Medvedev Chides Putin for 2008 Attack on Coal Billionaire Zyuzin

Russian leaders need to avoid tough, “unequivocal” talk with business to make the economy more competitive, Prime Minister Dmitry Medvedev told an investment forum in the southern Russian resort town of Sochi.

The government can’t hope to make the economy more effective by “offers to send a doctor,” Medvedev said in a speech broadcast by state television channel Rossiya 24 today. “Russian business knows what I’m talking about.”

Medvedev was referring to a comment then-Prime Minister Vladimir Putin made at a July 2008 industry meeting that billionaire Igor Zyuzin, the main owner of coal producer OAO Mechel, was unable to attend because of illness. Putin said he hoped Zyuzin would get well soon, “otherwise, we’ll need to send him a doctor and clean up all these problems.” Days after Putin’s remarks, then-President Medvedev called on authorities to stop “causing nightmares” and intimidating business.

The comments criticizing the company for selling coal to its Swiss unit at less than the domestic price wiped 50 percent off Mechel (MTLR)’s American depositary receipts. The company was fined 790 million rubles ($25.5 million) and pledged to cut prices 15 percent. A year later, Putin said he regretted that the remarks sent the company’s shares tumbling.

Medvedev, who stepped aside as president in May after deciding not to challenge Putin, said these methods of steering Russian business should become a thing of the past.

“I’d like it if we were able to start living differently,” he said.

To contact the reporter on this story: Scott Rose in Moscow at rrose10@bloomberg.net

To contact the editor responsible for this story: Balazs Penz at bpenz@bloomberg.net

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