MOSCOW, FEB. 17 -- Russia announced today that it has hired one of capitalism's biggest guns to recruit foreign investors and guard its interests in business deals with the West.
The move to retain the Wall Street investment bank Goldman, Sachs & Co. indicates that President Boris N. Yeltsin is intensifying his efforts to revive Russia's moribund economy through foreign investment.
"We want to create a new image of Russia for foreign investors," said Leonid Grigoriev, deputy economics minister in charge of Yeltsin's Committee on Foreign Investment.
Goldman Sachs will be "a new force inside the country to work on the side of the Russian government," Grigoriev said at a press conference.
Robert Rubin, a Goldman Sachs senior partner, signed a contract Saturday with Deputy Prime Minister Yegor Gaidar, Russia's top economic official.
Goldman Sachs won the contract over three other firms. Officials refused to disclose the terms, but indicated that the company will receive commissions for bringing business to Russia.
Rubin said his firm's reputation will reassure foreigners who are skittish about investing in Russia.
Russia has sought the advice of many Western experts in creating a market economy. The International Monetary Fund now advises on managing the foreign debt, and Harvard University economist Jeffrey Sachs works as a consultant on overall economic policies.
Rubin said Goldman Sachs would implement a small number of projects with "a good chance of success," including ventures in the oil and gas sector, food processing, consumer goods and clothing.
Rubin stressed that Goldman Sachs will mainly negotiate deals with foreign companies, not advise Russia on managing its economy. But, he said, the firm will offer advice on making Russia's tax laws attractive to foreign business and on providing special tax breaks.