Russian President spoke on the results of APEC activities in 2012, and the joint declaration adopted following APEC-2012 Leaders’ Week.
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Vladimir Putin: Thank you! Allow me to make a brief opening statement, and then I will try to take all of your questions.
Ladies and gentlemen! Please allow me to begin thanking our colleagues and our guests for our joint work for the economic leaders' two-day plenary meeting and bilateral meetings. We thought that all of our partners were business-minded, open to constructive work, and committed to achieving our common goals as part of our efforts to enhance cooperation in the APEC region.
Unfortunately, as you know, tragedies recently occurred in the People's Republic of China. Lives were lost as a result of earthquakes. Many were injured. Once again, on behalf of the Russian authorities and the Russian people, I would like to express my condolences to those who lost their loved ones, and to wish good health to those who suffered. I could see that our friend Hu Jintao was extremely concerned, and he was constantly monitoring the situation and dealing with these problems. It takes our attention away from discussing our agenda, but such is life.
Expanding cooperation between our neighbors in the Asia-Pacific region is a priority in Russia's foreign policy, and Russia's chairmanship of APEC in 2012.
Russia's theme this year is, "Integrate to Grow, Innovate to Prosper." While developing the organization's work during our presidency, we try to be guided by today's priorities and the issues that will be relevant tomorrow. We work to identify areas where our efforts to enhance the leading role of APEC economies in the global economy will be most efficient, and to create additional sources of sustainable growth. We believe that we have successfully achieved the goals that we formulated ahead of the Leaders' Week in Vladivostok, and that we were able not only to achieve continuity in APEC's activities, but also to open up new horizons and to listen closely to the positive messages from business circles.
When our Asian colleagues decided to create this format many years ago, they made the right choice. It was a useful initiative. In the past few days, we learned once again that it is an extremely useful forum for exchanging views and trying find solutions to the challenges that we all are facing. The summit's major outcome is the APEC economic leaders' declaration, which reflects the results of the forum's work during Russia's presidency, and formulates the future agenda.
Historically, APEC was established to encourage mutual trade and investment. The forum's philosophy is to lift barriers, to encourage the openness of markets, and to encourage fair competition. Russia believed that it was important to step up the efforts to promote this process, and to move it forward, especially today when all of us want to see the global economy overcome the recession and achieve a trajectory of sustainable and long-term growth. The Vladivostok summit once again reaffirmed the commitment of APEC economies to the underlying principles of free trade and integration.
Russia also suggested to perform monitoring of environmental policy measures that might hamper trade. An important achievement was the adoption of the list of environmental goods. Our effort to implement arrangements and to reduce duties on environmental goods was tough, but at the end of the day we managed to adopt a credible list of environmental goods including 54 items and groups of goods.
Ladies and gentlemen, let me note that under the umbrella of WTO similar efforts have already been proceeding for over 10 years - and so far they have brought no results. Meanwhile, we were able to accomplish this list in just a few months, and this list of environmental goods was finalized during the meeting.
Another major point is that the APEC leaders unilaterally supported further regional and economic integration. Russia is determined to actively participate in these processes. We are participating and drafting FTA agreements.
APEC's leaders recognize the importance of the full transparency of multilateral and bilateral FTA agreements in the region. It was Russia's initiative to draft and approve a so-called model chapter to be incorporated into the FTA agreements, which mandate that member economies disclose information about preferential agreements in advance.
When we acceded to the WTO, we promised and committed to fully disclose such information, and I believe that once the FTA areas are established it would also be handy if the participants provided full information about the conditions and the preferential arrangements. The development of regional economic integration is our strategic choice and we will implement those arrangements in accordance with the coordinated goals of our partners, the Custom Union, and the Single Economic Space, keeping in mind our future efforts regarding the Eurasian Economic Union.
By the way I would like to reaffirm that Leaders' Week was guided not only by Russia, but it was also supported by the coordinated position of "the troika" - Russia, Belarus and Kazakhstan. Also, I have heard that certain APEC economies are already showing a practical interest in establishing special relations, such as free trade areas, with the Custom Union and the Single Economic Space.
We are holding practical negotiations with some of these economies. We believe that the coordination of integration efforts in the Eurasian and Asia-Pacific space would also benefit everyone. In the future, we can speak about building a free trade dialogue between the participants of the Eurasian Economic Union, which is now being established, and APEC. Cooperation is possible with other regional associations.
During the Leaders' Week, we reaffirmed the importance of taking joint steps to improve supply chains and to eliminate the remaining stumbling blocks that limit the flow of goods. We suggest using our country's transit potential to diversify regional and global supply chains and to create new, shorter, more profitable routes that will link the Asia-Pacific and Europe across both the continental regions of Russia and through the North Sea route.
We discussed investment cooperation. We noted the need to share best practices to protect investments. This is yet another topic that we addressed. A review of such practices has been made, and they will be implemented in all APEC economies.
Another significant area of our work is food security. Our partners endorsed the Russian suggestion aimed at enhancing the food market's stability, and expanding access to food for more vulnerable social groups. We spoke about the need to attract investments and to introduce innovative technologies to agriculture.
We need to combat the illegal production and trafficking of marine bioresources. By the way, the Japanese Prime Minister and I agreed that we would sign an agreement to counter poaching at the G20 Meeting in Los-Cabos, Mexico. This is a very sensitive and important issue for us and our Japanese partners. I note with satisfaction that we did sign such an agreement during the APEC Leaders' Week.
All APEC economies are future-oriented, as we recognize that innovations hold the key to the future. We are in favor of establishing the Common Educational Space, and establishing comprehensive cooperation between the relevant agencies, research institutes, educational facilities and business circles.
Among APEC's achievements in 2012 are initiatives to ensure closer cooperation between governments and businesses, and creating public-private and policy partnerships in spheres such as innovation and food security.
On the eve of the APEC Leaders' Week, we held substantial discussions with the members of the International Confederation of Trade Unions' Asia-Pacific network. I took part in one meeting myself in Moscow just recently. We discussed constructive and useful ideas. In particular, we spoke about how the global crisis impacts the labor market. We spoke about the social responsibility of the state and businesses.
Trade unions would like to have greater influence on the work of APEC and to take part in drafting the outcome resolution. I promised our trade union colleagues and I informed my fellow leaders at the leaders' meeting today about the initiative. We agreed to build closer cooperation with trade union leaders. The Indonesian chairmanship in APEC will not only take on board their desire for greater cooperation, but also host ministerial meetings for labor ministers. So, trade unions will have a genuine influence on the APEC agenda and outcome documents.
Russia is prepared to share its experiences on issues such as the preservation of biodiversity, and combating the trafficking of endangered species with the Asia-Pacific. Our partners have shown a strong interest in programs and projects to protect endangered species. Not only the tiger and the leopard... We also spoke about other animals. We see significant potential for cooperation. Environmental protection has strong economic dimensions. For instance, we must focus on clearing riverbeds, such as border riverbeds. This is an important environmental problem that has a strong economic dimension.
Generally, during the Russian chairmanship of APEC, we held over 100 different events. We hope that they not only demonstrated Russia's technological investment potential to our partners, but also helped show them more about our culture and our traditions. We have shown through our actions our adherence to the APEC ideals and goals. We are ready to continue constructive cooperation with our partners. In 2013, we are passing the chairmanship to Indonesia. We welcome our Indonesian colleagues and friends, and wish them every success and fruitful work.
In conclusion, I would like to give special thanks to the people of Vladivostok, and those in the Primorye Territory. Thank you, dear friends, for your hospitality, for your great contributions toward the preparations for the APEC Leaders' Week.
This forum's success is our common success - the success of Vladivostok and the people of the region. We will certainly continue developing and improving the living conditions in Eastern Siberia. We will use - and make use of in full - the active involvement and initiatives of our people, and work to completely tap the new opportunities that integration and partnership with our Asia-Pacific neighbors open up. This concludes my opening remarks. Your questions, please.
Question: During the Leaders' Week, we often heard from media, delegation members, and heads of states, but I would like to hear your view as a host leader. Did you enjoy the Leaders' Meeting? Not just in terms of substance, but in terms of conditions - organizational conditions?
Vladimir Putin: I did indeed because my guests were very interesting, very constructive, and very pleasant to deal with. They are true leaders of their economies, and top experts in economics and politics. Communication with such people is always enriching. The discussions were very constructive.
Our guests - the leaders of APEC economies - greatly appreciated our idea to host them not in a five-star hotel, but rather on a university campus. They appreciated our use of public resources not to construct palaces, but instead to build a new, top international level federal education and research center. They really enjoyed being the first guests at these premises. In terms of substance, I would like to note that we all - my colleagues, Russia's ministers, and I - were the hosts, but we also acted based on the spirit and the desire of our APEC partners to discuss the issues that are most important and relevant to all of us at this moment in time.
So, once again, in terms of the venue, the arrangements, the working conditions... They are very good. They might be a little modest, but they are decent. They meet top modern requirements, including in terms of technologies, sighting equipment, and design. I want to thank everyone who worked to prepare the Leaders' Week - technical experts, building workers, and volunteers. However, if I am not mistaken, I will have a chance to meet everyone and to thank them because they did a really spectacular job. And this was noticed by the guests. I want to stress that... They noticed this and they appreciated it. They asked me to thank you on their behalf. Most importantly, of course, is the substance. Our work was constructive. We have specific results and I am fully satisfied with the outcome.
Question: Vladimir Vladimirovich, during the Leaders' Meeting, you spoke a lot about free trade and protectionism. At the same time, Russia and its major trading partner, the EU, often engage in a kind of cold trade war. In this respect, how could you comment on the European Commission's investigation regarding Gazprom and the statements that we are hearing from European officials who say that Russia should lift import duties and other duties? Are you going to employ WTO mechanisms?
Vladimir Putin: Well, I would disagree with your assessment of our relations with the EU. Our relations are very constructive, very positive, and we are not talking about trade wars, or any hostilities. The investigation that is underway in the case of Gazprom is nothing new. Last year, Gazprom offices abroad were searched. This was the next step in the investigation. We, of course, are not pleased with what is happening, as this is occurring for economic reasons. We are talking about Eastern Europe, and we are fully aware of what is going on. The problem is as follows... The EU committed to subsidize the economies of its member states. And to a large extent, the EU subsidizes the economies of Eastern European countries. Probably, someone in the EU has decided to shift part of the burden, some of the subsidies, onto us. United Europe wants to preserve its political influence and wants us to pay for it. This is nonconstructive - for one.
Second, there are technological reasons. Back in the Soviet days when the Eastern Bloc existed, the Soviet Union used to supply energy to these countries at non-market prices. You could not describe this as being part of market-driven relations. Later on, we started to cooperate on the basis of market principles, and the pricing formula has changed to become market-oriented. I believe that we need to be guided by today's realities. Modern Russia never committed to and was not planning on undertaking additional commitments that would help regulate the economies of these countries through the use of non-market measures.
Third, we have had certain pricing principles in place for decades, and they are written in long-term contracts. No one ever questioned these principles. I know that during a crisis there is a strong desire to shift the financial burden onto someone. However, once again, I do not think that this is constructive. I sincerely hope that through business-oriented, friendly dialogue - I want to highlight that - between our economic entities, Russian companies and the European Commission will find solutions and a way out of the situation without any side being damaged.
Question: According to various estimates, the preparatory costs for the Leaders' Week were 600 billion rubles. Do you think this amount was too costly and wasteful, and will we be able to justify these costs in the future?
Vladimir Putin: I do not know what to tell you right now. What could the answer be to this question? Please do not get angry with me. What are you saying? What 600 billion are you implying? 300 billion were used to create a gas pipeline system running from Sakhalin to Vladivostok. Let me emphasize that it is not an export pipeline - it is a gas transportation system to supply gas to the Primorye Territory. What does this have to do with the preparations for the APEC Leaders' Week? Maybe, to a certain extent, it has to do with that, but the goal is to supply gas to the region. That is the first point. The second point is that we have created utility and water supply systems. We have expanded the runway. We have created new fueling facilities, a new railway station was built, and three roads were constructed. We have also constructed three bridges.
We invested in other infrastructure objects, which have nothing to do with Russky Island. They have to do with Vladivostok and the Primorye Territory. Some premises are not the utilities proper. You know what is happening to the bay here, and what types of settlements have accumulated on the shores and on the seabed? To make the ocean clean, we have to do this. We have to invest in infrastructure projects. This helps us to develop the region in the long term. I was told more than once that it is not expedient to build such a huge runway because there are not so many flights operating from here. However, I am sure that this runaway will soon not be sufficient because more flights are appearing as new infrastructure is built. This is where we invested most of the funds.
Speaking about the preparations for the Leaders' Week, most of the investments were used to build the campus. However, we all understand that any venue could have been chosen to organize the Leaders' Week and it could have been much cheaper. However, there would not have been any Federal University. We would not have created such a dominant intellectual power in the Far East. I think that we should make such investments to implement these kinds of projects. Speaking about Eastern Siberia and the Far East's development, we should start with intellectual projects, and this requires the necessary funds. And I am convinced that these projects will be accomplished in the future.
Our major goal now is adding intellectual substance to these walls. However, we already have the Far East Federal University. On this basis, we can continue our work and attract experts from other countries. We can set other large-scale goals.
Another waste has to do with the preparations for the Leaders' Week in terms of the security for the event. We even invested in buying equipment for the special services and the law enforcement and border agencies. How will this equipment be used? Will be discarded? No, it will be used for these various services. They will be used to hold the University Games in Kazan, the Olympic Games in Sochi, and for organizing the G8 and G20 in other Russian regions. Nothing was spent in vain. We have received a large heritage due to the APEC Leaders' Week. Certain funds had to be invested in organizational arrangements. However, I think that these costs were kept at a minimum, and the total costs are fully justified.
Question: Distinguished Mr. President, thank you. We are grateful for your condolences in light of the earthquake in China.
To which spheres will Russia attract investments from China to develop the Far East? Also, a lot of young people in the Far East want to leave this region. What measures are taken by the Government to encourage them to stay? Thank you.
Vladimir Putin: As for spheres that could attract Chinese investments, they are very diverse. First and foremost, we would like - as I have mentioned - to work with our partners, including our Chinese partners, on innovative technologies, on the technologies of the future. Let me draw your attention to the fact that the Far East includes clusters that were created long ago and that have certain capabilities for growth. These clusters are being reorganized and revitalized. Let's take a look at ship manufacturing and industry. Companies in these sectors are created with the participation of Chinese capital. I know that our colleagues from Hong Kong are present here. A second such enterprise is going to open with the participation of Korean capital. This is the first sphere. There is also the potential to create aviation equipment manufacturing companies.
Now, together with our Chinese partners, we are considering working in aviation manufacturing. First of all, this concerns the creation of a large helicopter based on Russian technologies. This helicopter was lauded by our Chinese colleagues, as it was used during the aftermath of an earthquake a couple of years ago. These are the largest helicopters around in terms of capacity. They can lift 20 tons. Together with our Chinese colleagues, we decided to work on designing similar helicopters. So, we could think of establishing such companies in the Far East. Now, we are working to create wide-bodied aircraft with China. We know that this task is tough and you know that two companies - EADS and the U.S. Boeing - dominate this market. However, we must do our best to find our niche based on open and transparent competition. Russia's technological capabilities and China's financial and intellectual resources give reason to believe that we will cope with this task.
And now, the energy sector. I should say that some of Russia's nuclear facilities are located in Eastern Siberia. You know how active the Russian Federation is in China. We count on future cooperation - not only in production, but also in terms of the sciences, and the scientific dimensions of this work. We have the Siberian Research Institution, where people are actively involved in promoting innovative technologies. And I hope that our experts will pay particular attention to this problem in the Far East and here at this new educational center.
And now, speaking about hydrocarbons and the energy sector as a whole, I would just like to mention that there are huge opportunities for the growth.
Question: Good afternoon, Vladimir Vladimirovich. You have said more than once that Europe is our major trade and economic partner. However, due to the current situation in the Eurozone and the recession in Europe, don't you think that we should shift the accent on the development of our trade economic relations to the Asia-Pacific, at least partially, taking into account the meltdown in the Eurozone? Don't you think we should reduce Russian reserves in the euro and keep these reserves in rubles or some other currencies?
Vladimir Putin: The first question was to shift the balance toward the Asia-Pacific. Nothing should be created artificially. This is actually happening by itself. Russia's trade turnover with Europe accounts for 51% of the whole, while its trade turnover with the Asia-Pacific accounts for 24%. Although the capabilities for economic growth in the Asia-Pacific in terms of trade turnover will increase, this doesn't mean that we have to stay idle and just watch as things unfold in the world.
Understanding current developments, we should adapt to these processes. We should prepare. Are we doing this? Yes, we are. We are expanding infrastructure capabilities. We are expanding the throughput capabilities of the Trans-Siberian Railroad and the Baikal Amur Mainline. We are going to expand the region's port economy. We will develop additional energy resources. We will develop hydropower to create industrial clusters on our territory. A lot of work will be done and we are going to move in that direction. This is a key priority for Russia's development as a whole and for the development of this region.
As for the Eurozone, I can say that there are serious problems. We were talking about them for a while during our luncheon. Madam Lagarde made a statement on this issue and we had lively discussions. Different points of view were expressed, and sometimes they were contradictory. We discussed the future situation in the Eurozone, as we mostly depend on the European continent. I am sincere in our hope that our European partners will overcome the difficulties that they face today.
Question: Good afternoon, Vladimir Vladimirovich. Lots of official events took place during the Leaders' Week, but there were also a number of informal meetings. On September 7, Igor Sechin celebrated his birthday.
Vladimir Putin: So, this is the main issue on our agenda...
Question: Much is happening in terms of life at the Leaders' Week. You were surely invited to the event. What did you give him as a gift and how was the party?
Vladimir Putin: I was not invited to the celebration. If it took place, you know more than I do. Then, I would like to ask you where it took place and who took part. Mr. Sechin did not invite me - too bad for him. You asked me what I gave him as a gift, but now I feel guilty because I did not give him a present. But now I have to, even if today is the day after his birthday. But I should say that Sechin is very efficient in his work and he is worth paying attention to.
Question: Vladimir Vladimirovich, you had over 10 bilateral meetings on the sidelines of the Leaders' Week. What were the results of these talks? You spoke with Hillary Clinton. What did you discuss? Did she tell you about the domestic political situation in the United States, as the election campaigns are underway?
Vladimir Putin: You know, even if she told me something about the domestic political situation, I do not feel entitled to relay the story, even to such a respected audience. I think that the Americans should have the right to decide what they are going to tell to the media. Indeed, we had a short talk on the sidelines. We spoke for about 15-20 minutes. It was a constructive conversation. We discussed our bilateral relations, trade, economic links, and some political issues.
Of course, we discussed the situation in hotspots in the world, in the Middle East, here, in Asia. It was a constructive, business-like conversation. I do not think that now is the time to go into details about this discussion because no agreements were reached. No agreements were made, but it was a useful dialogue. We just shared our positions. I think that this is useful - such talks are useful as they allow us to better understand each other. Maybe we'll find joint solutions in the future.
Question: Vladimir Vladimirovich, there was the bilateral meeting yesterday with Japanese Prime Minister Mr. Noda. How do you assess the results of this meeting? What do you think of the capabilities of and the opportunities for Russian-Japanese cooperation in the region? What are the long-term prospects, and what can be done to strengthen security for Russia and Japan?
Vladimir Putin: Japan is our longstanding partner - a key partner in the region. We know about the Japanese economy's abilities. We are aware of the economy's problems and potential. We are interested in developing ties with your country and we would like to resolve all outstanding issues that have historical roots. We talked about this yesterday as well. We also discussed measures that could be undertaken in the near future. We agreed that Mr. Prime Minister will pay an official visit to Russia. We will discuss all these problems in detail and not on the sidelines.
We focused our attention on economic issues - on Japanese investments in Russia and on Russian investments in Japan, as well as on opening joint ventures with the participation of Japanese capital. The Prime Minister expressed satisfaction on behalf of the Japanese business community with the way that things are developing and their activities in different parts of the Russian Federation. In the North-West, as you know, we have some enterprises with Japanese participation - in Russia's European regions. Mazda has just opened a car assembly company enterprise here. This is the company's first foreign enterprise. Toyota is also active in this region.
However, our colleagues pay particular attention to Russia's experience in the energy sector after the problems associated with the Fukushima incident. We agreed to expand cooperation in this area. You know that Gazprom signed an agreement with its Japanese partners on natural gas liquefaction. This project could turn into a major international project because Japan is a huge consumer, since it has limited natural resources. This is why we will assist Japan in this process. We are working with Japan on market conditions. Both we and our Japanese partners are satisfied with the Sakhalin project's development. We will address these issues.
I noted that we agreed in Los Cabos to sign an agreement against poaching. We implemented the agreement, and signed it yesterday. There is huge area for joint work. We are developing this work not only with Japan, but also with the Republic of Korea. We are holding many negotiations devoted to the fishing industry - and fishing quotas. There is nothing new here, and I think that I can tell media representatives that we insist on granting quotas in connection with the opening of processing facilities in the Russian Federation. I think this approach is enough.
Question: Vladimir Vladimirovich, I have a question that has nothing to do with APEC. I would like to ask you about Asian Cranes - the birds that you showed the way to warmer habitats. What is your view of the large number of rather sarcastic comments that have been made - a lot of things have been said and written and many jokes have been made. Why talk about this? Just let them fly themselves. Your steadfast opponent Kseniya Sobchak compared the situation to electoral statistics. I am not sure whether you know this, but 63% of the cranes followed you, as it turns out, and the rest went south. Only a small number of birds stayed on the boulevards and in the squares in the cities. I think that there is a certain degree of truth to these words - not all of the cranes followed Mr. Putin. So, this is my question. It's up to you to answer. Thank you.
Vladimir Putin: Applause. I even heard applause. Indeed, not all of the cranes followed me. Only the weak ones, the weak ones didn't follow. And that was just the first attempt. During the second attempt, they all took off. To be honest, I have to admit something and to be frank with you - not all of the cranes flew. The pilot was going too fast and getting too high, and the cranes lagged behind. They could not catch up. But this is not the whole truth. In certain circumstances, when there is strong wind or bad weather, the pilot has to get off the ground fast, or the plane can overturn and capsize. What else can be said? There are certain birds that do not fly in flocks. They prefer to nest separately. However, this is a different problem. Even if they are not members of the flock, they are members of our population, and they have to be treated carefully - of course, to the extent that this is possible.
Question: First, Vladimir Vladimirovich, I have been in this profession for a long time, and I would like to thank the host and the organizer of the Leaders' Week for the conditions that have been created. Indeed, we have many things to compare this with - and everything was really up to the mark. As a Far East resident, I would like to ask you a question. I love this area, and I wouldn't go anywhere else - I really wouldn't reside anywhere else. Our region is huge, stretching from Lake Baikal to the Bering Strait. I believe that a certain status should be accorded to our region that includes tax breaks and tax vacations for innovative enterprises. Some sort of customs preferential treatment for enterprises working in resource production... What are your thoughts in this regard?
Vladimir Putin: Well, we are continuing to discuss this issue all of the time and to think about creating conditions to promote accelerated development in these areas. There is a temptation to establish free economic zones, but taking into account our people's talents, we fear the entire Russian economy would move to these areas.
There are some other ways that can be pursued and we have discussed one with Madam Nabiullina, which includes providing preferential treatment terms to so-called "green field projects." We will give this some consideration. I would like to ask the members of the Government to provide their proposals on the subject.
And there are also other opportunities and possibilities... Perhaps it is premature to discuss this publicly because, generally speaking, such things should be discussed publicly only when they have been developed and agreed upon... But you know that in Eastern Siberia, for example, we have provided preferential taxation terms for mineral resource producing enterprises, and these terms cover the major infrastructure that they create.
This could be pursued in other areas, such as hi-tech, by setting up favorable conditions for the projects implemented here. However, there are some other tools that could be employed. By the way, the Far East development program is one of the few regional development programs... We will extend this program. So, let's conclude.
Question: Vladimir Vladimirovich, perhaps my question will follow up on what you have just said. You need investors to implement the projects that have been planned. You have had the opportunity to discuss this issue with entrepreneurs during the APEC meetings and during the CEO Summit. What is your impression? What is their sentiment? Are they optimistic or pessimistic in terms of the global economy, the Russian economy, and the projects that are being discussed? Isn't there a risk that they will just stay on paper? Or could they really be implemented?
Vladimir Putin: Well, here, and, generally speaking, at the APEC Leaders' Week, we don't discuss specific projects. The Leaders' Week is convened for a different reason - to check our watches to see where we stand on major regional and international economics issues. However, in this context, we see our colleagues' sentiments from the Asia-Pacific. And I must tell you that there is a certain concern with respect to global economic trends, of course, taking into account the problems facing Europe. And the United States is also facing many challenges and similar problems. But this particular region - the Asia-Pacific - we have discussed this issues many times and repeated it many times in the media... This region is a locomotive - a driving force for the global economy. While in the Eurozone we are witnessing zero growth prospects or even a recession, here we are seeing growth - significant growth. Of course, the growth rate is dropping, but nevertheless it is growth. And, by and large, the state of affairs makes the leaders of the economies represented here optimistic as opposed to pessimistic.
Today, we have discussed the global economy. One of our colleagues - I won't mention him by name - said a very true thing that the issues in the Eurozone have more to do with politics than the economy. I think that this is true because the political system itself, the high level of social security, and the impossibility to provide for the growing demand on the basis of the existing economic order... This is a heavy burden for the European economy.
And in the Asia-Pacific, this burden is significantly less. There is nothing like this paternalistic burden that exists in Europe. Here, all of the economic actors feel a responsibility for the situation in the social and economic sector. This is a very important political, economic and psychological effect. Of course, I am speaking in general, but the problem - the number of problems - that we face is much greater. Responding to your question, I would like to stress that the sentiment in this region is positive and the expectations are hesitantly optimistic, I would say. Thank you.
Question: Vladimir Vladimirovich, I'd like to thank you for organizing the meeting on Russky Island, but I'd like to ask if you have had the opportunity to do some sightseeing in the city. If you did, you probably saw fresh paint on the facades of the buildings, some barracks concealing certain areas... We residents have never seen anything like this before, and people have complained. Will any additional federal allocations be made to ensure urban development? Because people are afraid to walk in some areas of the city.
Vladimir Putin: Well, this is an important issue and I thank you for raising it. Let me explain why this is a good question. I have already mentioned something, and if some colleagues did not hear me, then let me say this once again. Vladivostok and the territory nearby have historically been a closed city - a restricted area. It could only conditionally be called a city. It was a navy base - a military base - and no foreigners could enter the area. But from the point of view of social development, nothing happened here for decades. Everything remained static. And construction was very modest and the area was degrading.
Now, the first attempts are being made to drastically change the situation. It is not enough to open the city. We have to develop it. It deserves this development due to its geographical position and its importance for Russia's future. This is why the decision was made to hold the APEC meeting not in St. Petersburg or Moscow. We could have done that easily. However, the decision was made to hold the Leaders' Week in Russia's Asian regions - specifically in Vladivostok to help develop its infrastructure.
And these are just the first steps to develop and invigorate the city. I should tell you that everything here looks beautiful. But, after yesterday's downpour, there are problems with drainage and the water supply. Actually, we have been working on the construction side, and this needs to be completed. But the volume of work to be done is huge and, therefore, things are normal in that respect.
In terms of Vladivostok, again, this is just the initial step. As you know, the situation in the eastern areas is the same - along the Baikal-Amur Railroad. People continue to live in barracks and have poor living conditions. They were promised better living conditions, but they were fooled and they still live with the same legacy that has existed for decades. People were left to make ends meet on their own in those barracks, and they have no right to apply for improved housing because the barracks where they live are not considered residential houses.
Here, the situation is different from Baikal Amur are, but there are still poor living conditions in areas. We have to think about what measures need to be taken to help the city develop. First, investments should be made to develop infrastructure. However, a large part of the work that needs to be done should be shouldered by the municipal and the regional authorities. Let me repeat this once more - it is our intention to support them. We will support them. A significant demand for work needs to be created by the authorities. It is the most important thing that needs to be done... We have to create highly qualified jobs to achieve sound living conditions, so people can use their buying power to resolve housing problems by building new offices and new corporate buildings.
Just yesterday representatives of our major banks had a look at what is happening here - the initial sprouts of new development. They expressed a desire to take part in this process. We are building a space launching site. We will develop the current district cluster. I have visited a plant built by the Japanese, and Sollers' representatives have already informed me about what they will be doing at the site. They will remove the barracks and build new houses. Where new enterprises are built, new houses are built.
The situation will continually improve for the better. There will be progress, continued progress. However, we have to improve the economic microclimate to do this. We have to attract foreign investment. When we develop the production base, social issues will be solved. For its part, the government will have to make investments to develop social infrastructure, medicine, education, and public health institutions. And this will take many years, probably decades, but I know Russia needs to deal with this task and I am confident that we will succeed. Thank you!