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Russia to consistently solve its problems despite external restrictions — Putin

October 02, 2014, 14:09 UTC+3
Many major foreign investors continue to do business in Russia despite existing difficulties, Russian President Vladimir Putin says
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Russian President Vladimir Putin

Russian President Vladimir Putin

© Stanislav Krasilnikov/TASS

MOSCOW, October 2. /TASS/. Russia will consistently solve its problems, despite external restrictions that only make it more resolute, Russian President Vladimir Putin said at the full-scale meeting of the investment forum Russia Calling on Thursday.

Transition to floating rate does not mean refusal from interventions, the president said. “I must say that the Bank of Russia has enough instruments to maintain financial stability. I would also add that the Bank of Russia’s transition to a floating rate does not mean overall cancellation of currency interventions,” Putin said.

Russia does not plan to introduce any foreign currency restrictions or restrictions on capital movement, he added. Russia will actively transfer to national currencies in foreign settlements with China and other partners, the Russian president said. Russian major oil company Gazprom Neft “has recently made a first pilot oil supply to China for rubles,” he said.

He recalled that the specific mechanism had also been created within the BRICS union of Brazil, Russia, India, China and South Africa. “We take the use of national currencies as a serious mechanism to bring down risks and as new possibilities for participants in economic life,” Putin noted.

Russia’s federal budget surplus reached over 900 billion rubles ($22.7 billion) in January-August this year, Putin noted.

Principles of Eurasian Economic Union construction fully correspond to the norms of the World Trade Organization (WTO), the president stressed. Russia shares the WTO principles and will seek to develop an open market economy, Putin said. “We share the WTO principles in contrast to the ‘founding fathers’ of the organization,” he said.

Mechanisms are created that allow to carry out transactions with the use of plastic cards of leading payment systems, even if domestic banks are cut off from them, he added.

Russia’s inflation will reach 7.5-8% in 2014, the president said. “As far as inflation is concerned, by the end of the year it will be at about 7.5-7.6%, 8% at the most, which is clearly above last year’s parameters. In 2013 we had 6.5%,” he noted.

Russia to make a breakthrough

Russia should make a significant breakthrough in the growth of industry, including processing industry, in the coming years, Putin said. “Along with development of foreign trade, export stimulation and participation in integration projects, we are set to use in full one of Russia’s competitive advantages — its receptive internal market,” Putin said, adding that the market was ranked sixth in the world’s volumes.

“Our goal for the coming years is to make an industrial breakthrough and create strong national companies in processing sectors, which would be capable of producing competitive goods,” he said.

Sanctions give a stimulus to the intensification of scientific and technological research in Russia’s industries, the president noted. “Today’s situation is objectively giving a powerful stimulus for intensifying scientific and technological research in all spheres where technology dependence on foreign partners is superfluous,” he said, adding that he referred first of all to the critically important — “so far imported” technology.

Putin said industrial and agricultural projects would be given low-interest loans through project financing instruments. “We are constantly working on this, thinking, offering instruments,” he said.

Despite currency fluctuations, there are strong fundamental factors ensuring the stability of the Russian economy, he emphasized. “I am stressing the main things: we have very strong and reliable fundamental factors that ensure stability. These are deficit-free budget, considerable reserves and firm balance of payments,” the Russian leader said.

Investment in Russia

Many major foreign investors continue to do business in Russia despite existing difficulties, Putin said. “In particular, I would like to point out that many major investors and long-time economic partners of our country keep building up investments in various sectors of our economy,” Putin said.

The Russian leader pointed out that the forum had brought together representatives of business circles who are aware of the “opportunities and long-term prospects of business in our country.” “We greatly appreciate your intention to maintain a meaningful, frank dialogue and constructive cooperation — irrespective of the current political and economic situation,” Putin told the audience.

He recalled that the Russia Calling forum held its first session in 2009 amid the global economic crisis. “It did not prevent us from making common plans for the future. Many of these plans have been successfully implemented to become specific business projects,” Putin said.

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