TRANSCRIPT: [Medvedev at] Sochi International Investment Forum 2016

(Government.ru – September 30, 2016)

The forum’s main focus is a new standard in public administration: projects for growth, projects for life.

From Dmitry Medvedev’s remarks:

This year’s forum is being held right after the elections. Russia voted for members of the State Duma, legislative assemblies in the regions, governors, mayors and local authorities. Almost 40,000 seats were contested by various political forces during the election campaign.

The result that we have today not only indicates political stability and the victory of United Russia, which I represent. It opens big opportunities and imposes huge responsibility on us to the people who trusted and supported us. It is, in fact, a carte blanche from millions of our citizens for us to continue the hard work on the country’s development.

My article “New Dynamics in Russia’s Socioeconomic Development” was published in the run-up to the forum. The article analyses the current risks and challenges faced by our country and our society.

In particular, I state in the article that economics is becoming increasingly politicised. This is not an overly positive trend, especially if it occurs at the international level. Revival of regular market relations becomes more complicated. The so-called sanctions against Russia are a perfect example. But even in these circumstances, the ability to convert political stability within the country into efficient development of the national economy is a direct responsibility of the Government.

Russian reality requires a real change in the economic and social environment and the Government’s task is to respond with prompt and effective action. All of this leads us to promote a project-based approach that is primarily oriented to efficiency. Every rouble from the budget at any level invested into specific projects must improve the quality of services, goods and infrastructure. Each regulation that we issue in line with this project-based approach and any documents approved by deputies must bring actual results.

The government machine is unwieldy and its efficacy remains low. This is one of the key factors holding off the country’s development. This explains why we now seek to transition from a directive-based governance model to governance based on results, or to the project-based approach I mentioned. As a matter of fact, the outcome of this effort will be a test of our ability to ensure a new quality of state governance.

Pursuant to the Government’s latest resolutions, we have singled out 11 priorities in all areas of social and economic life.

I will begin with healthcare. Therefore, one of the tasks is to make medical care more mobile. In the past few months, we have allocated around 4 billion roubles for this purpose. These funds will be used to purchase new ambulances. This is around 1,800 vehicles.

The number of people frequently using personal patient accounts on the public services website should more than double in the next few years. In 2017, the figure is expected to reach six million and in 2018, it will be around 15 million. This will be a major change in the healthcare services system.

Thanks to the continuous medical education portal, we can ensure a new level of medical training. Within a few years, the portal will be able to offer almost 2,000 professional development courses in all specialties. By 2018, these courses will contribute to the career enhancement of at least 260,000 doctors. We will support the development and production of the most efficient medications and will invent a coding system that will prevent the sale of pirated and counterfeit drugs.

We will continue improving reproductive medicine. Russia’s infant mortality rate must reach the level of industrialised countries. Twenty-six new perinatal centres are opening soon. This project will receive over 80 billion roubles of investment. Starting in 2018, we will be saving 1,500 more newborn babies than in 2015, every year.

We must make sure Russian education meets modern requirements of quality and is available to anyone who wants to study. The number of school students alone will grow by 3.5 million in the next ten years. We have provided sufficient number of places for small children in kindergartens. Now our task is to make sure our children are studying at comfortable and safe schools. We will find money for this, beyond any doubt. This year, we have invested 25 billion roubles in the construction of schools, and plan to invest the same amount next year.

We expect that by 2025 college education and vocational training will be based on completely new standards.

Russia’s leading universities should become innovative centres able to compete with the world’s best universities. In 2025, one million students will be studying online.

In the past ten years, we have been improving mortgage lending. Since 2005, annual mortgage lending has increased more than 20 times over; over five million families have taken out mortgages. Last year, we launched a state-sponsored mortgage programme, thanks to which people have been able to purchase new economy-class housing with interest of no more than 12 percent. As a result, one in every three loans is provided under the state-sponsored programme.

In order to accelerate construction, we have started building on the lands that are used inefficiently in the regions, municipalities or by the federal authorities, particularly, industrial areas in big cities where there is a shortage of unoccupied land. At the same time, we have made allowance for 20 billion roubles yearly to develop utility and social infrastructure.

We expect that in a few years, these measures will break new ground in residential housing construction, around 100 million square metres annually. This means that over 1.5 million families will be able to improve their living conditions every year.

Apartment owners these days have tremendous authority in the management of their condominiums. People have the right to expect high quality services. It is very important to reduce the number of accidents in utility networks. For this purpose, we will continue transferring boiler stations, water pipelines, power grids and other utility infrastructure into public-private partnership while maintaining strict control over obligations under such contracts.

The situation with federal roads has improved, although there are still many problems. At least fifty percent of all the roads must comply with regulatory requirements and the number of dangerous areas where traffic accidents occur more frequently must reduce at least by half, within the next 18 months.

There are areas with particularly acute problems, especially single-industry towns. One-tenth of the population, or almost 15 million people, live in single-industry towns. Our goal is to transform them from depressed industrial areas into areas of new opportunities or, even better, into areas of success. It is an ambitious, very challenging but feasible task.

About 6.5 billion roubles are to be spent for these purposes already next year. We will use this sum to finance the essential business infrastructure in single-industry towns and will give them with the status of advanced development territories. All this will be done regardless of whether any specific town has been removed from the list of single-industry towns or not. This status will be preserved in the future, so as not to create any problems. A special list of business-related privileges, including tax breaks and those in the area of state and municipal oversight, will remain in force.

There are plans to create, by late 2018, at least 230,000 jobs in single-industry towns outside of the backbone enterprise that is the main employer in the area. These projects are to receive substantial investment.

The success of our efforts to implement growth projects is a mandatory, key condition for completing our projects which are geared toward helping people.

They include small businesses and support for initiatives of self-employed people. Currently, small businesses employ about 25 percent of the entire economically active population, but their share should increase several times over. In the next two years, we need to do our best to set up about 435,000 new small companies in this sector.

We must help small businesses to enter new market niches and encourage major corporations to make more purchases from them. The regions must develop the infrastructure for supporting small and medium-sized businesses and a chain of leasing centres. About 20 billion roubles are to be allocated for these purposes next year.

One of our key tasks is to simplify procedures for those wishing to open their own businesses or to expand current ones. We must ensure the smooth operation of the one-stop-shop system at integrated government service centres where business people would be able to access the full array of government services.

The second such growth project deals with exports and international co-production arrangements. We must support companies turning out non-commodity goods and services, and we must help them enter foreign markets. Competitive, high-tech and consumer-friendly goods stamped with “Made in Russia” are the best answer to any geopolitical challenges, and their manufacture is our future.

Our Russian Export Centre has already started operating, and we will continue to expand various tools that will help promote Russian goods, including via global online trading floors. We have set the ambitious goal of doubling non-commodity exports in the mid-term. Speaking of the most important sectors with impressive export potential, this includes the aircraft industry, the automotive industry, farming machinery, railway engineering and agriculture in general. We can focus our efforts and achieve substantial results already in 2018.

State control and oversight is another infrastructure project. We need to seriously overhaul the system of state control and oversight, so that all business support measures work, and so that business people can breathe easier. We need control and oversight in areas posing real risks for human safety and health, rather than everywhere. We should not subject businesses to “carpet bombing” and issue various multi-volume instructions. A joint register of checks and inspections is already being compiled for small and medium-sized businesses. Since early 2016, we have stipulated three-year oversight exemptions, provided that no serious violations were exposed in the three previous years. But we still have a lot to do.

The achievement of these large-scale goals calls for a special approach to drafting the budget. The Government is focused on drafting the budget for the next three years. We are compiling the budget with due consideration for implementing priority projects. The draft budget revolves around ideas that we want to achieve, while following these priority guidelines.

Our plans for the next few years seem quite ambitious, but we have every chance of implementing them. And, most importantly, the people trust us, this is our most important asset for accomplishing this objective, and it was displayed during the recent elections.

[featured image is file photo]