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President of Russia Dmitry Medvedev: Colleagues,

Today we are meeting to discuss the decisions we need to take to ensure Russia’s continued social and economic development this year. We realise that the global economic crisis has not yet reached its peak. The experts’ assessments attest to this, and so do my contacts with other countries’ leaders. There are a great many different forecasts.

But practically none of these forecasts expect any pickup in the world economy before 2010. Most analysts, specialists and those involved in the economy in practice think that the next year will be very difficult. Consequently, we should not expect any significant increase in foreign demand for our products and goods, or any revival of capital inflow of the level we would like. In this situation, we need to once more analyse how to best adjust our policies and measures, above all our budget policy.

Our main priority remains unchanged, namely, to fulfil all of our social commitments. You have been working on this. Over these last months, the Government has carried out weekly monitoring of the social and economic situation, and this work needs to continue. To maintain stable development you need to make more active use of the instruments already approved and that have already proven their effectiveness.

At the same time, a number of the guidelines set last autumn now require additional discussion. I am referring to the budget parameters and to maintaining the financial system’s normal operation. In fulfilling all of our social commitments (and this top priority remains in place), we also need to maintain macroeconomic stability, not let prices rise too far, and try to conserve needed resources for the possibility that the crisis in the global economy will continue beyond the current year. We have decent reserves – around 5 trillion roubles [approximately $139 billion] in the Reserve Fund, and 3 trillion roubles [approximately $83.5 billion] in the National Prosperity Fund. We can maintain our budget spending commitments this year without having to resort to excessive and expensive borrowing.

At the same time, I propose that we look further today and examine the amount of anti-crisis spending we can afford in order to maintain sustained development in the medium term. We always need to think about the future, including during crisis periods. I remind you in this respect that the National Prosperity Fund’s purpose is to maintain the pension system’s stability. This money needs to be managed in such a way as to preserve it inasmuch as possible, all the more so as one of our objectives is to increase pension payments, this year too, in accordance with the figures that have already been announced.

I know that the ministries have discussed the possibility of replacing less urgent, relevant and effective expenditure with programmes that could produce significant results this year. This concerns above all infrastructure programmes, construction programmes, housing programmes and banks’ capitalisation. We need to look at the financial possibilities available for this.

We need to make the final principled decisions today, and once the Government has examined them, we need to submit the amended budget law to the State Duma. This is the ultimate purpose of today’s meeting.

Let’s start work.