Goldman Sachs Group Inc. (GS) Chief Executive Officer Lloyd Blankfein said Moscow’s traffic jams are the biggest obstacle to turning the capital into a financial hub, according to Deputy Finance Minister Dmitry Pankin.
Blankfein and President Dmitry Medvedev discussed investment opportunities in Russia and Medvedev’s plans for the capital at a March 15 meeting outside Moscow that Pankin attended.
“The first question we asked was about the main problem for creating Moscow as a financial center,” Pankin said in an interview in Moscow yesterday. “He said it was bottleneck from the airport to the city center.”
Medvedev has named 27 people, including Blankfein, JPMorgan Chase & Co. (JPM) CEO Jamie Dimon and Citigroup Inc. (C) CEO Vikram Pandit, to an advisory board as he seeks to bolster Russia’s role in international finance, according to the Kremlin’s website this month and a member of the board who declined to be identified. Medvedev has made diversifying the economy of the world’s biggest oil and gas supplier a priority.
Transport and infrastructure, as well as child care, are priorities for bankers working in Moscow, Pankin said. Goldman Sachs declined to comment, said a spokeswoman, who asked not to be named, citing company policy.
Mayor Sergei Sobyanin vowed to focus on easing transportation in the capital and uprooting corruption after Medvedev ousted Yury Luzhkov, who had governed the city for 18 years. The president wants investors in Moscow to feel “no less comfortable than in London, Geneva or New York,” according to the Kremlin website. Moscow ranked 68th of 75 cities in the December 2009 Global Financial Centers Index commissioned by the City of London.
Moscow drivers suffer the longest traffic jams of 20 major cities, making for a “grueling” atmosphere that inhibits commerce, according to a July report by International Business Machines Corp.
The average Muscovite motorist spent a “whopping” 2 1/2 hours stuck in traffic at least once in the last three years, IBM said in its global study on the “emotional and economic toll of commuting.”
Goldman Sachs is also among the 23 banks selected by the government last year to help manage its 1 trillion-ruble ($35 billion) state-asset sale program over three years.
Russia picked advisers “that have experience in launching big projects” to help build Moscow into a financial hub, said Alexander Voloshin, head of the government working group overseeing the project and former chief of staff under Presidents Vladimir Putin and Boris Yeltsin, in a Jan. 11 interview. “And those big banks that can bring business here.”
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