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:
Mykola Azarov: Mr Prime Minister, ladies and gentlemen, it is a great pleasure to welcome you to Kiev again, especially on this great occasion, a celebration we share – the 50th anniversary of Yury Gagarin’s space flight.
Our bilateral trade developed at a good rate last year to increase by 60% and closely approach $42 billion, exceeding the volume of the pre-crisis year 2008. In January-February 2011, our trade in commodities and services exceeded the same period last year by more than 55% and reached $7.2 billion. If we retain this pace, I think this year’s results will be even better than in 2010.
At the same time, much has still to be done to improve trade, especially by abolishing the existing exemptions and limitations. There are presently import limitations on five Ukrainian and six Russian commodities, and investigations on another three Russian and three Ukrainian items are underway or finished. We agreed to reduce mutual limitations but, evidently, the present arrangement does not promise tangible progress in tackling such complicated issues.
Mr Putin, I would like to draw your attention to the terms of Russian pipe imports from Ukraine. We are grateful to the Russian government for its timely decision, which allowed a major increase of duty-free pipe imports from Ukraine. However, Russian government resolution No. 41, of January 31, envisages an increase of import duties and their extension by further five years for certain classes of Ukrainian-manufactured pipes.
We are closely monitoring the formation and development of the Customs Union of Russia, Belarus and Kazakhstan, and we certainly do not expect the introduction of the new Customs Code to hinder our trade and economic cooperation with Russia. We also hope that limitations used by each particular member state will not spread to the other Customs Union countries.
In this connection I would like to note the provisions for contractual regulation of Ukraine’s commercial relations with the Customs Union countries in compliance with the international practice, and the necessity to minimise the probable damage caused by the revision of special anti-dumping measures.
Considering the scale and importance of our fuel and energy cooperation, and our repeated talks about the need for a new agreement on natural gas, I believe it necessary to speed up its coordination.
Ukraine fully and consistently complies with its obligations on natural gas transit to European countries. At the same time, it wants firm guarantees of long-term Russian natural gas supplies to the European market through Ukrainian pipelines.
As we know, the price of natural gas supplied by Russia to Ukraine in compliance with the Gazprom-Naftogaz contract of January 19, 2011 differs from its EU market price and dramatically exceeds the prices of alternative fuels. I said so in the beginning, and I would like to repeat that Ukraine wishes to establish an economically grounded and just gas price.
I would also like to say a few words about the upgrading of the Ukrainian pipeline network. I would like Russia to confirm its intention to make a thorough reconstruction of gas pipelines leading to European countries, and increase their capacity roughly by 30%. I expect Russian companies to take an active part in the modernisation of our gas pipelines, which envisages the replacement of old mainlines and construction of more powerful compressor stations, which will improve the technical and economic conditions of gas transportation. We are very serious about this issue, and already have some achievements in this area.
As you know, much is being said about the prospects for a joint venture with the participation of Gazprom and Naftogaz. I want to note in this connection that we are interested in evaluating relevant assets as soon as possible so as to arrive at the most lucrative formats and the best terms for the company’s establishment.
I think that Ukrainian-Russian joint ventures to produce oil and gas in Ukraine can play a major role in the enhancement of our energy cooperation. In particular, we are ready to offer our sea shelf and propose the production of methane and other substances from coal beds, which is an innovative source.
As for the electric industry partnership, I think we should use its potential more fully. In addition to the existing contracts between Ukrainian and Russian electric companies, I believe it would be worthwhile to speed up efforts on an intergovernmental agreement guaranteeing the compatibility of the Ukrainian and Russian united power grids.
It gives me great satisfaction that there has been considerable progress in major joint projects in nuclear energy, such as the joint construction of power units 3 and 4 of the Khmelnitskaya nuclear power plant, long-term nuclear fuel supplies for Ukrainian plants, the purchase by Ukraine’s Nuclear Fuel government company of 10% shares of the International Uranium Enrichment Centre, and the construction of a nuclear fuel manufacturing plant in Ukraine.
Considering the importance to our two countries of the construction of power units 3 and 4 of the Khmelnitskaya plant, I believe the loan agreement with Russia’s Sberbank should be drawn up as soon as possible to fund the project. All necessary instructions have been given to experts in our country, and they are ready to get down to practical talks any time.
As for the integration of nuclear industrial centres, I also believe we must expedite the evaluation of the assets of Ukrainian and Russian nuclear power stations proposed for integration.
In the integration of aircraft building centres, I think we should finish in the nearest future all the preliminary procedures for the establishment of a joint Ukrainian-Russian venture by the Antonov State Corporation and the United Aircraft Building Corporation, so that the venture should start work quite soon. As the same time, we should expedite the increase in joint output of the AN-140, AN-148 and AN-158 passenger liners and military cargo jets AN-70 and AN-124, and also to make cooperation closer in aircraft engine production.
We know about the Defence Ministry’s approval of the Dnieper programme, and express our gratitude. We are prepared to cooperate further in this sphere.
I also want to say that my country is interested in completing the construction of the “Ukraine” missile cruiser as soon as possible. We are prepared to provide all the required technology for the project and offer our expertise. In this connection I would like to ask you to inform us about Russia’s position on this issue.
As for the Nitka training grounds for deck-based aviation pilots, I find its use by the Russian Air Force mutually beneficial and corresponding to the spirit of military partnership. There are some issues we must address, in particular, rents and the coordination of the protocol on amending the relevant basic agreement. Ukraine hopes that Russia will display understanding as it calls to resolve all legal, organisational, financial, technical and other issues before the start of training this year.
Regarding the introduction of speed railway trains from Kiev to Moscow and back, I would like to stress that Ukraine is interested in settling all pertinent issues soon, including simplified border and customs control of passengers. Ukraine has done what it could. The work is underway, and we want to know what reciprocal progress Russia has made. We arranged such control on the stretch between the Kiev railway terminal and the Darnitsa station, which is 10 minutes away, and we hope that Russia will also address all the issues to do with simplified border and customs control in the nearest future.
Another issue for us to discuss is the construction of a bridge across the Kerch Strait. I think we must urgently complete the feasibility studies, cost estimates, decide on the sources and volume of financing, appoint subcontractors and establish a managing company.
Ukraine is prepared to export to Russia 1 million tonnes of maize and sugar. I would like to confirm our agreement to fulfil the order and ask Russia to expedite the consideration of our application for exemption from customs duties to supply 100,000 tonnes of beet sugar.
Mr Putin, I outlined only a few items from the extensive agenda of our cooperation. I hope Russia will consider the matters to which I drew your attention.
Vladimir Putin: Thank you very much, Mr Azarov, for your invitation to the meeting of chairpersons of the economic cooperation committee under the Russian-Ukrainian intergovernmental commission.
Today is a truly memorable day in the history our countries share. April 12 was the day of the first manned space flight fifty years ago. It was the achievement of all Soviet peoples, but Ukraine played an outstanding part in it because Ukraine’s part of the Soviet space industry was always prominent – suffice it to name the Yuzhmash engineering plant. Ukrainian scientists made an enormous contribution to space exploration and the development of the space industry. I am happy to congratulate all Ukrainians who did their bit for the cause.
As for our current achievements, I agree that we are witnessing a dynamic revival of our trade and economic relations, with a 62% increase last year, and another 63% in this year’s first quarter. We have exceeded the pre-crisis levels. Ukraine now firmly ranks third after Germany and China among Russia’s strategic trade and economic partners.
As for your apprehensions concerning the Customs Union, I don’t see any problems in the Union itself and its policy toward third-party countries. There are no such problems, and none will arise in the future. The question is what agreements Ukraine will reach with its partners in the European Union on the free trade zone. We are involved in similar negotiations with Europe, as you know.
I would like to remind you that customs protection of the Customs Union countries is roughly at 10.5%, while Ukraine’s customs protection in the World Trade Organisation is at 4.5%. We are apprehensive that if free trade zones are established with the European Union on similar terms, many commodities will not find their customers abroad. So these commodities will come from Ukraine to our customs territory, and we will have to introduce protective measures. We must talk about it directly, and conduct open and timely work with Ukraine, while Ukraine should do the same toward Russia, Kazakhstan, Belarus and Europe. We must all put our cards on the table and see honestly just where we are. That is the only way to arrive at solutions acceptable to all. Such are certainly the decisions we want to make.
I would like to invite you to Moscow for the next meeting of the economic cooperation committee, which is to take place on June 7. We hope that Ukraine will join the integration processes underway in the post-Soviet area.
Expert estimations show that Ukraine will gain from $6.5 billion to $9 billion a year if it follows this road. I am referring to growing opportunities for its many industries, including heavy engineering, agriculture, the metals industry and the chemical industry. The Ukrainian gross domestic product will grow by 1.5% to 2% due to administrative decisions promoting integration alone with the opening markets and abrogated limitations Mr Azarov has just mentioned.
All this must certainly be agreed through negotiations, with the involvement of experts with the most diverse views. Their decisions must be perfectly aboveboard and close to objective reality as much as possible. That is the only way to do it – we cannot even imagine it otherwise.
Whatever happens, we will make a special effort to develop relations with Ukraine in all the fields Mr Azarov has mentioned. I would like to remind you that total high-tech exports from Ukraine, which I want to pay special attention to, presently, amount to $9 billion a year, according to our estimates. Russia’s share in this is worth $5 billion. We have technological chains that have survived from the Soviet years. They work well, and no link in this chain can succeed without the other links. That is what we should think of as we give a new lease of life in the new conditions to the opportunities created in the past decades. We can do it on a thoroughly new administrative, legal and technical basis, recurring to the competitive advantages we possess.
Thank you.
