Question: Mr President, the member states of what has now become the “Five” are all very different, with a mass of mutual contradictions, directly competing for global investment. Is there anything that really unites the BRICS states apart from high growth rates and the aspiration to increase their weight in the world? And the second question: how do you assess Russia’s investment attractiveness compared to the other members of the group?
President of Russia Dmitry Medvedev: It is obvious that at present our countries are united not only because they are all emerging economies: some have more rapid growth, in others it is slower, some have been affected by the global economic crisis to a greater extent, some less, but there is no doubt whatsoever that our countries are rapidly developing and are attractive markets.
But apart from that, now that the forum has been joined by South Africa, the BRICS states are also united by shared views on development of international affairs, the world economy and political processes. The positions of our countries on key issues are very similar.
Let me remind you that at present the BRICS states are all members of the UN Security Council. China and Russia are its permanent members, as you know, while the others are non-permanent members. Despite some differences in the voting, for example, on the Libyan resolution, on the whole we hold very similar views. This shows that apart from economic factors, there is a bigger similarity between our nations, and that is the fundamental outlook on the future of global development, international cooperation, world economic system, and in general the way life should develop on our planet.
”At present the BRICS states are united not only because they are all emerging economies: some have more rapid growth, in others it is slower, some have been affected by the global economic crisis to a greater extent, some less, but there is no doubt whatsoever that our countries are rapidly developing and are attractive markets.“
Now about Russia's investment attractiveness: I would not want my comments today to be at odds with what I recently said about the investment climate. In general, there is no doubt that Russia is a very attractive country, because we have huge opportunities, an immense territory and an equally enormous market, great reserves of mineral resources, a growing economy and economic institutions. But we have also a lot of problems — I do not want to say that we are worse than other countries, that would be absolutely wrong, but our investment climate still requires a cardinal change, it must become a priority for the government, and a number of institutions have to be refined, there is no doubt about that. In this sense, our competitiveness is somewhat low compared to other BRICS countries. We must focus on the investment climate, which is what I did not so long ago.
Question: A question about Libya. Have the BRICS countries agreed on a position on Libya that they can present at the UN Security Council? And did you discuss at the bilateral meeting with the President of South Africa the reasons why the African Union’s initiative failed?
Dmitry Medvedev: Let me just say that the BRICS states have very close positions: four countries abstained from voting on Resolution 1973, and South Africa voted in favour, but not because its views on this resolution were fundamentally different (we were fully aware what we were voting for and what the resolution signified), but rather out of solidarity, because that was the position of the African Union. I spoke about this issue with President of China Hu Jintao and Indian Prime Minister Singh, as well as with President of South Africa Jacob Zuma, and in addition all of us discussed it with President of Brazil Dilma Rousseff.
Our views are very similar, and they are as follows. We believe that the Security Council resolution must be executed regardless of whether we voted for it, like South Africa, or abstained. It must be executed in accordance with its spirit and the letter, and not in accordance with the arbitrary interpretations which have been made by several states.
Ultimately, what did we concede to or vote for? A resolution imposing a no-fly zone, which would stop the conflict from escalating and break up the warring parties. And what have we got as a result? We have what is in fact a military operation, which is not taking place on the ground but it is happening in the air, an operation in which a number of states are taking part and which was joined by NATO as a military bloc. The resolution has no mention of this. So when I hear that the resolution is at fault, that’s wrong. The resolution is absolutely adequate, but it must be implemented as it is, instead of trying to exceed the mandate that is laid down in it. This is a very dangerous trend in international relations. In fact, what we see is the misuse of powers laid down in Resolution 1973, which is a very broad interpretation of the resolution.
For example, the resolution on the developments in Ivory Coast, Resolution 1975, if I remember correctly, talks about using United Nations agencies, but not about supporting one of the sides in the conflict. The UN generally cannot support any side, but in fact that is what we have in Ivory Coast. To be honest, we have some very serious questions to the leadership of the United Nations because it is a very dangerous trend. The UN certainly should make an effort to separate conflicting parties, but it must never help one of the parties, even if we believe that it is in the right. If we talk about the events in Ivory Coast, we’ve seen atrocities and murders committed by both sides. Therefore, the resolutions must be implemented and enforced in accordance with their content, in accordance with their spirit and letter, and the BRICS states are in absolute agreement about this.
Question: Mr President, could you please say what the BRICS states have agreed regarding the yuan? And the second question: could South Africa’s entry into the group slow down the transition of BRICS states to payments in national currencies? When will it become theoretically possible for the BRICS states to abandon the US dollar?
Dmitry Medvedev: Let me remind you that the yuan is a national currency of the People's Republic of China, and that says it all. It is a national currency, just like the others, although China's economy is huge and that increases the role of the yuan as a currency, but we have not taken any decisions specifically on the yuan and did not discuss it as a separate issue. We did talk about it at a narrow format meeting, and our experts have been analysing different ways of making the transition to payments in national currencies.
I have just had a meeting with the President of Brazil and we agreed to intensify our efforts on making the transition to the settlements in national currencies. This has a number of well-known benefits, including reduced dependency on the fluctuations of reserve currencies and better opportunities to adapt to our national economies. I also believe that we could consider such a system for payments with all BRICS members.
I do not think that South Africa’s economy, for example, is an exception in this sense. If they are ready for this step, we will look at their opportunities, because the crucial question here is not the strength of the currency you are going to use to make payments by making a transfer from one account to another, or offset respective calls in national currencies, the issue here is how convenient it is to use it. I think the idea of switching to national currencies is fully justified and we will continue our efforts to make it a reality. In fact, the declaration we adopted at the end of today's BRICS summit talks about this.
Question: Mr President, during talks with the Chinese leader did you discuss increasing the supplies of gas along the Eastern Siberia — Pacific Ocean pipeline from 15 billion to 30 billion cubic metres?
Dmitry Medvedev: You probably mean our gas trade, because Eastern Siberia — Pacific Ocean pipeline is mainly about oil supplies.
We have two routes for future supplies to China, the so-called eastern route and the western route. At present we are prepared to begin work on both directions. President Hu Jintao and I have discussed it, as well as the issue of intensifying cooperation between companies and state agencies of our two countries to quickly agree on the terms of gas supplies along the western route and somewhat later along the eastern route.
”Our investment climate still requires a cardinal change, it must become a priority for the government, and a number of institutions have to be refined, there is no doubt about that. In this sense, our competitiveness is somewhat low compared to other BRICS countries. We must focus on the investment climate.“
The basic terms should be negotiated this year and the deliveries will begin later. If we can agree on the price (I have no doubts about that although, naturally each side cares about its own commercial interests, which is to be expected, but our positions are now drawing closer), then we can assume that the main issue has been resolved. We believe that this is currently the most important energy item between our two countries. Our positions are drawing closer and I hope that we will come to a consensus soon.
Question: You discussed the situation in Libya and Japan today. It is obvious that the crisis in Japan has extended far beyond Japan itself. Japan’s example is a perfect illustration of the fact that the UN Security Council has a mechanism in place for resolving armed conflicts but not one for responding to natural and technological disasters. You spoke about such a mechanism today. Could you tell us what it could be like and whether its creation is only possible within the BRICS format or could it also be adopted by the UN Security Council?
Dmitry Medvedev: As I am sure you realise, the response mechanism is even more complex when it comes to natural and man-made disasters than to armed conflicts or such events as are currently taking place in Libya. It is clear that in some cases humanity simply does not have the resources to prevent such catastrophes or even to localise their effects. However, it is crucial for us to move in this direction.
We discussed this issue and Russia put forward an initiative to set up such a mechanism. It does not need to be limited to BRICS, especially since disasters can strike in any country, regardless of its affiliations. We just want to set an example and create a mechanism for consultations and rescue operations in certain situations. In general, I do not even rule out the possibility of creating special funds, thus setting an example for other states.
I think we could start with the BRICS states and later extend this mechanism so that it could be adopted by the United Nations. This does not mean that the UN has no agencies of its own, but it certainly lacks a global mechanism. What is also important, in my opinion, is to revise the existing international legislation on nuclear power stations operation.
The accident at Japan’s Fukushima-1 nuclear power station showed that the international legislation contains almost no regulations on such disasters, especially if a disaster assumes cross-border dimensions, and one way or another catastrophes like this extend beyond the borders of a single state, and we need to think about creating such legislation. Therefore, my answer is yes: we should set up a mechanism for the prevention and containment of natural and man-made disasters, and to make it open for other states that may wish to join it.
Question: While making a press statement today you said that you had suggested to your BRICS colleagues that cooperation on scientific progress and innovation could be strengthened. On Saturday you will visit Hong Kong, where you will also raise this theme of innovation. To what extent have your colleagues accepted this proposal? Perhaps, there are already some projects for Skolkovo Innovation Centre?
Dmitry Medvedev: You know, we are all, that is the BRICS countries, busy creating the basis for innovative economies, some quicker than others, and some with more success than others, so we are all very much interested in such innovations. You might be surprised to hear that yesterday I discussed the subject of innovation in great detail with the newcomer to BRICS – President of South Africa Jacob Zuma. Despite the fact that South Africa also has its own problems, the South African economy is the biggest on the African continent and is eager to launch scientific projects. I also spoke with President of Brazil Dilma Rousseff about this topic, including the opportunities offered by Skolkovo, and with President of the People’s Republic of China Hu Jintao, too. I in fact have discussed this issue [of innovation] with almost all the leaders.
Regarding actual cooperation, different countries certainly have differing interests. Some are interested in GLONASS [Global Navigation Satellite System] and launching satellites, and we discussed that, while some are interested, for example, in Russian technology parks like Skolkovo Innovation Centre, to which everyone has been invited. Russia is, of course, very much interested in the People’s Republic of China’s experiences, just as in those of other states. I have discussed this generally with each of the leaders. Yet each state has its own path.
Question: The ten measures that you announced in Magnitogorsk caused quite a stir in the business community and beyond. What time period do you envision for this reform implementation — surely not a year? And what else can we expect?
”The response mechanism is even more complex when it comes to natural and man-made disasters than to armed conflicts. It is clear that in some cases humanity simply does not have the resources to prevent such catastrophes or even to localise their effects. However, it is crucial for us to move in this direction.“
Dmitry Medvedev: Surely not a year! I would like it to happen far faster. In any case, a number of the instructions that came from the statement made in Magnitogorsk must be implemented promptly, or in the shortest possible timeframe. If we take the boards of directors as an example, what is there to ramble on about for a year? So a timeline has been established: some of the officials, which is to say members of the Government, will be taken off boards of directors by the middle of the year, and the rest by October 1. This must be done quickly. Some of the measures must, naturally, be implemented with an eye to the right conditions developing.
I would also like to draw attention to the fact that the list of instructions I gave in Magnitogorsk is neither exhaustive nor complete. If I judge it to be necessary, I will add to those instructions with specific details on any weaknesses in investment policy. This work is ongoing in nature, but the instructions give a clear timeline for implementation. In fact, following the meeting in Magnitogorsk, I have already approved a whole packet of instructions with detailed actors and deadlines. On the whole the actor is the Government, and to a large degree all these instructions have timeframes that fall within this calendar year.
Question: Have you already planned some further steps?
Dmitry Medvedev: Yes. I’m working on that at the moment.
Question: A terrorist attack occurred in the Minsk metro, something which could hardly be expected since Belarus is a country that has always positioned itself as very peaceful, very quiet and without problems. Do you think that the terrorist attack means that not everything is quite so simple or stable in Belarus, what does the attack mean?
Dmitry Medvedev: First of all, I would like to once again express my sincere condolences to our friends, the people of Belarus, on behalf of the Russian people, because this was a great tragedy and a grave crime.
Unfortunately, Russia knows all too well what such acts mean and what distressing consequences they bring. I am not only talking about the deaths; the people who died will never come back which is the greatest tragedy in itself and there is nothing to add to that. I mean the consequences from a psychological viewpoint, because after a terrorist attack society is in shock, and needs to overcome that shock. The full responsibility for overcoming that shock, finding the criminals and preventing other attacks from happening in the future unquestionably lies with the leadership of a state. I hope that the Belarusian leadership will rise to this challenge.
The attack is a very sad and tragic event. I hope that the law enforcement authorities will establish who was involved. There were news already that someone has been arrested or is under suspicion, but I think I can say, based on the experience we have in Russia, the following: it is far simpler to identify a perpetrator, than to understand the mechanisms used, who organised the crime and what goals they were pursuing, unless there is an absolutely clear picture of events. This should be the focus for our Belarusian colleagues’ attention today. But the answers shall be given by the law enforcement agencies.
Regarding peace or a lack of peace, there is of course a far greater accumulation of all kinds of problems in Russia, because Russia is a large, multiethnic state — the biggest on the planet.
This does not mean that there are no problems in a much smaller state, such as Belarus. The events taking place in the world today are not separated by a solid wall. What happened in Minsk, shows that the criminals, the rats that set off an explosion in the Minsk metro, may be found everywhere. They are in Russia and many other countries besides. Unfortunately, this pest has now come to Belarus. The Belarusian leadership will have to make great efforts to mitigate the general public sentiment that is always a result of such crimes. This is always very difficult, for both the people, and for those whose responsibility is to protect the people’s peace and calm – the authorities. I hope that our partners will succeed in this.
We will help them. Indeed, I immediately, literally 90 minutes after the attack, spoke with President of Belarus Alexander Lukashenko. I told him that we were not only offering our sympathies, but that we were ready to take an active role in the investigation. I gave instructions to Director of the Federal Security Service Alexander Bortnikov and Minister of Healthcare and Social Development Tatyana Golikova that, given our unfortunate experience and resulting technology, specialists should be sent to start adequate investigative activities and to assist in the treatment of injuries from explosive blasts. We are certainly prepared to help in other ways too, because we appreciate that this tragedy happened to a nation that is a friend and brother.