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Vladimir Putin: Ladies and gentlemen,

The APEC summit and business meetings taking place on its sidelines provide a good opportunity for both the Governments and for business to look at the economic aspects of the problems posed by globalisation.

The ideas about global inter-connection of events and phenomena are centuries old. The great Oriental philosopher Lao Tse wrote: “The more a person does for others, the more he has left for himself.” The sense of inter-connection of everything in this world is brought home to you very forcibly in the East with its ancient traditions, where trade has been guided by strict ethical principles and has been regarded as inter-course between partners who respect each other.

In the early 20th century, my fellow countryman, Vladimir Vernadsky, developed the doctrine of the noosphere, the space which is shared by the humankind. It combines the interests of countries and peoples, nature and society, scientific knowledge and government policy. In fact, the present-day concept of sustained development is based on that doctrine.

The ongoing progress of information systems and increased mobility of international cash flows provide prerequisites for sustained and predictable processes in the global economy. But on the other hand, there are many hidden snags.

Globalisation changes the work of all types of business, from trans-national to small enterprises. Today everyone involved in business is influenced by the international situation and currency rate fluctuations. This is highlighted by world financial crises. Local producers cannot avoid competition with their major Trans-Atlantic rivals even in a village shop.

Of course, it is up to business itself to adapt to the new conditions. Natural selection through competition is inevitable.

But the challenge is to make sure that financial upheavals do not affect the foundations of the social security of individual countries and people; to make sure that productive forces do not decline as a result of the “battles between trans-national giants” or ill-considered actions of Governments, to make sure that the goals of business are in harmony with the interests of society.

It is our duty to find an answer to these challenges posed by globalisation. So, the consequences of globalisation are undoubtedly a key concern of Governments and international organisations.

In terms of the level of development, the world is known to be divided into the North and South, the so-called “golden billion” and the rest of the humankind. A similar dividing line runs through APEC. Apparently, it would be right for Governments and international organisations to resume the North-South dialogue and look for ways to bridge the gaps in their development. Failing that, globalisation will bring more risks than advantages. This is well understood, among others, by the World Bank. Paraphrasing the dictum that a rich society consists of rich people one can say that the wellbeing of the world community depends on the wellbeing of all countries together and every country individually.

Governments should take part in managing the processes of globalisation through trade policy and international law. With the potential of major trans-national corporations already exceeding the combined economic potentials of a number of countries, that is an imperative.

Finally, globalisation of the economy creates conditions for the spread of international economic crime. It includes illegal migration of capital, money laundering, tax and customs violations, drug trafficking and arms smuggling, on which terrorism thrives.

Of course, it is up to the national and international organisations and agencies to counter that threat. But associations of industrialists and their codes of honest conduct also have a positive role to play.

Speaking about the prospects of globalisation, we believe that APEC could do something to help business, above all, by developing the systems of commercial and investment information, and technical and advisory assistance. Another essential factor is a more considerate attitude to the needs and recommendations of business on the part of Governments and the forum itself.

Russian foreign economic policy today is also influenced by the world market and international competition. We are mindful of these processes. We are preparing to join the WTO and are planning substantial cuts in our customs duties. The new laws we initiate are aimed at making our economy more transparent, creating favourable conditions for its integration into the world economy. It will not only greatly accelerate our economic growth but will make Russia more attractive to foreign investments. We are ready to provide more detailed information on that matter to all the companies in the APEC countries interested in working in the Russian market.

I would like to say a couple of words about Russia’s interests in APEC from the business point of view.

As regards exports, we are looking above all at our natural resources, including energy resources. Russian science is also an important part of world science. We are looking at machine-building, transport routes, fishing and tourism. An infrastructure oriented towards Asia is being created to export energy, and this opens up opportunities for investors from other countries. Some energy fields in Siberia and the Far East are operating under production sharing agreements with foreign investors. But for us energy is not only oil and gas, but also transport and energy-intensive products.

So, we offer for export electricity and chemical and petrochemical products. The Trans-Siberian Railway and the trans-Caspian transport corridor are open for transportation on the Asia-Europe route. That is 10 days faster compared with transportation through the Suez Canal.

Our markets have a considerable import potential. The US, Canada, Japan, China, Malaysia, Singapore and several other APEC members are already active in our markets. Russian companies have contracts to deliver engineering products and raw materials, for example, for non-ferrous metallurgy. Our country has always needed tropical farming products. And consumer goods produced in Asia sell well in our markets. Now their range has greatly expanded, from clothes and computers to toys.

In short, political stability and the economic recovery open up broad vistas for business cooperation with Russia.

We perceive globalisation in practical terms. We perceive it as an opportunity to modernise our economy. But we are not thinking only about benefits for ourselves. Russia’s destiny is inseparably bound up with that of the world. We are aware of the degree of our responsibility in building a new world order, including economic order. It will not be a simple or an easy process. But such forums and meetings and discussions as these can help us overcome the difficulties.

Thank you.