foir print

28.03.2011

Center-Invest Bank is teaching foreign specialists how to modernize southern Russia.

On 25 March, the President and Chairman of Center-Invest Bank, Dr. Vasily Vysokov, delivered a lecture to students at the London School of Economics and Political Science (LSE) entitled «Designing Economics Mechanisms». His audience learnt about the theory and methods of producing balanced socioeconomic programmes designed to provide social stability and the integrated approach to their implementation. Center-Invest Bank has been using these methods successfully for many years, to monitor the reforms being carried out in southern Russia, to produce its own sustainable development strategy, and also to assist its customers in the writing of business plans.

Dr. Vasily Vysokov had previously given a number of lectures to students and teaching staff from LSE and Oxford University. During this most recent lecture, Dr. Vysokov referred to the results of his analysis of the current economic situation, an analysis that is being used to develop the Russian government’s 2020 Strategy.

When a company embarks on a process of modernization, it should start with self-evaluation of its own competitiveness at all levels. This self-evaluation should be the first step when putting together investment projects designed to ensure international competitiveness. Indeed, it is an essential step for companies that wish to secure finance on competitive terms for the implementation of projects based on international standards and best practice in public private partnerships.

To prevent the emergence of new investment bubbles, when financing projects, budgets at all levels must be balanced. Companies wishing to enter international markets should be guided by long-term global price trends, rather than speculative price fluctuations in local markets. Price regulation should be achieved through the consistent formation of a competitive environment and by using the opportunities presented by the diversified economy of southern Russia.

A significant advantage of this strategy is that it has already been proven to be effective by Center-Invest Bank customers. In 2010, Center-Invest was the top performing bank in terms of the number of loans made to SMEs in the Rostov Region for the implementation of investment projects. We account for almost half (47.2%) of all such loans.

During the crisis, with our assistance and through their own perseverance, Center-Invest Bank customers managed to complete existing projects, introducing new equipment and technologies. Their experience clearly demonstrates the following: by replacing equipment left over from the era of privatisation with modern equipment, you can achieve a three to five-fold increase in the efficiency of your business. It is on the basis of our successful experience of financing such projects in various sectors of the economy that we strongly recommend to our customers that they begin to modernize.

In 2011, we will continue to promote the modernization of SMEs in southern Russia by working more extensively with their foreign partners. This increased cooperation requires skilled personnel, both in southern Russia and in other countries, and one of the issues addressed by Dr. Vysokov during his lecture at LSE was how to meet this challenge.