Sergey Sobyanin: “Moscow is on the verge of an upsurge of long-term investment growth”

February 3, 2012


The second day of plenary discussions at The Russia Forum 2012 was launched by Moscow Mayor Sergey Sobyanin. He was introduced by Ruben Vardanian, Chairman of the Board of Directors of Troika Dialog, who reminded the audience that in his first year as head of the Russian capital, Mr Sobyanin has already initiated several reforms to transform Moscow into a modern metropolis which is comfortable to live and do business in and a place that is appealing to both Russians and foreigners.

Moscow was able to overcome the consequences brought by the crisis of 2008-2009 and in 2011 its economy grew by 4%. Unemployment is practically non-existent in Moscow, the official figure coming in at around 1%. “In 2011 Moscow’s long-standing birth rate record was beaten and the death rate dropped heavily. Average life expectancy in Moscow now stands at over 75 years,” stated Mr Sobyanin.

In his words, in 2011, for the first time in recent years, Moscow experienced a revival of growth of investment in its economy. However, one must admit that the budget and general welfare of the city cannot avoid the impact of global financial turbulence. This is most felt by banks, investment companies and foreign companies.

Nevertheless, Mr Sobyanin does not see any reason to be pessimistic: according to leading global economists with whom the mayor held a number of meetings, the city administration’s choice in favour of actively resolving Moscow’s strategic objectives is the right way forward. “Our country and our city have a great opportunity that they must fully take advantage of,” underlined the mayor. Last year Moscow was number one in a rating of the largest European cities in terms of the rate of economic development, which indicates the growth potential of the real estate market and the profitability of investing in it for the next five years.

The mayor reminded the audience that in the past year the city hall turned down a number of construction projects in order to clear up city planning policy and make it more transparent. In the immediate future the city plans to approve new land usage rules and agree on industry-based plans for layout of buildings. Besides this, the Moscow government will implement comprehensive programmes for developing the city’s transport infrastructure and improving the current situations in the fields of healthcare, education and the environment. All these plans are aimed at increasing the quality of life for Muscovites. It should be pointed out that in actual fact, Moscow shouldn’t just be considered as the 12 million people registered within the Moscow Ring Road, but also the 8 million who live in the neighbouring Moscow Region.

The mayor remarked that in the new land recently attached to Moscow, there will be simultaneous construction of residential and commercial real estate as well as university campuses, scientific centres, parks and other essential infrastructure projects. The Russian capital does still not have enough retail space (Moscow has approximately two times less than European cities), hotels, hospitals, schools or sports facilities. “The city government plans to resolve many of modern Moscow’s problems and will determine the steps needed for further development,” emphasised Mr Sobyanin.

In reply to Ruben Vardanian’s question about how many years it will take for Moscow to become a city that is as comfortable for business and living as Singapore, the city’s mayor answered: “I don’t want our city to be like Singapore. Moscow must be Moscow, but a city that is a good, comfortable place to live. And we are moving towards this goal as fast as possible, using all the resources, knowledge and strength available to us.”