VLADIMIR PUTIN
ARCHIVE OF THE OFFICIAL SITE
OF THE 2008-2012 PRIME MINISTER
OF THE RUSSIAN FEDERATION
VLADIMIR PUTIN
ARCHIVE OF THE OFFICIAL SITE
OF THE 2008-2012 PRIME MINISTER
OF THE RUSSIAN FEDERATION
VLADIMIR PUTIN
Transcript of the beginning of the meeting:
Vladimir Putin: Mr Kanokov, could you describe the situation in your republic?
Arsen Kanokov: Overall, the pace of economic development is good. Over the last four years our budget has nearly tripled, that is increased by 180%. In addition, we managed to cut unemployment from 29 thousand to about 17 thousand people.
In the last two years, we launched 10 new projects that created over 4,000 new jobs. There are currently 14 thousand vacancies in the republic, which we offered to people who are registered as unemployed. In addition, we created new jobs at the construction of the furniture factory, textile industry, construction materials production as well as new greenhouses.
Vladimir Putin: How many jobs have you created in total?
Arsen Kanokov: In total we have created about 3,500 jobs in hi-tech industries in the last two years. I would like to tell you more about these projects. One of them involves greenhouses that were built using state-of-the-art Dutch hydroponic technology, which yields five times more crops.
Another example is a textile factory with 500 new jobs, mostly for women, with an average salary of 12-15 thousand roubles. We have set up a joint venture there.
We've recently opened a furniture factory in the republic. It's a joint Russian and Turkish venture that has already completed four projects.
The figure you mentioned today, government guarantees up to 70%, is of great importance to us. The problem we often face is a lack of collateral, because these companies are relatively young. We consider all the projects and approve them at investment committee meetings, but we cannot guarantee anything because these companies are just getting started. However, if we have government guarantees, we will carefully analyse all the projects to ensure that they will succeed. If the government provides 70% guarantees, we will monitor these projects from the beginning. It is a very important development, and your decision will boost the economy of Kabardino-Balkaria and the whole North Caucasus region.
Vladimir Putin: I know you have projects in the sectors we discussed today, such as energy and tourism? How are they going?
Arsen Kanokov: They are going very well indeed. One of them you have already mentioned, the Kislovodsk-Elbrus Area road, which was included in the South of Russia Federal Programme under Dmitry Kozak. We have already built 60 kilometres, and it is an excellent road. We expect to finish it next year at the eastern slope of Elbrus. There will be brand new 300-hectare ski and thermal bath resorts, and it only takes about an hour to get there from Kislovodsk. I have been there several times myself. I think that the tourists coming not only to Kabardino-Balkaria, but also to the Caucasus Mineral Springs resort need modern infrastructure. And as you correctly noted, we can hardly provide them with the required level of service. We would like to build from scratch and provide the best possible accommodations and services. Only then will this project be competitive.
Another project you've mentioned is Cheget, Elbrus. We have already built two cable car lines, and we are currently building a third over Azau field. It is a bit more difficult with Cheget - we haven't yet obtained any financing.
We also need to change our mentality and stop seeing the tourists solely as a source of money. We must also ensure their security; otherwise we won't get the effect we want regardless of how much money we invest. You've mentioned the security and skills of the people. I don't know how much time this change will take. I have been dealing with this for four years, and Dmitry Kozak was helped a lot, but it's often much more difficult to change the way of thinking than to find investors.
Vladimir Putin: You need professional training here.
Arsen Kanokov: We've contacted Western companies, and we went to France to negotiate a deal. We need to get managing companies from there to come and opening training centres here.
Vladimir Putin: It might seem like a trifle, and that it will be easy to make, but it's not easy at all. However, it is not impossible either. If we invite managing companies and gradually train local people, the problem will be solved. What about energy projects?
Arsen Kanokov: We produce only 30% of energy locally. We have completed the first and second phases of the Cherekskaya hydroelectric power plant and got 150 MW capacity, but this is not nearly enough. We need to develop smaller energy projects, but it takes seven to eight years to recoup the cost of building them. It is also difficult to use businesses to solve the problem due to the high interests rates on bank loans. Private businesses alone will not cope.
Vladimir Putin: How much of an investment are we talking about, 10 billion?
Arsen Kanokov: Yes, around 10 billion. We have many projects in small power generation, we plan to meet and negotiate with the company RusHydro. I hope to launch these projects with the government's help as well as the participation of private businesses.
The republic has huge potential when it comes to water resources. We need around 20 MW of electricity for the Kislovodsk-Elbrus Area road. It is already supplied by an 80km gas pipeline.
Vladimir Putin: What's needed here is greater discipline. I know there is a lot of waste and unsanctioned connections to power grids. You need to bring order to the situation.
