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President of Russia Vladimir Putin: Mr Shokhin, colleagues, friends,

Thank you for the invitation. I would like to welcome the participants of the congress of the Russian Union of Industrialists and Entrepreneurs.

Mr Shokhin has just said that you have been working for a couple of days here, and all the key members of the Government spoke today. I hope that the dialogue has been rewarding and many things have become clearer and more understandable. And in general, it is good that you have an ongoing dialogue.

I would like to thank you, as well as the thousands of companies you represent, for your work and your contribution to the country’s development.

The RSPP is a highly respected organisation that brings together major companies that hold leading positions in many sectors of the Russian economy and play a key role in the economy as a whole, in industry, agriculture, finance, transport and other sectors.

It is also important that the RSPP remains engaged with the national agenda. The organisation has its own views and proposals to offer – what needs to be done to increase the pace and sustainability of economic growth, how to support the development of Russian regions, enhance their industrial, technological, infrastructure and human resources, and in a broader sense, how to make our country stronger, more successful, and more competitive.

This active and creative position taken by the RSPP and the business community as a whole is particularly relevant today. I mean, it has always been relevant, but today it is particularly relevant for obvious reasons, and most especially now that the Russian economy is acquiring a fundamentally new quality and beginning to develop under a new model, something I spoke about recently in my Address to the Federal Assembly.

Let me remind you that Russia’s maximum GDP decline was recorded last June; I believe it was 4.7 percent. The reasons for this are well-known: the sanctions war and the unprecedented challenges in the global economy and trade as well as in the system of international relations as a whole, and it was not us, as you know, who was creating these problems. These are challenges that neither Russia nor probably any other country in the world has yet faced in modern history. All of this lies at the base of and is the reason for what I have just said.

Since then – starting last July – our economy, nevertheless, has transited to growth. Standing behind these achievements is the hard work of thousands of companies and many millions of specialists, their responsible and professional attitude towards business, their striving for progress, for protection, and for their own country’s development.

We see the positive trends in the Russian economy gaining strength; in the second quarter of this year, we expect a significant increase in GDP over last year.

What is it that determines the current state of domestic industries and is shaping this new economic trend?

First, we have managed to compensate for the actual closing of Western markets to us and to expand Russia’s foreign trade contacts with nations in the world’s fastest growing regions. You know that in previous years – before all these crises and special operations – we were orienting ourselves, step-by-step, towards rapidly developing markets anyway.

Today, a different situation has taken shape, where it turns out that we were not doing this in vain. Moreover, we were doing it at an even slower pace than we should have. But this is fine, we continue making strides. Over the past year, our trade with these regions, with these countries has been growing at double-digit rates and it continues to grow.

Incidentally, I would like to add for reference that, on the whole, Russia’s 2022 foreign trade surged by 8.1 percent to $850 billion, including exports – by almost 20 percent, 19.9, with imports declining by almost 12 percent (11.7). The trade balance surplus was $332 billion, or 70 percent more than in 2021. We are now with you at the House of Music – this is such good music.

I would like to mention at this point Russian business executives and their management teams. In a short span of time and in the difficult conditions of external pressure, they managed to rebuild investment and trade chains, develop logistics routes, and open up new areas of cooperation with predictable and bona fide foreign partners.

I must say that credit for this goes, of course, to you and your teams, but we know – and I will tell you like family – there are people who are advising our ill-wishers on how and where to hit us harder, but those who have stayed here and are really working have proved to be smarter, more vigorous and effective than those who left and are giving such advice to our ill-wishers. Their success is obvious, as I have just said. It is also obvious that the state will continue doing everything necessary to strengthen this interaction.

The second point. Domestic demand is growing fast. Experts estimate that in April, our retail growth rates will be at least 5 percent, and this is a figure in real terms.

As for what is important here and where I would like to draw your attention. This is not some accidental spike. Experts note that domestic demand has entered a trajectory of sustainable, long-term growth. It is based on our stable labour market, higher salaries and incomes of the people, and reduced inflation.

By the end of March, inflation is supposed to be under 4 percent. Different experts have different opinions, including those present here. Some of them say it will be 4 percent, others say less, and still others say five. The figures are in this ballpark. That said, it is clear that this will be the target inflation.

I will mention for comparison’s sake that inflation here will be lower than in the Eurozone countries, which are endlessly waiting for the collapse of the Russian economy and trying to convince themselves and our partners of it. Let us recall again a famous American writer who said that reports of his death were greatly exaggerated. The same applies to our economy. On March 13, inflation was 7.6 percent and will reach the target figures by the end of the month, in early April.

Now the third point to which I would like to draw your attention. A year ago, Western authorities were twisting the arms of their companies and compelled some of them, many of them to leave the Russian market. At that time, foreign analysts predicted a depression and a decline in the consumer sector for us. They promised us empty shelves in shops. Massive shortages of goods and the collapse of the services sector.

However, life took a different turn. Now the Western countries themselves have faced these problems in full measure. It got to the point where their leaders suggested that their citizens eat turnips instead of lettuce and tomatoes. Turnips are good produce, but to get them, they will have to come to us because our harvest is much bigger than that of our neighbours in Europe.

True, this may not be their fault. They had a drought and the like, but they can hardly do without our fertilisers if they want to increase their crop yields. At any rate, this calls to mind a Russian proverb: “He who digs a pit for others falls in himself.” It seems that this is exactly what is happening.

In Russia, domestic companies began to fill vacated market niches after the withdrawal of certain European and American companies. The situation is similar to the food market eight years ago, when we introduced our own restrictive measures in response to sanctions, and that triggered rapid growth in domestic agriculture and food processing.

Now there are even more opportunities and better prospects for business development and expansion, and Russian business should not overlook them, otherwise, you never know – some of those foreign players might want to return. The situation is, without exaggeration, unique for many of our companies. A timely investment decision today will surely pay off handsomely tomorrow. This applies to the manufacturing industry as well as to domestic tourism, Russian consumer brands, and so on.

There is something else I would like to note about this new model of economic growth.

We must primarily rely on our own technological resources, as well as partnerships with friendly countries to increase production capacities, open new facilities, and create jobs throughout the country. I am well aware of the threats that are arising; I know what the ill-wishers are pointing out to us, that Russia will face problems in the medium term.

Yes, this is a threat to be reckoned with. But I am absolutely confident that we will overcome it, because this is a medium-term outlook, and I urge you not to wait for the negative consequences of this medium-term threat. To prevent this from happening, you need to act right now. The audience in this room understands what I am talking about, and I am sure that they will continue to work like this.

To help you with this, the Government has launched mechanisms like industrial mortgages and the cluster investment platform. I ask the Government to keep their work under review at all times with feedback from businesspeople and the regions. An ongoing dialogue is in place to get their feedback, and there is no sign that the dialogue might fall apart. On the contrary, I think our interaction at the business level and at the level of administrations at all levels – pardon the repetition – will only grow. Dialogue is the only way to realistically assess how effective and necessary these tools are.

And of course, the main criterion that the mechanism is working is the volume of investment decisions made and the funding raised. These parameters will also be closely monitored. Due to modern digital technologies and big data-enabled analysis, the Government can do this almost in real time. We must give credit to the Government: our colleagues have learned how to do this, have learned to work in this mode and use these tools.

In this regard, here is one more task for us: the efficiency of management must be raised to a qualitatively new level, both in business and in the government system. We need to develop digital platforms, and use data-based management models, models based on big data. Obviously, modern technologies, including the so-called lean technologies, need to be implemented across the board, in all sectors of the economy and the social sphere.

In this regard, I would like to remind you of the work we began in 2019 as part of the national project to increase labour productivity at small and medium-sized companies throughout the country. The effort has yielded tangible results, and these results are being recorded at the national level.

I know that many large companies, such as Rosatom, Gaz, Kamaz and many others, also use these approaches in their production processes.

A significant effect from the introduction of lean manufacturing was also noted in the defence industry; that enabled us to quickly scale the output of the products we need. I would like to thank my colleagues for their work.

And one more thing – you certainly know about this –the introduction of new technologies in manufacturing and management should definitely be accompanied by an influx of qualified personnel. This cannot work otherwise. Much needs to be done to increase the efficiency of training young people and the professional development of accomplished specialists.

Here I would like to note the joint initiative between business and the Government – the Professionalism federal project. As I said in my Address, we will intensify work in this area so that the project will reach at least a million young people in the next five years. They will receive an up-to-date and high-quality education, gain skills and qualifications that would guarantee them an interesting, good and well-paid job.

I would like the Government and our colleagues from business in this room to note that these plans will require additional investment, both from the state and from the business community, of course. I count on there being unanimity in approaches to this matter and a shared interest in the results of this work.

Colleagues,

As I have said, today vast opportunities are opening in Russia for almost every endeavor, every business, for launching promising long-term projects in the consumer market, the high-tech sector, in tourism and many other industries.

Yes, of course, we still have to resolve a number of systemic issues related to logistics, financing, infrastructure and technology. But the number of outstanding problems never goes down because the number of goals increases with the growth of our state and our economy. This is a natural process.

We will certainly discuss progress in every key area at the meeting with our government colleagues today.

As I have already said twice today, additional initiatives in this respect were voiced in my address. I am sure that we will definitely carry them out, overcome systemic challenges and achieve the desired results through the concerted efforts of the authorities, business circles and citizens.

As far as I know, we have planned our traditional discussion during a plenary session – Mr Shokhin has just mentioned this. I hope to hear your opinion on how to make the development of the domestic economy more dynamic with a view to tangibly improving the quality of life in the entire country.

Here is what I would like to add in this context. Businesspeople in Russia have always played a big creative role – and I would like to emphasise the word “always” – in both the pre-revolutionary era and in the past few decades. They have assumed huge responsibility for the progress and development of territories, social support, education, healthcare, infrastructure, and charity, and have been rightly proud of that. Many of them have gone down in history, and the names of some are still heard today.

Today, we are also seeing examples of great attitudes to this effort, to the lofty mission of the businesspeople who care for the conditions in which their companies, their people and their specialists are working. They are using their entrepreneurial talent – and this is a talent – not only to derive profit and engage in overconsumption but also for the public good. Instead of working offshore and withdrawing the money made here for what can hardly be called basic necessities, they are launching special programmes to support their employees and their families. Along with the regional authorities, they are channeling funds into the construction of roads, hospitals, sports and cultural facilities. In a word, they are making life better for all the people around them.

We should have more initiatives like this that bring real benefits to our people. Naturally, big, medium and small businesses alike, as well as the regions, should be interested in such projects. They should be feasible if they are implemented through a concerted effort.

The state will do all it can to support domestic companies, those who are ready to fight for their business, for the welfare of their teams, the people who work for them and for the good of all Russian citizens.

Here is what I would like to add in this regard.

First, companies that focus on steady operation for years to come, rather than short-term gains, which invest in research and design and create proprietary technology platforms and trademarks should and will be supported. For these companies, a lasting reputation and their good name are not an empty phrase, but a great value. These companies have a strategic outlook on the future.

As I have said earlier, we need businesses that care about staff and employees and create comfortable working conditions for them, invest in their employees’ knowledge and skills, take care of their families and children, and understand that family welfare is the foundation of demographic development, higher birth rates and longer life expectancy. Ultimately, this helps cut corporate costs, to put it in primitive terms, improves the operating environment and leads to bigger and better results.

Responsible businesses do not disassociate themselves from the locality or the region where they are based. They take part in their development and, in conjunction with the state, invest in schools, universities, the education system, public health and all areas that are critically important and sensitive for the people, and support social programmes as well.

Of course, business is first and foremost about business, not a social institution, which we are all well aware of. But you know what I am talking about as well.

Truth be told, taking care of the environment is the undisputed priority. We must not only improve the environmental safety of factories, but also reduce the accumulated harm to nature and assist regional authorities as they strive to implement environmental projects.

Most importantly, a responsible Russian entrepreneur is a true citizen of Russia who understands its interests and acts in its interests, does not hide assets in offshore accounts, but registers companies here, in our country, and does not become dependent on foreign authorities.

You know, I often – I have known many people in the audience for many years now, and I often heard them say, “It is safer there.” How about now?

We must understand that the foundation of our existence and the future of our families and our children are here. Only with this understanding will business projects bring satisfaction, and a person will have a chance to rise to their full potential.

I am sure that the greater number of our businessmen share these values; the stronger Russia will be, the stronger our economy will become, the faster life around us will improve, and, of course, the greater standing in society and respect entrepreneurs will enjoy.

I propose establishing a special award for the most trustworthy domestic companies and to present it to the first winners during the next RSPP congress.

In addition, I propose considering the annual publication of non-financial reporting by major enterprises, which will focus on what a particular company has done for society, for a particular village, town, region, or the country. I am aware of the fact that the vast majority, almost all companies, have such social programmes, but they are known to a limited number of people. Let all of society learn about them. This will benefit everyone and will be a good example for everyone.

Widely sharing this information and these stories about creative work will improve the image of the Russian business and, ultimately, its market and social positions.

That concludes my opening remarks. Thank you.

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Vladimir Putin: (responding to KAMAZ CEO Sergei Kogogin's speech on import substitution and ensuring technological sovereignty and his proposal to increase authorised capital of the Industrial Development Fund, which is an effective financial instrument): Regarding the industry support fund. It has indeed been in operation for a long time, for several years, and it is effective. It has supported over a thousand projects, 1,300 of them, I think, with the total support standing at 400 billion rubles. But when the difficulties you mentioned arose, the Government made a decision and promptly increased the capital of this Fund by 120 billion rubles, and the total amount of resources extended hit a record of more than 140 billion, 144 billion. In other words, we increased the capital by 120 billion and extended 144 billion, and if my memory does not fail, there is only about 70 billion left. And of course we have to look at the needs of industries and think that at some point recapitalisation may be necessary, as you said.

I want to remind you that even before last year's events, you and I talked about how your main partners – well-known German companies – were always looking over what people overseas were saying, you know? You told me this yourself, I remember. At the same time, they were looking back at the yelling from Washington and were afraid to take further steps and were thinking about how to invent a new situation, how to take this step on cooperation. Finally, it ended, it ended the way it is now. Maybe that kind of certainty is better after all.

Here I remember what? You said that you yourself could not even think that you would be able to respond so effectively to these challenges. In this sense I recall a well-known proverb. It doesn’t sound offensive to our German partners. I have many friends there, as you know, and all my friends, by the way, have been kept on. My real German friends are all still there, we joke with each other all the time, we are neighbours after all. Just a distraction: we call cockroaches, those big reddish-brown ones, ”prusaks,” which in Russian sounds very much like “Prussians.” And in Germany they call them russen – ‘Russians.’ Jokes always take place between neighbours. But there is a well-known saying: what is good for a Russian is death for a German.

Hardly anyone, other than those who were brought up on Russian soil, could respond to the challenges you mentioned, indeed. But these challenges motivate us to work so effectively, and we have succeeded, and you have succeeded.

We will definitely consider increasing capital of the Fund as well. It is working well; it is generally producing real results.

You just mentioned a good financial result. Here, of course, we all have to think together about how to maintain quality so that there is no monopoly. We don’t have just one enterprise like KAMAZ, there are others. I know that competition is developing and we need to support it – this is an appeal to my colleagues from the Government.

And in general, of course, we are happy about your successes and wish you further successes.

Thank you very much.

President of the Russian Union of Industrialists and Entrepreneurs Alexander Shokhin: Mr President, last year we established the Union’s coordinating council for import substitution, technology independence and technology development, and considered certain tools to coordinate the work of technology companies with major customers, state corporations and large private companies, as well as with small business.

We have several related platforms that operate in Russia, ranging from the government-owned, State Industry Information System, to independent ones. It emerged that one of the most advanced platforms is the engineering centre operating under the auspices of Innopraktika, which you have probably heard about.

Vladimir Putin: Sure.

Alexander Shokhin: They actually have really good experience that allows for this coordination – and not only placing orders, say, with small or medium-sized businesses for large enterprises, but also involving the entire chain, starting from design and engineering documentation and so on, in order to respond to the need for investment, including in terms of development institutions’ activities. And the Agency for Technological Development, as well as the Industrial Development Fund and other organisations, can make investment in these projects.

We are now working on technological solutions that allow for technology-based import substitution.

Vladimir Putin: This initiative was once proposed by Moscow State University rector. I supported it, because even then it was highly important to consider efforts to coordinate the capabilities of our scientists and others working on advanced developments with the needs of our business and specific enterprises that were seeking potential customers and making purchases abroad, while we were looking for ways to support our own manufacturers. This is what Innopraktika’s activities are about.

Mr Shokhin has now spoken of other opportunities, apart from the Industrial Development Fund that we mentioned. Indeed, we are working to develop different fields. You know about the Government’s initiative on creating technology clusters, which is yet another opportunity to create additional options for business, along with the already launched and available tool for industrial mortgage loans.

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Vladimir Putin (commenting on the remarks by Patimat Gamidova, head of the Daghestan regional office of the Russian Union of Industrialists and Entrepreneurs, who spoke about new logistics directions). The topic you brought up is very important, the new North–South transport corridor. We have been dealing with all logistics related to the eastern direction for a long time, and in fact, the end point of the North–South route is also the east. Unfortunately, we did not make all the investment decisions we considered necessary on time, well, we made the decisions but did not fully implement them, we were in doubt. It is really a pity we did not do it. Now it is clear – with the wisdom of hindsight, it is clear that we missed the moment. But we will make up for it; nothing happened that we can’t fix.

The North–South corridor is yet another opportunity to expand the cargo flow to the east. Why? Because it goes from St Petersburg right through Daghestan, Azerbaijan, Iran and then to ports of the Persian Gulf, and from there it goes both to the Middle East and the Far East, to the Asia-Pacific. This includes Iran, then India and China, and the entire Southeast region.

There are several possible routes. The first route is just Daghestan, then Azerbaijan, Iran and access to the Persian Gulf. Or to the ports of the Caspian Sea in Russia, including in Daghestan, and then to the Iranian port, and then further towards the Persian Gulf. And the third route goes once again via Russia, starting in St Petersburg, then to Kazakhstan and Turkmenistan and again enters Iran. It is more difficult, but also a possible option.

First, if it goes across the sea – it is already operating, but we and our Iranian friends and partners should create the appropriate conditions there, including terminals for receiving and sending cargo on the Iranian coast.

As for the route you mentioned, it means going via the territory of Daghestan, then to Azerbaijan and on to Iran. The cities of Astara and Rasht (Astara is in Azerbaijan, and Rasht is in Iran) are there, and 162 km where there is no railway, I think. So then it would be necessary to complete this 162-km section, to gain access to the transport and railway networks of Iran.

We support this project, Iran supports this project, and Azerbaijan supports this project. It is very interesting not only for us, but for all global trade players, because it would make a significant addition to the Suez Canal and the Black Sea straits. This simply reduces the cost of the route, which means that the final price of goods would be cheaper. Many participants in global trade are interested in this and would like to take part in it.

I want to stress that everyone agrees. Despite the complexity of geopolitical landscape and various disputes between the countries of the region, which always arise between neighbours, everyone agrees that this route should be built.

Now we only have to understand how fast we will do this, what the final sources of funding are. But we will find them, and some think that we do not need to attract them from somewhere else. In fact, we are able to finance this construction of the Rasht–Astara section from scratch.

The issue of a wide or narrow gauge – 1,520 or 1,435 – is quite a theoretical issue, we have generally resolved it, and everyone agrees with our decision. We just need to start. I would ask everyone in the Government who deals with this issue to speed up this process. We will try to do this as quickly as possible.

In my opinion, the first part is about 1,700 kilometres, there are 1,500–1,600 [kilometres], and it will cost about 1.5 to 1.6 billion rubles. We need to find this money, we can find it inside the country, in fact, we can find it from our potential investors.

By the way, I would like to address everyone present here: keep in mind that this is a very good project, cost-effective, preferential, and many of our partners, including those in the Arab world, are showing considerable interest in it. It will work well – just like the Suez Canal, the Bosporus and the Dardanelles. This will work well. The special military operation can end, start, start again, end again, but goods will continue to be transported, and, no doubt, it will always be in demand.

Therefore, we need to find sources and consolidate the sources of financing for this project. It might be of interest to everyone. And the Government just needs to think about how to form this pool of potential investors.

To be honest, I would like it to be primarily Russian investors. Why should we miss out on such projects? A profitable, good project.

I repeat, despite the geopolitical landscape and difficulties, everyone agrees. We will do it.

We spoke with the President of Azerbaijan: Azerbaijan has leased, that is, it is ready to work not only on its territory, but it has leased territory in Iran, and Iran agreed to this – it leased this territory to Azerbaijan. The President told me: “We are ready to do this together with Russia.” Well, it is also a very good investment. I know that a logistics centre is being built there, on the border of Azerbaijan and Daghestan, and, if I am not mistaken, it is to start working now, but this is a promising project as part of the North-South project.

Once again, I want to draw the attention of my colleagues, who still have plenty of offshore money, and many do not know what to do with it. I am not making any claims – this is the direction life has taken. But how can you use this money? Where can you invest it? There are many trillionaires in the Arab world, this is a problem for them. They sit like minority shareholders in some developed economies, they are not let out of there, and at any second they may be killed – and everyone understands this, there is such a threat to them. And everyone looks for good projects – and this is a good one. Just think about it.

And let the Government form the pool. Really, think about it – this is a good project: promising, stable and marginal.

<…>

Alexander Shokhin: Now I would like to give the floor to Matteo Vaglica, General Director of Biesse Group. This is an Italian company that is operating in Russia and not planning to leave the Russian market. They would like to highlight development opportunities and some problems, I believe.

Vladimir Putin: Buongiorno.

Matteo Vaglica: Mr President, Mr Shokhin, colleagues, good afternoon, or good evening already.

As you can see, I am a foreigner. I was born in Italy, and for a long time I have been a citizen of Russia, and now I am especially proud of it. Russia gave me family, children and friends, and now I consider it my homeland.

Over the last year, my team and I have made every effort possible to support Russian businesses, despite certain difficulties.

Besides me, there are a lot of foreigners who want to continue developing their businesses in Russia, but, unfortunately, not everyone knows what is really happening in the country right now.

Mr President, Mr Shokhin, I sincerely believe that if we give people abroad an opportunity to get to know Russia better, then more people will want to support our development. This is also a great way to combat the deceit spread every day in foreign media.

For the last few centuries, the whole world has been using the technologies and innovations of Russian scientists, and Russia has an absolute right to use foreign technologies. I believe that we need to create even more comfortable and attractive conditions for foreign businesses, scientists and students who will help us in our development now and in the generations to come.

In particular, I suggest making the procedure for making decisions on paying dividends more predictable for those companies that have decided not to leave the Russian market and continue to invest here: today this is very important.

Mr President, thank you very much for your time and attention. And thanks to Mr Shokhin for such a unique opportunity that you have given me today.

Thank you.

Vladimir Putin: You know, the phrase “unfriendly countries” has become widely used. It does not accurately reflect the current reality, or, one might say, does not reflect it at all. Because we have unfriendly elites in a certain number of countries, unfriendly leaders.

And the political system in many countries, unfortunately, often elevates people with a rather low level of education and general culture. Sometimes they do not understand what they say and do. The result, as you know, is obvious. Their work is detrimental to their own populations and their own businesses.

In addition, unfortunately – I say this really with regret, because we have an interest in our European partners being independent and sovereign and making decisions based on national interests – but, unfortunately, this is not entirely true, and often not true at all.

However, we live in the conditions we live in, and nothing can be done about it. Probably, we should make a move on both sides: we cannot blame only our partners for the current situation, although we really want to.

I firmly believe that we have always fundamentally relied on our desire to cooperate with everyone when our interests are respected. Unfortunately, we have not seen any respect for our interests in the previous decade, but simply a desire to get their way, including, to a large extent, at our expense.

The decision you just mentioned, namely the decision related to sending dividends to the ”C“ type accounts – I think that’s the name – of foreign companies from those countries that impose certain sanctions against us. I want to repeat: it is probably incorrect to call them unfriendly countries, because a country consists of people, and we have a lot of friends in those countries, a great many of them. You are one of them, and there are many people like that.

But the elites, the so-called ruling circles, have a different attitude for various reasons, some of which I have just mentioned. Yet our decision was dictated by the need to protect the interests of our economy and our business.

If certain improper or illegal methods are used against our business, against Russian assets and holdings, including gold and foreign currency reserves, it forces us to also take appropriate actions, including those related to paying dividends and transferring them to ”C“ type accounts so that they cannot be transferred abroad.

I realise that, to a certain extent, this limits the opportunities of our bona fide friends and partners who have worked, are working and want to continue working with us. And I agree with you that we should, of course, somehow adjust our position and not be like those people who make the wrong decisions in the context of cooperation with Russia to the detriment of their own business.

I know that many did not want to leave. They did not want to but were forced to do it under pressure and they regret it. Many of them are waiting for the right moment to return. We know this for a fact. But today we should probably adjust our position. I will ask the Government to think about it.

After all, such companies can pay out money in the form of dividends, but it is frozen in the ”C“ type accounts and cannot be withdrawn. Maybe we should think of a more flexible situation where the dividends could be paid and a part of these dividends could be withdrawn, at least some of it. But on condition that these funds will be used, among other things, and maybe primarily for the development of business inside Russia, related, say, to new technologies, new investments and so on.

Our colleagues are present here, and maybe I will ask Mr Belousov to comment on what I have just said. I hope that he, at least partly, shares the position I have just stated.

First Deputy Prime Minister Andrei Belousov: Indeed, this issue exists.

I want to point out that, first of all, these measures were purely a mirror-like response – what Mr President has now said. Secondly, no one prohibits the payment of dividends; it is just that they are now accumulated in “C” type accounts.

Clearly, there are different situations in life and there are quite a few cases where dividends need to be withdrawn in order for a company in Russia to function. There is a special structure for this: a commission headed by Finance Minister Anton Siluanov. It includes representatives from the Presidential Executive Office, the Bank of Russia and the Ministry of Economic Development, who make these kinds of decisions.

You are talking, as I understand it, about setting the criteria and regulations more clearly, i.e. setting clearer rules by which the relevant decisions are made. This should probably be done.

Mr President, we will have another meeting of the Government today, where I will make my report, in particular, on the development of the financial market. One of the proposals that is now fully supported both by the Ministry of Finance and the Bank of Russia is that we have investors and investments that came to Russia after the start of the special operation and after the sanctions were imposed.

For this kind of investment, we propose that the restrictions that exist today should be significantly eased. In other words, people from the so-called unfriendly countries – I will call them this – came here being already aware of the threats, when the environment already got hostile, yet they came here and are operating. Of course, it would make sense to ease restrictions against them – at this point, under strict control, of course, but these are technical issues.

Vladimir Putin: Do you see where he is pushing you? What he just said? Re-register and all will be well – as if you had come in again. Note: we do not have a good and bad cop here – we are all good. (Laughter.)

Alexander Shokhin: Mr President, we have discussed this topic with both Mr Belousov and Mr Oreshkin, and there was a suggestion that maybe we should introduce the concept of a “friendly company from an unfriendly country”?

Matteo Vaglica: Excellent idea.

Vladimir Putin: Practice a little bit more – we are on the right track, we just need to practice.

Alexander Shokhin: Basically, what Mr Belousov said is to introduce clearer regulations, with restrictions, but understandable to companies and investors.

Vladimir Putin: I agree. But they must be fully transparent – this an obvious requirement.

Alexander Shokhin: Thank you, Matteo.

Matteo Vaglica: Thank you very much.

<…>

Vladimir Putin: A big thank you to Mr Shokhin and all our colleagues attending today’s meeting. But most importantly, thank you for the outcome.

While visiting a helicopter factory recently, I said that one of the greatest results of last year is the performance of our economy and its real sector, which is your work, of course.

Thank you very much.