Official website of the President of Russia

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Economic Development and Trade Minister German Gref on measures to improve support mechanisms for high-technology exports:

We have been using a whole range of export support mechanisms in Russia for several years now. Support has gone primarily to machine-tool and machine-building sector export goods in a bid to diversify the Russian economy and help our high-technology goods gain access to foreign markets.

This system of support measures has been operating for two years now. This year we also adopted a new programme, the first of its kind, to provide export support to small and medium businesses. We are using financial instruments such as subsidised interest rates and export credits under the guarantee of importing countries. Under the special programme for small and medium businesses, we pay for products to be certified on foreign markets and for businesses to present their products at exhibitions and fairs abroad in order to promote their goods and demonstrate their potential. These instruments have had varying results. There is not enough of a systematic approach, unfortunately, and implementation is too slow. Often financing for these measures becomes available only towards the end of the year, and this has an impact on their effectiveness, of course.

It is for this reason that the Government proposes establishing the Russian Development Bank to act as the main financial institution responsible for implementing state export support measures. The bank’s principle responsibilities will include lending and support for projects outside the raw materials sectors.

President Vladimir Putin: Not only projects geared for the export market?

German Gref: That’s right, not just export projects. The bank’s principle responsibility will be support for exports, but in order to create goods for export markets we have to develop our domestic production, of course. The bank’s work and lending activities will therefore focus on supporting non-commodities sectors of the economy. We spent quite a long time discussing the relevant draft law. There are a few minor technical differences that remain to be settled but we hope that they will all be resolved by Thursday and we will be able to submit the draft law for government examination that same day.

Vladimir Putin: What will be the bank’s charter capital?

German Gref: The plan is to create the bank through a reorganisation of three existing Russian banks: Vnesheconombank, the Russian Development Bank and the Export-Import Bank. The total capital that these three banks currently have, after some transformation, comes to more than $2 billion.

We have also been looking at increasing the bank’s capitalisation in the future so that it would be able to carry out major projects. We don’t yet have a defined figure for the bank’s potential future capitalisation. We need to pass the draft law and then we will probably be able to settle the matter of future capitalisation.

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Health and Social Development Minister Mikhail Zurabov on the demographic situation in the country:

We have received data on the demographic situation in the country for the first ten months of this year.

All the main parameters show positive movement, but I want to note above all the increase in the birth rate. The birth rate dropped slightly during the first quarter compared with the same period in 2005, but it began to pick up considerably over the following six months and this gives us an overall positive result for the first ten months of 2006. True, the increase is not high, but the upward trend is in evidence nonetheless.

We registered more than 3,000 additional births over this period, that is, an increase of more than 1 percent as compared to 2005. The noticeable decline in the death rate is also positive news. Overall, the death rate fell by 5 percent over the first ten months of 2006 compared to the same period last year. This represents a total of 94,000 people. Also positive is that child mortality is coming down.

Vladimir Putin: Is this a sustainable trend?

Mikhail Zurabov: We are inclined to think that it is indeed now a sustainable trend because if we look at the data since the beginning of the year, we see that the decline in the death rate represented a total of 66,000 people over the first nine months of the year, for example, while now the decline represents 94,000 people, and we believe that this confirms that we can indeed speak of a trend.

What’s more, the fall in the death rate applies to all types of pathology, and this is a sign that the healthcare system has begun working more actively, in particular in carrying out prevention work and detecting illnesses at an early stage. There have been 54,000 fewer deaths from cardiovascular disease, for example, since the beginning of the year.

The migration situation is also showing positive tendencies. Last year, we had a positive migration balance of 74,000 people, while this year the positive balance is 95,000 people since the beginning of the year. We have seen a drop in the number of people leaving the Russian Federation and the CIS countries. Last year there were around 24,000 people emigrating, while this year we are down to 7,000 departures and this represents a considerable decrease.

All of this together gives us grounds to say that these ten-months-period indicators are the best the Russian Federation has had in the last seven years.

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Deputy Prime Minister and Defence Minister Sergei Ivanov on creating a civilian agency for defence procurement:

We are set soon to examine the draft documents on creating a civilian federal agency for defence procurement – arms, military equipment, special equipment and material needs for the Armed Forces. All the issues regarding this project should be settled by the end of the year. Russia has never had an agency of this kind in all its history, but we are convinced that this is what we need in order to make our national defence spending more efficient.

We estimate that the creation of this federal defence procurement agency will enable us to save more than 1 billion roubles. We have already settled overall the question of dividing responsibility between those who place the procurement orders, those who determine the specific procurement needs, need for equipment repair work, acquiring goods for the rear, foodstuffs and other maintenance goods and needs. Each armed forces body will identify its needs, of course, but it will be the civilian federal agency that actually places the orders and organises the contracts. We now have to present all the draft instructions to the Government by the end of the year in order to be able to start setting up the agency itself over the course of 2007.