"When we take into account that most Cypriot companies own Russian assets, what we're really talking about here is developing our stock market in the context of global financial markets, which is a very important step," VTB CEO Andrei Kostin said Wednesday before a signing ceremony in the Kremlin.
Cypriot investment in Russia reached $49.6 billion at the end of 2007, of which 60 percent was direct investment, the Kremlin press service said. Kostin declined to name companies that might apply to sell depositary receipts in Russia under the memorandum of understanding.
The deal was signed after a meeting between Medvedev and Christofias in which Cyprus backed Russia's call for a new European security treaty and urged other European Union members to do the same.
Greek Cypriot President Dimitris Christofias has enthusiastically embraced Russia's initiative during Kremlin meetings with Medvedev.
Medvedev has made calls for a new trans-Atlantic security treaty a major foreign policy thrust of his 6-month-old presidency.
Western response has been lukewarm, but Russia got a boost last week when French President Nicolas Sarkozy proposed a pan-European security conference next year.
The Cypriot leader's support Wednesday was the most vocal yet from an EU member state.
Christofias said he is confident that others will eventually follow suit.
Medvedev also offered the assistance of Russian firms in helping Cyprus solve its water-supply problems, Interfax reported.
"We know that you have a problem with Cyprus' water supply," Medvedev said. "Our companies are ready to start working on this problem."
(Reuters, Bloomberg, MT)
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