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Brave new world heralded for Russia

Posted by John Bonar on Saturday, 09 June 2012 13:27 | Published in Regions

With 25-30 per cent of Russian GDP to be produced in Moscow by 2025, the capital of Russia is emerging as one of the new Mega Cities of the world, says Frost & Sullivan. But the modern Russia is beyond Moscow. Five to seven cities are set to become alternative growth centers in Russia by 2020, bridging the welfare gap between the capital and the regions.

A brave new world emerged from Frost & Sullivan’s inaugural launch of it’s flagship community and global event GIL 2012 - Growth, Innovation & Leadership , Industry leaders, innovators and visionaries from top  Russian and international companies gathered at the Ritz-Carlton for this year’s GIL 2012: -The Journey to Visionary Innovation

Frost & Sullivan’s Mega Trends and their impact on Russia were discussed in detail by Beatrice Shepherd, Vice President CEE, Russia and CIS, and Director of Frost & Sullivan in Russia. “We perceive Mega Trends as a tool to build strong business and generate new revenues,” said Ms Shepherd. “By 2025, twenty per cent of all Russians will live in Moscow which is set to grow 2.5 times. The economic implications of this dramatic change will be that Moscow will become a global economic force on its own with a diverse and dynamic socio-economic mix and tech-savvy citizens connected 24/7.”

At the same time, we will witness the emergence of new mega corridors between Moscow – St. Petersburg and Moscow – Nizhniy Novgorod. Three major cities will be emerging from those with a vast growth potential: Vladivostok, Tomsk and Yekaterinburg, which are seen as new locomotives for growth.

The upcoming decade will also show the Russian middle class significantly increasing, resulting in a surge in consumer spending and stimulating strong economic growth. With its ambitious infrastructure development programme Russia will enter an era of high-speed railway and build or modernise over 20,000 km of roads offering a Europe-China connection highway via Kazakhstan. Other trends along with industry innovations will lead to the development of an e-Russia, the establishment of a global recognition of Russian brands as well as allow technology leapfrogging.

Innovation was at the core of Frost & Sullivan Global President and Managing Director, Aroop Zutshi’s keynote speech. Introduced by EIA Director and Partner Dorman Followwill Mr. Zutshi said: “Globalisation has changed the modern world entirely, making it increasingly complex and competitive. Innovations, new technologies, changing business models and new social tendencies – all these require visionary perspective for the future expansion. Frost & Sullivan’s programme is designed to support business leaders in achieving these three essential objectives and I am proud to be here and accompany you in your journey to Growth, Innovation and Leadership.”

The day culminated in the panel discussion “Investing in Innovation” gathering representatives from international and local companies discussing their experience and lessons learnt while doing business in Russia. Representatives from EMC Corporation, RUSNANO, I2BF Global Ventures, among others, highlighted the importance of new technologies for the future development of the country.

In Russia, almost all investment in innovation comes from the state, whereas Frost & Sullivan research shows, that 75 per cent of innovations globally come from start-up companies and 25 per cent from top industry leaders.  “This is a great move by the Russian government to transform the state from a natural resources net exporter to a country of innovations. More private investors will support innovative start-ups, but to make it happen, the government should also improve legislation to be more favourable for small and medium businesses and for companies operating internationally” – added Ms. Shepherd.