Official website of the President of Russia

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Question: You met with Ukrainian President Leonid Kuchma eight times during the past year, and you will have your ninth meeting in Dnepropetrovsk. How would you describe the qualitative changes that took place in Ukrainian-Russian relations during the past year? And what do you expect from your trip to Dnepropetrovsk?

Vladimir Putin: You have practically answered the question yourself. During the past year Ukrainian President Leonid Kuchma and I managed to change the quality of relations.

To be honest, I see this as one of the main achievements of Russian diplomacy during the past year. We regard the relations in the post-Soviet space as a priority, and especially relations with Ukraine. It is our biggest partner.

So, the quality of relations has indeed changed. The new element is a high degree of mutual trust. I think that marks a fundamental change.

As for the scale of relations, the volume of trade is a potent indicator. Last year it amounted to nearly $9 billion, an increase of $1.3 billion. And not all the figures are in yet. I think it is a very good result.

What do we expect from the visit and what goals do we set? First, it is essential to consolidate what has been achieved to date. We believe that we have settled the disputes in the energy sphere. All that remains is to finalise some details. I mean ensuring Ukraine’s interests regarding gas and ensuring Russia’s interests regarding the transit of our gas to Western Europe.

RAO UES of Russia has done some positive work recently. And while during our meeting with Leonid Kuchma in Sochi last year we discussed the possibility for RAO UES to operate in a small area using its potential only in some border areas in Ukraine, during the past six months or so RAO UES has done some good work with our Ukrainian partners and concluded that cooperation in the power sector can be global, so to speak, and can cover the entire territory of Ukraine.

If the outstanding problems are finally agreed it will enable Ukraine to solve other major issues of energy supply and it will enable Russia to enter the Ukrainian market, and that means that our energy will flow freely further West, to Moldova, for example, something both Russia and Moldova are interested in.

That is a major step forward. But that is not all. It is not by chance that we have agreed to meet in Dnepropetrovsk because we are going to visit the Yuzhmashzavod facility. It is a flagship rocket-building enterprise. Formerly Russia and Ukraine were practically leaders in that sphere.

We stand a good chance of remaining leaders. We have ambitious plans in this sphere. They involve joint work on booster rockets such as Zenit and Dnepr. We have a major project called Sea Launch and prospects for joint building of aircraft are good. Some of our facilities in Omsk and Saratov are manufacturing aircraft designed by the Antonov centre. We have plans to penetrate foreign markets and to use these products inside the country.

The third area of joint work we are going to discuss with the Ukrainian President is cooperation in the engineering sector.

These are the main areas.

Question: Mr Putin, Ukraine is going through a difficult political period. Protests took place in Kiev on Tuesday. How does Moscow see the latest developments in Kiev? And can the recent events in Ukraine influence the relations between Kiev and Moscow and between you and Leonid Kuchma personally?

Vladimir Putin: I don’t think it is a very appropriate question. I am going to be a guest of President Kuchma. And what is happening there is an internal political matter for Ukraine. It would not be proper on my part even to make any comments on the issue.

On the whole, there is nothing wrong about inner political struggle. I think it is a sign of a normal democratic society. Speaking not as the Russian President but as a citizen, I think there is nothing wrong about that. What is important is that all these processes should be within the law.

Question: Going back to the visit to Dnepropetrovsk and military-technical cooperation, will you discuss joint production of intercontinental missiles? Kiev speaks about a breakthrough in military-technical cooperation between our two countries following Sergeyev’s visit. Are you aware of a breakthrough or dramatic progress in this sphere?

Vladimir Putin: Ukraine is a non-nuclear country. We respect its status. And there is no reason why we should seek to change this state of affairs, there is no need for that. All our plans are geared to joint work in civilian sectors. I am absolutely sure that by working together we will be more competitive in that market. And it is a huge market.

Question: Mr Putin, you have mentioned the penetration of Russian business into the Ukrainian market. Ukraine has embarked on a massive privatisation campaign. To what extent does Moscow want to be involved in these processes? Was the issue of Russia’s participation in the privatisation in Ukraine discussed at the top level?

Vladimir Putin: Yes, it has been discussed many times. Leonid Kuchma raised these issues and urged us to contribute to this process. That was in fact the aim of our meeting in December. As you know, a large group of Ukrainian businessmen visited Moscow.

I can report some progress in this area. Russian investors have already taken part in the privatisation of some oil refining facilities, for example, the Odessa refinery. We have invested in some chemical industries and engineering plants. But that is still short of our goals. I have to tell you frankly that it depends not so much on Ukraine, although it probably could do more to create an investment friendly climate, but that many of the problems are on our side. I think there is too much red tape in the sphere of currency regulation and in the sphere of foreign investments.

We have just discussed it with the Government ministers responsible for the economy and with the Central Bank, and we are planning certain steps in this field. But it cannot be done only with regard to Ukraine or only with regard to the CIS. It should be an all-embracing decision. We are thinking about it. I hope that once the relevant decisions are taken Russian investors will become more active in Ukraine.

Question: For good or bad, key issues between Ukraine and Russia are often solved at the highest level. Are there negotiators in Moscow and Kiev who could prepare this question for the Presidents? Who do you think could lead the Ukrainian affairs in Moscow and, probably, in Kiev? Are there people who are respected in Moscow and whose opinion is heeded?

Vladimir Putin: There are several such people, but two are perhaps best suited for it. They are Deputy Prime Minister Viktor Khristenko, who is in charge of energy, and Deputy Prime Minister Valentina Matviyenko, who is in charge of social issues. I am sure that they are the best candidates if only because their names are Ukrainian. And as you probably know Valentina Matviyenko is as fluent in Ukrainian as she is in Russian.

So I think her area of activities is just as important as that of Viktor Khristsenko, who supervises energy and some sectors of industry.

It is not by chance that I mentioned the social sphere. You know that last year Russia took some steps to support Ukrainian culture and the Ukrainian language. I think it is very important both for Ukraine and for Russia, and we expect that cooperation in this sphere will grow at least as fast as in the economic sphere.

Question: Picking up the language topic, what do you think should be the status of the Russian language in Ukraine and, conversely, the Ukrainian language in Russia?

Vladimir Putin: The status should be acceptable to Ukraine and should enable all the ethnic minorities, all the people who consider Russian to be their native tongue to live in that linguistic environment, to develop their language, to acquire an education in their language and to work using their language.

Question: Mr Putin, March 26 will mark an anniversary of your brilliant electoral victory. What kind of a year has it been for you? What have you managed to achieve and what have you failed to achieve, and how have you changed over the course of the year?

Vladimir Putin: We all change. I think all those present have changed during the past year. It is impossible not to change in this rapidly changing world.

What have I managed to accomplish? The year has not ended yet. But thinking about my successes and failures, I would note the following. Most importantly, we have ensured the necessary economic growth rate. We haven’t had a growth of 7.6% in twenty years.

We have ensured or created conditions for a measure of political consolidation in society. Consolidation enables us to take constructive decisions and to create conditions for economic development and for addressing social issues at the same time.

And thirdly, you know that we have substantially increased pensions and paid back almost all the wage arrears in the public sector. Real incomes have registered a growth. But I don’t want to cite figures because the average Russian’s life is still very hard. He does not live in a world of virtual figures or percentage points. He lives in the real world and he wants economic growth to benefit him, his children and family. He wants to enjoy the tangible results of growth. So far, we cannot say that the overwhelming majority of Russian citizens are enjoying the results of the economic growth rate and the favourable internal political climate. Much has still to be done in this area.

Question: If your reforms succeed what kind of a country will Russia be?

Vladimir Putin: A prosperous country.

Question: Thank you for giving your time to meet with Ukrainian journalists. We have been waiting for this opportunity for almost a year and a half. Could you give us an autograph, with hopes for further meetings?

Vladimir Putin: With pleasure.

Question: Thank you very much. Until we meet in Dnepropetrovsk.

Vladimir Putin: Thank you. All the best to you.