Russian national development Corporation VEB.RF has finally concluded a two-year period of transition to a new operational structure and business model. The transition culminated in a new amendments to the Federal Law “On State Development Corporation “VEB.RF” coming into force on the 11th of August. As the result of these changes, VEB.RF has finally become a full-fledged development institution, perfectly fit for the task of developing Russia’s economy.
Among the major changes are those aimed at strengthening the role of VEB.RF Chairman (acting in his capacity of the chief executive officer) and Management Board (as a collegial executive body) in making independent decisions on VEB entering into transactions. VEB.RF Supervisory Council, previously consisting of Russian government officials exclusively and chaired by Russian Prime-Minister ex-officio, can now incorporate independent members, while the Government of Russian Federation appoints its Chairman. Furthermore, its powers were substantially limited to fundamental questions regarding VEB.RF organizational structure as well as its participation in projects of statewide significance, which involve federal budget compensations.
Recent amendments to the law complete the period of transformation of VEB.RF into a robust development institution. Capital problems have been resolved, VEB.RF has restructured investment process with the focus on the principles of syndication with commercial banks (so-called “project finance factory”). The organizational structure was rearranged and the staff was cut almost 3 times. Its priorities now include urban planning, investments into high-tech industries, sustainable development and infrastructure.
A new Investment committee was created within the structure to give VEB.RF more freedom in determining the course of action. From now on, the state will only determine the strategic tenets, while the corporation maintains highest degree of operational freedom. With these new capabilities VEB.RF is fully equipped to overcome all difficulties and serve as an engine of Russia’s future growth.