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. Last Updated: 07/27/2016

Tulin, Burgov: New Players at IMF and WB

The tempestuous events of the first half of October -- the collapse of the ruble and the ensuing resignations of the acting finance minister and the chairman of the Central Bank -- deflected attention from some other developments which, while not as prominent, are no less important for the future of the Russian economy. I have in mind some personnel changes within Russia's representation at the International Monetary Fund and the World Bank.


At the annual joint meeting of these two organizations in Madrid at the beginning of October, two new Russian executive directors were chosen: Dmitry Tulin and Andrei Burgov. Tulin, who replaces the first Russian director at the IMF, Konstantin Kagalovsky, is now setting out for Washington. Burgov, on the contrary, has already been acting head of the Russian delegation to the World Bank for almost two years, having replaced Boris Fyodorov, who held the post from September 1992 to January 1993. However, he only officially took over the post last month.


The selection of the new directors indicates the beginning of a new stage in Russia's relations with these organizations. The strict and self-confident Kagalovsky -- one of the last representatives of Yegor Gaidar's team -- did quite a bit to force the IMF to make significant concessions to Russia in view of the country's unique transitional economy.


The soft, intelligent Tulin is unlikely to achieve any revolutionary changes in course. However, he is an experienced, professional banker who will most likely accomplish quite a bit within the already existing framework of the organization.


Tulin has never tried to play any kind of political role in Russia and this no doubt pleases Prime Minister Viktor Chernomyrdin very much. In recent months it has seemed clear that Chernomyrdin was tired of the overly politicized Kagalovsky, who was constantly producing newspaper articles concerning problems of economic strategy.


Burgov, who was selected to be an executive director of the World Bank, also symbolizes the fact that the time when Russia's representation in world financial organizations was highly politicized is now behind of us. We are now entering the phase of routine work which, most likely, will be less exciting but no less important than the previous phase.


His first step in this new phase has been to propose a basic change in the character of the relations between Russia and the World Bank. In general, these relations seem completely acceptable as they stand. The World Bank has already created a portfolio for Russia consisting of 10 loans with an overall value of $2.89 billion. It is true that the bank has so far transferred only a little more than $600 million, but it is expected that another $1.5 billion will be forthcoming by the end of the year.


However, as Burgov has stated, the effectiveness of an executive director is determined not by the number of loans he or she secures, but by the scope of the orders that Russian enterprises receive in connection with the credits granted. Burgov notes that the World Bank's credits are generating a huge amount of orders, amounting to about $25 billion per year. However, Russia has been unable to get into this market, although in the long run it may be possible to secure from 5 to 10 percent of it.


So, Russia has new executive directors representing it at the World Bank and the IMF. But what will these new, "apolitical" figures bring?