An advisor to Russian Federation President Vladmir Putin compared the Russian economy to those of Argentina and Mexico at the first economic workshop at the World Economic Forum's Russia Meeting 2001.

"The time is particularly appropriate for the Russia Meeting," said Klaus Schwab, President of the World Economic Forum. "The events of the 11th of September have changed the significance of the world and the mindset of people looking at Russia."

While participants will be assessing the growth of Russia's economy over the next day and a half, questions will also be raised as to the sustainablilty of the growth, said Schwab.

"The purpose of this meeting is two fold," he said. "Many things in Russia have changed, yet we have to see how they are to going to move forward."

There was consensus among participants attending an afternoon economic workshop, a preview of The World Economic Forum's The European Competitiveness and Transition Report 2001 2002, that Russia is changing for the better. Keynote speaker and personal advisor to President Putin, Andrei Illarionov, highlighted the new macroeconomic picture of Russia. "There is positive news coming from Russia," said Illarionov. "Inflation is high by economic standards, the exchange rate is stable, and foreign exchange reserves will be up to $40 billion by this year's end."

In his brief 10 minute address, Illarionov elaborated on the reforms responsible for the fundamental changes that have occurred in Russia during the past 10 years. "We are in the process of reforming all spheres of life," he said. " Private business is different, the authorities are different, the bureaucracy is different. We have joined the ranks of Argentina and Mexico as one of the world's leading emerging markets and we are entering the next phase, a mature market economy."

The afternoon workshop included a panel of economists from government,academia and the private sector, moderated by Thierry Malleret, World Economic Forum director of Europe and Central Asia. Malleret's questions challenged panelists to think about the sustainability following the upswing in Russian economy.

Participants replied with indicators of long lasting growth including Russia's current 13 percent flat rate of income tax, the recent adoption of the Land Code in the Parliament, which gives a greater degree of purchasing power to individuals within Russia and from abroad to buy land throughout Russia, and signs of deregulation. "Domestic factors will determine much," said Augusto Lopez Claros, Executive Director of Lehman Brothers in the United Kingdom. "New social reform and political stability could attract Russian capital."

Among potential factors that could have an adverse impact on Russia's growth, panelists cited its weak banking system, potential over-dependence on natural resources, and vulnerability to external shock. Panelists were particularly concerned with Russia's abundance of oil and gas. While Claro said Russia's oil and gas, in particular, are a blessing and should be used to fuel growth, others were in disagreement. "The international evidence is there," said Erik Berglof, director of the Stockholm Institute of Transition Economics and East European Economics at the Stockholm School of Economics. "Abundance leads to civil strife and conflict."

The possibility of Russia's acceptance into the World Trade Organization (WTO) in the near future was an overriding theme throughout the workshop, with panelists suggesting methods for gaining membership. "The key to speeding up WTO access is judicial reform and creating a system of checks and balances," said Berglof.

Other members attending the panel, who wished to remain anonymous, criticized process of WTO admittance, and looked at the European Union as a friendlier, more historical organization.

Following an afternoon of discussion participants, who included over 340 men and women from 28 countries, attended a dinner with key Russian personalities. Tuesday morning Russian Federation President Vladimir Putin is expected to officially open the event.