Bonds News

Russia's Putin says no roll-back on free market

SOCHI, Russia (Reuters) - Prime Minister Vladimir Putin assured foreign businessmen on Thursday that Russia would not roll back the free market despite its current turmoil and would not take politically motivated steps in its ties with the West.

“Our policy will remain unchanged: there will be no market closure, no model of forceful mobilization,” Putin told a meeting with the businessmen in the Black Sea resort of Sochi.

“We will not take any politically motivated steps in our economic relations (with the West).”

Putin said the government was considering further cuts in taxes for the oil and gas sector, with additional steps to be made in 2010.

The fall in Russia’s stock markets since May has been steeper than in other emerging markets, with many in the market attributing that in part to the increased political risk from Russia’s military intervention in Georgia.

The domestic political impact has so far been limited because private share ownership in Russia is small, but some analysts say the pressure for greater state intervention in the markets could derail President Dmitry Medvedev’s agenda of liberal reforms.

Putin said “steps would be proposed to liberalize taxation for securities markets participants”. Finance Minister Alexei Kudrin had said earlier the government agreed to lift taxes for sales of shares which their owner has held for more than a year.

“We will steadily move in the direction of creating demand on the long-money market,” Putin said.

Reporting by Oleg Shchedrov; Writing by Dmitry Solovyov