Anti-terror support, but Putin is all business

By Alex Frew McMillan
CNN in Shanghai

SHANGHAI, China (CNN) -- Russian President Vladimir Putin expressed his commitment to the anti-terrorism campaign at the APEC meeting on Friday but was keen to keep the focus on business.

Addressing an audience of executives at a CEO summit in Shanghai, Putin said an "instrument to quickly and expeditiously react to this [terrorism] threat" was essential and that diplomacy was the key.

"The most important thing is to find collective solutions in diplomacy and I think that is possible," Putin said.

Russia, like many of the 21 Asia Pacific Economic Cooperation member nations, was quick to declare support to U.S. President George W. Bush's war on terrorism.

As a result, U.S.-Russian relations have warmed though the two countries are still in disagreement over Bush's proposed national missile defense program.

But business was high on Putin's agenda as he spoke to his audience, including such luminaries such as Hewlett Packard Chief Executive Carly Fiorina.

Solid business place

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Putin said he expected economic growth this year to increase 5.8 percent, adding that a solid business place was vital for all APEC nations.

"This is a lesson we have learnt," he said, arguing that a solid economy helped prevent corruption and helped Russia emerge from the shadow of communism.

Putin conceded that in the last decade Russia spent all of its efforts on political rather than economic reform.

When asked if that placed it at a disadvantage against China -- which has done the reverse-- he said he didn't mind the "polite question" and that it was "true".

It was no secret Russia had spent years dealing with its political issues, Putin said, which at times threw the country into turmoil.

"Where would you find people who are willing to invest their own money in a region that is not stable?" he said.

'Social consensus'

But Putin said that the "social consensus" in Russia was now that a good economy was essential for the country.

"The social forces in Russia have realized that political stability is of the utmost importance for economic development," he said.

"This is not just a vogue, it is a natural stage of evolution in Russia's development into an international, civilized, developed state."

Putin noted that, bizarrely, the leading force of foreign direct investment in Russia last year was Cyprus followed by the Netherlands. Germany and the U.S. are next on the list.

That, he said, was just Russian capital that had fled overseas being "for whatever reason" returned home.

But he said it was the first sign that Russia might start drawing overseas money after the embarrassing debacle that saw it default on its government bonds and precipitated wholesale flight of international investors away from Russia