TRANSCRIPT PART I: News conference of Vladimir Putin
[Click here for Transcript Part II]
[Fuller Russian transcript and video here http://kremlin.ru/news/17173]
(Kremlin.ru – December 20, 2012)
Moscow
Vladimir Putin’s news conference took place at the World Trade Centre on Krasnopresnenskaya Embankment.
Over 1,000 Russian and 200 foreign journalists were accredited to cover the news conference.
Channel One, Rossiya-1 and Rossiya-24 TV channels and Radio Mayak, Vesti FM and Radio Rossii radio stations broadcasted the event.
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PRESIDENT OF RUSSIA VLADIMIR PUTIN: Good afternoon, ladies and gentlemen,
I am very pleased that the media has shown such interest in today’s event. Greetings to all of you. I know that there are many journalists from the Russian regions here. I will try to answer your questions as far as possible and tell you my perception of the outgoing year’s results. (Can everyone hear me all right?) As usual, I will begin by citing some figures. They are widely known but I have the most recent data, so I think that you will find it interesting.
To start with, the main indicators of economic development, the growth of GDP (gross domestic product) I have the data for January-October 2012 3.7%. This is slightly lower than last year, when we had 4.3% growth, but I want to point out that amid the recession in the Eurozone, slowing economic growth in the United States and even some scaling down in China, I consider this a good result overall.
What were the causes of the slowdown this year? I’ve already mentioned the first reason, the general slowdown in global economic growth and even a recession in the Eurozone, one of the leading global centres. The second reason is our domestic problem, which is primarily concerned with crop failure. Last year the grain harvest was 90 million tonnes, and this year it was just over 74 million. This had an impact on inflation to some extent, which I will talk about a little later, and slowed down the pace of economic growth in the 3rd and 4th quarter. But, I repeat, I think overall this is a satisfactory result.
As for inflation, I am sure you know that last year it was the lowest in 20 years. This is an achievement we are very proud of because we tried to suppress inflation for a long time. Now we have seen the result of our efforts. This year (as of December 17), inflation rose slightly and was 6.3%, but as you can see, the figure is very similar to last year’s.
Industrial growth was 4.7% last year and 2.7% this year, which is almost half. Naturally, we cannot be happy about that. However, the fact that investment in fixed assets has not fallen, and has even shown slight growth, gives us reason to feel optimistic. Last year the figure was 8.3% and this year it is 8.4%. At the same time, the growth was much higher in the manufacturing sector, 4.4%, which is particularly gratifying. I hope that this is also the result of the Russian Government’s constructive policy.
Now on social issues. In 2011 the average monthly salary was 23,369 rubles, and in November of this year it was 27,607 rubles [$900]. Last year’s growth was 2.8%, and this year it was 8.8%. This is a good indicator.
Another socioeconomic indicator that is very important for our country and for any other market economy is the unemployment rate and the situation in the labour market. Based on ILO calculation methods, the unemployment rate last year was 6.6% in Russia. In fact, we started the year with 6.6 % as well but by November of 2012 it fell to 5.3-5.4%. This is an excellent result and one of the best indicators in the developed economies around the world. The number of officially registered unemployed is 1%.
Real disposable incomes increased by 0.8% last year and by 4% this year. We know what is behind this growth. It is due to a sharp increase in the incomes of servicemen, internal troops and pay rises in the Interior Ministry. This is due to a 60% increase in pensions. I will speak about the planned pension increases later. The social sector wages have also posted growth. This applies to school teachers and university professors. I am sure we’ll come back to this issue. There has also been a clear growth in healthcare professionals’ salaries. Taken together, this is what has produced this result. I think it is a good result. The growth of 4% is a decent indicator.
As of October 2012, the retirement monthly pension has been raised to 9,810 rubles [$300] from 8,876 rubles. The social pension has also grown, but, unfortunately, it remains quite low: it was 5,200, and has been increased to 5,942, but bear in mind that this is the social pension.
Finally, let us look at the maternity capital. I remember there used to be a lot of questions about whether we were going to raise it. I want to reiterate: we are going to raise it and we will continue raising it. If last year the maternity capital was 365,698 rubles [$12,000], at present it is 387,640 rubles, and on January 1, 2013 it will be increased to 408,961 rubles.
To return to the economy, the banking system capitalisation is growing. What is particularly gratifying, there has been an increase in people’s deposits in our banks and our financial institutions, which grew by 19.6% year on year. In absolute figures, this amounts to 13.1 trillion rubles.
We have a trade surplus. Last year it was 198.2 billion and in January to October of this year it amounted to 164.6 billion. I think the figure for the year will not be any lower than for 2011. Bear in mind that the figures I am citing are preliminary and will be finalised in the 1st quarter of 2013.
We have been able to achieve these results not only due to the favourable global economic factors, which were certainly in place, but also through the Government’s purposeful actions. First, Russia joined the WTO. Second, we signed the free trade zone agreement in the CIS. Third, the Customs Union and the Common Economic Space with Belarus and Kazakhstan were established. I have already talked about this at the news conference yesterday.
Trade with these countries grew by 10% that is not bad at all. Most importantly, and I want to reiterate this in front of this large audience, we have a very good structure of trade with the Customs Union countries. Machinery and equipment make up 20% of all goods traded. That is very good, because machinery and equipment make up only 2% in our trade with the rest of the world this is the average figure for all three Customs Union states. This suggests that we are very comfortable and the right partners for each other.
National debt remains at very low level, a little over 10%, of which the external debt makes up only 2.5%, there is little change here. We have one of the best positions of all developed economies according to this indicator.
The Central Bank’s international reserves have grown from $498.6 billion last year to $527.3 billion, this figure is for December 7. The reserve fund has also increased substantially: from $25.2 billion to $61.4 billion today. The National Welfare Fund has remained almost the same: it amounted to $86.8 billion last year and is 87.5 now.
I want to point out the stability of state finances despite the existing problems, of which we have many and I am sure we will discuss them later.
The Government made a very important decision this year to adopt the budget rule, that is, a cutoff of federal revenues and their use in current expenditure only up to the level of the price of a barrel of oil. For 2013, this level is $91 per barrel. Incidentally, this is a rather strict rule. The second part of the budget rule is that we agreed that we would not spend the money from the reserve funds until we achieve a certain level of savings in these funds. As a result, the budget is quite tight but feasible, and this together with an increase in the reserves the Central Bank’s reserves and the Government reserves suggests that we have a balanced and meticulous financial and economic policy.
We are particularly proud of the birth rate indicator, the best in the past 20 years, as well as a low mortality rate, also the lowest in 20 years. This suggests that people have begun to plan their lives in a different way, expanding family planning horizons. This suggests that despite all the problems, of which we have more than enough, there is a sense of confidence in the country’s future as a result of our efforts. I have cited the income growth and welfare figures. I think this has had a positive effect in addition to the special measures to boost the birth rate and positive demographic processes.
Apart from the maternity capital, which I talked about earlier, we have a comprehensive programme for the support of women who decide to have the second and subsequent children. Starting next year, in the 1st quarter, the Government will launch a programme for the support of families with three and more children. In the 50 regions of the Russian Federation where the demographic indictors have been negative for several years (the north-west of the country, parts of the Volga areas and the Far East), families will receive an additional monthly allowance amounting to the subsistence minimum for children.
That is all I wanted to say in the beginning and will end my monologue now. I am sure that you have a lot of questions, or you would not have come here. Let’s start our direct conversation.
DEPUTY CHIEF OF STAFF OF THE PRESIDENTIAL EXECUTIVE OFFICE AND PRESIDENTIAL PRESS SECRETARY DMITRY PESKOV: Mr President, we could start with questions and answers, if you don’t mind.
VLADIMIR PUTIN: Mr Peskov will help us to warm up at the start. To find our bearings, and then we will move on to direct communication.
DMITRY PESKOV: I know someone of you by name, but not all of you, so please introduce yourselves, state your city and media outlet.
Go ahead, please.
QUESTION: Ksenia Sokolova, Snob magazine.
In response to US Congress passing the Magnitsky Act, the State Duma adopted restrictive measures against US nationals who want to adopt Russian orphans. Do you think this is an adequate response? Does it not bother you that the most destitute and helpless children become a tool in a political conflict?
VLADIMIR PUTIN: First of all, you have just said that this is a response to the so-called Magnitsky Act. Let me tell you briefly what I think about it. I have already spoken about it, but let me just outline my attitude to this case.
This is undoubtedly an unfriendly act towards the Russian Federation. What is at issue here is not just officials who are not allowed to open bank accounts or own real estate. I mentioned this in my Address to the Federal Assembly recently. We also believe that Russian state officials, especially high-ranking politicians should keep their money in Russian banks. Incidentally, there are many banks in Russia with one hundred percent foreign capital, and there can be no doubt as to their efficiency and reliability. If such a bank has an office in Russia or in Vienna, or in some other capital makes no difference; what is important is that it is an international financial institution. Hold it here, please.
As for real estate, I have also spoken about this. If our colleagues abroad can help us identify those who violate laws, we will be grateful to them and can even give them a prize for their efforts. However, the issue here has nothing to do with officials. It’s a matter of one anti-Soviet, anti-Russian law being replaced with another. They can’t seem to do without it. They keep trying to stay in the past. This is very bad, and has a negative impact on our relations.
As for the issue you have mentioned, the adoption of Russian children by foreigners, as far as I know, public opinion polls show that the overwhelming majority of Russians do not support the adoption of Russian children by foreign nationals. We must do it ourselves. We must support the adoption of abandoned children or orphans.
In this regard, I fully support Mr Medvedev’s proposal. We should promote this work in our country, remove bureaucratic barriers and give even more support to the families that adopt children.
Now for the American side. It’s not about specific people, US citizens who have adopted our children. We know that tragedies happen but the vast majority of people who adopt Russian children take good care of them and are good, decent people. The State Duma’s response was not to that but to the US authorities’ position. What is their position? It is a fact that when a crime is committed against an adopted Russian child, the American justice system often does not react at all and releases the people who have clearly committed a criminal offense against a child, of any criminal responsibility. But that’s not all. Russian representatives are denied any access, even as observers, in these legal processes.
We recently signed an agreement between the US State Department and the Russian Foreign Ministry on the actions Russian representatives can take in such crises or conflicts. What happens in practice? In practice, it turns out that according to US legislation, states have jurisdiction over such cases. And when our representatives try to fulfil their obligations under the agreement, they say, ‘This is not a federal case, it’s a state case, and you do not have any agreements with the individual states. Go to the State Department and sort it out with them because you signed an agreement with them’. But the federal government refers them to the states. So what is the point of this agreement? Russian representatives are not even granted access as observers, much less as participants in the case.
What concerns do our partners in the United States and their lawmakers voice? They talk about human rights in Russian prisons and places of detention. That is all well and good, but they also have plenty of problems in that area.
I have already talked about this: Abu Ghraib, Guantanamo, where people are kept jailed for years without being charged. It is incomprehensible. Not only are those prisoners detained without charge, they walk around shackled, like in the Middle Ages. They legalised torture in their own country.
Can you imagine if we had anything like this here? They would have eaten us alive a long time ago. It would have been a worldwide scandal. But in their country everything is quiet. They have promised many times that they would close down Guantanamo, but it’s still there. The prison is open to this day. We don’t know, maybe they are still using torture there. These so-called secret CIA prisons. Who has been punished for that? And they still point out our problems. Well, thank you, we are aware of them. But it is outrageous to use this as a pretext to adopt anti-Russian laws, when our side has done nothing to warrant such a response.
I understand that the State Duma’s response is emotional but I think it is adequate.
To be continued.