President of Russia Vladimir Putin: Good afternoon, colleagues.
I am well aware that all of you are working very hard, as the current situation requires. We are in constant contact with one another throughout the day. I mean, with almost each one of you present at this meeting. Let us continue working in this remote way with video conference calls as is required at the moment.
However, the results of our work should correspond to what is happening at present, as I have already mentioned. And I am sure working remotely will not affect the quality of our joint activities.
Today we will consider a number of topics that are extremely important. Naturally, they deal with the most acute issues, namely our actions with respect to the coronavirus pandemic. No doubt, we will talk about socio-economic matters too.
Let us begin our meeting. Mr Mishustin, Prime Minister, the floor is yours.
Prime Minister Mikhail Mishustin: Mr President,
Recently you set the Government a number of tasks to help support the people and the economy through these difficult times. All the preparations were completed most promptly and we formulated the necessary amendments to the legislation within just one day and already on the next day, on March 26, we discussed them at a Government meeting. Members of Parliament also worked quickly. Yesterday, the State Duma and the Federation Council approved the draft federal laws that provide for the implementation of the initiatives you put forth.
First, support for individuals. Federal draft laws provide for an automatic extension of monthly payments in connection with the birth or adoption of a first or second child and for any new sick leave period (the amount is based on at least the minimum wage). The Ministry of Labour has also instructed the regions to extend social payments. War veterans and home-front workers will receive a single payment timed for the 75th anniversary of the Great Victory by the end of April. There are also instructions to provide payments for children aged 3 through 7 years starting in June, rather than July.
A Government resolution was signed and came into force to increase the maximum amount of the unemployment benefit to the level of the minimum wage. About 30 billion rubles will be allocated for this.
In addition, through amendments to law, we have facilitated filing for bankruptcy for individuals. It will be free of charge. To do this, it will be necessary to enter information in the Unified Federal Register of Bankruptcy Data independently, or through the integrated service centre, which will allow people with debts ranging from 50,000 to 700,000 rubles to be released from their debt obligations.
Second, support for business. To protect businesses, a six-month moratorium on initiating bankruptcy cases is envisaged. For the period of the moratorium, enforcement proceedings and the levying of fines and penalties are to be suspended, and the process for finalizing amicable agreements on debts will be simplified.
The draft laws also envisage tax deferrals (except VAT), for small and medium size businesses and deferrals on insurance premiums for micro-businesses. We have cut the insurance premiums for SMEs in half – from 30 to 15 percent starting April 1, if the employee’s salary exceeds the minimum wage.
The Government jointly with the Bank of Russia has developed measures to provide SMEs with a six-month deferral on interest and principal debt on loans. This programme will cover a loan portfolio totalling about half a trillion rubles.
We are making separate decisions to support the hardest hit sectors of the economy, including public catering, consumer services, airlines, tourist agencies, sports, culture and cinemas. Specifically, we have postponed sending out tax notifications until May 1. All small companies working in these sectors will also be able to postpone loan payments; an appropriate resolution will soon be signed by the Government.
In addition, airlines will receive 1.5 billion rubles to compensate for the costs of evacuating people from abroad due to the coronavirus. We have almost completely cancelled tourist agency fees to the Tourist Operator Association reserve fund for outbound tourists.
As discussed, we started implementing the instructions on taxing dividends from foreign accounts with Cyprus. The Cypriot government has been notified of the changes in the agreement on avoiding dual taxation. The related agencies have to submit their proposals on the next steps by April 24.
The Russian Finance Ministry has reserved a total of 1.4 trillion rubles to counter the spread of the coronavirus and implement anti-crisis measures.
The Government is developing a second package of measures aimed at overcoming the consequences of the new coronavirus infection.
First, inter-budgetary relations. It is important to support the regional budgets. We have reserved 171 billion rubles in the federal budget for deferred payments and restructuring budget loans as well as for compensating for the regions’ losses from revenue decrease.
Secondly, employment support. We suggest short-term purpose loans for small and medium-sized businesses on favourable terms to pay wages and for other immediate needs with guarantees from VEB. The suggested amount is 150 billion rubles.
Thirdly, additional measures to ensure the stability of the economy. The Government has already introduced a grace period for small and medium-sized businesses for lease payments on federal property. Federal and regional lease programmes will provide 20 billion rubles to support small and medium businesses. We understand that a large part of the lease market is private commercial leases, therefore regions and municipalities will receive recommendations to lower property taxes for leaseholders in exchange for lowering rental rates or postponing payments for lessees in certain business categories. In addition, coronavirus-countering measures can be regarded as force majeure under lease agreements.
Small and medium businesses in the hardest hit industries will, temporarily, not have to pay penalties or late fees for housing and utility services. In addition, it will be prohibited to cut off housing and utility services for those who cannot pay.
We also suggest a moratorium on a number of penalties and a temporary ban on blocking the accounts of small and medium businesses and of individual entrepreneurs on certain grounds.
There will be a special procedure to expedite procurement from small and medium businesses by publicly owned companies, which should help support demand for their products.
Licenses and permits will be automatically renewed in accordance with the list established by the Government, which will significantly reduce business costs.
We suggest expanding the suspension of inspections to noncommercial social organisations. In addition, organisations in the most damaged industries will get the same incentives as small and medium businesses.
The Government has created a list of backbone companies, which includes 650 companies, and up to 4,000 with affiliates and associates. The monitoring of their financial and economic situation has been organised. The results will be used to develop a system of support measures. Enterprises will be able to deduct their costs for supporting sanitary and epidemiological measures.
The Government will also decide on postponing deadlines that can result in additional business costs and that can increase the administrative burden. They will make these decisions soon in consultation with the State Duma.
Mr President, we will continuously report on additional measures taken by the Government to support the people and the economy.
Vladimir Putin: Thank you, Mr Mishustin. We handled these issues together. I am grateful to our colleagues for following them to the logical conclusion, to the adoption of these laws.
I also would like to thank State Duma deputies for promptly considering the draft laws submitted by the Government.
However, I have a question. You mentioned the measures we have agreed on – a six-month deferral of all taxes, insurance payments for certain companies, a six-month moratorium on tax penalties and fines. But when I met with representatives of small businesses, what was their request? They asked to relieve them from paying the entire six-month debt at once when these six months pass. I asked you to think about it.
Mikhail Mishustin: Yes, Mr President, we will definitely consider all the possibilities of restructuring tax debt, and we will make a decision after analysing the overall situation.
Vladimir Putin: Yes, right, but you need to do it beforehand, not when they face having to pay the entire sum.
Mikhail Mishustin: We will.
Vladimir Putin: Thank you very much.
The situation in the country is getting more complicated. The global situation with the coronavirus pandemic is grave: 850,000 people have been infected already. In Russia, as I can see from the latest data, there are 2,777 coronavirus cases.
Ms Golikova, I know that you are coordinating the work of the emergency response centre to fight the coronavirus. What is the current situation?
Deputy Prime Minister Tatyana Golikova: Mr President, colleagues,
You are right; the novel coronavirus has been spreading and has affected almost 857,000 people as of today. Largest clusters are now in the United States and Europe, with China ranking third.
As for the Russian Federation, coronavirus cases have been detected in 75 regions; there are 2,700 cases, an increase of 400 since yesterday. That is, the number of infected people has grown by 18.8 percent in the past 24 hours. Unfortunately, 24 people have died as of yesterday; 190 people have recovered.
It should be pointed out that the majority of coronavirus cases are those who have returned to Russia from abroad and those who were in contact with them. The largest number of confirmed cases per 100,000 of the population has been reported in Moscow, the Republic of Komi, St Petersburg and Moscow Region. On the other hand, the increase in the number of patients is due to more tests being carried out.
As of yesterday, we have tested more than 460,000 people, which means that Russia is one of the world’s top three countries when it comes to the number of people tested for the coronavirus. All Rospotrebnadzor laboratories in the regions, as well as local labs operating in 47 regions plus two large private labs are taking part in this job. I would like to say that we will continue to increase the testing because we have registered new testing systems and more such systems have been submitted for registration.
As per your executive order, a stay-at-home week began in Russia on Monday. Everyone knows that this has been done to reduce the spread of the infection through social distancing to give our medical facilities and the healthcare system as a whole time to prepare for working during the peak period.
Throughout this non-working week, the Healthcare Ministry, the Federal Medical-Biological Agency (FMBA), Russian Railways and private medical facilities working together with the regional authorities are mobilising and reassigning hospital beds to prepare for the potential increase in the number of coronavirus patients. As of today, they have 94,000 hospital beds. As I already mentioned, since the largest number of coronavirus cases has been registered in Moscow, yesterday I finished the coordination of the number of hospital beds in Moscow, both regular and reassigned beds, with our colleagues from the federal and private medical facilities. Therefore, the first stage of the preparations should be completed by April 3.
During a recent meeting you issued instructions to the plenipotentiary representatives and regional heads, as well as the Government, to rationally organise and oversee the implementation of this job. I would like to say that we are acting in the prescribed manner.
I have to say, that as the situation develops, the country’s regions are taking decisions to expand the social distancing regulations. Of course, the decisions are based on the epidemiological situation in each particular region. Let me just remind you that so far, there have been no cases of the coronavirus in ten of the regions. But this should not make us think that we are out of danger because the number of regions with infected people goes up by about two per day.
Assessing the first three non-working days that were introduced by your Executive Order, we believe that these social distancing measures should be extended. But I would like to say that we need to do it proceeding from the situation in each particular region. It is very important that together with our colleagues from other regions we try to find a compromise between the restrictive measures and the development of the regional economy when taking these decisions. It is crucial to prevent a serious economic decline.
Mr President, colleagues,
I would also like to say a few words about our leading research institutions that are currently working on all aspects of prevention, diagnostics and treatment of the novel coronavirus infection. In late March, we carried out research to detect antibodies to the new virus. Overall, 226 samples of the blood serum of people who were not registered as infected with the novel coronavirus were studied. Out of these 226 people, 11 recovered from the virus and had antibodies to it.
Rospotrebnadzor’s state research centre VECTOR has developed a test system for detecting antibodies in the blood serum of patients and those who recovered from the virus, as well as for studying herd immunity and assessing the efficiency of vaccines that are currently being developed. The registration of this system is planned for April 10–15, 2020.
I would like to say that, just as we planned, the VEKTOR state research centre has developed vaccine prototypes based on six different technological platforms, such as the widely used recombinant viral vectors and synthetic vaccines. We expect the initial choice and serial manufacturing of several vaccines to be made before May 10.
The pre-clinical evaluation of the vaccine’s specific activity will be completed by June 22. After that, the first phase of clinical trials will be held on a limited group of people to assess their safety and immunogenicity. Some 60 people have volunteered for this. We expect that the first phase of the clinical trials will begin on June 29. We are doing all we can to support our researchers and to develop the vaccines as soon as this can be done.
This work is ongoing not only at the VEKTOR Centre but also at the research institutions of the Federal Medical-Biological Agency, the Russian Academy of Sciences, Moscow State University and several other facilities.
I would like to add that we are also testing several existing medicines for the treatment of the coronavirus infection. We are analysing eight medicines that have been registered in Russia. We will receive reliable data regarding their possible use to treat COVID-19 by April 10. In addition, we are testing 22 new medicines submitted by the Siberian Branch of the Russian Academy of Sciences and expect to make reliable conclusions regarding them by April 10 as well.
Mr President, we continue working and will be reporting to you on the results in accordance with the deadlines we have set for ourselves.
Vladimir Putin: Thank you very much.
You have just said that nearly all cases are those who have returned to Russia from abroad and those who were in contact with them. Since March 11, 2020, 825,031 people have entered Russia. This is a lot. Another 1,400 people are expected today, and the overall number of arrivals is expected at almost 20,000.
Judging by the available reports, a large number of our citizens permanently living abroad are returning to Russia. It appears that it is not easy for them to receive medical assistance at the places of their permanent residence outside Russia. This is putting more pressure on us. My question in this connection is how this work is being organised and what you plan on doing with those who have returned and those who will be returning.
Tatyana Golikova: The situation is very complicated when it comes to monitoring the returning citizens. However, we have developed the necessary measures to monitor these people in Russia together with the Interior Ministry, the FSB Border Guard Service, Rospotrebnadzor and our colleagues in the Russian regions, as well as the Ministry of Digital Development, Communications and Mass Media. Upon arrival, all these people are issued the instruction of the Chief State Sanitary Physician to stay in quarantine or self-isolation for 14 days.
As you have correctly pointed out, in light of the great desire to return home, including among those who are living permanently in other countries, and to reduce pressure on our healthcare system and our doctors, the Coronavirus Response Centre has decided that charter flights will be organised to bring our citizens back home. However, the number of returning citizens will be limited so that we can monitor them and hence prevent an uncontrollable spread of the infection.
In other words, no more than 500 people will be allowed to land at the Moscow hub each day. The number of people landing at other Russian airports will be limited to only 200. Of course, some exceptions are possible, because we do not know when the foreign states that have declared a state of emergency on their territories will allow us to bring our citizens back to Russia. We will take such exceptional cases into account.
By decision of the Chief State Sanitary Physician, those returning to Russia will be placed under medical observation if they arrive in cities where they do not have permanent residence. The Russian regions have already organised this job. We have also agreed with the Moscow authorities that those who are staying or living in nearby regions can be transported to the relevant regions located near Moscow.
Vladimir Putin: Fine. Thank you very much.
Look, currently overall we have 3,317,175 people in quarantine; 1,777 are under observation and 292,740 in mandatory self-isolation. We have already spoken about arranging remote work, if possible, if it is expedient, demonstrating in this way, hopefully, an example of responsible and law-abiding behaviour. But we also agreed to help people spend their time usefully at home, in their houses and apartments, or to continue working remotely. Again, as we are doing. And we have agreed that starting April 1, we will make access to socially significant internet resources free of charge.
Mr Shadayev, please tell us about this in detail.
Minister of Digital Development, Communications and Mass Media Maksut Shadayev: Mr President, colleagues,
Indeed, given the current situation internet access is a basic need for people who are forced to stay home for a long time.
Five of our major communication providers, which cover now 70 percent of households, supported our initiative not to disconnect users who for some reason cannot pay for their home internet access, and to keep them connected but restricted to a list of socially significant sites. Actually, we are talking about adopting a mandatory social standard of internet access.
This pilot project started today and will be completed on July 1 as planned. We hope that smaller internet providers will join this initiative too. The operators need just a little time to reset the networks starting today for subscribers who have no money in their accounts; the operators shall provide uninterrupted service. And this is very important.
Now, a couple of words, if I may, about how the list that will be available to all our citizens free of charge, was drawn up. The main criterion for the inclusion of this or that website was popular demand. We used all open data on site traffic and the popularity of services and compiled the list, which includes as of today 370 sites and services in 18 categories. The daily traffic of the sites included in the list exceeds 50 million people. This means that we have included what truly enjoys popular demand. Naturally, 99 percent of them are Russian resources.
This list includes popular Russian social networks, communities, email services, messenger apps/sites, news sites and online media, as well as popular information websites on education, medicine, culture, sports and science. Of course, it also includes the popular state agency and public service websites, as well as the largest online retailers, aggregators and delivery services. It also includes online banking and financial services as well as recruiting and career development services. The list is to have everything necessary to stay home and work conveniently.
Our people can continue to communicate through these services as well as enjoy their time, develop what they want to and order everything they need from home. Of course, we would like this list to be longer. It is open, and we will add new items to it. But it is important for us to find a balance between the free social package and the capacities of our communications providers. In fact, this experiment will be all about finding the golden mean.
Mr President, just a few more words. We are developing services on public service websites in line with the Government’s instructions. We have created a form for Russian citizens returning to the country. They fill in their data, including the place where they expect to stay during the quarantine.
Secondly, we sent text messages to all our citizens abroad and asked them to fill out the form if they needed emergency help or financial support and whether they have a place to stay. To date, 900 Russians abroad have filled out this form, and the Government has issued instructions to quickly provide them with financial aid.
We also believe it is necessary to launch an online sick list service as well as online prescriptions in the near future. A decision has been made regarding online sales of non-prescription drugs, but it is still necessary to go to a pharmacy to buy prescription drugs. If we introduce this service on the public services website, we can guarantee that these prescriptions will be credible and people will only be able to buy them after authorisation.
This is the end of my report.
Vladimir Putin: Thank you, Mr Shadayev.
Ms Lyubimova, you are aware of the developments in culture. Here, the most important thing is to cover the current expenses of cultural institutions to cover wages, utility bills, and security issues. I know that the Ministry is taking the necessary steps. What exactly is being done and what else do you think needs to be done?
Minister of Culture Olga Lyubimova: Mr President, I would also like to start with the measures that we are taking in relation to our audiences. Since all cultural institutions are temporarily closed, we consider it one of our priorities to optimise our online offerings. This is based on our portal Kultura.rf, which contains thousands of hours of films, recordings of performances, concerts, books, tours and lectures.
In recent weeks, viewings of online materials have increased five times and the number of submissions from cultural workers to post content has increased 20 times. Thus, a nationwide posting board of online events was created at Kultura.rf. The largest Russian theatres offer broadcasts of performances, and the Bolshoi and Mariinsky theatres are offering shows from their gold pool. The Maly Theatre is posting the audio recordings they have been making since 1938. The Alexandrinsky Theatre took a step further: on March 21, a play was first premiered on the main stage without an audience. Over 4 million users have become regular viewers of the Moscow Philharmonic online project Home Season, which was opened by Denis Matsuyev on March 20.
In connection with the announced week off work, we are broadcasting recorded concerts, and the new posts include daytime and evening shows. Daytime broadcasts (at 2 pm) are designed for children, for family viewing. Also, fans of excursions can enjoy lectures and virtual tours of museum exhibitions, from the Hermitage and the Tretyakov Gallery down to the smallest regional museums.
Libraries are not falling behind; they are holding many online seminars and various lectures for different age groups and even in different languages. In response, people send not only words of gratitude, but they are also submitting poems, drawings by their children, and small videos with applause to support the artists who are working in this new reality.
I would like to add a few words about art and theatre universities and colleges. The faculties are holding a lot of online classes. For example, the first online open day by the GITIS production department was held on Sunday, and some 1500 future applicants had the opportunity to watch it online. We think this is a very good format, which we will consolidate and continue to use with other universities.
(Ms Lyubimova then spoke about measures to support cultural institutions in the absence of extra-budgetary revenue from the sale of tickets, about monitoring the payment of wages in regional and municipal cultural institutions, and about supporting non-governmental cultural organisations. The Minister noted that the decisions made by the Government to support small and medium-sized businesses would also support entrepreneurs engaged in cinema and theatre and concert activities.)
We are working in all these areas. The main task now is to maintain our unique creative teams and, of course, to support our audiences.
Vladimir Putin: Good, thank you.
Colleagues, before going over to the next item on our agenda, that is the spring field work, I would like to ask you if you have any other ideas, comments or proposals regarding the topics we have just discussed.
Accounts Chamber Chairman Alexei Kudrin: May I, Mr President?
Vladimir Putin: Go ahead, Mr Kudrin.
Alexei Kudrin: Mr President, I would like to say a few more words about the socioeconomic situation. Over the past two weeks, economic forecasts for Russia and, of course, the world have become even more pessimistic. As of today, we can expect, even under a moderate scenario, a considerable decline in GDP – between 3 and 5 percent. Or the situation can become similar to 2009, when our GDP plunged by nearly 8 percent.
I would like to remind everyone that in 2009 the average price of oil was $61, but it will be much lower this year, and the market situation differs significantly from the past in that we are seeing increasingly more unusual and even shocking developments in the oil market. I would like to add that in 2009 people’s real incomes did not decline because you decided to increase pensions by nearly 50 percent, which alleviated the problems for the social status categories of the population.
And lastly, I would like to say that during the 2009 crisis we allocated nearly 10 percent of GDP to go towards support measures. Nearly half of those funds were used to increase the banks’ capitalisation in various forms, and, of course, a substantial share of these funds was used to make up for the federal budget revenue shortfall and to provide various forms of assistance to our businesses.
What is happening at the moment is very unusual, and even if GDP does not fall as low as it did that time we would still need to allocate upwards of 5 percent of GDP on support measures. I know that the Government is discussing such measures, and I wholeheartedly support everything that has been said today.
However, I believe that our businesses needs lie to know that a new and very serious package of support measures is being prepared. This would alleviate their concerns. And we will have to take non-standard support measures such as we did not take last time, including direct subsidies to some sectors, possibly allocating more funds not to the banking sector but to the service industry, where we should help owners compensate part of the wages. We should discuss the principles of allocating financial assistance to a group of sectors.
Our economists have formulated an interesting idea regarding the selection of such sectors so as to ensure a more fair allocation of funds, for example, as a percentage of last year’s taxes paid. However, we should also provide direct assistance; deferred debts and taxes alone will not be enough for many industries.
I reiterate, I would consider an additional package. I know it is being prepared, so what is the point in delaying? In addition, this support should be significant, we should bear in mind that we will have to spend more from the Reserve Fund this year rather than, say, distribute it evenly over the upcoming three to four years. Of course, loans will be important too, and the financial sector is ready to provide some of them in the form of loans to the Government.
These are the measures I suggest should be developed.
Vladimir Putin: Thank you, Mr Kudrin.
The situation is indeed complicated. We are suffering two blows: the economic consequences of the coronavirus pandemic and the decline in business activity. We fully realise that these are serious challenges for the labour market. In addition, of course, the prices on our main export commodity have fallen significantly. We are discussing it with our colleagues in the country and at the international level with our OPEC partners. I recently talked about it with the President of the United States. The Americans are worried about it, too, because the profitability of their tight oil production is, according to various estimates, at about $40 per barrel, and this is a grave challenge for the American economy.
It concerns everyone and should concern consumers as well, because if the sector is not sufficiently financed and the development of new deposits stops, there will be a huge price hike on the market, and nobody wants that. Therefore, together with the main producers and consumers we will have to come up with solutions to ease the situation on the market in general.
Yes, it is a very serious challenge for our economy. The measures you mentioned, we used them in the previous crises, in 2008–2009. The current situation has its specific features, but still we have some experience of dealing with such events.
You are right, Mr Mishustin hears us; we discuss it with him several times a day. The Government is indeed preparing new proposals on how to support the economy and certain sectors in accordance with the current situation and with regard to possible developments as predicted by experts. The Government will act in accordance with this forecast. We will speak about it soon, including to the public.
I will ask again: if someone here wants to add something to the discussion, please, do it before we get down to the main agenda.
Is that all? Thank you.
Then, let us give the floor to Ms Abramchenko on the progress of spring field agricultural work.
We have many problems, but we want to eat every day. We understand how important it is, therefore, in spite of everything, this is the industry that should work without interruption, just as some other economic sectors. This is an extremely important area of our activity. I would like to stress that our rural citizens have always done their best. In recent years, they have shown brilliant results. Obviously, this refers not only to those who sow, but also to those who are involved in transport, logistics, fuels and lubricants, this is a large team of scientists, agronomists, and experts in various areas of agriculture. A lot will depend on them now: the stability of the economy as a whole, and the stability of the sector. The inner feeling of our citizens also depends to a large extent on how the agricultural industry works. When there is bread, there is inner confidence that in other sectors we will also achieve positive results and overcome all these temporary, I have no doubt, temporary difficulties that we are facing today, just like almost all the other countries of the world.
Let us discuss the current state of this industry and how spring field work is going.
Ms Abramchenko, please take the floor.
Deputy Prime Minister Viktoria Abramchenko: Thank you.
Mr President, Mr Prime Minister, colleagues,
Before I move on to the main topic of my speech, I would like to brief you on developments in the food market. Together with the Ministry of Agriculture, the Ministry of Industry and Trade and the Customs Service, we monitor the situation regarding food availability on a daily basis. And I want to thank my colleagues, as they work smoothly, clearly and very quickly.
I can report that the situation in the food market is stable. Our peak demand fell on March 14 and 15. Now there is no excessive demand for goods, including for durable ones. There are enough products in warehouses and distribution centres, there are no problems with potatoes and vegetables of the so-called borsch set. And you can see such a stable situation in all regions of the Russian Federation, including Moscow and St Petersburg. The regions are forming a permanent two-month supply of basic products.
Mr President, you are absolutely right that farmers never let us down, and they really are showing good results. You know that we already see overproduction in some industries, first of all in cattle breeding, where we now have 12 percent more meat than the threshold requirement of the Food Security Doctrine.
Here I would like to share some good news. On March 25, Mr Mishustin signed a directive to hold talks with China on exporting our beef. These talks were underway for several years, and on April 7, the first eight containers of Russian beef will arrive in China. The export of our products to China will further boost the development of beef cattle breeding; let me remind you that this industry began developing 20 years ago, almost from scratch. This is especially important in the current situation.
We still have a lot to do to develop our export potential and achieve the goals you set of $45 billion per year; but first of all we must think about how to involve farmland that is not used today in agriculture.
Farmland comprises a separate, large category of land, the second largest after forests. It covers 20 times more area than all populated areas. Most importantly, this land is not only used in agriculture but also ensures our food security. It also serves as a donor for the development of populated areas. In addition, activities that are not directly related to agriculture are carried out on this land, such as road construction or mineral extraction.
(Next Viktoria Abramchenko spoke of certain issues of land legislation and noted that it was necessary to draw up a new version of the basic Law on Land Management, which is the main legislative act on agricultural land use planning, as well to amend the Land Code and the Law On Agricultural Land Management.)
To conclude my report, I would like to stress that involving unused farmland in agriculture requires the development and support of the Russian land-reclamation complex, land clearance operations, forest amelioration, draining, irrigation and lime treatment of acid soils. Such work would be impossible for our farmers without government support.
These measures must be carried out consistently and systematically as well as envisaged in the state programme for effective involvement of farmland in agriculture, which the Russian Government is developing, Mr President, in line with your instructions.
Vladimir Putin: Yes, this is true. In line with my instructions, a draft state programme for the effective involvement of farmland in agriculture and the development of the land-reclamation complex of the Russian Federation must be developed. I hope this work will be carried out as soon as possible.
You have mentioned especially valuable farmland, which is good, because one third of our farmland is deer and other pastures. However, above all we should consider farmland used for farming, in the literal sense of the word.
This is why the difference is very important here, as you have said. I completely agree with you that the transfer of lands from one category to another is not transparent and there is a lot of corruption involved. You and I understand very well: they buy land very cheaply as farmland, then do nothing for several years, and then some officials sign the necessary documents and transfer the land from farmland to residential land, for construction. The price goes up dozens of times, just because of one signature, dozens of times. This must stop immediately; of course, we must get down to this. Everything you have said must be done as soon as possible.
The same goes for the unused areas, which have… you have said 17 million hectares of land in total are unused land areas, which means 1.7 million unused plots. Of course, it is high time we did something about this; the solution is long overdue. I am asking you to resolve these issues as soon as possible.
Viktoria Abramchenko: Done.
Vladimir Putin: Of course, I support all your proposals on amending the current law if necessary.
Viktoria Abramchenko: Agreed. Thank you.
Vladimir Putin: Mr Patrushev, it is your turn now, please tell us about the current situation.
Minister of Agriculture Dmitry Patrushev: Mr President, colleagues,
Of course, the Russian agricultural market depends on timely and high-quality spring field work, which is gaining momentum.
On the whole, sowing is proceeding in a normal manner, I reported on this in detail on March 17. I can add that as of today, 26 regions of the Southern, North Caucasian, Central, Volga and Far Eastern federal districts have already begun getting down to work. We are ahead of schedule in all almost all areas. In particular, as of March 31, spring sowing was carried out on an area of two million hectares, which is twice as much as on the same date last year. The availability and prices of basic material and technical resources are stable. On March 30, the Ministry of Agriculture increased the annual limit on subsidies for soft loans on plant growing by 10 percent to support sowing. In addition to this, for the regions with an additional need, the subsidy limit on small businesses was also increased.
Despite the current situation, there are no significant problems during the sowing. We are constantly in touch with the regions, providing them with all the necessary support. As in previous years, we can look forward to a decent harvest.
Mr President, our country’s agricultural producers are working hard to ensure the uninterrupted supply of fresh and high-quality goods to the Russian population, both in the current situation and in the long term. First of all, we connect the long-term development perspective for our industry with the 2030 strategy, which was approved at the government meeting on March 19. The strategy reflects the dynamics of all key fields of agriculture and the fisheries. I also would like to emphasise that its implementation will make a significant contribution to achieving the national goals outlined in Presidential Executive Order No. 204. The priorities of the strategy are synchronised with all key, already approved sector planning documents, including state agribusiness and fishery development programmes, as well as the integrated development of rural areas.
Today, we have also included in the strategy certain provisions from the future state programme that you mentioned concerning the effective involvement of agricultural land and the development of the reclamation complex. The Ministry of Agriculture is developing it in accordance with your instruction following the State Council meeting on agriculture.
Alongside the goals laid down in our strategic documents, the strategy itself is linked to the goals set out in the Food Security Doctrine. In 2019, its goals were exceeded, in particular, in terms of grain, sugar, vegetable oil, meat and meat products, as well as fish products and potatoes. This year, we are sticking to the same forecast for these food categories. Notably, the threshold numbers for milk and salt have not been reached. We are working hard to get there. In addition, the updated doctrine includes vegetables and gourds, fruit and berries, as well as seeds, on which we are working systematically.
Colleagues, I will provide a brief overview of the key industry goals, which we expect to achieve over the next decade based on available funding and being fully aware of the inherent risks.
Under the strategy, which is part of the state agriculture development programme, we plan to achieve the following by 2030: 1) the agricultural output will increase by over 25 percent; 2) agricultural exports may exceed $45 billion; 3) the index of physical volume of investment in fixed agricultural assets will increase by almost a third; 4) gross added value created in agriculture will almost double and may reach 7 trillion rubles.
(The Minister went on to provide specific figures for output growth in key agro-industrial sub-sectors and focused on introducing digital technologies, transforming the manufacturing and processing facilities with the use of advanced technology and improving breeding and genetics.)
As you may be aware, the Federal Agricultural Research and Technical Programme has been in place since 2017. Its most important goals include reducing dependence on imports and increasing the volume and improving the quality of agricultural produce. Once it gets implemented, the number of new varieties of seeds, plant hybrids and highly productive livestock breeds will go up. The current level of innovation-driven activities is fairly low at such companies. Among other things, it has to do with a certain legacy, as well as the fact that agricultural research and agribusiness are disconnected. The State Council discussed this matter in December 2019.
Next, we need to discuss the long-term outlook as it applies to land, which is the key resource in agriculture. Protecting agricultural land, making unused land available for farming, and constantly working to improve fertility and to preserve the quality of the soil are among our strategic goals. The actions and tools for implementing this are included in the corresponding draft state programme, as I mentioned. This is necessary both to ensure food security and to increase exports. According to our estimates, we need an additional 12 million hectares of land. Of course, designating more land for farming is a must if we want to develop rural areas. Therefore, the Ministry of Agriculture will do its best to get the state programme going as early as 2021.
Of course, the strategy’s main focus is to improve the quality of life in rural areas. In particular, we will be taking steps to keep the rural population numbers from declining, to improve living conditions and expand the social and utility infrastructure. All of that is included in the state programme Comprehensive Development of Rural Areas. We plan to bring the level of employment among the working age rural population to 89 percent by 2030. The unemployment rate of the rural working-age population will be cut in half compared to 2019 to about 4 percent. Almost 3.2 million square metres of new comfortable housing in rural areas will be commissioned or acquired. As many as 257,000 households will see their housing conditions significantly improve.
I would like to spend a moment to discuss easy-term rural mortgage loans, which are widely popular with customers. Importantly, rural mortgages are a direct, concrete and straightforward form of state support. Now, three months after this mechanism first became available on the market, it is clear that people are buying new homes in rural areas because they are willing to live there.
In addition, affordable relocation to rural areas can help reduce urban density, which is an important factor. Therefore, it is critical to support funding for this.
Mr President, colleagues,
Undoubtedly, domestic market stability has always been and will remain our top priority. Domestic produce has significantly improved its position on the international market in recent years. We hope that despite the current circumstances, Russia’s role as a supplier of high-quality alimentary raw materials and foods will continue to grow. We have no plans to stop looking for and expanding new market niches popular with Russian and international customers.
I would like to mention several promising areas, including for exports, such as organic and “green” produce, the demand for which is growing every year. In addition, we are increasing the production of domestic fruit and berries. The amendments to the Tax Code, whereby the VAT rate for these products fell to 10 percent, gave a boost to this industry. As of the end of 2019, the production of fruit and berries in Russia reached an all-time high of 3.5 million tonnes.
Viticulture and winemaking are promising agricultural areas as well, including in terms of their export potential. An increase in interest here is also largely due to state support. More vineyards are becoming available annually. Last year, 7,000 more hectares were added, which is up 40 percent on the previous year. The cumulative figure should be 32,200 hectares in 2025.
Mr President, colleagues,
Summing up the report on the agriculture industry’s strategic development, I would like to express hope that the existing state support will allow us to keep up our pace of work across all key areas. Of course, the strategic goals can only be achieved with steady funding, including the ongoing state programmes.
Vladimir Putin: Fine. Thank you very much.
Colleagues, any comments on what Ms Abramchenko and Mr Patrushev have said? No? Thank you.
Thank you Mr Patrushev.
To conclude our work today, I would like to say the following.
First, I would like to repeat: I think this online work format fully meets today’s requirements and shows our law-abiding behaviour, a responsible approach to what is happening. I want to draw attention to this. Each of you, colleagues, must be at your workplace and make every effort to achieve the results that the country expects from us, to solve the problems that we face. I want to emphasise and note: every person on our team today is important. Therefore, I would ask you to keep this in mind and to treat your health responsibly – this is the first thing.
Second: Ms Abramchenko said that she has good news about the food market. I hope that our joint effective work will result in more good news in other industries. And indeed, when there is bread on the table, then people correctly think that everything else can be achieved. So, this is very important. It is important for us to go through this period of spring fieldwork as in previous years, with the hope of a good harvest.
Well, as for this format, I think we might like it. Because, first of all, we do not have to go anywhere, we can save time on travel. And second, the number of cars with flashing lights in Moscow will decrease and will not interfere with other people on the road, which will also have a positive impact on people’s mood in Moscow.
I wish you all the very best.
Thank you very much.