Official website of the President of Russia

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President Vladimir Putin:

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We planned this meeting in order to discuss the specific problems in the gold-mining sector. I think that today, as in the past, this is an important matter for our country. The gold-mining industry in Russia has always been of particular significance and has always held an important place in our economy, and so today’s discussion will be equally significant.

Our country is one of the world leaders in terms of gold reserves, but we remain in fifth place for gold production. There is a clear discrepancy between our potential results and the real situation, and this suggests that we are justified in giving this matter greater attention.

Russia already has considerable influence on the situation in the world gold market. But I hope, and I am convinced, what’s more, that Russia has everything it needs in order to considerably strengthen its position in the future.

Our country possesses considerable, genuinely unique, reserves of gold. Recent prospecting and exploration work has revealed the existence of large new gold fields. A favourable foreign economic climate and, most importantly, positive changes underway in the gold-mining industry itself contribute to the successful industrial development of these major gold fields. The Russian gold-mining sector now has a stable structure. Leading companies have emerged in each of the gold-mining regions and have consolidated considerable production facilities. As the governor just reported, the same process is underway in this region and as far as I know, this is also the assessment of the Russian Finance Ministry. The companies that have emerged as industry leaders are enterprises with considerable economic and human resource potential.

The sector’s increasing attractiveness is encouraging investment from other economic sectors. Investment is coming in from the oil industry, from the non-ferrous metals industry in general and from the diamond-mining companies. Good conditions have been established for a continued flow of investment into the gold-mining sector. This concerns not only short-term and expensive financial resources, but also long-term and relatively cheap money.

Now what we have to concentrate on is drawing up a legal and financial-economic model for developing the Russian gold-mining sector, a model that will ensure sustainable growth in the sector through the development of new deposits and through raising the industry’s effectiveness.

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First, we need to draw up a programme of measures to encourage the expansion of prospecting and exploration work and put in place the conditions for attracting private investment to this area. We definitely need to stimulate mining companies’ interest in prospecting and exploration work and I think that the state should play a significant role in this respect.

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Second, many of the gold fields are located in difficult-to-access regions where transport, energy and social infrastructure remain as yet fairly under-developed. This makes gold-mining projects a lot less commercially effective.

I think we should discuss possible measures, including tax measures, for making development of remote deposits more profitable. The same goes for development of other mineral resources, and for oil and gas – all these sectors face the same problem. We need to continue expanding the transport and energy networks in the gold-mining regions. This is in everyone’s interests – in the interests of the state, the municipal authorities and the gold-mining companies themselves. We should therefore work together to develop this infrastructure, fairly dividing up the costs and benefits.

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Third, it is my view that the economic and legal conditions governing gold mining should facilitate development of all the different types of gold fields and deposits. This in turn will guarantee stable employment in the sector and decent living standards in the gold-mining regions.

Finally, there is one other issue, and that is ensuring a balance in the work of the companies both upstream and downstream in the sector, from the mining to the finishing companies. This requires us to make effective use of inter-regional cooperation and the potential offered by our foreign economic ties.

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