According to new figures from KPMG, mergers and acquisitions activity in Russia dropped by 62% in 2009, with $46.1 billion in deals, compared with $122.4 billion for the previous year. Oil and gas, and communications and media, were the best performing sectors in the M&A market. The Economic Development Ministry is planning to ask investors which state assets they are interested in buying, in a bid to speed up privatizations, although critics are doubtful that investors ‘will believe in the sincerity of the government’s call‘. Vladimir Ryzhkov is not impressed by Vladislav Surkov’s ‘innovation city‘ proposal, calling it a ‘fantasy world‘. Strong oil prices mean that Russia’s budget gap will probably stay within 7% of gross domestic product this year, less than the government forecast.