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The meeting participants gave particular attention to implementing the law on priority development areas in the Far East, which has already come into force.

The President also asked the Minister for the Development of the Russian Far East to speed up work on a draft law establishing a free port in Primorye Territory.

Mr Putin also instructed Deputy Prime Minister and Presidential Plenipotentiary Envoy to the Far Eastern Federal District Yury Trutnev to take personal control over provision of assistance to the families of victims and those injured in the Dalny Vostok fishing trawler disaster.

The ship sank on April 2 in the Sea of Okhotsk. It had 132 people on board. Fifty-six people died and 63 were rescued. Thirteen people are still missing.

President of Russia Vladimir Putin: Colleagues,

We have discussed social and economic development matters in various formats and we know that we are facing more than enough challenges today. Indeed, the number of challenges has never really decreased, but we are nonetheless going through a particularly difficult time right now. The Government is working hard – with some success – to carry out the programme that will help us to overcome the economic crisis and stabilise the social sector.

At the same time, there are strategic issues that we cannot overlook in the current circumstances and turbulent processes taking place in the Russian and global economies. Without question, developing the Far East is one of our priorities. We have given this matter much attention and put together the necessary plans.

I want to note that despite the current difficulties, the Far East produced some good results last year. Industrial output was up by 1.7 percent for the country as a whole last year, but in the Far Eastern region it increased by 5.3 percent. Agriculture grew by 3.7 percent for the country as a whole, but it was up by 18.7 percent in the Far East. These figures show that the region has good potential that we must use to best effect.

The gradual increase in the number of births also fits with these trends. This is a social rather than economic indicator, but it also reflects people’s feelings about what is happening in the region. For the first time in many years, natural population decline was less than natural population growth by a ratio of 1.5.

The number of deaths in the Far East was lower than the number of births. The population outflow from the region has continued, but at a slower pace, and this too is a positive result.

This week, as you know, the law on priority development areas has come into force. Now we need to make sure that its provisions are implemented with full effect in the Far Eastern Federal District. I remind you that the law offers various incentives, including reduced and even zero rates on some taxes, fast-track simplified administrative procedures, provision of ready-to-use engineering infrastructure, and so forth. As I said, we need to make sure that the law is used to full effect in the Far Eastern Federal District.

I would like to hear from you on what you are doing to implement the proposals that you yourselves made on land relations, including the plan to offer a hectare of land. As you know, we gave this idea our support and took the necessary decisions. The important thing now is for the land allocated to be in attractive areas, and for it not to just then be put on the market. Of course, we also must make sure above all that, once allocated, this land is not transferred immediately to foreign legal entities and individuals.

Finally, another matter I wanted to draw to your attention is the establishment of a free port in Primorye Territory. This is a good proposal and we should carry it out.

I want you to remember that the State Duma must pass all amendments to the laws regulating the activities of the Vladivostok free port during the spring session. You need to work closely with your colleagues from the Parliament to settle the draft law’s parameters.

I remind you too that a law was passed at the end of last year, allowing the regions to offer two-year tax holidays to newly registered individual entrepreneurs. I hope that you will work through the issues with the regional authorities in the Far Eastern Federal District so that all problems that can be settled using these instruments will be resolved effectively and these instruments will be put to good use.

The heads of the Far East’s regions came up with the idea, which you supported, of holding the Eastern Economic Forum in Vladivostok. The first forum will take place on August 12–15. I hope very much that this will become a good platform for showcasing the Far Eastern Federal District’s development opportunities, highlighting the region’s advantages and finding new partners to help us to resolve the tasks facing what is one of Russia’s key and most strategically important regions.

I would like to hear now from the Minister, and then we will have a free discussion on what else we should do to ensure that our plans are implemented. Please, go ahead.

Minister for the Development of the Russian far East Alexander Galushka: Mr President,

I will try to address the issues you have raised regarding the Far East’s development.

Yes, the law on priority development areas came into force this week. The relevant bylaws have been drafted. Four government resolutions need to be adopted. One has already been adopted and the other three have been submitted to the Government for approval. We expect they will be approved very soon.

The Ministry for the Development of the Russian Far East has approved 11 ministerial instructions that were required following the law’s adoption. The Justice Ministry has already registered two of them and the others will be duly registered too. The work on bylaws is thus nearly complete and the law will go into effect with the required legal base in place. 

Along with the legislative efforts, work has been going on directly in the region. We have chosen the sites where these priority development areas will be established, and have selected investors. The main purpose in setting up these areas is to attract quality modern investment that will create jobs and bring tax revenue and economic growth to the Far East.

In this respect, let me say that we have established a transparent procedure for selecting the sites. A special Government commission, headed by Mr Trutnev [Deputy Prime Minister and Presidential Plenipotentiary Envoy to the Far Eastern Federal District] publicly and openly discusses and selects the sites. The Ministry has the needed powers in this respect.

The commission held its first two meetings in December and February, and will meet for the third time in April. They have already chosen three sites, in Primorye and Khabarovsk territories. We plan for another six, in Amur Region, Chukotka Autonomous District, Kamchatka and Magadan. They will focus primarily on natural resources, industry and transit.

We have potential investors and anchor residents for each site, and the demand we are seeing from them confirms that our choices are viable. In total, we expect to raise 188 billion rubles in direct investment from the initial anchor residents at the start of the areas’ work. The areas, as we plan them, are far from full yet, so this is just the start.

Foreign investors have responded very positively to our law on the priority development areas. We signed 20 investment memorandums of understanding with foreign investors even before the law was passed.

For example, Japan’s big trading houses signed official memorandums with the Far East Development Ministry, confirming their readiness to invest in the Far East if we introduce instruments such as the priority development areas. We hope that these plans will go ahead.

It is a similar situation with the law you mentioned on the free port in Vladivostok. You spoke about this in your Address to the Federal Assembly and gave the relevant instruction. The Far East Development Ministry has prepared the draft law. It is currently going through the approvals process with the federal executive authorities and being put to public discussion.

The Civic Chamber held a so-called ‘zero reading’ of the draft law this week. The response has been positive, quite good overall. The law on a free port in Vladivostok builds on the ideas we are pursuing through the law on the priority development areas and addresses a number of specific issues such as crossing the border, visa rules and open skies.

In accordance with the Government instruction, we expect to complete the approvals process and submit the draft law to the Government by the end of the month. I think that the experience we have gained here will be useful for developing legislation on free ports in general.

We are also working on the land issue that you mentioned. Amendments to the land laws came into force on March 1, 2015. These were major amendments drafted following your instruction.

These amendments make it possible to allocate the relevant plots of land in the Far East to Russian citizens without going through bidding procedures, on a rental rights basis, and – very importantly – without having to go through the land surveying procedures.

We agreed with the Economic Development Ministry that plots of land can be rented out initially for five years at a symbolic cost of one ruble. If, after the five years is up, the land has been developed, Russian Federation citizens can officially register as owners of the land they have developed.

The Ministry is currently drafting a model law for the Far East regions to implement this mechanism. Amur Region is the first of the Far East regions to pass this law and is also the first to start allocating plots of land under a pilot programme. People are showing interest in the scheme, which is good to see.

Working with Rosreestr [Federal Service for State Registration], we plan to establish a convenient online service by the end of the year so that we can note within minutes people’s interest in this or that plot of land, using the Internet and the current land cadastral maps. People would then be able to reserve the plots of land in question and register rental rights. 

We are drafting proposals for the content of multifunctional centres providing this state service, namely, allocating plots of land in the Far East to Russian citizens. This is where our work stands to date. We hope to have the system in operation by the end of the year.

Mr President, you mentioned the question of tax holidays for individual entrepreneurs. I note in this respect that in our anti-crisis work in the Far East’s regions we have made this one of our priorities and have discussed it on a number of occasions with Mr Trutnev at meetings with the Far East regional heads.

Overall, the regional heads are very keen to make full and effective use of this right that is theirs since the start of the year to grant tax holidays to newly registered individual entrepreneurs.

Finally, regarding the Eastern Economic Forum, which you mentioned, we are grateful for your support for this initiative. We will prepare for this forum and present to our international partners all the development projects and institutions that we are currently establishing in the Far East and will do so in as full and complete fashion as possible.

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