At the Kazan Universal Exchange in the Tatarstan capital, 1,500 km east of Moscow, traders can find virtually anything for sale from flowers to furniture to plumbing supplies. But upstairs at the exchange itself, the one item they will be hard-pressed to find are corporate stocks.
According to a privatization law in Tatarstan, one of the fastest growing regions in the Russian Federation, corporate shares cannot be traded on the secondary market for three years following the initial issue. The result may be good for company directors wary of losing their position through acquisitions, but it means a lonely existence for the exchange and its brokers.
"Since voucher privatization and its auctions ended in August, 1995, the stock market you can't even call it that in terms of corporate shares has just been standing around," says exchange director Viktor Isaenkov.
Yet if Tatarstan's government is putting stumbling blocks in the way of domestic investors, it has gone all-out in its attempts to attract the attention of foreign businesses and their capital. Its latest effort is Tatinvest LLC, a joint Tatar-American project to attract foreign investment into 17 of Tatarstan's leading companies.