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Speech at Opening of Second Nanotechnology International Forum

October 6, 2009, Moscow

President of Russia Dmitry Medvedev: Good afternoon, ladies and gentlemen, dear friends,

I would like to welcome to the capital all our visitors from abroad and those who have come from different parts of our country to this Nanotechnology International Forum. This is the second such forum, and I hope that it has already become a good place for conducting discussions. It should concern itself not only with issues that may emerge in the future but also deal fully with operational issues, engage in the commercialization of scientific ideas and promote their development. In short, I hope that the forum has already become not just a public platform but a scientific and practical one as well.

Everybody knows that nanotechnology is poised on the brink of breakthrough achievements and that this has created equally important expectations based on the prospect of such achievements.

The world already has a large number of materials and technologies which are classified as “nano”. They have been touted as the solutions to several great challenges and as the means of revolutionising the industrial sphere. At the same time there is an absence of competitive, serious mass production techniques for such nanomaterials and nanotechnology. In any case, this is true of a great many components. This means that we are still in the very early stages of this development.

The current market volume associated with production based on nanotechnology is evaluated differently by different experts. At any rate, I have seen estimates that suggest the market is worth USD 250 billion. In any event this is a growth market. And experts estimate that by 2015 it will be worth between two and three trillion dollars. That is a huge figure, one that is in every way comparable with, say, the energy market. And I do not think that anyone can deny that in the coming years the development of nanotechnology will change the face of humanity, change our lives. We also have our own immodest goal in this area: we want to become leaders here — and for that we have the intellectual potential and the organisational and financial resources. We have said this repeatedly but it’s actually true – that’s the way it is.

For Russia the important lesson that we have still not fully learned is that we must escape from our dependence on raw materials. Of course the years that preceded the crisis created relative economic prosperity for us. But our post-crisis economy must be based on knowledge: it must be based on innovative technologies, rather than on Russia’s natural resources, no matter how extensive they are. Incidentally, I should say that to this point there have been no changes in this regard, and even though the crisis has hit everyone hard, nobody particularly wants to change. The sad conclusion that I am obliged to announce at this podium is that as long as our way of doing business does not change, our country will not change in the ways that we would like.

I have formulated five technological development priorities. Let me spell them out once again, because in my view these are crucially important: they are energy, including energy efficiency, energy conservation and new fuels; nuclear technology; information technology; ground-based space information transmission infrastructure; and medicine, especially diagnostics and pharmaceuticals. To achieve some productive movement on these issues I have created a special commission [Commission for Modernisation and Technological Development of Russia's Economy] which is already at work. I hope that it will fulfil our expectations.

It is obvious that the successful development of nanotechnology will be possible only against such qualitative transformations in our lives. In this respect at least in terms of organisational capacity Russia still looks very good. We have the world's largest public investment programme in the field of nanotechnology — and I want to stress public investment. By 2015 we will have allocated 318 billion rubles for these purposes. According to our estimates at that point total sales by Russia's nanotechnology industry can be expected to have reached about 900 billion rubles. Of these, something like a quarter will be the result of exports.

To fulfil these predictions, we intend to use the extremely varied capabilities and opportunities provided by Russian science and international opportunities as well, but our challenge is not just borrowing money and attracting foreign investors: what we really need is the transfer of high technologies and their adaptation to Russian industries. Of course I should say immediately that this is the most difficult challenge, and so far in this regard we have had very little success.

We are counting on our country’s intellectual potential, as well as the intellectual potential of our compatriots, who for various reasons have gone abroad. It would simply be unforgivable to neglect such an important resource, so our challenge is to motivate these people by arranging for the necessary working conditions in our country and for the development of projects in this field.

We need to learn from international experience but a great deal of this work we will have to do ourselves. Let me say a few words about Russia’s advantages from our point of view.

First, our competitive scientific tradition and first-rate higher education system. Of course we occasionally criticise these, but at this point they represent a genuine potential advantage.

Second, a vast domestic market ranging from the production of consumer goods to large-scale projects in the energy field. In this area there is really a lot that can be done.

And, finally, the third advantage: active support from government and private business. But in my view to this point such support has been somewhat disorganised, because even though the state's role has been clearly laid out, all the decisions taken, and the relevant state corporation created, in my view we have still not grasped the essentials of what needs to be done. We are working on it, working very hard, but we need to better co-ordinate our efforts in this regard.

As for support from the private sector, that is really a separate issue. I think that so far business has been spectacularly inactive in this area. I don’t mean government-owned business or support from government agencies; I mean private business. It either lacks the financial capabilities, or – as far as big business is concerned – it just does not seem interested in this area. And it is the government’s task to maximise interest from large, medium-sized and small businesses, and of course to encourage them to invest their money in nanotechnology.

What do we need? People have written me to say that above all we lack high-quality legislation in this area. That is not the case. Of course we need high-quality legislation and we need to make changes to the legislation. We need to change tax and customs regimes. But that is only one of the necessary steps.

If the problem could be solved by simply preparing a bunch of high-quality regulations, then we would be the most advanced country in the world, because we adopt a lot of laws, and their quality is already quite impressive. This is not the beginning of the 90s, when we produced laws like hotcakes. Now we have highly qualified lawyers and economists working on those laws. So we do need to improve our legislation but that is not our main task.

Nevertheless, the first step in improving the relevant legislation has been taken. We have adopted several documents, including documents of a very specific kind: for example, a law that allows national economic institutions and universities to create businesses that can deal with nanotechnology, for example. Let's see how it works. Anyway, I have tried to arrange for this law to come into force as soon as possible.

We need to organise a system of state orders for long-term procurement of innovative products. We really need this and it is one of the Government Cabinet’s most important challenges.

We also need to create a green corridor for the export of hi-tech products, as well as special conditions concerning customs clearance procedures. Of course here we do have to change the law. Moreover, such services should be competitive when compared to the services provided by customs services in other countries. This is not an easy thing to do, given how our customs services are currently arranged, but we have to do it.

In addition we have to modify a number of special laws, including those changes that I mentioned in tax law, corporate law, and other laws concerning intellectual property protection. Finally we need to adjust the system of technical regulation and create an up to date system of national standards, because the one we currently have is problematic.

But of course our principal resource is not laws but our willingness to deal with these issues, our desire to engage with them in the broadest sense of the word. It is the desire of everyone present in this room, because as long as that willingness exists the laws can be adjusted and even in the current regulatory field something can be done. In any event we have made a definite decision to approve a programme encouraging nanotechnology until 2015. It is good that we have a government programme in this sense and that we have done what was needed in this regard. We established a state-owned corporation called Rosnanotech and we have invested very heavily in it. From what I’ve been told it seems to have weathered the crisis quite well. Let's hope that the corporation will be able to solve all of its statutory goals.

One subject that I particularly wanted to say a word about is training. It is obvious that we need modern, informed, qualified professionals in this field, people who have been trained in the new programmes. I think that we should reconsider a number of fields of specialization that have been approved by our Ministry of Education, specializations directly related to nanotechnology. Here we need to take the standard creative approach. If the existing nomenclature of specializations does not provide the capabilities we need, then we simply need to change it and to prepare the sort of professionals that we do need. According to experts, the demand for professionals in our country will be very serious indeed, something like 100–150 thousand people, and of course a shortage of personnel remains a serious barrier to Russia’s serious engagement in nanotechnology.

Dear colleagues, I would say that, despite some pessimistic items, I still think that the crisis is a huge incentive for renewing our economy as well as of course the global economy, and we have every reason to want to do this. Let me say again, that at this point we are not sufficiently motivated to make such a change. And what we really need to avoid is following the scenario that we know all too well: the world economy starts to grow, oil prices rise, export capacity improves, we can relax, we can forget about nanotechnology, we can continue to engage in the supply of energy resources for export and at the very least make ends meet. This scenario for our country and our economy would be absolutely disastrous. I hope we will all do everything we can to make nanotechnology and nano industries one of the strongest sectors of Russia's economy and that, in cooperation with our foreign friends and our foreign partners, we can diversify our own economy and work at developing international projects. That is what we want. This is the kind of scenario that we must seek and I want to actively encourage this.

Good luck with the conference and good luck with your businesses. All the best!

October 6, 2009, Moscow