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Medvedev talks WTO, gas and Ukraine's debt

October 29, 2013, 13:37 UTC+3

Russia's Prime Minister mentiones WTO, notes the high volume of overdue domestic gas payments

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Photo ITAR-TASS/ Ekaterina Shtukina

Photo ITAR-TASS/ Ekaterina Shtukina

GORKI, October 29. (Itar-Tass) – Russia’s Prime Minister Dmitry Medvedev believes that his Ukrainian counterpart underestimates the gravity of the situation with the country’s debt for Russian gas.

Medvedev noted that Ukraine has voiced statements, suggesting they understand that there are problems regarding payments for gas, but these problems are not critical. “This was said by my colleague Nikolai Yanovich Azarov,” the Prime Minister said, adding: “I believe that it’s a very mild way to put it. Problems exist, and they’re very much critical.”

WTO Claims

 Medvedev believes that Russia should be prepared not only to reply to the claims within the World Trade Organization (WTO), but also formulate its own claims if necessary, as “if you do not resist, you are knocked out.” Medvedev has made a statement to this effect at a meeting summarizing the results of the first year of Russia’s membership in the WTO.

“In general, the following principle is in effect in the WTO: if you do not resist, you are usually knocked out as well as in the world in general,” the prime minister noted.

“Therefore, if the scope of claims are made to us, probably, some of them grounded and some others groundless we should meet the situation head-on and should be prepared to reply to these claims and in turn formulate our own claims,” Medvedev said.

In this regard, he named as the priority task “to eliminate unjustified trade restrictions, which are applied against Russia.”

“In fact, these restrictions continued to be applied in some cases contrary to common WTO rules. Some of them affect directly the interests of our investors and exporters,” the prime minister said, focusing on the need to promote Russia’s positions and to build up Russia’s presence on the world markets.

He called “to make use decently of opportunities that the WTO membership gives: use the permitted mechanisms and procedures at most.” “Particularly this is a body for the settlement of disputes in the WTO. This body works and the claims are made to us, but also we should be prepared to initiate talks to this effect,” Medvedev noted.

"Gas communism" 

The debt for gas supplies in Russian regions exceeded 100 billion roubles (about $3.1 billion), this “gas communism should be halted,” Russian Prime Minister Dmitry Medvedev said at a meeting in Gorki, Moscow Region, on Tuesday.

“Everybody should understand that the forgiveness of all debts or ‘gas communism’ will be out of place in the future,” he said, setting the task to provide for full payment for gas supplies.

The prime minister stated that the situation with gas payments in Russian regions is getting worse every year.

“I will recall that we take the leading positions in the world in terms of production and exports of natural gas, but this does not mean that despite the economic logics gas can be delivered inside the country gratis. This is impossible,” Medvedev noted. “I will recall that the total amount of overdue debt of consumers, according to Gazprom, makes more than 100,000 billion roubles (about $3.1 billion),” he added. Meanwhile, as the growth of the tariffs on the services of natural monopolies is frozen, Gazprom is put in tough conditions, over this fact the full payment for gas supplies is very important for it.

The prime minister noted that the housing and public utility sector is one of problematic spheres in this issue. In this regard, he noted that the utility sector should be made “absolutely transparent, with comprehensible rules of game for gas suppliers and for consumers.”

“Presently concrete steps should be proposed in this direction that will not only put the activity of different mediators in order, I mean management companies, but also will curb different criminal schemes of evasion from debt repayment,” Medvedev stated.

“We will have to discuss such measure as the restriction of gas supplies to indecent energy suppliers. Naturally, people who pay their utility bills timely and fully, should not be affected from this restriction,” the prime minister has set the task.

“We should ponder over how to deal with those electric power and thermal power generating companies, which do not pay for gas. There are just criminal schemes, some kinds of manipulations. It is high time to introduce amendments in the legislation that will seal off different loopholes in this sphere,” the premier said.

He also noted that the situation with debts for gas payments in Russia frequently differs strongly from that even in neighbouring Russian regions with similar economic development. “It means that this is a flaw of local authorities,” Medvedev added.

In this regard, he addressed to the governors, “Your direct task is to ensure the preparedness of local infrastructure and the observance of the payment discipline in all categories of consumers. This is the task not only for Gazprom or the Energy Ministry and the government in general.”

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