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
“I believe that our main task today is to create the conditions for the military-industrial complex to use effectively the state defence order and other instruments of Government support.”
“We will consider other measures to maintain railways investment potential. Analysts estimate it would take more than 100 billion roubles to implement the current investment programmes, and another 100 billion roubles to refinance Russian Railways debt. How should we do that? I think it is possible to place Russian Railways bonds to the tune of 150 billion roubles, and then see what the budget can afford in the beginning of the year, and before February 1 make a decision on possible direct government investment in the company's capital stock. I feel obliged to stress that the matter demands the utmost accuracy and circumspection.”
“We need to implement large investment projects - those that guarantee demands for high technology. Now that traffic volume is shrinking, Russian Railways and independent traffic companies have the opportunity to inventory equipment and to discard obsolete and worn-out cars and other equipment. At the same time, they should consider purchasing new, state-of-the-art cars, which are far more efficient. This is a chance to become more competitive. These acquisitions can also give a new lease of life to Russian transport manufacturers.”
“The decision to phase in the tariff increase over the next year was made to promote the entire economy - in particular, to facilitate the business activity of the railways' primary clients.”
“The Government does not intend to force the railways to bear the brunt of the burden. Federal allocations, up to 50 billion roubles, will compensate for Russian Railways' lost revenues. We will also compensate student travel discounts. We have directed the relevant instructions, as you know.”
“Freight traffic volume is on the decline. That is the railways' main concern. This is due primarily to shrinking demand for steel and fertiliser and for mined coal. The market is on the decline and taking Russian Railways' revenue with it. As you know, we have decided on a more gradual increase in raising tariffs of natural monopolies. This was done in the interests of the entire economy. For example, railway freight transport rates should increase 12% at most in 2009, as opposed to the expected 18.7%. January 1 will see only a 5% rise - less than planned previously.”
“The next proposal will have a direct effect; I am referring to our plan to renew municipal vehicle fleets. We will allocate 20 billion roubles from the federal budget for this purpose, and expect regional and municipal governments to provide an additional 10 billion, as has been agreed. I hope people will see how municipal fleets of passenger transport vehicles and special machinery will be replenished with new cutting edge equipment.”
“In 2009 we plan to support Russians who buy cars worth up to 350,000 roubles by co-financing their loans. We'll help them repay two-thirds of the Central Bank's refinance rate. The current rate is 13%, which means that the government will provide slightly over 8% of the interest rate of a car loan, provided the car costs below 350,000 roubles.”
“We have vastly supported agricultural engineering by changing our tariffs and customs policies to protect domestic manufacturers. We have allocated an additional 25 billion roubles to Rosagroleasing, the state agricultural leasing company, and implemented a set of measures to support domestic agriculture. The most important decision was without a doubt subsidising between 60% and 80% of agribusinesses' loan interest, and even up to 100% for specific times of investment loans.”
“We have made tariffs and customs regulatory changes to protect domestic producers, supported Rosagrobank's capitalisation with 35 billion roubles in mid-2008, and approved the additional allocation of 45 billion roubles for purchasing grain, making interventions, and other operations.”
“We have recently provided extensive support to the national automotive industry. The support included a 60 billion rouble bond issue and loans to leasing companies worth 43 billion roubles at the Central Bank refinancing rate. We plan to set up, or assign to the Transportation Ministry, an existing leasing construction machinery company, where the ministry will have to concentrate at least 40 billion roubles. We also plan to increase vehicle purchases for state needs by 12.5 billion roubles.”
“I propose abolishing railway transportation charges for Russian cars manufactured in any part of Russia to the Far East. The Russian Railways' foregone income will be compensated by the state budget.”
“The federal authorities will earmark an additional 12.5 billion roubles for the purchase of vehicles. Allow me to recall that in a tentative estimate, the federal bodies already have about 10 billion roubles at their disposal. Hence, the final figure will be around 22 billion-23 billion roubles.”
“The government has already submitted budget amendments to the State Duma to provide state guarantees for loans attracted by key companies in nationally vital industries. Auto industry enterprises are undoubtedly among these. We intend to compile a list of several hundred strategic enterprises. At first, I spoke about 300 companies. Government analysts are drawing up this list now, and it may include up to 400 or 500 companies. On the whole, this system must cover as many as 1,500 enterprises. I repeat, this includes auto industry as well. It is expected that these enterprises will be able to attract up to 70 billion roubles using state guarantees.”
“In 2009, the Government will also help the producers to float bonds worth up to 60 billion roubles to make these bonds more attractive. They will be issued under state guarantees, and the Central Bank will open refinancing for the banks that will buy out these bonds.”
“A major task is to restore consumer demand. We must support the people. We proposed the following measures: subsidise interest payments on three-year loans to citizens for new car purchases. I want to underline that those who want to buy a car, should do it in 2009 because this regulation will apply only in 2009. If one buys a Russian car - meaning cars produced in Russia, especially those in high demand which cost no more than 350,000 roubles - the subsidy will equal two-thirds of the Central Bank's refinancing rate. This means that if a person buys a car in 2009 with a three-year loan contract, we will help him to repay this loan by refinancing interest payments at two-thirds of the Central Bank's rate.”
“Credit lines in the amount of 43 billion roubles will be opened to leasing companies. We know that they are in a difficult situation now. I repeat: we will provide 43 billion roubles for this purpose. It is important that the loans will be contracted for a term of three years and at interest rates not higher that the Central Bank's refinancing rates. This will allow a resumption of operations.”
“It is now necessary to stimulate investment demand for commercial vehicles. Let me remind you that several days ago the decision was taken to increase Rosagroleasing's authorised capital by 25 billion roubles. We have agreed with the sector's representatives that 5 billion roubles out of this amount will be spent to buy vehicles for agricultural producers.”
“We need to put state auto acquisitions up for tender as soon as possible, so that state contracts can provide timely assistance to the ailing domestic industry. If possible, upfront payments under those contracts will be made to producers as early as the first quarter of 2009. Moreover, upfront payments under state contracts will be raised to 50% of the contract amount from the current 30%. We'll also cancel all requirements to ensure the fulfilment of the contract - bank guarantees, insurance or other guarantees, in cases where vehicles are purchased directly from the manufacturer. We'll have to eliminate distributors and other intermediaries, too.”
“We must provide subsidies to help local self-government bodies to acquire new vehicles for the needs of public transportation, housing and utilities services, hospitals, schools and all other areas managed by the municipal government. As you know, several years ago I initiated the idea of priority national projects. They are making good progress today. I want to put forward another initiative now: a programme to replace the municipal public transport fleet. The federal budget has earmarked an additional 20 billion roubles to finance this progrramme, with regional and municipal authorities to provide another 10 billion roubles as co-financers.”
