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
"Our second task is to strengthen the financial system. This is an incontestable objective. We have made a decision to increase the authorised capital of national banks. We expect the number of banks to decrease in Russia. It will be a gentle, positive process that will strengthen people's trust in our financial institutions and will allow the economy to use these resources more effectively."
“The crisis has affected Russia very seriously. However, we see nascent stabilisation in the country, beginning in June, and economic growth, even if modest, of 1% monthly since June."
"In the realm of social policy, we have adopted a very important law called the Labour Code. I spoke about it with several of my counterparts from developed European countries, and they told me they would also like to have such a code in their countries. Their laws in this area are much more socialized. I think this was a great achievement on Russia's part. The current system protects workers' interests while keeping the labour market flexible, and at the same time makes demands on the workers themselves."
"We should not forget the goals we must reach, notably, to maintain macroeconomic stability, keep the deficit at an acceptable level, reduce borrowing and preserve our reserves. We must pursue responsible social and economic policy. The Finance Ministry has drafted the appropriate proposals."
“In the last few months, we have been registering positive signs both from world markets and from the domestic economy. Starting in June, industrial production has grown by about 1% per month. Prices on our export commodities are also standing at a high enough, acceptable level.”
“Distribution markups will be regulated by the constituent entities, as before, but based on the methods approved by the Federal Tariff Service. This will help exclude useless intermediaries from the supply chain. If a company violates pricing regulations, it will bear responsibility, up to losing its license.”
“The prices of medicines rose by 18.3%, much more than the prices for other goods and services. Moreover, in the regions, the price of one and the same drug can vary by as much as two to three times. All this indicates a lack of order here. <…> I think we should tighten state regulation in this sector. Producers will have to prove the need to revise prices of vital medicines, and federal bodies of authority should develop an effective procedure to oversee and verify their calculations, and be given the authority to refuse the registration of inflated prices.”
"Today this is far from being a theoretical question. In the conditions of serious budget deficit, it is vital that we take all possible steps to plan and implement the spending of economic resources rationally, and to improve the quality and efficiency of managing the network of state financed institutions. In addition, the agencies must be ready to be fully accountable for each rouble spent."
"It is crucial to ensure macroeconomic stability and a balanced budget: This is a key prerequisite for successful solution of social and economic tasks at present and in the post-crisis period."
"I want you to know that we are not only limiting car imports but also opening our borders to technologies and removing customs barriers for commodities which Russian industry and the entire economy may use for technological modernisation."
"The present-day Russian economy is much stronger, and has greater stability. Its scale has changed cardinally, and we have sizeable reserves. So we can afford to address acute social issues, at any rate, and we are dealing with them."
"The corporate debt has reduced by a third as of today. Our companies have made sizeable debt payments in the preceding months, and rescheduled their debts to $174 billion without Government support. The state has no obligations on corporate debts."
“Today, too we cannot be wholly satisfied with the quality of our market and social institutions. But one thing is certain: The crisis has shown us that these institutions are functioning. They remain stable, displaying their ability to resist destructive trends.”
"Also, and we can all see this, the rouble has stabilised. There is a basis for suggesting that inflation will fall. This means that in coming months we will be able to count also on the fall of the Central Bank rates."
"However, we can be confident that Russia will overcome the crisis. It will certainly maintain its position as one of the world's biggest economies with a large reserve of development, powerful labor, and technological potential."
“We had to parry two blows at once. First, we had to deal with the financial crisis which caused the outflow of capital because Western economies faced liquidity shortages and took away their assets. Speculative capital also started leaving our market. Foreign crediting sources dwindled, too. Second, demand for our traditional export items and their prices plunged.”
"It is thus our duty to protect Russian manufacturers. We are doing it ever more actively, and we also protect Russian consumers, considering the high import prices. In this, the principles we proceed from should be simple enough for everyone to understand. We should merely support domestic agricultural development. We cannot cut off the domestic market from imports-or the prices of staple foodstuffs will skyrocket."
“We have to say that the crisis is not over yet and has not even peaked. The efforts by the Governments of the most developed global economies have not yet produced any tangible results. This means that this situation may persist for a long time.”
“We have promised that no matter how difficult it may get, we won't apply shock therapy. I believe that these measures have primarily helped the country to avoid a crisis shock.”
“True, we have made economic diversification our goal only recently. On the whole, I think we have taken the right road and are reaching our targets at a fairly good pace. We'll make it, I am sure. The global financial and economic crisis is helping us, in a sense, because it forces us to be more rational, implement new technologies (energy saving, for example), upgrade production and retrain the personnel. All that gives us hope that we will get out of the crisis more mature and with better development prospects.”
“The balanced and reasonable policy of the recent years has made the Russian economy completely different from what it was in 1998. That is why we can afford a fairly mild treatment of the rouble exchange rate and why can keep all the social policy commitments we made during the period of economic growth.”
“Today we must look at unproductive and ineffective spending and the actions we made in the comfortable conditions when petrodollars were plentiful and flowing in. Today, we must be more effective and economical. If we speak about such areas of our activity as energy-saving, it is clear that we are talking about high technologies. Clearly, our work in this area in the short term will make the Russian economy and the country as a whole more competitive.”
“Starting on December 1, federal public sector agencies will switch over to new remuneration forms aiming to provide better services to the population and incentives for the best doctors and teachers. Despite all the manifestations of the crisis, the wage fund for budget-dependent employees has swelled by 30%.”
“In all, the Government is set to implement 60 high-priority projects until 2012. We have selected project managers and stipulated specific deadlines and funding sources. First of all, this concerns reforms in the human resources sectors. I have repeatedly noted that current investment in education, healthcare and the social sector will become our competitive advantage tomorrow.”
“We hope that these measures will prove effective in 2009 and will help to prevent plunging standards of living and rising unemployment, and will facilitate the sustainable performance of the financial system and the industries.”
“In November, the Government approved a long-term national development programme until 2020. This implies that Russia must assert itself as a global leader in terms of economic development levels and key quality of life indices by the end of next decade. We are not going to scrap our plans. On the contrary, we have been working hard to implement them.”
“We have taken measures to maintain business activity in the economy, slashed taxes, and drafted measures to support the key sectors of the real economy, above all engineering, transport, defence enterprises, fuel and energy, construction, agriculture, retail trade, and small businesses. Of course, we know that the real economy has been pressured by high banking interest rates, which is exactly why we have drafted special measures to support individual sectors.”
“We have published a list of strategic enterprises recently, which will receive additional assistance if needed.<…> The Governmental Commission on Sustainable Development of the Russian Economy will monitor the operation of these strategic enterprises.”
“The Russian economy and social sphere will finish the year in the black despite negative dynamics in the fourth quarter. GDP is expected to grow 6%, and many other key socio-economic indicators will also be positive. In particular, growth in agriculture has been even higher than expected. The latest data show a 10% increase. Investments in the economy were also 10%, which is higher than we had expected. The average monthly wage will grow, despite the 13.5% inflation, by 10%-12% in real terms. Pensions have increased by a third.”
“I can tell you that the Central Bank and the Government have reserved huge funds, trillions of roubles, for the anti-crisis package, notably for maintaining banking liquidity and compensating huge income shortfalls. Even if we don't need to spend all of them, the scale of planned allocations points to our greatly increased possibilities. I must say, though, that the Government does not intend to use all of its reserves to fight the crisis regardless of the effect of such measures. The priority goal today is to increase the efficiency of budget spending and to maintain macroeconomic stability.”
“The financial distress followed by a broader economic crisis is a serious trial for the global oil and gas industry. Oil prices plummeted to a quarter of the summer level August through November. This naturally affected the gas market, as gas prices are linked with oil. However, since the gas market is more inert, it is bound to be more severely hit by the crisis than even the oil sector, and may require more time to regain pre-crisis operation levels.”
“Russia will see a 6% GDP growth by the end of this year, even despite the problems. People's real incomes will have grown by around 7%; the growth in January-October was 7.6%. Eleven-month inflation was 12.5% and is expected to hit 13.5% in 2008. We have also seen an economic slowdown in the past few months.”
“The declining global prices of oil, metals and other commodities Russia traditionally exports, may still lead us to a negative foreign trade balance. This is a factor of pressure on the national currency. Nevertheless, we are determined to do our best to prevent sharp fluctuations of the rouble. Russia has sufficient reserves for that.”
“On the upside, industrial production will show some overall growth by the end of this year: it went up 4.9% in January through October (0.6% in October alone). Yet, as I have said, a number of sectors are currently forced to slash production to reduce costs. Our metals and chemical industries, building materials production and engineering were hit the hardest because they depend heavily either on exports or on investor demand.”
“When oil prices were high, we took most of oil companies' windfall profits away from them and into the budget - through export and customs duties and taxes, as much as 80% and sometimes even 90%. It was thanks to these revenues that we formed most of the country's gold and hard currency reserves, which today, as I said earlier, are the third largest in the world - $450 billion. They are our "safety cushion" and allow us to make things easier during the crisis for millions of people.”
“What is particularly important for us is the results of our efforts in the social sphere. The increase in take-home wages will be approximately 12.6% and pensions slightly more than 12% - 25% in nominal figures. Industrial production growth will be nearly 5% (4.8%).”
“We have problems with inflation. The target figure was slightly above 12%, but annual inflation is likely to be 13%, because of the global crisis and because the Central Bank and the Finance Ministry had to inject a huge amount of liquidity into the economy.”
“On the whole, our economic results in 2008 are positive even despite the negative effects of the global financial crisis. Let me just remind you of the figures. The economic growth target was above 7%, or more precisely 7.5%. The annual growth rate will be around 7%, possibly 6.8% or 6.9%. This is good.”
"We will not allow leaps in the economy and sudden changes in the exchange rate of the national currency. To secure the interests of both the citizens and the economy we will, if necessary - and we have done so before - we will carefully use the gold and currency reserves and the other funds at the Government's disposal."
"At the same time, we should proceed with the conviction that Russian money-both corporate and government money-should work within the Russian economy. Everyone involved-whether in mining, steel or machine production-should consider the current situation when formulating cost parameters, and should not forget imports as an alternative."
"I would like to remind you that the new law sets out a new order for placing foreign investment in the strategic branches of the national economy. However, they are not closed to foreign investors. Quite the contrary, we are developing transparent and clear procedures for them. Legal approval has been given to a list of spheres in which to gain control over enterprises foreign investors will have to receive permission from the Government Commission."
"Let me focus on the sources of financing real economy. They must be multi-faceted. We should not use budget funds only. Otherwise, it will result in aggravating corruption and non-efficient spending. We need to use budget funds to finance infrastructure, science, education, healthcare and the pension system, and we speak about that openly. These are our so-called federal mandates, our commitments to the nation. These real economy spheres are our priorities."
"The main guarantee is a competitive and stable national economy, market institutions, effective government control mechanisms - wherever justified and necessary - and an up-to-date system of credit and finance, one which rests chiefly on internal resources and so is immune to global financial viruses."
"You know, over the past few years the Government has been trying to keep the prices down, by administrative methods, and in most cases we were successful. Unfortunately there is some increase in prices, which is rather substantial. I will not give you figures. But largely it is connected with the growing world market prices. We cannot shut our market from the rest of the world."
"As for land ownership rights. How can we solve the problem of unit funds, and what can we do with them? Can we serve the interests of people, our citizens? Can we live up to their hopes and at the same time create conditions for effective development of agriculture, both small and medium-sized farms and large producers? This calls for collective discussions and decisions based on current practice, modern realities and development prospects."
"Despite our modest record in addressing social problems we still see rising incomes. Real incomes grew by over 7% in the first six months and real wages by almost 13% (12.7%-12.8%)".
"Russia is developing at a rapid pace. In 2003 I said that doubling our gross domestic product was our medium-term goal. And we are moving towards that goal: the goal will be achieved in late 2009 or, according to some other estimates, in the first quarter of 2010".
"We observed some outflow of foreign capital from our economy even before the events in the Caucasus. This is not connected with the problems of the Russian economy but with the problems of the Western economy and insufficient liquidity on the Western financial markets. The money that came into our economy from the West has been taken off. This is true not only of the Russian market, but of many other developing markets where the same processes have been taking place".
"We are facing a unique situation when building and engineering work in Russia costs several times more than the same work in neighbouring European countries. And yet on many counts this work is cheaper in Russia. I am not just talking about the cost of labour, but energy, land, even water and other resources are also much cheaper here. But on balance it turns out to be more expensive. Why is that? Legally, everything is in order. The reason is outdated regulations going back to the 1950s and 1960s applied to what appear to be natural and simple instruments. But at the end of the day it is a mess. We have to put an end to it".
"The adoption of technical regulations is an important instrument in enhancing the competitiveness of the domestic industry. Early steps in that direction are being taken. Let us face it, they are still very timid, but we must go down that road".
