President of Russia Vladimir Putin: Good afternoon colleagues,
Two years ago at the Business Russia congress, we launched the National Business Initiative. We set the goal then of creating a comfortable environment for doing business in the regions and in the country in general.
We have already achieved visible results that are reflected in international ratings, as you know. It is not these ratings that are so important of course, but that it really is becoming easier and more convenient to do business.
To give you some concrete examples, we all remember the complaints and criticism about the complicated procedures and exorbitant costs of getting connected to the energy grids. This situation dragged on for years without any real change. The situation still cannot be called ideal, but coordinated efforts by businesspeople, experts, and the Energy Ministry have finally resolved a lot of the problems. Today, we will discuss the next steps needed to improve the situation in this area.
To take another example, broad use of modern information technology has made it possible to do away with superfluous administrative procedures and halve the cost of state services for cadastre registration and state registration of real estate property rights. We are now among the top 20 countries in the world for ease of doing business when it comes to property registration.
We have also made a lot of headway in improving customs administration. One of the measures taken under the National Business Initiative was to introduce preliminary notification when going through customs procedures, and also electronic payment of customs fees.
I stress though that we need to continue moving forward if we want business to really feel the benefits of faster and cheaper customs procedures. We will discuss this in detail too today.
I would note that the technology used for developing roadmaps and evaluating their results has become much more innovative, and demonstrated the effectiveness of modern approaches to project management and implementation. Together with entrepreneurs, society itself has determined what specific steps are needed to significantly improve the quality of the business climate, reduce the number of various procedures and permits, and cut administrative costs for businesses many times over.
More than 14,000 people from across the country have submitted around 10,000 proposals, and each of these was reviewed by ad hoc working groups composed of entrepreneurs, experts, and representatives of the Russian Government’s ministries and departments. Along with this, entrepreneurs themselves oversee the implementation of various roadmaps via the so-called Leaders’ Club that they helped to establishing.
I know that this dialogue is not always easy – that’s natural. Sometimes the business community disagrees with government agencies. But nevertheless, we were able to design all roadmaps to focus precisely on substantive, practical changes.
Today I would like to thank the leaders and members of the working groups, the Agency for Strategic Initiatives where these proposals and roadmaps were formulated, and everyone who submitted proposals for your perseverance and desire to help the national economy.
We know that it is much easier to plunge into gloomy pessimism, and start criticising everything. Much more difficult is to take responsibility for real changes in our country, and not to work for publicity, but at practical changes. Therefore the choice and position of all participants in the National Business Initiative certainly deserve our most sincere respect and support.
And in general, work to improve the business climate has demonstrated that a mature class of entrepreneurs is being established in Russia. For the most part it consists of people who did not participate in the privatization of the 1990s, who have created a business from scratch, who overcame all bureaucratic obstacles and the trials of economic crises, and who compete honourably with foreign companies, some of which have a little more experience and broader access to affordable credit.
These people have proven their worth. They invest in Russia, revive its economy and create new jobs. And most importantly, as citizens they intend to actively participate in the country’s affairs. I am convinced that we have to rely on precisely such people. That is why we consistently work together with entrepreneurs not only to improve the investment climate, but also on other reforms on the national agenda.
Colleagues, roadmaps have served as a measure of the effectiveness of all levels of government, their ability to get results rather than evade instructions, and, as I already said, to solve problems comprehensively, based on the needs and interests of both citizens and entrepreneurs.
The uniqueness of the National Business Initiative was its rejection of habitual bureaucratic logic. In fact, each roadmap constitutes a separate project with its own goals and timetables for achieving them. And these goals are measured by clear indicators. Along with this, within the roadmaps a particular ministry or department is designated responsible for the implementation of each particular indicator.
We must admit openly that far from all public authorities were able to develop an effective approach to joint work, and perform their tasks in an intelligent and timely fashion.
What is the situation at present, today? Unfortunately, a third of the activities foreseen by such roadmaps have not occurred on time. And equally unfortunately, a number of business proposals got hung up on issues relating to interagency coordination. Sometimes government agencies offer to take purely cosmetic measures.
I will say something in more detail about this. But it is clear that the greatest challenges in this respect relate to construction. That is the sector where there are the most difficulties. We must openly acknowledge that, unfortunately, here the dynamics are virtually unchanged. Transparent mechanisms for allocating land for development have not been created, and no exhaustive list of construction permits has been approved, among other things. Often entrepreneurs’ suggestions passed through a working group, were approved, and then changed beyond recognition within the depths of the departments themselves.
As a result, judged by the quality of administrative procedures in the construction sector, we are still at the bottom end of global rankings. But let me repeat once again: it is not the rankings that are at stake here, but the fact that due to the lack of clear decisions we are not receiving millions of square metres of housing, and, as before, it takes businesses months if not years to receive permission to build new enterprises and facilities.
I also want to stress that in a sector such as construction, a lot depends on output-based, engaged work on location, namely in regions and municipalities. Thus, serious steps to reduce administrative procedures have been taken by Moscow’s Government. In Sverdlovsk Region they have established lists of cases for which building permits are not generally required. There is progress in other Russian regions, for example in Rostov Region.
We need to ensure that the best practices – and let me repeat, they do exist in Russia – are introduced everywhere. And also to ensure that we remove all barriers from the regulatory framework that prevent developers from working normally.
I would ask the new ministry, the Construction Ministry, other departments, and State Duma deputies to take all necessary measures within the first half of 2014. I would also ask the business community to reliably oversee their execution.
Colleagues, we agreed that all roadmaps that are adopted must be implemented in the following two years. No deferrals or slippages will be tolerated. This means not simply passing a law, but also ensuring its high-quality performance, both at the federal and regional levels.
At present the country’s leading business associations are developing a national investment climate rating. This should provide an objective picture of each region: how work in all fields associated with the National Business Initiative is proceeding. It will be based on the assessment of businesses themselves.
Establishing an open, public national ranking should motivate regions to improve their work and, as I already said, use better practices to support investors. I should add that many of the mechanisms must be worked out within the framework of pilot projects. The extent to which the entrepreneurial community and entrepreneurs themselves can access these projects should be as transparent as possible.
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