'We can do better': US, Russia seek business reset

US President Barack Obama on Tuesday said the United States and Russia had to boost lacklustre trade volumes as business leaders sought to reap the benefits from his drive to revive political ties.

Obama addressed a business forum staged in parallel to his two day visit to Russia, agreeing with complaints from Russian tycoons that bilateral trade had nowhere near reached its full potential.

"Total trade between our two countries is just 36 billion dollars," Obama said in a speech to the forum alongside Russian President Dmitry Medvedev. "America's trade with Russia is only one percent of all our trade in the world. A percentage virtually unchanged since the Cold War... Surely we can do better."

He said his aim of resetting relations between Russia and the United States has to be more than "just security or dismantling weapons."

"We need to make it easier for American companies to invest in Russia and make it easier for Russian companies to invest in the US."

Medvedev, who spoke first, agreed it was necessary to promote the "positive mood" of business leaders from the two countries.

Viktor Vekselberg, a billionaire tycoon and head of the Renova group, told the forum that while there were some positive examples in Russia-US business relations, cooperation has not become systematic yet.

"We are going around in circles all the time. Every time, US business has to discover Russia for itself anew and vice versa," he said.

Even five years ago however a business forum on US-Russian mutual investment would have been "out of place," he said.

Bilateral trade turnover is "despicably low, while (the amount of) mutual investment is simply shameful," Vekselberg said.

His fellow tycoons expressed similar views.

"The tensions of the recent times have not allowed us to carry out large projects in oil and gas," said Vagit Alekperov, head of Russia's largest private oil company Lukoil.

He poured praise on Obama, calling him a forward-looking man. "Today many expect more decisive action from him," Alekperov added.

Mikhail Prokhorov, Russia's richest man, declined to comment about his expectations for the future of Russian-US ties, but indicated he was optimistic.

"We do not live by expectations. We live in real life."

Despite several high-profile acquisitions in the United States, Russian businesses have long complained of barriers in that country, while US firms say corruption and bureaucracy sour the business climate in Russia.

Steel tycoon Vladimir Lisin said the US government offered "absolutely inadequate support" for companies in the metals sector.

Obama's two-day visit to Russia has seen over 1.5 billion dollars' worth of deals, including a commitment by soft drinks company PepsiCo to invest a billion dollars into its Russian operations over the next three years.

US farm machinery company John Deer has said it will invest 500 million dollars in the country over the coming years.

On Monday, President Dmitry Medvedev and Obama agreed to create a high-level commission to boost economic and trade ties.

That commission would be similar to the so-called Gore-Chernomyrdin commission that promoted bilateral ties in the 1990s and was named after Vice President Al Gore and Prime Minister Viktor Chernomyrdin, officials have said.

Russian Economics Minister Elvira Nabiullina said the new commission will allow the countries "to considerably improve the dynamics of our trade relations and our investment cooperation."

"We believe it's high time to invest in Russia," she said.

Vladimir Yakunin, head of Russian Railways, injected a note of sober realism however, saying geopolitics will always be a factor in international affairs and will therefore affect businesses.

"So companies should not relax," he said.

One executive, who asked not to be named, was sceptical about the ambitions. "It's a bit of a deja vu... nothing has changed. The question is, is it going to be just a reset or a real change?"