As Important as BRICS: Meeting of the Council for Strategic Development and National Projects
Putin's video conference Tuesday afternoon. Long read.
With Lavrov representing Russia at the BRICS Summit in South Africa, Putin was free to hold an equally important domestic meeting with selected government members that amounts to an informal audit of the planning goals for 2030 and the development of the supply-side economy Putin announced at the St. Petersburg International Economic Forum last June. Here are two short excerpts defining Putin’s supply-side economy:
Putin: I repeat what I said at the recent St. Petersburg Economic Forum: we need a proactive policy of supply-side economics aimed at creating a sovereign economy that not only responds to market conditions and changes in demand, but also forms it itself. This means a widespread increase in the productive forces and services sector, the creation of new modern industrial capacities and entire industries, including on the basis of advanced technologies that we have and, I am sure, will continue to develop thanks to the rich scientific and creative potential of Russia.
Prime Minister Mishustin: During the St. Petersburg International Economic Forum, you set the task of implementing a policy aimed at developing the supply-side economy. It focuses on creating modern industrial capacities and entire industries with a balanced labor market, expanding construction, updating infrastructure, and, as you mentioned, improving efficiency both in terms of productivity and the operation of the entire economy as a whole.
The above sketches will be filled in during the meeting’s presentations. It should also be kept in mind that this is to be developed within the strategic design for Russia’s economy that uses national projects planned out to 2030 as the main engine. Yes, like the USSR, the Russian Federation has a very well planned economy that clearly functions better thana its predecessor’s. The budgeting process allows for various temporal planning goals—one, two, five, and ten year plans. Such planning began again during Yeltsin’s early years and continued as documented here:
Formation of long-term energy policy began with the first steps of the new Russia as an independent state. Energy Policy Concept of Russia in the New Economic Condition was approved by the resolution (N°26 of September 10, 1992) of the Government of the Russian Federation. In May 1995 “Major directions of Energy Strategy of Russia for the period up to 2010” were approved by the edict (N°472 of May 7, 1995) of the President of Russia and in the same year “Major provisions of the Energy Strategy of Russia for the period up to 2010” were adopted by the resolution (N°1006 of October 13, 1995) of the Government of the Russian Federation.
Realizing the necessity of regular monitoring of the Strategy implementation and its periodic correction the Ministry of Fuel and Energy in 1998 decided to establish a new structure State Institute of Energy Strategy (IES) as a coordinator for complex analysis and long-term forecast of the fuel and energy complex development in connection with the trends of the socio-economic development of the country.
Yet in 2000, the Government of the RF (by the resolution N°39 of November 23, 2000) approved new version of “Major provisions of Energy Strategy of Russia for the period up to 2020” that was prepared by the interdepartmental working group under IES and by the Council of Experts under the Ministry of Fuel and Energy. And in 2003 the Energy Strategy of Russia for the period up to 2020 was approved.
Later, it was decided to mandate the revue and updating of the plan every five years. Then at the beginning of Medvedev’s Presidency and Putin’s Prime Ministership, a new planning document was decreed:
While implementing the Energy Strategy of Russia for the period up to 2020, approved by Decree N° 1234-r of the Government of the Russian Federation dated 28 August 2003, the validity of most of its key provisions was confirmed by the actual development of the country’s energy sector even under conditions of abrupt changes of foreign and domestic factors determining the main operating parameters of the Russian fuel and energy complex. In the Energy Strategy of Russia for the period up to 2020 was also specified that the document should be amended where necessary at least once in 5 years.
The Strategy extends the time period up to 2030 with new goals and priorities for the country development.
The Strategy sets new guidelines for the development of the energy sector in the transition of Russian economy to the innovative path of development specified in the Conception of Long-Term Socio-Economic Development of the Russian Federation up to 2020 approved by Decree N° 1662-r of the Government of the Russian Federation dated 17 November 2008 (hereinafter referred to as “the Conception”).
The provisions of the Strategy shall be used when developing and adjusting programs for socio-economic development and energy strategies, as well as programs for the constituent territories of the Russian Federation, and integrated programs for energy developing regions in the Eastern Siberia, Far East, North-West Region of Russia, Yamal Peninsula, and continental shelf of the Russian Federation. They shall also be used when developing and adjusting master plans for development of individual industries of the fuel and energy complex, geological exploration of the regions, and when developing and adjusting investment programs and major projects of energy companies.
The document from which the above was excerpted, “Energy Strategy of Russia for the Period up to 2030,” is essential when examining the performance of Russia’s political-economy for it contains goals outside those of Russia’s energy sector where one can learn beyond doubt what Putin’s goals were for Russia when he became President in 2000 and ought to shut the mouths of those who continue to label Putin as a Neoliberal when he’s more akin to a Neosocialist. Such people need to ask, Why does the Communist Party of the Russian Federation support Putin’s governance on almost every point?
The above discussion was to prime minds for what follows, which is a rather long read. Putin begins with a detailed overall revue of where Russia currently sits as it actually has passed not just Germany but also Japan (when Japan’s Neoliberal overhead is subtracted from its claimed GDP) to become the world’s fourth largest economy. There you’ll read some policy actions that go against what’s implemented in the West, particularly the great increases in Russia’s minimum wage and the goal of reducing as greatly as possible the jobs that merit that pay level. Recently there’s been lots of criticism of Russia’s Central Bank, but the bank is a public utility and is directly involved in Russia’s economic success, whereas when reading some critics you’d think Russia was in a recession or worse.
After Putin’s recap, we get PM Mishustin’s detailed report, and he’s followed by a parade of other ministers beginning with Maxim Reshetnikov, Minister of Economic Development. Deputy Prime Minister for Industry and Trade Denis Manturov then presents with some additional input from PM Mishustin. Tatyana Golikova, Deputy Prime Minister of Russia for Social Policy, Labour, Health and Pension Provision, is then followed by Labor Minister Dmitry Grigorenko’s short presentation. Minister of Health Mikhail Murashko provides his update then we get into the topic of financial sovereignty with Anton Siluanov and Vladimir Chistyukhin, Minister of Finance and First Deputy Chairman of the Central Bank of the Russian Federation, respectively.
Alexander Kalinin, President All-Russian Non-Governmental Organization of Small and Medium-Sized Businesses, makes the closing report. Many more key people were included on the roster for this meeting but didn’t contribute as far as the transcript is concerned. And directly after this meeting, Putin went to attend the BRICS Summit via video link, making today a very busy day. Now for the meeting:
Vladimir Putin: Dear colleagues, good afternoon!
Today, within the framework of the Council for Strategic Development and National Projects, together with colleagues from the Government, constituent entities of the Russian Federation, public and business associations, we will discuss the current results in achieving the national development goals, which, I remind you, are set in demography, in the economy and social sphere, infrastructure, and many other key sectors and areas, designed for the horizon up to 2030 year.
I would like to emphasize the importance of our work today. Such monitoring and auditing is not necessary for a formal report, not just for checking hours between departments. In order to move forward, we need to clearly understand where the work is being done effectively, and where there is a backlog, where unresolved issues are accumulating, and based on this operational analysis, make managerial adjustments, allocate additional financial and other resources in various areas in order to generally maintain and sustain our long-term plans, calculated as I said, until 2030.
And such long-term planning is fundamentally important. Our colleagues in the regions are also talking about this, and, of course, this topic was repeatedly raised at meetings with our industrialists and entrepreneurs. It is certainly important for federal subjects, businesses, and specific enterprises to know what tasks the state will solve tomorrow, the day after tomorrow, and so on, what technologies will be in demand, what capacities need to be increased, how stable and guaranteed the order for products, equipment, and so on will be, what social and infrastructure facilities will be built, and where new equipment will be needed housing in additional volumes.
I will start with the basis, the basis for solving our problems, namely, the state of affairs in the domestic economy. Despite, frankly speaking, the pessimistic forecasts that were voiced and still are voiced by some experts, first of all, of course, Western experts, Russia by the end of 2022-despite all these forecasts-entered the top five largest economies in the world. According to the World Bank, the Russian Federation has moved ahead of the Federal Republic of Germany in terms of purchasing power parity and economic size. This is one of the most important indicators.
Yes, several months in the middle of last year were extremely difficult for Russian entrepreneurs and companies. We are aware of this, and we have worked together to overcome these difficulties. But since the third quarter, economic growth has been evident in Russia, and now its pace is quite stable.
Thus, in the second quarter of this year, gross domestic product grew by 4.9 percent compared to the same period last year. Moreover, industries that are not related to the extraction of natural resources, including oil and gas, are growing at a faster pace.
While overall industrial production grew by 6.3 percent in the second quarter, manufacturing output grew by 11.3 [percent].
It is very important to maintain such dynamics in the industry, to support the investment of enterprises and companies in the opening of production facilities, in the development of new technological solutions and the creation of jobs.
I would like to note that a target has been set for this purpose: by 2030, investment should increase in real terms by at least 70 percent compared to 2020. And the dynamics here are good: for the third year in a row, it has exceeded the planned values.
Our manufacturers occupy new market niches, including those that Western companies themselves have freed up for us, and large-scale state investments in infrastructure, capital facilities, and so on, in turn, stimulate the investment activity of private businesses.
I would like to note that we will continue to work in this direction. This is exactly what the state of public finances allows us to do, and the current budget situation is generally stable and does not pose risks to macroeconomic stability.
In the second quarter, the federal budget deficit decreased by almost eight times compared to the first quarter and amounted to 264 billion rubles. In July, the budget balance was 458 billion rubles better than a year ago. It is expected that in July–September the budget will be brought to a surplus, and in general for the year the excess of expenditures over revenues will be at the planned level – about two percent of GDP.
I repeat: it is necessary to use all the state's capabilities, to ensure maximum impact from all bodies and levels of government, from their partnership with society and business to solve national development tasks, much depends on achieving real, tangible, and most importantly understandable, visible changes for the better in the most important areas of life.
At the previous meeting of our Council in December last year, the key tasks for the Government and the entire public administration system for 2023 were outlined in detail. As part of this meeting, let's sum up some results.
The first of the tasks mentioned at that time was to expand Russia's foreign economic relations with partners from friendly countries.
For example, in the first half of 2023, our trade turnover with APEC countries increased by 10.2 percent. Trade turnover with the Eurasec countries increased by 14.3 percent over the same period of time.
More and more payments in our foreign trade are made in rubles and friendly currencies, or the currencies of friendly countries. For example, in a year and a half, the share of the ruble in paying for Russian exports has more than tripled – from 12 to 42 percent, and if you count together with the currencies of friendly countries, this share reaches 70 percent.
It is important to continue the large-scale systematic work that we are doing to strengthen the payment infrastructure. It should be reliable and convenient for both our companies and their foreign partners.
And of course, to expand foreign trade, we need to develop logistics corridors, primarily in the Azov-Black Sea, eastern and southern directions. Only in the last year, the volume of export cargo transportation on these routes has grown significantly, and all forecasts indicate that it will continue to increase.
It is important that the infrastructure capacity grows faster. Only then, under these plans, when businesses launch new projects, will our regions and territories receive an impetus for development. The Government has already approved so-called roadmaps in this regard. It's up to their implementation, in practice.
I would like to add that it is important to constantly monitor the situation in logistics and promptly solve any problems that arise here.
Here is an example from the recent past. At the beginning of this year, the loading of imported containers at Far Eastern ports increased dramatically. But thanks to the joint actions of the Government, Russian Railways managed to increase the export of containers to the European part of Russia, which significantly simplified and accelerated the delivery of goods, and solved the problem.
Further. The second task that we discussed at that time was to strengthen the technological sovereignty of our country.
To speed up its solution, a number of additional mechanisms have been launched, including preferential treatment for industrial clusters, industrial mortgages, and a cluster investment platform. Of course, this is a difficult task, very difficult for our economy. We perfectly understand where we have these unsolved problems, we perfectly understand where we are even lagging behind in something. But we agreed at the time that this platform would invest at least two trillion rubles in projects to produce priority products in the manufacturing industry this year. Today, of course, I would like to hear how this tool works and what the results are.
An important topic here is ensuring the country's personnel sovereignty, training specialists, including in the most scarce working professions.
The key mechanism for such work is the federal project "Professionalism". It covers about a thousand core businesses in 24 real sector sectors and hundreds of colleges across the country. In five years, this project will help at least one million people to get modern, popular working professions. At the same time, it is very important to continue to maintain a close link between the educational system, industries, and employers.
In addition, we have special programs to increase labor productivity in the economy – one of the key tasks, of course. Of course, it is large-scale, and today about five thousand enterprises are covered by activities under this program. Of course, this is only the beginning, but it is already about a hundred thousand specialists who have been trained in the methods of so-called lean production.
Colleagues note that participants in the programs achieve real results, I mean an increase in added value in production. And of course, we need to expand such practices and scale them up, including with the help of the Federal Competence Center.
Here I would like to remind you of my instructions: to involve this federal center in the introduction of artificial intelligence technologies and modern management systems, as well as to apply lean manufacturing technologies in a number of enterprises of the military-industrial complex. I would like to hear a detailed report on this issue from the Minister of Economic Development.
The third task concerned not only the real sector of the economy, but, in fact, concerned all spheres of life. I mean ensuring the financial sovereignty of our country.
It is known that the Bank of Russia, together with the Government, has prepared a program that encourages the financing of projects for technological sovereignty and structural adaptation of the Russian economy, including such industries and sectors as mechanical engineering, microelectronics, the medical and pharmaceutical industry, and some others. I would like to emphasize that these initiatives should receive additional support from the banking sector and our development institutions.
A separate topic is the creation of so-called long money in the economy and banking system. We have been talking about this constantly for many years. We are talking about creating a resource for financing large-scale complex projects designed for a long payback period. At the same time, such projects guarantee a return on investment, income over time.
In order to support such investments and attract additional funds for the development of the economy, the program of voluntary long-term savings of citizens will start operating from January 1, 2024: for each participant of the program, funds in the amount of up to 2.8 million rubles will be insured by the state, and when replenishing savings in the amount of up to 400 thousand rubles per year, a tax deduction will be applied.
This tool will allow citizens to earn additional income in the future or create a "safety cushion" in the future in case of special life situations. I ask my colleagues from the Government and the Bank of Russia, of course, to make the new mechanism as convenient and reliable as possible for citizens, and I also ask the Government to set specific key indicators for the next year.
At the end of this topic, I would like to focus on some more problematic issues.
We have repeatedly talked about the importance of developing the stock market and the need to create additional opportunities for attracting equity capital within our country, including for fast-growing high-tech companies. And this should be done regardless of the current market situation at foreign sites.
I would like to note that currently Russian companies practically do not place their shares on the domestic stock market. Since the beginning of this year, only two initial public offerings have taken place. By the way, they were successful. I know that the Central Bank and the Government are working in this area, but there is still a lot to be done. I would like to draw your colleagues ' attention to the fact that we need to significantly increase our efforts and achieve concrete, tangible results.
And one more thing: in recent months, financial markets have experienced a significant increase in volatility. We all know this very well. It is obvious that such fluctuations make it difficult for businesses, enterprises, and citizens to make investment decisions. The Government and the Bank of Russia need to make more active use of the available tools and adapt them to the objective situation. Here we need to work, among other things, to limit unproductive, speculative demand in the economy, control capital outflows, and monitor the behavior of major financial market participants. We have recently discussed this with you, and we have discussed it with some of our colleagues.
Further. The next, fourth task that we discussed is the rapid development of transport, municipal and social infrastructure in cities and villages, the construction and repair of roads, schools, kindergartens, clinics and hospitals, cultural centers, public spaces, and so on.
This is a key element, the most important area of work for improving the quality of life of our citizens, for updating settlements and increasing the volume of housing construction.
My colleagues from the construction industry and I recently discussed the results in this area. Recently, the construction process has picked up a good pace, even a very good one. It is expected that by the end of this year, 3.7 million Russian families will improve their living conditions, and the volume of commissioning of residential buildings will again update the record. We had a good pace: in 2021 – 92.6 million square meters of housing, in 2022 – 102.7 million. I think that this year we will also exceed 102 million square meters.
Yes, of course, there are also issues here, we also discussed them, issues that require special attention. Nevertheless, taking into account all objective factors, it is important and possible not to slow down the pace gained, including by increasing the urban development potential of our settlements, integrated development of territories, the introduction of new construction sites and networks, that is, the advanced development of transport and municipal infrastructure for electricity, gas and water supply.
We also have the tools and resources to do this. Thus, 239 housing and utilities projects will be implemented in 73 regions of the Russian Federation at the expense of the National Welfare Fund. This year, the regions also received special treasury loans of 110 billion rubles for these purposes.
Work is also underway within the framework of infrastructure budget loans. This year, 347 measures will be implemented with their help, and next year, another 250 billion rubles will be allocated to the regions within the framework of the already approved program of one trillion rubles.
Road repairs in major urban agglomerations, as well as the main road network, are gaining momentum. Let me remind you that by 2030, at least 85 percent of such roads must meet modern regulatory requirements. At the same time, by the end of July, the indicator in agglomerations has already exceeded 80 percent.
Similar work is also being carried out ahead of schedule in the construction of hospitals, polyclinics, and FAPs. As part of the national project" Healthcare", three thousand 600 capital facilities have been commissioned since 2019, of which 3.5 thousand are in primary health care.
At the same time, an even greater reserve has been formed. Thanks to the transfer of budget expenditures, as they say, to the left, for earlier periods, we will quadruple the commissioning of health facilities next year, 6,5 thousand of them will be launched throughout the country.
As for general education, we also have big plans here. By the beginning of the new school year – and it starts next week – almost 1,300 schools will be completely renovated. Almost 500 more schools will complete repairs before the end of the calendar year.
And one more thing: by 2030, 25 modern university campuses will be created and should be created in Russia. These campuses will house new dormitories, equipped laboratories, technology parks, spaces for recreation and sports, and so on.
The first 17 such projects have already been selected and launched in Moscow, Nizhny Novgorod, Ufa, Kaliningrad, Yekaterinburg, Novosibirsk, Chelyabinsk and Sakhalin.
I am sure that the advanced and comfortable conditions for studying and scientific activities on campuses will allow us to train personnel for our economy at a qualitatively new level in the most popular specialties, which means that graduates will get interesting, well-paid jobs and the opportunity to realize themselves.
And in this regard, the fifth task is to increase the incomes of our citizens and the well-being of Russian families.
If last year, unfortunately, real disposable incomes fell by one percent, then in the first half of this year they have already grown by 4.7 percent – again, I want to emphasize this too, to note: in real terms, that is, taking into account inflation. Of course, these are average data, and I always emphasize this. Nevertheless, it is an indicator.
The average wage in the economy also increased at a comparable rate – by 4.2 percent. I would like to draw the attention of our regional and local colleagues to the fact that the dynamics of wages in the economy of a constituent entity of the Russian Federation is one of the main indicators of the effectiveness of management teams, an integral, basic result of the entire range of efforts to attract investment, create new jobs, and build up infrastructure. You need to keep this in mind all the time and always put it at the forefront of your work.
It is also impossible to weaken attention to raising the salaries of the so – called specified categories of specialists-public sector employees. Their salaries should also grow, as well as in the economy as a whole. We once agreed that they should be comparable to these indicators. Here, the ratio of state employees ' salaries to the average for the regional economy should be met and maintained, including by the results of the current year, 2023.
We continue to index the minimum wage so as to increase its separation from the subsistence minimum. Starting from January 1, the minimum wage was raised by 6.3 percent, now it is 16,242 rubles per month, and from January 1 next year, it is planned to increase the minimum wage by 18.5 percent ahead of schedule. This will be much higher than both the rate of inflation and the rate of wage growth in the country as a whole. This decision, of course, should have a positive impact on the income of about 4.8 million employees.
What can I add here? Of course, we will continue to index the minimum wage, social benefits, allowances, pensions, and develop measures to support families and people with low incomes, but the fundamental factors that affect real incomes, wages, and poverty reduction are, of course, the state of the economy and the labor market itself, as well as, of course, the pace of economic growth. inflation rate.
Objective data show that inflationary risks – I want to draw your attention to this, my colleagues and I have been constantly addressing this topic lately-are still growing, and the task of restraining price growth is now coming to the fore.
I ask my colleagues from the Government and the Central Bank to keep the situation under constant control and build economic policy accordingly. I know that there are a lot of disputes here, but we have always found a consensus so far, and we will find it now.
And finally, the sixth task-a fundamental guideline for all the steps that we are building in the economy and social sphere, and in all other areas-is to save the people, protect motherhood and childhood, and increase life expectancy.
I would like to note that this year life expectancy in Russia exceeded the pre-pandemic level and amounted to just over 73 years. As we know, it "sat down" in our country during the pandemic and has now returned to the pre-pandemic level again.
Behind this figure is a whole range of factors, including the level of medical care, the quality of housing conditions, people's incomes, the state of the environment, and a lot of other things. And the positive dynamics in this indicator shows that we are moving in the right direction.
At the same time, the birth rate situation in Russia continues to be difficult, and in some months of this year it was higher – it is true, we know this – than last year, but in general, the trend should be better as long as fewer children are born in Russia than a year ago.
We have already discussed this issue and formulated special instructions to propose additional measures in the field of demography. To date, regional programs to increase the birth rate have been launched in all regions of the Russian Federation. And I ask the Federal Government to provide all necessary assistance to our colleagues in the successful implementation of these programs. The task really stands in such a way that we need to additionally support families, expectant mothers, support our traditional values, unite the forces of the state, society, and religious denominations and together achieve a turning point in the situation. And it is, again, a difficult situation right now, because we are once again fully confronted with the consequences of the demographic failures of the past decades.
What would you like to mention here? As you know, we extend child care benefits for mothers who go to work before the child is one and a half years old. This decision has already been made, and from September 1, another pilot project will be launched. Its goal is to create a unified system of social and medical assistance for women who raise their children independently, as well as for full families with children. All these mechanisms should also be worked out as thoroughly as possible. It is necessary to act efficiently and conveniently for citizens.
Dear colleagues, the scale and complexity of the tasks that we are solving and continue to solve are truly exceptional. Our plans are ambitious, big, and require maximum responsibility and concentration from every manager, specialist, and employee in the capital, regional centers, and local areas. In some cases, we are moving ahead of individual updates, as I have already mentioned, but in others there is a certain drawdown in terms of timing or volume. In general, despite many external and internal challenges, the situation is stable and working. It needs to be closely monitored and monitored in order, I repeat, to make clear and, most importantly, timely management decisions.
Of course, our successful work in all areas is based on a strong and sustainable economy. I have already mentioned this, and we are well aware of it. In this regard, I repeat what I said at the recent St. Petersburg Economic Forum: we need a proactive policy of supply-side economics aimed at creating a sovereign economy that not only responds to market conditions and changes in demand, but also forms it itself. This means a widespread increase in the productive forces and services sector, the creation of new modern industrial capacities and entire industries, including on the basis of advanced technologies that we have and, I am sure, will continue to develop thanks to the rich scientific and creative potential of Russia.
To build a supply-side economy, we need to work closely with representatives of the business community and our entrepreneurs. In this regard, of course, I would like to ask Mikhail Mishustin in his report to focus separately on the management structure that is planned to be used in the course of such work.
Please, let's get started.
Please, Mikhail Vladimirovich.
Mikhail : Dear Vladimir Vladimirovich, Dear colleagues!
During the St. Petersburg International Economic Forum, you set the task of implementing a policy aimed at developing the supply-side economy. It focuses on creating modern industrial capacities and entire industries with a balanced labor market, expanding construction, updating infrastructure, and, as you mentioned, improving efficiency both in terms of productivity and the operation of the entire economy as a whole.
I'll tell you more about the directions you mentioned and the tools we use to do this.
The first direction is investment. It is necessary to achieve accelerated growth in capital-intensive industries that require the use and maintenance of complex equipment, the development of new technologies and high-quality raw materials, materials, and comprehensive scientific and engineering support. These are well-known areas, I will name them: machine tool construction, chemical industry, transport and power engineering, engine building, radio electronics, aircraft and shipbuilding, automotive industry, production of medicines and medical devices.
It is no secret that before the introduction of external restrictions, these segments accounted for a fairly large share of imports. We have enough internal resources for such development. A set of flexible support tools has been created: assistance from the National Welfare Fund, special mechanisms for large industrial projects, an agreement on the protection and promotion of capital investments, reverse engineering, a cluster investment platform, industrial mortgages, and much more. We are also working on fine-tuning the legislation on technological policy: the relevant draft law is currently being widely discussed.
In order to develop the manufacturing industry and increase its share in gross domestic product, the Government continues to implement state support programs for investment projects and automation solutions. I could talk about this for a long time, but Denis Manturov will report on it in more detail today.
The second direction in terms of the formation of the supply economy is the labor market. The country is currently experiencing record low unemployment, but there is already a shortage of specialists in a number of segments. This issue requires special attention, because in the long run, given the positive dynamics in the economy, it can become a new serious challenge for us-it has already become. Timely training and retraining of personnel is needed, primarily to meet the long-term demand in key sectors.
We have started work on modernizing secondary vocational education programs. Vladimir Vladimirovich, you have spoken in detail about "Professionalism", but to adjust the admission target figures and increase its target volume in popular specialties, in particular in industry, we need to develop proposals right now to change both the scale and structure of personnel training in the coming years in accordance with the needs of our economy. It is important to improve the quality of education, as well as structural changes, taking into account current and future challenges. Tatyana Golikova oversees the work of the interdepartmental working group on labor market recovery. The resolution of these issues will be reported in detail at the State Council meeting in late September.
Another key area is to increase the efficiency of the Russian economy as a whole. We still have large reserves to increase labor productivity, reduce low-productivity and low-paid jobs, digitalize processes and develop artificial intelligence technologies, increase prioritization and, as a result, increase the efficiency of budget expenditures, and further reduce administrative costs for businesses. Today, the Minister of Economic Development Maxim Reshetnikov will tell you more about this in more detail.
The next task is to ensure the rapid development of transport, municipal and social infrastructure. Capital-intensive sectors and highly qualified personnel present an increased demand for relevant services, and therefore its formation in the logic of the supply economy should occur at an accelerated pace.
It is necessary to improve the infrastructure of cities and industrial territories, the capacity of roads and railways in the directions of international transport corridors, ensure the construction of domestic aircraft, helicopters, locomotives, water vessels and expand the capabilities of the high-potential tourism industry, including new year-round seaside resorts. Since the beginning of this year, a five-year state construction program has been implemented, as well as a road activity plan. A new project to modernize utility networks has been launched in the regions.
In the changing geopolitical environment, it is important to reorient commodity flows from unfriendly states to new promising sales markets, including through international transport corridors. This is also one of the tasks of the updated strategy for the development of foreign economic activity, which the Government is preparing.
In close cooperation with the Presidential Administration, the Bank of Russia, both houses of Parliament, private businesses, and the expert community, strategic sessions are held at our Government Coordination Center ‒ I report to you regularly, Mr Putin. Now, in the near future, the management model of the tourism industry, as well as the strategy for infrastructure development, artificial intelligence and the national project "Data Economy"will be considered.
A special project on risk models of socio-economic development and price monitoring is also being implemented. This is necessary to identify deviations from plans in time and quickly correct the situation or prepare additional solutions where necessary. 24/7 we just conduct such a project without fail, taking into account feedback from people and business structures.
This concludes my report, and my colleagues from the Government will continue.
Thank you.
Vladimir Putin: Good.
Thank you very much, Mikhail Vladimirovich. We will return to some issues during the discussion. And now ‒ Maxim G. Reshetnikov, Minister of Economic Development.
You are welcome.
Mikhail : Dear Vladimir Vladimirovich, Dear colleagues!
Mikhail Vladimirovich outlined the directions and industry priorities that we will work on. I will focus in more detail on the main mechanisms for implementing these tasks.
Investment is of key importance for the development of the supply-side economy. Today, Russian companies have accumulated more than 48 trillion rubles in their accounts, which means that the economy has resources. To direct them to investments, it is necessary to ensure stable conditions for business and distribute risks between the state and investors.
The key mechanism for ensuring that the project implementation conditions remain unchanged for the entire period is the investment protection and promotion agreement. 58 agreements worth 2.6 trillion rubles have already been signed, of which almost 800 billion rubles have been invested, and 19 thousand new jobs have been created. It is important that a third of all agreements were concluded this year. This means that investment activity continues.
Under these agreements, investors can also invest in infrastructure, reimbursing it later at the expense of future taxes. Through the "Project Finance Factory" and a number of industry – specific programs, the state guarantees investors an affordable loan interest rate – as a rule, these are just investment loans-covering fluctuations in the key rate at the expense of the budget.
At the same time, it is important that there are resources in the economy, and it is important to direct them specifically to projects whose products are not on the market or whose share is small. Mikhail Vladimirovich named these areas: machine-tool construction, aviation, automotive, microelectronics and others, which form the basis of technological sovereignty. For this purpose, the project taxonomy mechanism has been launched. It allows identifying such projects and encouraging banks to lend to them through the Bank of Russia's regulatory eases. The state will also take part of the risk of financing these projects through the guarantee mechanism of VEB. RF.
The mechanism was launched in July, and the first projects have already been identified. These include the production of batteries for electric vehicles and the creation of shipyards for composite, more economical vessels. That is, the mechanism has already started working, and now the task is to replicate it as much as possible.
The mechanism that still needs to be launched before the end of this year in conjunction with the taxonomy is the investment tax deduction. It is designed to encourage existing profitable companies to invest in new industries and new products. The relevant amendments to the Tax Code have been prepared, reviewed by the Government and submitted to the State Duma.
Also at the St. Petersburg Forum, you instructed to ensure that starting next year the regions will be able to provide such a deduction at the expense of long-term budget loans. Relevant proposals are being prepared. We expect to discuss them at the State Investment Council this fall.
We focus our support on developing our own technologies, and we have formed a single database of technology companies, the so-called startup showcase. For investors, it contains all reliable and up-to-date information about the company itself, as well as about projects and technologies being developed. Now there are almost nine thousand companies and, accordingly, all the evaluated projects. On August 4, the law on small technology companies was adopted, which defines a special legal regime for them, which allows us to effectively adjust all this support.
The development of technologies and innovations is associated with high investment risk. In order to attract private capital, we are strengthening support for venture investments, first of all, developing legislation on investment partnership agreements and expanding the potential circle of their participants. At the moment, the process of creating venture funds has resumed.
Any project is implemented in a specific territory, so the regions are provided with a wide range of support tools, you have named many of them: infrastructure and budget loans, special treasury loans, the 1704 program, when the region pays off part of its debt to the federal budget by investing in specific projects and receiving new taxes. We can see how the attitude of the regions has changed. The share of funds allocated by them to infrastructure projects in industry and tourism, which is directly related to the supply economy, has tripled. If in the beginning, at the first selections of infrastructure budget loans, it was less than 20 percent, then at the last selections within the framework of special treasury loans and others, it reached 60 percent of the total amount of funds distributed.
Special economic zones allow efficient concentration of investment projects, providing them with infrastructure. At the suggestion of the regions, we are constantly creating new SEZs and improving this mechanism. Starting from September 1, amendments to the legislation came into force, and investors in SEZs will also receive protection from deterioration of industry regulation conditions and rising tariffs.
Dear Vladimir Vladimirovich, a wide range of investment support mechanisms has been created, and we are able to adapt them to the needs of a specific market, a specific industry and a specific region.
Support for entrepreneurship is also a prerequisite for economic efficiency. Since Covid, much has been done to reduce the administrative costs of the business. Under the leadership of Dmytro Grigorenko, the number of inspections was reduced, the punishment was replaced with a warning, and a pre-trial appeal mechanism was introduced. A risk-based approach allows you to comply with mandatory requirements without increasing the burden on your business.
Under the leadership of Andrey Removich Belousov, work continues to reduce the regulatory burden, including within the framework of the business climate transformation mechanism. Starting this year, together with entrepreneurs, we are implementing a roadmap for reengineering the rules of industrial construction. We have already reduced the average construction time by 200 days.
To support technologies, we actively use the tools of experimental legal regimes. A successful example is the development of unmanned systems. Currently, there are three experimental legal regimes for ground – based drones and three for aviation systems. In total, there are already nine such regimes, and appeals are constantly being made, including now in medicine, there are new ideas.
We continue to encourage the development of small and medium-sized businesses. The main task here is to move from quantitative growth – because the size of small and medium – sized businesses is quite decent with any comparison-to qualitative growth. We will focus government support on companies with growth potential from micro to small companies and from small to medium-sized companies.
It is also important that companies have an incentive to outgrow the boundaries of SMEs, while not dramatically losing either state support or preferences. At the same time, small businesses provide a significant share of the supply economy in such industries as processing, tourism, IT, and engineering.
To stimulate the investment activity of SMEs, we apply and have worked out a wide range of financial and non-financial instruments that allow us to provide this support from a budget point of view, let's say, not very expensive, but at the same time covering a very wide range of entrepreneurs.
In conditions of a shortage of personnel, it is of particular importance to increase labor productivity based on the correct organization of production – what you said. You have already mentioned the key figures: more than five thousand enterprises where our production culture has been changed, and they now employ 1,600 thousand employees.
As a result, their productivity grows an average of five percent faster than that of their industry peers. We specifically compared and conducted such a large sample based on tax data. If we have an average of 19 percent growth in value added across industries, these companies have 24 percent growth.
We propose to extend the accumulated competencies to new sectors of the economy and technological chains and create industry-specific competence centers not only in processing, but also, for example, in tourism, where there is a great need for new personnel, where many people are employed and where there is something to increase labor productivity.
Digitalization of industries and its most advanced component, namely artificial intelligence technology, should contribute to improving labor productivity, as you also mentioned. We are among the top ten countries in the use of artificial intelligence, and this is also the result of the implementation of a federal project over the past three years.
In order to strengthen our position, we need to further shape trends in the research agenda and in personnel training. And the main thing at the moment is to ensure an increase in computing power. We gave you a detailed report on this issue in mid-June.
Vladimir Vladimirovich, you have raised the issue of combining two national projects – productivity and artificial intelligence. While working on your assignment, we just took 40 ready-made solutions with artificial intelligence and handed them over to the Federal Competence Center for Implementation and replication. We found out that, of course, not all of them are ready for such mass replication, and now we are proposing to change the mechanisms within the framework of artificial intelligence, allocate funds for finalizing and implementing such solutions. And the Federal Competence Center is ready to become such a team leader in a number of positions, a common customer from entire industries for these solutions. Therefore, our practice of combining national projects is really very useful.
We have prepared the relevant proposals and will defend them in the framework of the strategic session on artificial intelligence, which Mikhail Vladimirovich mentioned.
Dear Vladimir Vladimirovich, the tasks that our country faces require a structural transformation of the economy, and for this purpose it is necessary to concentrate all available resources of both business and the state, to ensure clear and well-coordinated work. At the same time, national projects are the most effective tool for such work.
Practice has shown that they really allow us to achieve visible results for both citizens and businesses in the face of set deadlines and budget constraints. Current national projects will be completed in 2024. We propose to preserve this mechanism by focusing new national projects on the tasks of structural transformation of the economy, ensuring technological sovereignty and developing the supply-side economy.
Thanks for attention.
Vladimir Putin: Thank you.
Maxim Gennadievich, you mentioned that we have already discussed the updating of work on the implementation of artificial intelligence several times. I know that work is underway to update the national Strategy for the development of artificial intelligence. Could you tell us in more detail what you want to change or add there?
Mikhail Reshetnikov: Mr President, in our Strategy we are moving in line with the issues that we discussed on July 19. In principle, we have a good pace, on the one hand. On the other hand, a dramatic breakthrough in technology, including the so-called generative intelligence models – what we know as ChatGPT, and the existing analogues in our country, of course, pose new challenges, because all this requires, on the one hand, fundamentally new computing power, and to do this, we need to seriously support our data centers and create new and existing ones. This issue concerns the construction of such centers here, the delivery of equipment, the design of their own equipment, and the solution of electricity issues. Because, it would seem, where is electricity and where is artificial intelligence? But in fact, all these calculations are very energy-intensive and very expensive, so this is the number one topic.
The second point. We have reached the point where artificial intelligence is a real replicated, live technology, and we need to promote it as much as possible to the entire economy, and this is our task. And of course, artificial intelligence is a unique thing in some ways, because the main thing is personnel, it is difficult to cut off artificial intelligence if we have our own specialists, and we have them, and if we continue, let's say, to train such a class of people and saturate the economy with them, then we will have there will be real movement in different directions and technologies, and efficiency, and labor productivity [will increase], and other issues. And plus, of course, we need to use all the tools that are at hand. We give subsidies to enterprises – we need to see how they implement artificial intelligence. We are implementing our scientific program worth a trillion rubles a year together with the Academy of Sciences – we also need to look at how we use technologies in the climate, somewhere else. We have discovered a large reservoir, and this federal project has really helped us gain good momentum and movement.
The main thing here, Mr President, is that we have a report every six months: an AI Journey is being held, Sber is actively developing, and there is a lot of traffic. Just in the Strategy, we are trying to generalize all this and respond to the new challenges that exist.
Vladimir Putin: Okay, thank you very much.
Denis Valentinovich, please, please.
Dmitry : Thank you very much.
Dear Vladimir Vladimirovich, Dear colleagues!
We continue to work on increasing investment in projects of technological sovereignty. In order to clearly orient business to this task, the Ministry of Industry and Trade has formulated a list of almost 300 types of priority industrial products.
We have focused new and previously existing support measures on its development and production projects. I would like to mention those that provide the largest inflow of investment.
First of all, it is the tools of a comprehensive investment platform. Enterprises of more than ten industries have already shown interest in the mechanism.
Today, 19 projects worth 400 billion rubles have been approved, and another 32 projects worth 1.3 trillion rubles are in the high stage of development. I reported on this in detail at the beginning of the month at your meeting with the heads of industrial enterprises.
At the current level of the key rate, the cost of concessional loans for participants of the cluster investment platform is 6.6 percent. This still allows you to" fold " the economy of most projects. As for those that fall below the profitability level, we will extend them by separate decisions of the Government. We have such a regulatory opportunity.
Another large source of investment specifically in aircraft and shipbuilding projects is concessional loans from the National Welfare Fund.
The decisions taken this year will ensure a total inflow of more than 500 billion rubles to the designated industries, and, in addition, about 130 billion rubles will be invested in projects for the production of priority products using concessional loans from the Industrial Development Fund.
And about 90 billion rubles more are promising investments of participants in special investment contracts concluded this year. As I reported earlier, we also have a high demand for the industrial mortgage program and R & D subsidies. By using these key tools, we must reach the investment milestone that you have outlined, Mr Putin. And most importantly, by the end of the year, it will launch more than 200 projects of technological sovereignty that we are currently implementing.
All of them will be implemented according to modern requirements for production automation. This is extremely important given the limited human resources available, especially in working professions. In order to systematically increase labor productivity in factories and plants, as well as reduce resource and logistics costs, we focus on projects of digital transformation of production processes. A large part of this activity is related to the development of digital platforms and software products.
Currently, with the support of the Ministry of Industry and Trade, 96 complex projects are being implemented in the creation of domestic industrial software. Successful implementation results have already been achieved for more than half of them. In this way, we consistently ensure technological independence in the areas of digital design, testing, production itself and lifecycle management, as well as after-sales services.
In terms of software and hardware solutions, the groundwork is formed in specialized industrial competence centers. They were created on behalf of Mikhail Mishustin and are being implemented with the participation of anchor customers from more than ten industries. In total, the Government approved 53 projects of industrial competence centers through the Ministry of Industry and Trade. Among the most significant ones, I will mention the development of engineering analysis tools, as well as the management of production and technological processes.
To track the depth of industry use of IT tools and automation technologies, we have been using an assessment of the level of digital maturity of enterprises since 2020, and today this figure is about 45 percent. In other words, almost half of the manufacturing industry keeps up with modern automation standards. We set ourselves a goal to increase this parameter to 85 percent by 2030.
A very important part in this area is the integration of modern robotic solutions into the work of enterprises. Their components are numerically controlled machines, automated warehouse systems, assembly operations complexes and, of course, industrial robots directly.
Here we are still lagging behind the technology leaders in terms of the number of robots per 10,000 employees, although in this part we need to make a reservation that reliable statistical accounting in this segment is not yet properly conducted. We will close this analytical gap.
We have agreed with Rosstat to maintain an appropriate reporting form. This will give us a real picture of robotization and allow us to more clearly build development plans. If we talk about the presence of robots in our market, we have never had a shortage of this. Previously presented models of foreign production are now being replaced by Russian products and analogues from friendly countries.
Industrial robots are now made by seven domestic companies. Last year, they shipped 120 units of products to customers. At the same time, their current production capacity is almost four times larger.
The main reason for the low density of robotics in our country, Vladimir Vladimirovich, is still the established approach of the company's managers: it was always easier to hire additional employees than to invest significant amounts in robotics.
At the same time, there are calculations of the payback of such costs. In different industries, this period averages from two to five years. To help businesses make such decisions, there is a need to conduct technological audits with the development of recommendations for robotization with economic justification.
First of all, this should be done in relation to companies with state participation and, based on the results, set requirements for increasing the level of robotization. We have included this proposal in the draft protocol decision. We count on your support in this regard, Mr Putin.
Such an audit, among other things, will make it possible to form a request to the industry both in terms of the production of robots themselves, and in terms of components, as well as ready-made solutions for the implementation of robotic complexes in technological processes.
The Center for the Development of Industrial Robotics will deal with these tasks, and we are immersing the measures to create them in a separate federal project "Development of Production of Means of Production". Industrial robots are taken out in a separate direction, support measures are provided, including in terms of stimulating demand. On behalf of the industry, I would like to thank you, Vladimir Vladimirovich, for your decision on tax incentives for buyers of Russian high-tech equipment. Our robots are included in this preferential list, which, of course, adds to their price attractiveness. In other words, the basic conditions for accelerating the automation of the industry as a whole have been formed, and we will continue to pay increased attention to this issue.
Thanks for attention.
Vladimir Putin: Denis Valentinovich, how do you assess the work of the R & D subsidy mechanism?
Dmitry Manturov: Mr President, this tool has been constantly upgraded over the past ten years, including making it more accessible. I can say that this tool is very much in demand by enterprises today, because it makes it possible to compensate up to 70 percent of R & D costs. You and I understand perfectly well that it is one thing to get a loan for the purchase of means of production and even use an industrial mortgage for the construction of a building, but the most difficult thing is to attract funds for R & D, this is always a more risky area, so banks do not provide funds for this, so the state acts as a driver and [ It provides real support in the implementation of R & D, which, in fact, is the basis for import substitution and achieving technological sovereignty.
Vladimir Putin: This is understandable. How does the mechanism work, in your opinion? It is effective, sufficient, and something else needs to be done in addition?
Dmitry Manturov: Mr President, to date we have not seen any comments from the industry or the business community. As I said, I think we have brought it to perfection, taking into account the fact that every year we made a number of changes, just choosing the right approaches for accessibility for enterprises.
Vladimir Putin: All right. Good.
Mikhail Mishustin: Mr President, literally, meeting with industrialists… First, they want more funds for R & D subsidies, because there are so many of them, and it is difficult…
Vladimir Putin: I see.
M. Mishustin: And the second – guaranteed demand "for the long". There is another mechanism, Denis Valentinovich [Manturov] spoke about this, - these are discounts for the implementation of the first trial batches and future discounts for scaling this. Because when the product was made and the R & D was closed, it is very difficult to implement it after that.
In particular, we recently talked about complex technologies, about turbines – (addressing Dmitry Manturov) Denis Valentinovich, we were here just now, we talked about turbines – and so on. They made a big turbine, but replacing everything Western-from Siemens to everything else-is difficult: they are afraid of the lack of a service mechanism and guaranteed demand, in order to completely switch to domestic ones.
First of all, we are currently making additional adjustments. We are looking at funds, including the sale of assets that are available, more funds to subsidize research and development, and, as I said, scaling up the opportunities to support those who will acquire these complex technologies.
Sorry.
Vladimir Putin: Thank you.
Tatiana Alekseyevna, I would like to ask you to comment on social issues.
T. : Vladimir Vladimirovich, good afternoon!
In your opening speech, you mentioned the issues of monitoring and ensuring higher wages for public sector employees. I would like to remind you that we are carrying out this monitoring in continuation of your decision of 2012 and the corresponding Presidential Decree No. 597 of May 7, 2012.
Today, there are 5.2 million state employees who fall into our field of attention: 600 thousand are federal employees, and four million 600 thousand are regional state employees. The Ministry of Labor, industry departments, and the Ministry of Finance are monitoring this work. Today, taking into account the growth of wages in nominal and real terms, we have adopted at the level of federal authorities ‒ the Ministry of Labor and the Ministry of Finance submitted to the Government ‒ an additional increase in the salary funds for employees of federal budget institutions in the amount of 30.7 billion rubles. These orders will be submitted to the Prime Minister for signature in the near future. This will affect education, culture, science, and healthcare at the federal level and will allow us to compensate for the growth in the wage fund that has occurred over the past and even the expected, projected period of time. Monitoring will continue further.
As for the subjects of the Russian Federation, we are working together with representatives of the State Council and the relevant commission [in the field of Economics and Finance], which [heads].
At the stage of preliminary work, based on the implementation of the budget for the first quarter, the need for additional funds to raise wages was stated by 44 subjects of the Russian Federation, and now we have seven subjects under monitoring.
The work is organized as follows. First, the Ministry of Finance monitors budget execution, taking into account the forecast estimate of revenue received by the Federal Tax Service in the first place, and those non-targeted account balances that are formed in the budgets of the constituent entities of the Russian Federation.
I would like to say that in comparison with January 1, 2023, the unearmarked balances of regional budgets have increased to 4.7 trillion rubles ‒ by almost two trillion rubles. Therefore, a number of regions that previously announced additional financial resources have confirmed that they can exercise these powers within the limits of their existing revenues.
This work continues. Naturally, where it will be necessary to provide appropriate financial assistance to the regions, it will be provided at the expense of funds that are provided for in the federal budget.
There is a third group of regions-the new regions of the Russian Federation, where we also monitor wages. Vladimir Vladimirovich, on your instructions, the increase and implementation of Decree No. 597 is being implemented in two stages: in 2023 ‒ by 20 percent, and slightly more than 20 percent ‒ from January 1, 2024. Now in the Donetsk and Luhansk People's Republics, all regulatory acts have been adopted, all payments have been completed in the first half of 2023, and wages have been recalculated in a new way. In Zaporizhia and Kherson regions, this work continues and will be completed in the near future.
In your opening remarks, you also mentioned issues related to the implementation of all national projects. I will not list the quantitative characteristics, but we are working within the framework of the indicators that we have planned for ourselves for 2023 and 2024, and we believe that we will meet and demonstrate good changes in infrastructure both in the field of education, culture, and healthcare. This is evidenced by the positive changes in life expectancy, as you have already mentioned the indicators. I also want to say that in the first half of 2023, we significantly reduced mortality rates ‒ by 12.9 percent compared to the same period last year, and we have already reached the pre-crisis indicators.
In accordance with your decision, we will implement additional measures to increase the birth rate. The figures here are modest. Indeed, within the first half of 2023, there were months where we had some improvement in the situation compared to the same periods last year, but in general, in the first half of 2023, we had a 2.3 percent decrease in the birth rate [compared to] the first half of 2022. Obviously, this is due to the demographic declines that occurred in the 1990s. But we hope that the additional package of measures that we have developed in accordance with your instructions will yield results.
I also confirm that from September 1, 2023 ‒ The Prime Minister agreed on this ‒ we are launching a pilot on the sufficiency and effectiveness of the measures to support the birth rate and improve the demographic situation that are being implemented today. We assume that the pilot will last until the end of 2024, so that support measures can be set up and, possibly, new ones can be developed.
One more topic, which I will tell you very briefly. As part of your assignment, we continue to develop the Professionalitet project in order to reach the targets that you have set out, namely, one million young professionals who are trained under the updated programs by 2027. This work is underway.
I must say that there is a very high level of interest in industrial sectors. We are focused exclusively on those industries that are currently in the perimeter of our attention and form the technological sovereignty. But, as Mikhail Vladimirovich has already said, we will report on this in detail at the meeting of the Presidium of the State Council.
Also, we are working separately to provide personnel to enterprises of the military-industrial complex, and here we work closely with the Ministry of Industry and Trade in those specialties that are in demand today by these organizations.
The work will continue, Mr President. We will report to you regularly.
Vladimir Putin: Good. Thank you very much, Tatiana Alekseevna.
We have been operating a system of independent assessment of the quality of social services by citizens since 2012. According to some reports, the interest of citizens in such work is still decreasing. And the ONF also notes that assessments of organizations ' performance are often given not by interested persons, not by recipients of these services, not by citizens, but by the organizations themselves.
I know that Dmitry Grigorenko is working on this in the Government. Dmitry Yuryevich, do you have any comments on this?
D. : Good afternoon, Vladimir Vladimirovich!
Our Ministry of Labor deals with this issue. In general, the Government has built a fairly large feedback system for all public services: not only social, but also non-social ones, including through our public services portal, where we collect feedback from citizens through a single entry point. This allows us to adjust our actions and change our goals in order to build all our services from assistance to performing the functions that the state implements, based on the requests of citizens and how citizens see how it should be arranged, including in the social sphere.
Vladimir Putin: We need this mechanism to work, so that the eye, as they say, is not blurred, and this connection with the recipients of services is alive and real. We still need to improve this mechanism. I'd like you to pay attention to that, okay? Thank you.
Mikhail Albertovich, we had the task of working more thoroughly to combat some infectious diseases. What is being done here?
Mikhail Murashko : Dear Vladimir Vladimirovich,
The emphasis was placed on hepatitis C. On your instructions, a government order was adopted and an action plan was approved to combat this disease. As part of the implementation of this action plan, we have prepared all the information materials for the work, methodological recommendations for prevention and dissemination. Each region has now developed and approved measures for the prevention and treatment of hepatitis C.
The Ministry of Health prepared a new edition of the standard for providing medical care to patients with chronic viral hepatitis C, and also developed and approved criteria for providing medical care to patients with hepatitis C in a day hospital and inpatient settings.
We have divided the funding system – we have grouped it for each case, which allowed us to increase the number of patients receiving this type of treatment by 35 percent this year.
It should be noted that we have made decisions on the treatment of our young patients with this disease, children. This year, all applications from the regions were collected and medicines were purchased for all children without exception. This year, they are all receiving drug therapy to eliminate the hepatitis C virus.
Also today [there is] the formation of information systems around the patient, registers are being built. The register was formed, and testing was carried out in ten subjects. Today, a draft resolution has been developed, it is being adjusted in connection with the 53rd Federal Law that was published, and accordingly, it is ready for work.
We have worked out the issue of reducing prices for medicines, and companies have confirmed that 20-30 percent are ready to give discounts as part of centralization and increasing the volume of purchases. We also worked with the federal executive authorities to determine the source of funding for outpatient treatment. But there is a dissenting opinion from some departments, and the discussion is currently ongoing at the Government platform, and I think we will finish it.
And another important element is, of course, the development and registration of our own medicines. Today, 13 companies have received permission to conduct clinical trials, and two companies are currently undergoing an expert examination. We are waiting for the decision of the ethics committee to issue a permit for clinical trials. Therefore, this work is being carried out, and, accordingly, today the implementation of these measures is proceeding in accordance with the schedule.
Thank you for finishing the report.
Vladimir Putin: As far as I know, the Government has developed all sorts of proposals to find sources of funding for this work.
Mikhail Murashko: Yes, there are such proposals regarding the source, including those agreed with federal agencies, but so far there is no final decision, because there is a position of the Ministry of Industry and Trade and the Ministry of Agriculture. I hope that we will now work out a common position and make a decision.
Thank you.
Vladimir Putin: I would ask you not to delay.
Denis Valentinovich, we won't go into details now, but there must be such a source if we want to work effectively in these areas, because there will be no extra money coming from anywhere. I would ask simply… I'm not saying that you need to make such a decision tomorrow or not, but you need to decide. No, no, then tell him not to hang around forever, okay?
Dmitry Manturov: We'll work it out.
Vladimir Putin: I would also like to ask Anton Siluanov and Vladimir Chistyukhin about the issue of ensuring financial sovereignty, how they assess this work.
Anton Germanovich.
A. Siluanov : Thank you, Vladimir Vladimirovich.
When we talk about financial sovereignty, we usually consider two aspects.
The first is the stability of the budget system, because a balanced budget and the budget rule allow us to create a margin of safety for the economy and quickly respond to possible macroeconomic shocks. Budget sustainability allows for a more lenient monetary policy, lower interest rates, and increase the availability of credit, which is important for economic growth and for ensuring the country's sovereignty. When preparing the budget for the next three years, we are guided by these principles.
It is clear that the smooth operation of financial markets is also important for ensuring financial sovereignty. Financial markets are the basis and source of money for the economy, because not everything is financed from the budget, investments, and it is important that the economy generates resources itself. And the financial market is the source where these resources are formed. Our task is to create conditions for these resources to be reproduced and directed to key areas of economic development. Therefore, the stability of financial markets and the stable operation of financial markets is one of the important components of the basis of financial sovereignty.
The government has done a lot here this year. We see that a significant part of financial investors and foreign investors have left the market. I would like to say that only in terms of investments in government securities, this is a quarter of all investors, in addition to the fact that these were also investments in enterprises and organizations that issued their own financial instruments.
Under these circumstances, we, the Government, have made a number of important decisions in order to find internal resources that, first, will replace the departed investors, and second, will reproduce the sources that are necessary for the development of the economy.
What are these measures? We have created a range of tools that allow Russians to safely invest their savings, and you have already said in your opening speech that we have created several new tools that will start working next year. Why next year? Because we needed to create a legislative framework, they were not there before, and we have now significantly adjusted the legislative framework for this. This is a long-term savings program, as you said in your introduction. In July of this year, the Parliament adopted a law prepared by the Government of the Russian Federation. It [the tool] will be interesting for citizens because, on the one hand, these long-term savings will be co-financed by the state, and on the other hand, tax preferences for participation in this program.
In the near future, we plan to attract two million people to this program, and new resources, according to our estimates, should be additionally attracted – in the amount of 300 billion rubles.
Citizens ' funds will be insured. We said that insurance is twice as high as for bank deposits. It is a reliable tool and is suitable for conservative market participants.
Two more new tools will be launched next year.
Shared life insurance. The tool allows you to accumulate funds and receive investment income in addition to insurance. The relevant draft law was adopted by the State Duma in the first reading. By the end of the year, we will work together with the Parliament to make this mechanism operational next year. We have all the agreements, and I am sure that the parliamentarians will support us in this matter.
Individual investment accounts of a new type, the third type. This is a tool for more active investors, for more active citizens who are ready to independently determine the products in which they want to invest their own funds.
We can see that there is still interest: citizens have opened about 25 million brokerage accounts. Our task is to create additional tax preferences. They are also provided for taxation both when entering this system, that is, there will be tax deductions, and when receiving income, tax preferences are also provided for.
And what is important is that we are now using this new tool to encourage "long" investments-from five to ten years, which was not the case before.
Therefore, we plan to adopt all these legislative initiatives – some of them have been adopted, some of them are planned to be adopted in the fall and launched next year. This is just the money for new investments, for "long" investments in development.
There are a few other points that are important for the stable operation of the financial system and financial sovereignty. If we are talking about the development of the financial market, we need transparency of market participants and, accordingly, that market participants have access to information about where they will invest money: what kind of enterprise it is, whether this asset is reliable. In July, the Government adopted a resolution on the company's obligation to disclose such information, with the exception of sensitive information that is currently important for enterprises, which is not yet disclosed by the company's decision. However, the company will independently determine the list of disclosed information that investors need to invest in the instruments that the company will issue.
Further. Another task to restore confidence in the financial market is to help our citizens whose assets are frozen in unfriendly countries. Today we have blocked the assets of more than 3.5 million Russian citizens in the amount of 1.5 trillion rubles. And taking into account the decisions you supported, we envisage the beginning of the exchange of assets of our citizens for assets of foreign investors, which are currently accumulated in Type C accounts.
At the first stage, we plan to unblock the accounts of about 100 billion rubles belonging to retail investors, and here the Government and the Central Bank have prepared a corresponding draft decree. We would also like to ask you to support this decision.
Further. Financial sovereignty is certainly not self-isolation, and we welcome foreign investment and work to increase the attractiveness of our market. For this purpose, in August of this year, a decision was made to pay unlimited dividends to foreigners who invest money now, at the present time, in the Russian economy.
That is why we say: all the investments that will be made in the current year and later, please, can be withdrawn in the form of dividends in the amount of investments made in our economy. This is also one of the elements of opening up our market, and we are open to foreign investors to work in our market. And we have a good market, and you can earn good money on investments.
Further. In order to make it more convenient for investors, including foreign ones, to work, we decided to remotely identify the client – a foreign citizen or legal entity. In July, the relevant law was adopted – also an innovation of the current year. This will allow you to remotely open accounts for foreign investors here in Russia and, accordingly, manage these accounts, investing them in interested investors and enterprises.
I would also like to focus on this year's decision. We are talking about the adoption of a law that launches an experiment on the development of partner financing in Russia. This will be an experiment first. Starting from September 1 of this year, we are launching it in four pilot regions. A new type of financial services is being launched, where investments from Islamic countries will be attracted to joint projects. This is also what investors have asked us to do. The relevant database has been prepared, and the legislative initiative has been adopted.
In conclusion, I would like to say that all the measures we are taking to ensure financial sovereignty, develop the financial system, and attract investment in the economy should produce results. We expect that such new investments and their attraction to the economy in 2024 will additionally amount to more than 1 trillion rubles, or more precisely, 1.3 trillion rubles.
We plan to increase the capitalization of the Russian market by two percentage points of GDP next year, bringing it to more than 26 percent of GDP. We plan to raise about 10 billion rubles in the initial public offering in the second half of this year, and more than 30 billion rubles next year. The money may be insignificant, but these are the first steps after the suspension of issuing shares to raise capital.
So, Mr President, this year we are launching a whole range of new tools, launching new sources to create investment, create jobs, grow the economy, and ultimately increase the growth rate and incomes of our citizens.
Thank you.
Vladimir Putin: Thank you. I will now comment on some things. Thank you very much.
Vladimir Viktorovich.
Vladimir Chistyukhin: Dear Vladimir Vladimirovich, Dear colleagues!
Anton Germanovich outlined the situation as a whole. I will focus on several aspects.
One of the cornerstones of financial sovereignty is price stability. Vladimir Vladimirovich, you have already mentioned the increased inflationary risks associated with overheated demand.
Anton Germanovich spoke about the importance of ensuring a sustainable budget, and I won't repeat myself here. At the same time, as a Central Bank, we are very seriously monitoring the overheated lending market and responding to this phenomenon with monetary policy instruments. I very much hope that the loan growth rate will be in line with the basic forecasts that we have in the Ministry of Economic Development.
If we talk about the financial market, which should provide an investment resource for the economy, then we should focus on the fact that after the departure of foreign investors, we rely on the domestic investor, and we attach great importance to the retail investor.
If you look at all the savings of citizens that exist today in the financial market, it is about 56 trillion rubles. It seems to be a large resource, but the problem is that a significant part of this resource is invested in short-term instruments, only 36 percent of this volume can be considered long-term resources. All the measures that Mr. Siluanov listed ‒ we are working here together with the Government and the Ministry of Finance-should, in our view, shift investment preferences, including towards longer-term investment. And here it doesn't matter what tools are used: insurance, long ‒ term savings or other tools-it is important that they are more long-term. Let's assume that if we turn this 36 percent into at least 50 percent, then this would give us an additional long-term resource of more than seven trillion rubles, which, of course, is a very significant amount.
We also pay significant attention to creating a foundation for attracting friendly foreign investors through the infrastructure of tools ‒ this is also partner financing. We very much hope that our Arab and other partners who adhere to the principles of Islamic partner financing will come to us. And, accordingly, so-called "green" investments, which are also important for Russia and continue to attract special attention of our partners from friendly countries.
In conclusion, I would also like to reiterate the view that trust in the financial market is fundamentally important for both retail and institutional investors, including disclosure issues. We understand that it is not the right time to disclose sensitive information, but the maximum amount of information that can be disclosed should be disclosed. These include protecting the rights of minority shareholders and building proper corporate governance, which is what the Government and the Central Bank are doing today.
I must say that the issue of trust is also the measures that we are taking to preserve the market basis for financing the economy. This is also a very important element for investors ‒ as a signal that the state gives on how a long-term project is financed.
Thank you.
Vladimir Putin: Thank you.
I would like to draw the attention of our colleagues and our financial authorities to the fact that some things still require special attention. All the work is going on properly, at a good level, but we still don't have enough initial public offerings, to put it bluntly.
There are other issues that require further study. Although in general, of course, the result and stability indicate that the work is underway and this work is being carried out with proper quality.
Colleagues, do you have a desire and need for someone to speak out on the topic?
A. : Vladimir Vladimirovich, may I ask?
Vladimir Putin: Please, Alexander Sergeevich, but I will only ask briefly, because BRICS is already progressing there.
Alexander Kalinin: Dear Vladimir Vladimirovich, Dear Mikhail Vladimirovich,
Over the period from 2020 to 2023, the contribution of small and medium-sized businesses in absolute terms to the country's gross product increased significantly. If in 2020 it was 22.2 trillion rubles, in 2021-26.5, then in 2022 the figures will be in January, but 30 trillion rubles are expected. That is, in absolute terms, the contribution of small and medium-sized businesses – along with GDP growth, along with economic growth-has grown significantly by eight trillion rubles.
In addition, in terms of employment: about 30 million people work in SMEs today, along with the self-employed. This is about 40 percent of the already employed citizens, without the self-employed-about 30 percent, or 22.5 [million].
According to the register of SMEs, the number of enterprises increased by 250,000 last year. According to VTsIOM research, 92 percent of respondents positively assess the perception of entrepreneurship by Russians in our country, and the level of positive perception of entrepreneurship among young people is 99 percent. These are VTSIOM data. Every second respondent positively assesses the conditions for the development of SMEs in the regions. In 2013, it was half as much. There are also positive developments in the fiscal component.
For example, in 2021, compared to 2020, small and medium-sized businesses contributed one trillion more to all budgets, and in 2022 another half a trillion more. That is, small and medium-sized businesses began to pay 1.5 trillion rubles more annually to all budgets over the past three years. For example, contributions in 2022 amounted to about 4.7 trillion rubles.
Of course, this is a joint effort between small businesses, the Government of the Russian Federation, regional governments, and business associations. First of all, we work closely with the Ministry of Economic Development, the Ministry of Industry and Trade, and the Ministry of Construction.I would also like to highlight the SME Corporation and other business associations.
What would I like to draw your attention to? In many respects, this was achieved due to the "whitewash" mechanisms that were launched by the Government of Mikhail Vladimirovich Mishustin back in 2020. In other words, the effect of the "whitewash" turned out to be just as expected: revenue increased sharply.
We understand that we need reserves now, and we need reserves for the budget of the Russian Federation right now.
We believe that there are large reserves in "whitewashing" today. We have worked out our proposals with the Ministry of Finance in the public Council, and we have discussed our proposals with the Federal Tax Service. We have sent our proposals to the Government Office, and they are currently being studied on behalf of Mikhail Vladimirovich in the Office.
We are talking about the fact that if you also significantly change the regulation in a number of industries – this applies to such industries as retail, for example, alcohol products, where there is a lot of shadow business, tobacco, fitness industry, security, tourism, self-employment-then you can get more than 100% without additional investment. billions of rubles of additional revenue next year.
Therefore, of course, we ask you to study our offers in a comprehensive way. They are thoroughly worked out with industry departments. We are ready to explain this in more detail.
In addition, we understand that the main success is investment. I would support the proposal of the Minister of Economy to resolve the issue of investment tax deduction in the regions. For small businesses, this is key: Today, it is not profitable for regions to give an investment tax deduction, because they lose money today, but they will receive it in three years. If you give treasury loans and budget loans for these three years, then this mechanism will work completely differently. This is especially true for small and medium-sized businesses.
In addition, if it concerns clusters, we support Denis Valentinovich's proposal. It was considered that the cluster system will include not only SPICs, where the investment volume is 700 million rubles or more, but also priority investment projects in regions where the thresholds are lower. But so far they have not been included in the cluster policy. We are currently working with Andrey Ramovich Belousov to promote small investments within the framework of investment standards in municipalities. We believe that it should be from 10 million rubles at the municipal level. Therefore, attention to small investments – of course, this is also a large reserve.
Finally, Mr President, we are also preparing for the Eastern Economic Forum together with Roscongress. In the Far East, the issue of personnel is particularly acute, especially in the construction sector. Previously, the Russian Federation issued about 50 thousand visas for North Korean workers, but now this has actually been stopped, and we understand that these are UN sanctions. But perhaps we can talk about easing them so that we can at least, as before, get 30 thousand North Korean disciplined high-quality workers to the enterprises of the Far East.
Thanks for attention. We are working with the Government as we did during COVID.
Vladimir Putin: Okay, thank you very much.
We need to take a closer look at your suggestions. As for additional loans in the regions, there are funds available in general. This is not only a matter of working out with departments and regions that are losing some money, but also, as I said, it is necessary to work out with the financial authorities, because there are issues of macroeconomic stability here. We won't go into details now, but I hope you understand what I'm talking about.
Please, colleagues, who else? All? Thank you very much. I would like to thank you all, we have a lot of participants, but nevertheless I asked you to meet in such a broad format, because the issues are more important. They apply to everyone without exception: public organizations, the business community, the regions, the Government, and the Central Bank – all of them take part in this huge and large-scale work in one way or another.
Our goal today is to sum up some results and conduct an analysis. Even in the course of preparing for today's meeting, for today's meeting, this analysis was carried out, and this is evident from the prepared materials. But this is only the first part of our work.
And the second part, based on this analysis, involves certain conclusions and making appropriate adjustments to our work in order to meet all the development goals we set for ourselves.
So that nothing is forgotten, as usual, we will formulate this: I ask the Presidential Administration and the Government to work together and prepare drafts of these instructions so that we can build a line of necessary steps designed for the near and medium term.
Thank you all very much. All the best!
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Can you imagine Biden being able to make this statement?
long read as you say! thanks karl... many interesting ups and downs they are dealing with..