14/01/2002 - One of the Russian government's top priorities is to reform major infrastructure sectors in order to improve efficiency and enhance competition and service to consumers. A new OECD report, Reforming Russian Infrastructure for Competition and Efficiency, summarises the main challenges in the rail transport, telecommunications, electricity and natural gas sectors and makes recommendations for reforms.
The report draws on a series of seminars hosted by the Ministry for Antimonopoly Policy and the OECD on competition and regulatory reform issues in these sectors, with the participation of the government ministries responsible for each area.
It will be presented at a news conference at 11.00 a.m. on Monday 21 January 2002 at the Ministry for Antimonopoly Policy in Moscow, with the participation of Russia's Minister for Antimonopoly Policy and the Support of Entrepreneurship, Iliya Yuzhanov, and senior OECD officials. Representatives of the relevant ministries have also been invited, with a view to providing information on reforms under way in the industries that they oversee.
The report assesses the state of competition in each of these four key sectors and discusses policy options for enhancing competition and promoting innovation and investment.
In the case of the rail sector the report recommends, amongst other things, placing the rail companies on a sound commercial footing, the separation of public service obligations from the commercial obligations of these companies and the structural separation of the overall rail industry into vertically-integrated route-based companies which compete against one another to provide end-to-end services to rail customers.
For the telecommunications sector the report endorses the broad policy directions of the Russian Federation and encourages further rebalancing of telecommunications tariffs, the formalising of the access regime and the establishment of a mechanism for timely resolution of access disputes.
For the electricity sector the report emphasises, amongst other things, the need for separation of transmission and generation and the importance of ensuring a competitive generation sector. This may require splitting up the existing generation company into smaller companies. The regime for pricing access to the transmission system should induce decisions for efficient dispatch of electricity in the short run and, in the long-run, should induce generating firms to locate where it is efficient to do so.
In the case of the natural gas industry, the report encourages the development of competition in gas production. This would be facilitated by separating Gazprom's transmission assets from its production facilities. Some competition in gas transmission might also be possible if investment by other companies in new pipelines was allowed. Separation of Gazprom's different activities would also enhance transparency of Gazprom's costs and make clearer the cost of maintaining cross-subsidies which are currently holding down domestic gas prices.
In all sectors the report emphasises the importance of on-going competition law enforcement both in the process of setting up a competitive market and in preserving that market once the reforms are completed. This will involve preventing anti-competitive mergers and anti-competitive actions such as collusion or agreements between firms which hurt consumers.
For further information, journalists are invited to contact either Nataliya Yacheistova in the Ministry for Antimonopoly Policy (tel: 00 795 254 8026) or Taras Kobushko in the OECD's Moscow Office (tel: 00 795 956 4721).
Journalists may obtain a copy of the report from the OECD
Media Relations Division
. This report is on sale through the
Online Bookshop.
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"Reforming Russian Infrastructure for Competition and Efficiency"
72 pages, OECD, Paris 2001
Available in electronic format (pdf)
Euro20; US$19
ISBN 92-64-19699-4 (14 01 25 1)
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