the course of the forum. This year, more than 14.700 participants registered including 600 speakers from more than 30 countries.
Gaidar Forum photo gallery day 2