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The forum’s theme was The Union State’s Industrial Policy: Common Approaches and Regional Aspects. Participants included the heads of the Russian Federation Council and State Duma, the Republic Council and House of Representatives of Belarus, the Union State Standing Committee, heads of key ministries and agencies, regional executive and legislative heads from both countries, and representatives from big business and public and scientific organisations. The last forum took place in June 2014 in Minsk.

After the plenary session, Mr Putin and Mr Lukashenko visited an industrial exhibition held as part of the forum.

Speech at forum’s plenary session

President of Russia Vladimir Putin: Mr President, colleagues, ladies and gentlemen,

It is a pleasure to welcome all of the Forum’s participants to Sochi. This meeting between the heads of our two countries’ regions plays an unquestionably important role in developing our bilateral cooperation and facilitating broader direct contacts between our societies, business and public organisations, and our citizens. Present here today are members of our parliaments, heads of ministries and agencies, and business representatives – everyone who is directly involved in developing our ties in a spirit of friendship, good-neighbourliness and mutually advantageous cooperation.

Belarus is our strategic partner and close ally. Our bilateral cooperation is multifaceted, comprehensive, and developing steadily in all areas. At the meeting with our ministry and agency heads just now, we discussed the plans ahead and what has been done up to now.

Russia is Belarus’ biggest economic partner. Our market accounts for nearly half of all Belarus’ foreign trade. The unfavourable foreign economic situation had an impact on our trade growth last year, of course, but let me note that although there was a noticeable drop expressed in dollar terms, in ruble terms our trade actually grew. Overall, the trade flows have not diminished.

I am sure that it is within our ability to put our trade back on a growth track for all indicators. Carrying out large investment projects will help greatly here. An accumulated total of $6.3 billion in Russian capital has been invested in Belarus. This is 40 percent of our total investment in the CIS countries. More than 3,500 joint enterprises have been established across the range of economic sectors.

We are carrying out around 40 programmes through our work in the Union State. We are developing cutting-edge technology for the space sector, satellite navigation, geological prospecting, and agriculture. Financing for the Union State’s budget has remained at its full planned level this year and comes to 4.8 billion rubles.

We work together to deepen the integration process in the Eurasian region and improve the legal base. Our efforts aim to provide the necessary conditions for our producers to intensify their work on the domestic and foreign markets. I think that we and our Belarusian colleagues have succeeded in building a solid cooperation infrastructure. As I said at the start, interregional cooperation is one of the main components. Of Russia’s 85 regions, 80 have direct ties with their colleagues in Belarus. Tyumen, Moscow, Smolensk regions and St Petersburg are among the regions cooperating most actively with Belarusian partners. The two capital cities, Moscow and Minsk, have longstanding strong ties and work closely together. Around 270 interregional agreements have been concluded in a wide variety of areas. New agreements are regularly added to the interregional legal base. Close to 20 new agreements have been signed on this forum’s sidelines.

Belarusian goods and products enjoy a reputation for high quality on the Russian market. Belarusian trading houses and chains operate in many large Russian cities. Our countries’ regions have built up solid experience in industrial cooperation and have established strong technology chains in machine-building, petrochemicals, pharmaceuticals and a number of other sectors. Partners in Altai Territory, Bryansk Region and companies from Sverdlovsk Region, who are taking part in modernising the thermal power stations in Minsk and Grodno, stand out particularly. Companies in Penza Region are assembling specialised equipment for vehicles using Belarusian components.

A centre engaged in developing new-generation radio-electronic devices is at work in St Petersburg. We can make more active use of the fruits of these efforts to find and develop internal reserves for economic growth and diversification, and make ourselves less dependent on foreign components and suppliers. As you know, we are already engaged in this work. The Russian Government has developed a comprehensive import replacement programme covering nearly all sectors and envisioning the launch of more than 2,500 projects.

But let me note at the same time that this import replacement we talk about is not some kind of fetish. It is primarily about the most important technology, dual-purpose technology. I have spoken about this before, but let me say publicly once more before this audience that import replacement as we see it, the import replacement we are pursuing, is about developing high-tech production here in our own country. This is our aim. This is something we would have had to do in any case, no matter what the situation. We are doing it now at a faster pace and with double effect.

Russia passed a new law on industrial policy last December. It provides for long-term guarantees for investors carrying out business projects, tax breaks, preferential loans, and information and consultation support. These measures will help business to cut costs, spread new technology, and raise investment for modernising industrial facilities. In total, the Russian Government plans to allocate 2.5 trillion rubles for these purposes.

The Russian Industrial Development Fund is producing good results. Its resources go towards spreading the use of advanced technology in Russia’s industry. Moscow Region, Sverdlovsk Region and Tatarstan are among the leaders in terms of the number of applications.

The regional investment rating will play an important part. It is formed on the basis of evaluations of the business climate in each region made by the business community itself, which is particularly important.

Based on an analysis of business community views, we can systematise their evaluations and offer the regions the best practices for business support at work in Russia’s different regions.

Let me assure you that Russia is ready to work as closely as possible with partners from Belarus in all areas of industrial policy. I think this would benefit us all. It is easier to raise the competitiveness of both Russian and Belarusian goods and promote them on other countries’ markets if we work together.

I discussed this just before with Mr Lukashenko. We share the view that our common goal is to ensure our economies’ steady growth, make them more effective, improve the business climate and attract investment, especially private investment. We hope that the Forum of Russian and Belarusian Regions will make a substantial contribution to reaching these goals.

I want to thank you not just for listening to me with attention, but for the work you have done over the last two years, and most importantly, for everything you are doing in your daily work to develop Russian-Belarusian ties.

Thank you very much.