WEBVTT

1
00:00:01.599 --> 00:00:06.122
Mr President, thank you very much for speaking to Bloomberg.

2
00:00:06.122 --> 00:00:13.698
Here in Vladivostok we're on the edge of the Pacific and on the eve 

3
00:00:13.698 --> 00:00:20.299
of the second Eastern Economic forum. What do you hope to achieve at it?

4
00:00:20.299 --> 00:00:25.446
We would like to draw the attention of our partners,

5
00:00:25.446 --> 00:00:31.224
of potential investors to the Russian Far East.

6
00:00:31.224 --> 00:00:37.517
In this sense, the Forum as an event is similar to other 

7
00:00:37.517 --> 00:00:40.084
regional forums of this kind.

8
00:00:40.084 --> 00:00:42.719
Russia hosts a lot of such forums,

9
00:00:42.719 --> 00:00:46.698
including the International Economic Forum in St Petersburg, 

10
00:00:46.698 --> 00:00:49.557
(usually in the beginning of summer)

11
00:00:49.557 --> 00:00:51.304
, as well as the Economic Forum in Sochi.

12
00:00:51.304 --> 00:00:55.694
The Far East is of particular significance for us in terms of this 

13
00:00:55.694 --> 00:00:58.344
region’s priority development.

14
00:00:58.344 --> 00:01:02.829
Over the last few years, let us say even over the last decades,

15
00:01:02.829 --> 00:01:05.752
we were faced with many problems here.

16
00:01:05.752 --> 00:01:09.969
We paid little attention to this territory although it deserves a lot 

17
00:01:09.969 --> 00:01:13.986
more of it, because it concentrates great wealth as well 

18
00:01:13.986 --> 00:01:16.509
as opportunities for Russia’s future development.

19
00:01:16.509 --> 00:01:21.689
Not only for Russia alone, but also for the development of the entire 

20
00:01:21.689 --> 00:01:27.829
Asia-Pacific region (APR), because this land is very rich 

21
00:01:27.829 --> 00:01:30.325
in natural and mineral resources.

22
00:01:30.325 --> 00:01:34.341
When we talk about the Far East we usually mean the Far East itself,

23
00:01:34.341 --> 00:01:38.949
including Primorye Territory, Khabarovsk Territory, Kamchatka,

24
00:01:38.949 --> 00:01:42.820
and Chukotka, as well as Eastern Siberia.

25
00:01:42.820 --> 00:01:50.955
All this area contains tremendous resources, including oil and gas,

26
00:01:50.955 --> 00:01:57.347
90 percent of Russian tin, 30 percent of Russian gold,

27
00:01:57.347 --> 00:02:04.835
35 percent of forest, 70 percent of Russia’s fish is 

28
00:02:04.835 --> 00:02:07.944
harvested in the local waters.

29
00:02:07.944 --> 00:02:14.598
This is a region with a substantially developed transport 

30
00:02:14.598 --> 00:02:15.723
and railroad infrastructure.

31
00:02:15.723 --> 00:02:22.528
In recent years we have been actively developing road connection.

32
00:02:22.528 --> 00:02:29.202
There is also a huge potential for developing the aviation 

33
00:02:29.202 --> 00:02:30.735
and space industries.

34
00:02:30.735 --> 00:02:35.900
As you might have noticed we have launched a new Russian spaceport 

35
00:02:35.900 --> 00:02:37.713
in one of the Far Eastern regions.

36
00:02:37.713 --> 00:02:41.147
As I have already said, the aviation industry,

37
00:02:41.147 --> 00:02:44.753
including combat air force, has been traditionally developing here.

38
00:02:44.753 --> 00:02:46.732
It is the Russian Far East where the SU aircraft,

39
00:02:46.732 --> 00:02:49.533
which are well known worldwide, are manufactured.

40
00:02:49.533 --> 00:02:56.437
Finally, we are resuming the manufacturing of sea vessels here,

41
00:02:56.437 --> 00:02:58.734
first of all for civilian purposes.

42
00:02:58.734 --> 00:03:03.826
Just earlier today I witnessed the commissioning of one 

43
00:03:03.826 --> 00:03:07.213
of the most promising sites of this kind.

44
00:03:07.213 --> 00:03:11.260
And this is also a good opportunity for humanitarian 

45
00:03:11.260 --> 00:03:17.109
exchanges with our neighbours.

46
00:03:17.109 --> 00:03:20.963
Our intention is to develop music,

47
00:03:20.963 --> 00:03:23.765
theatre and exhibition activities here.

48
00:03:23.765 --> 00:03:28.618
Just recently Mr Gergiev, a distinguished Russian musician 

49
00:03:28.618 --> 00:03:30.398
and conductor, held his concerts here.

50
00:03:30.398 --> 00:03:33.043
We are going to set up a branch of the St Petersburg 

51
00:03:33.043 --> 00:03:34.641
Mariinsky Theatre here.

52
00:03:34.641 --> 00:03:38.731
We are also planning to open local branches of the Hermitage Museum 

53
00:03:38.731 --> 00:03:41.502
and the Vaganova Academy of Russian Ballet.

54
00:03:41.502 --> 00:03:45.426
As you can see, we are now present in the building 

55
00:03:45.426 --> 00:03:48.769
of the Far Eastern Federal University.

56
00:03:48.769 --> 00:03:52.580
I am sure you too have had a chance to assess the size 

57
00:03:52.580 --> 00:03:57.353
of the University – the number of foreign students studying here is 

58
00:03:57.353 --> 00:04:00.625
already in the thousands; there is also a great number 

59
00:04:00.625 --> 00:04:02.462
of foreign professors.

60
00:04:02.462 --> 00:04:07.574
We would like to see science and higher education developing here,

61
00:04:07.574 --> 00:04:16.152
so that it could become one of the major research centres 

62
00:04:16.152 --> 00:04:18.553
in the entire APR system.

63
00:04:18.553 --> 00:04:20.382
Undoubtedly a lot remains to be done here,

64
00:04:20.382 --> 00:04:24.120
but given the labour market demand,

65
00:04:24.120 --> 00:04:28.361
the relevance of such a university is undeniable.

66
00:04:28.361 --> 00:04:31.993
In addition to everything that I have already mentioned,

67
00:04:31.993 --> 00:04:34.282
there is another domain that we consider relevant and having good 

68
00:04:34.282 --> 00:04:35.568
prospects – marine biology.

69
00:04:35.568 --> 00:04:42.617
For many years this region has been home for one of the leading 

70
00:04:42.617 --> 00:04:44.895
institutes of the Russian Academy of Sciences,

71
00:04:44.895 --> 00:04:46.749
the Institute of Marine Biology.

72
00:04:46.749 --> 00:04:49.506
You know, we are launching a new centre here;

73
00:04:49.506 --> 00:04:52.262
we have built an oceanarium on its premises,

74
00:04:52.282 --> 00:04:57.848
which is supposed to be not only a public place where people,

75
00:04:57.848 --> 00:05:01.288
I am sure, will enjoy the wildlife,

76
00:05:01.288 --> 00:05:08.933
but also part of the Institute of Marine Biology.

77
00:05:08.933 --> 00:05:12.608
A very interesting and promising cluster has formed here,

78
00:05:12.608 --> 00:05:17.151
and we would be happy if our potential investors,

79
00:05:17.151 --> 00:05:20.381
our counterparts from abroad, first of all those from 

80
00:05:20.381 --> 00:05:24.916
the Asia-Pacific region, knew more about it.

81
00:05:24.916 --> 00:05:31.517
One of the guests who have coming is Shinzo Abe.

82
00:05:31.517 --> 00:05:36.752
There seem to be the beginning of a political deal: you might give up 

83
00:05:36.752 --> 00:05:43.410
one of the Kuril Islands in exchange for greater economic cooperation? 

84
00:05:43.410 --> 00:05:46.532
Are you opened to a deal of that sort?

85
00:05:46.532 --> 00:05:53.384
We do not trade territories although concluding a peace treaty with 

86
00:05:53.384 --> 00:05:58.994
Japan is certainly a key issue and we would like to find a solution 

87
00:05:58.994 --> 00:06:02.017
to this problem together with our Japanese friends.

88
00:06:02.017 --> 00:06:12.814
Back in 1956, we signed a treaty and surprisingly it was ratified both 

89
00:06:12.814 --> 00:06:16.664
by the Supreme Soviet of the Soviet Union and the Japanese Parliament.

90
00:06:16.664 --> 00:06:23.497
But then Japan refused to implement it and after that the Soviet Union 

91
00:06:23.497 --> 00:06:27.023
also, so to say, nullified all the agreements reached 

92
00:06:27.023 --> 00:06:28.999
within the framework of the treaty.

93
00:06:28.999 --> 00:06:32.555
Some years ago our Japanese counterparts asked us to resume 

94
00:06:32.555 --> 00:06:37.379
the discussions of the issue and so we did meeting them halfway.

95
00:06:37.379 --> 00:06:44.892
Over the passed couple of years the contacts were practically frozen 

96
00:06:44.892 --> 00:06:47.596
on the initiative of the Japanese side,

97
00:06:47.596 --> 00:06:54.292
not ours. At the same time, presently our partners have expressed their 

98
00:06:54.292 --> 00:06:57.246
eagerness to resume discussions on this issue.

99
00:06:57.246 --> 00:07:00.775
It has nothing to do with any kind of exchange or sale.

100
00:07:00.775 --> 00:07:06.342
It is about the search for a solution when neither party would be 

101
00:07:06.342 --> 00:07:11.339
at a disadvantage, when neither party would perceive itself 

102
00:07:11.339 --> 00:07:13.040
as conquered or defeated.

103
00:07:13.040 --> 00:07:21.095
Are you as close to a deal now as you have been since the 1960s? Is it 

104
00:07:21.095 --> 00:07:23.393
better now than any time since then?

105
00:07:23.393 --> 00:07:28.517
I don’t think that we are closer than in 1956 but anyway we have 

106
00:07:28.517 --> 00:07:36.713
resumed our dialogue and agreed that our foreign ministers and relevant 

107
00:07:36.713 --> 00:07:40.577
experts at the level of deputy ministers will intensify this work.

108
00:07:40.577 --> 00:07:46.170
Naturally, this issue has always been a subject of discussions between 

109
00:07:46.170 --> 00:07:47.802
the Russian President and the Prime Minister.

110
00:07:47.802 --> 00:07:52.478
I am sure that during the meeting with Mr Abe here in Vladivostok this 

111
00:07:52.478 --> 00:07:56.054
issue will also be discussed, but finding a solution requires it to be 

112
00:07:56.054 --> 00:08:00.333
well thought out and prepared, and I reiterate,

113
00:08:00.333 --> 00:08:02.869
a solution that is not based on the principles of causing damage, but,

114
00:08:02.869 --> 00:08:06.447
on the contrary, on the principles of creating conditions 

115
00:08:06.447 --> 00:08:10.884
for developing long-term ties between the two countries.

116
00:08:10.884 --> 00:08:21.853
You seem to be more relaxed about territory in Asia.

117
00:08:21.853 --> 00:08:28.318
You mentioned the Kurils, you gave the island of Tarabarov back 

118
00:08:28.318 --> 00:08:32.865
to China. Would you consider giving back Kaliningrad as a tribute?

119
00:08:32.865 --> 00:08:41.056
We handed over nothing, those territories were disputed and we have 

120
00:08:41.056 --> 00:08:45.318
been negotiating this issue with the People's Republic of China,

121
00:08:45.318 --> 00:08:47.711
let me stress that, for 40 years,

122
00:08:47.711 --> 00:08:49.802
and finally managed to come to an agreement.

123
00:08:49.802 --> 00:08:54.876
One part of the territory was assigned to Russia, while another part –

124
00:08:54.876 --> 00:08:57.691
to the People's Republic of China.

125
00:08:57.691 --> 00:09:02.446
Notably, it was only possible, and this is very important,

126
00:09:02.446 --> 00:09:07.678
due to the high level of trust Russia and China reached 

127
00:09:07.678 --> 00:09:09.770
in their relations by that time.

128
00:09:09.770 --> 00:09:14.587
If we reach the same level of trust with Japan,

129
00:09:14.587 --> 00:09:17.282
we might be able to reach certain compromises.

130
00:09:17.282 --> 00:09:23.355
However, there is a fundamental difference between the issue related 

131
00:09:23.355 --> 00:09:31.078
to Japan’s history and our negotiations with China.

132
00:09:31.078 --> 00:09:39.166
What is it all about? The Japanese issue resulted from World War II 

133
00:09:39.166 --> 00:09:45.530
and is stipulated in the international instruments on the outcomes 

134
00:09:45.530 --> 00:09:51.170
of World War II, while our discussions on border issues with our 

135
00:09:51.170 --> 00:09:56.219
Chinese counterparts have nothing to do with World War II 

136
00:09:56.219 --> 00:09:59.048
or any other military conflicts.

137
00:09:59.048 --> 00:10:01.821
This is the first, or rather, I should say, the second point.

138
00:10:01.821 --> 00:10:06.147
Thirdly, regarding the Western part. You have mentioned Kaliningrad.

139
00:10:06.147 --> 00:10:10.609
It was a joke.

140
00:10:10.609 --> 00:10:15.188
All jokes aside. If someone is willing to reconsider the results 

141
00:10:15.188 --> 00:10:19.805
of World War II, let us discuss this.

142
00:10:19.805 --> 00:10:23.669
But then we will have to discuss not only Kaliningrad,

143
00:10:23.669 --> 00:10:30.114
but also the eastern lands of Germany, the city of Lvov,

144
00:10:30.114 --> 00:10:32.487
a former part of Poland, and so on,

145
00:10:32.487 --> 00:10:35.079
and so forth. There are also Hungary and Romania on the list.

146
00:10:35.079 --> 00:10:40.468
If someone wants to open this Pandora's box and deal with 

147
00:10:40.468 --> 00:10:43.335
it, all right, go for it then.

148
00:10:43.335 --> 00:10:47.452
Can I ask you about the Chinese again.

149
00:10:47.452 --> 00:10:54.718
Back in 2013 you said you set $100 billion of trade with 

150
00:10:54.718 --> 00:11:00.079
China as a target for 2015.

151
00:11:00.079 --> 00:11:05.847
But it was about $67 billion-$70 billion a year.

152
00:11:05.847 --> 00:11:09.718
What went wrong? I know the problems to the ruble 

153
00:11:09.718 --> 00:11:11.091
and problems to the oil.

154
00:11:11.091 --> 00:11:17.309
Do you still think that target of $200 billion in 2020 is achievable?

155
00:11:17.309 --> 00:11:20.601
Yes, I find it absolutely attainable.

156
00:11:20.601 --> 00:11:24.371
You have just listed the causes of this fall in bilateral trade 

157
00:11:24.371 --> 00:11:29.409
yourself. At the first stage, we set the target at about 100 billion 

158
00:11:29.409 --> 00:11:33.042
US dollars, and we almost got there –

159
00:11:33.042 --> 00:11:40.968
it reached 90 billion. So we are almost there.

160
00:11:40.968 --> 00:11:42.925
But we also know the reasons for the fall.

161
00:11:42.925 --> 00:11:48.782
These include a decline in the prices of our traditional export goods 

162
00:11:48.782 --> 00:11:52.288
and the exchange rate difference.

163
00:11:52.288 --> 00:11:57.186
These are objective reasons. And you know that very well.

164
00:11:57.186 --> 00:12:00.990
Did sanctions make a difference?

165
00:12:00.990 --> 00:12:05.555
The sanctions have nothing to do with our relations with China,

166
00:12:05.555 --> 00:12:12.239
because our relations with the People's Republic of China are 

167
00:12:12.239 --> 00:12:16.850
at an unprecedented high both in terms of their level and substance.

168
00:12:16.850 --> 00:12:20.699
They are what we call ”a comprehensive partnership 

169
00:12:20.699 --> 00:12:30.470
and strategic cooperation“. Sanctions have nothing to do with this.

170
00:12:30.470 --> 00:12:34.398
The decline in our mutual trade has objective causes,

171
00:12:34.398 --> 00:12:38.238
which are the energy prices and the exchange rate difference.

172
00:12:38.238 --> 00:12:42.216
But the physical volumes have not decreased,

173
00:12:42.216 --> 00:12:44.956
quite the opposite actually. They are growing.

174
00:12:44.956 --> 00:12:48.802
As to our trade and economic relations with China,

175
00:12:48.802 --> 00:12:54.546
they are growing more and more diverse each day,

176
00:12:54.546 --> 00:12:59.313
something we have worked on for a long time with our partners from 

177
00:12:59.313 --> 00:13:02.302
China. I would like to draw your attention to the fact that we have 

178
00:13:02.302 --> 00:13:04.799
gone from pure trade in traditional goods 

179
00:13:04.799 --> 00:13:09.107
(energy resources, such as hydrocarbons, oil and now natural gas,

180
00:13:09.107 --> 00:13:13.003
petrochemicals on the one hand and textiles and footwear on the other)

181
00:13:13.003 --> 00:13:15.926
to a whole new level of economic cooperation.

182
00:13:15.926 --> 00:13:21.166
For example, we are working together on space programmes.

183
00:13:21.166 --> 00:13:27.713
Moreover, we are developing and soon will begin 

184
00:13:27.713 --> 00:13:30.084
the production of a heavy helicopter.

185
00:13:30.084 --> 00:13:34.966
We are now tracing the plan for the creation of a wide-body 

186
00:13:34.966 --> 00:13:37.293
long-range aircraft.

187
00:13:37.293 --> 00:13:41.692
Russia and China also cooperate in mechanical engineering,

188
00:13:41.692 --> 00:13:53.965
high-speed railway transportation, lumber processing,

189
00:13:53.965 --> 00:13:56.370
nuclear energy production and so on.

190
00:13:56.370 --> 00:14:00.868
We have built the Tianwan Nuclear Power Plant.

191
00:14:00.868 --> 00:14:03.907
Two units are already operational and are showing good results.

192
00:14:03.907 --> 00:14:05.479
There are two more to go.

193
00:14:05.479 --> 00:14:09.289
So, the goal we have set for ourselves,

194
00:14:09.289 --> 00:14:13.357
which is to diversify our cooperation with China, is making progress.

195
00:14:13.357 --> 00:14:19.488
Just listening to you speak I wonder if you look back,

196
00:14:19.488 --> 00:14:22.979
you became president first back in 2000,

197
00:14:22.979 --> 00:14:26.410
I wonder if you look back over that period whether you think Russia has 

198
00:14:26.410 --> 00:14:30.127
become a little bit more an Asian country and a little bit 

199
00:14:30.127 --> 00:14:32.491
less European one?

200
00:14:32.491 --> 00:14:36.448
I'll tell you this: it has become a more developed country.

201
00:14:36.448 --> 00:14:45.517
I would not draw a line between Asia and Europe as the divide lies 

202
00:14:45.517 --> 00:14:49.302
in a different field – in the level of development.

203
00:14:49.302 --> 00:14:54.514
Since then, Russia's economy has become 1.7 times larger.

204
00:14:54.514 --> 00:14:57.076
That is a nearly two-fold growth.

205
00:14:57.076 --> 00:15:01.641
Russia has moved up to the fifth or sixth position 

206
00:15:01.641 --> 00:15:08.428
in the world in terms of PPP ranking.

207
00:15:08.428 --> 00:15:17.612
It is absolutely clear that ten and even less so fifteen years ago we 

208
00:15:17.612 --> 00:15:20.331
would not have been able to respond to the sanctions that have been 

209
00:15:20.331 --> 00:15:26.783
imposed against Russia, with countermeasures in agriculture,

210
00:15:26.783 --> 00:15:31.075
for example. We would not have been able to close our market 

211
00:15:31.075 --> 00:15:34.677
to the countries making unfriendly steps against us,

212
00:15:34.677 --> 00:15:37.200
because we could not satisfy the demand with our own 

213
00:15:37.200 --> 00:15:40.597
produce at that time. But now we can. That is point number one.

214
00:15:40.597 --> 00:15:45.803
Second, freeing up domestic market allows our agricultural companies 

215
00:15:45.803 --> 00:15:48.598
to step up sale cropping inside the country.

216
00:15:48.598 --> 00:15:53.345
Aside from the overall decrease in GDP caused by a number of factors,

217
00:15:53.345 --> 00:15:57.640
not limited to sanctions but also related to the processes 

218
00:15:57.640 --> 00:16:04.115
in the global economy, — there is a small decrease in GDP,

219
00:16:04.115 --> 00:16:06.198
including in industrial production.

220
00:16:06.198 --> 00:16:08.967
However, the agricultural sector is growing steadily at a yearly pace 

221
00:16:08.967 --> 00:16:14.122
of 3 percent, and it will be 3 percent or even more this 

222
00:16:14.122 --> 00:16:15.502
year and the next year as well.

223
00:16:15.502 --> 00:16:20.814
So, if we look at was has changed in the last 15 years,

224
00:16:20.814 --> 00:16:22.621
we will see that a lot has happened,

225
00:16:22.621 --> 00:16:24.882
but that is not the only point.

226
00:16:24.882 --> 00:16:27.759
Even more importantly, the Russian economy as a whole has 

227
00:16:27.759 --> 00:16:29.857
been put on a sound footing.

228
00:16:29.857 --> 00:16:35.710
In 2000, we had 12 billion in gold and foreign currency reserves and,

229
00:16:35.710 --> 00:16:40.489
if my memory serves me well, a foreign debt of 20 billion.

230
00:16:40.489 --> 00:16:46.016
Today, Russia is among the top ten countries with the best ratio 

231
00:16:46.016 --> 00:16:48.689
of foreign debt to gold and foreign currency reserves.

232
00:16:48.689 --> 00:16:58.119
As of August 1, 2016, the volume of our gold and foreign currency 

233
00:16:58.119 --> 00:17:00.603
reserves amounted to almost $400 billion — $395 billion in fact,

234
00:17:00.603 --> 00:17:04.816
with foreign debt of slightly about 13 percent of GDP.

235
00:17:04.816 --> 00:17:08.408
This ratio is among the most favourable in the world.

236
00:17:08.408 --> 00:17:13.659
Back in 2000, over 40 million people,

237
00:17:13.659 --> 00:17:15.347
a third of the country’s population,

238
00:17:15.347 --> 00:17:20.374
were living below the poverty line.

239
00:17:20.374 --> 00:17:24.223
Since then, this number has dropped almost three times but has been,

240
00:17:24.223 --> 00:17:27.476
unfortunately, growing a little bit due to the economic difficulties 

241
00:17:27.476 --> 00:17:30.238
and the overall fall in the household income.

242
00:17:30.238 --> 00:17:36.461
Still, it is an incomparably lower number than 15 years ago.

243
00:17:36.461 --> 00:17:41.594
Pensions are several times higher now,

244
00:17:41.594 --> 00:17:45.102
real wages have grown substantially;

245
00:17:45.102 --> 00:17:46.970
they are now nothing like back then.

246
00:17:46.970 --> 00:17:54.357
These are the factors that helped us achieve what we have fought 

247
00:17:54.357 --> 00:17:55.203
for and what lays the foundation for a successful 

248
00:17:55.203 --> 00:17:58.149
development of any state, namely the demography.

249
00:17:58.149 --> 00:18:01.894
In the early 2000s, it seemed to us that we could not reverse 

250
00:18:01.894 --> 00:18:04.617
the negative demographic trend.

251
00:18:04.617 --> 00:18:09.718
The Russian population was decreasing year after year by –

252
00:18:09.718 --> 00:18:11.295
I will now tell you a horrifying number –

253
00:18:11.295 --> 00:18:15.269
nearly one million people a year, 900,

254
00:18:15.269 --> 00:18:17.929
000 to be precise. In the past three years,

255
00:18:17.929 --> 00:18:26.600
we have witnessed natural population growth, we have the lowest…

256
00:18:26.600 --> 00:18:31.490
You're encouraging romance, it seems.

257
00:18:31.490 --> 00:18:37.505
We have the right to say and be proud that we now have the lowest rate 

258
00:18:37.505 --> 00:18:42.597
of infant mortality and the lowest maternal mortality 

259
00:18:42.597 --> 00:18:46.114
in our contemporary history.

260
00:18:46.114 --> 00:18:49.132
As far as I know, this was not the case in the Soviet times.

261
00:18:49.132 --> 00:18:51.927
We set ourselves the goal of increasing life expectancy.

262
00:18:51.927 --> 00:18:57.087
Over the last five years, it has been growing a lot faster 

263
00:18:57.087 --> 00:19:01.200
than we expected. All these facts taken together allow us to believe 

264
00:19:01.200 --> 00:19:04.363
that we are on the right track.

265
00:19:04.363 --> 00:19:11.241
Certainly, we still can and have a lot to do and we might have achieved 

266
00:19:11.241 --> 00:19:15.411
greater results, but on the whole we are doing what has to be done.

267
00:19:15.411 --> 00:19:20.033
You've just talked about the Russian economy,

268
00:19:20.033 --> 00:19:24.717
we'll come back and I ask you about reserves in just a second.

269
00:19:24.717 --> 00:19:27.507
But it struck while you're talking in detail in all 

270
00:19:27.507 --> 00:19:29.487
the ways Russia got stronger.

271
00:19:29.487 --> 00:19:33.745
You're about to go to G-20 you have studied and watched 

272
00:19:33.745 --> 00:19:40.899
the west many times. You've been to G-20 more than any other leader 

273
00:19:40.899 --> 00:19:44.595
at the moment. Have you ever been to G-20 where the west is seen more 

274
00:19:44.595 --> 00:19:48.746
divided, more in doubt, more distrustful in itself.

275
00:19:48.746 --> 00:19:51.031
Look at all those things happening in Europe –

276
00:19:51.031 --> 00:19:54.190
you look at migration, you look at Brexit,

277
00:19:54.190 --> 00:19:57.868
you look at America with all the election and the problems with that.

278
00:19:57.868 --> 00:20:01.829
Does the West seem particularly disunited at the moment 

279
00:20:01.829 --> 00:20:03.676
to you. How do you explain that?

280
00:20:03.676 --> 00:20:11.677
There are many issues in the global economy in general 

281
00:20:11.677 --> 00:20:16.954
and in the western economy as well: population ageing,

282
00:20:16.954 --> 00:20:25.175
drop in labour productivity growth rates. This is obvious.

283
00:20:25.175 --> 00:20:30.508
The overall demographic situation is very complicated.

284
00:20:30.508 --> 00:20:33.892
Then, the specialists themselves,

285
00:20:33.892 --> 00:20:37.403
and you are one of the best specialists in this area,

286
00:20:37.403 --> 00:20:44.590
probably believe that in the course of EU expansion, for example,

287
00:20:44.590 --> 00:20:50.796
some elements concerning the readiness of some economies to enter 

288
00:20:50.796 --> 00:20:53.476
the Eurozone have not been taken into account.

289
00:20:53.476 --> 00:20:59.331
It is very difficult to enter a single currency zone having fairly weak 

290
00:20:59.331 --> 00:21:07.019
economic parameters and maintain a favourable state of the economy,

291
00:21:07.019 --> 00:21:09.546
not to mention positive growth rates.

292
00:21:09.546 --> 00:21:11.518
We have witnessed it not only in Europe,

293
00:21:11.518 --> 00:21:18.834
but for example in Argentina (nearly 10 years ago or more)

294
00:21:18.834 --> 00:21:23.845
, when they tied the national currency to the dollar and later they did 

295
00:21:23.845 --> 00:21:27.878
not know what to do about it. It is the same with entering the Eurozone…

296
00:21:27.878 --> 00:21:31.342
Do you expect the euro to survive?

297
00:21:31.342 --> 00:21:37.300
I hope so, because we believe in the fundamental principles 

298
00:21:37.300 --> 00:21:39.571
of the European economy.

299
00:21:39.571 --> 00:21:43.779
We see that leaders in Western Europe 

300
00:21:43.779 --> 00:21:51.389
(there are some debates of course, we also see that and analyse it all)

301
00:21:51.389 --> 00:22:02.562
stick to, I cannot say right or wrong ones,

302
00:22:02.562 --> 00:22:07.857
it always depends on someone's view, but I think,

303
00:22:07.857 --> 00:22:13.398
very pragmatic approaches in addressing economic issues.

304
00:22:13.398 --> 00:22:20.531
They do not misuse financial instruments, financial injections, but,

305
00:22:20.531 --> 00:22:24.111
first of all, seek structural change.

306
00:22:24.111 --> 00:22:28.191
This is urgent for our economy as well,

307
00:22:28.191 --> 00:22:33.524
maybe even more urgent bearing in mind the problem that we cannot yet 

308
00:22:33.524 --> 00:22:37.445
deal with, namely the prevalence of the oil and gas sector 

309
00:22:37.445 --> 00:22:40.590
in the Russian Federation and, as a result,

310
00:22:40.590 --> 00:22:43.312
dependence on revenue from oil and gas.

311
00:22:43.312 --> 00:22:48.622
This is also evident in Europe, not the dependence on oil and gas,

312
00:22:48.622 --> 00:22:52.919
but the fact that structural reforms are long overdue,

313
00:22:52.919 --> 00:23:00.756
and I think that the leading economies are very pragmatic and efficient 

314
00:23:00.756 --> 00:23:04.431
in addressing the issues facing the European economy.

315
00:23:04.431 --> 00:23:08.631
That is why we keep approximately 40 percent of our gold 

316
00:23:08.631 --> 00:23:11.472
and foreign currency reserves in euros.

317
00:23:11.472 --> 00:23:19.793
You expect that Europe won't keep the existing membership,

318
00:23:19.793 --> 00:23:23.164
and they going to lose more like they lost Britain?

319
00:23:23.164 --> 00:23:28.165
You know, I do not want to answer your provocative question,

320
00:23:28.165 --> 00:23:31.672
though I understand that it may be interesting.

321
00:23:31.672 --> 00:23:37.944
Come on, many, many times you've criticized Europe…

322
00:23:37.944 --> 00:23:39.615
Well, yes, I have criticized it,

323
00:23:39.615 --> 00:23:46.061
but I repeat: we keep 40 percent of our gold and foreign currency 

324
00:23:46.061 --> 00:23:48.157
reserves in euros, we are not interested in the collapse 

325
00:23:48.157 --> 00:23:52.786
of the Eurozone, but I do not rule out the possibility of decisions 

326
00:23:52.786 --> 00:23:58.689
being made that would consolidate a group of countries equal 

327
00:23:58.689 --> 00:24:03.118
in economic development and this, in my opinion,

328
00:24:03.118 --> 00:24:05.519
will lead to a consolidation of the euro.

329
00:24:05.519 --> 00:24:10.322
But there can also be some interim decisions in order to keep 

330
00:24:10.322 --> 00:24:14.720
the present number of members of the Eurozone unchanged.

331
00:24:14.720 --> 00:24:26.052
This is not our job, but we always follow the actions of our European 

332
00:24:26.052 --> 00:24:29.689
partners closely and we wish them luck.

333
00:24:29.689 --> 00:24:31.031
Now, regarding that criticism you spoke about.

334
00:24:31.031 --> 00:24:34.264
I have criticized foreign policy,

335
00:24:34.264 --> 00:24:38.521
but that does not mean that we should agree with everything.

336
00:24:38.521 --> 00:24:40.797
Indeed, we criticize a lot of things,

337
00:24:40.797 --> 00:24:44.762
we think that our partners make many mistakes 

338
00:24:44.762 --> 00:24:47.487
(may be we make mistakes too, no one is immune to making mistakes)

339
00:24:47.487 --> 00:24:51.903
, but as for the economy, I repeat that, in my opinion,

340
00:24:51.903 --> 00:24:56.634
the European Commission and the leading European economies are acting 

341
00:24:56.634 --> 00:24:59.721
very pragmatically and are on the right path.

342
00:24:59.721 --> 00:25:03.820
Can we talk about the Russian economy.

343
00:25:03.820 --> 00:25:09.591
I know you will say that exchange rate a lot depends on central bank 

344
00:25:09.591 --> 00:25:15.355
and the exchange rate is set by the market.

345
00:25:15.355 --> 00:25:21.014
I saw back in July, on July the 19th when the ruble was 62,

346
00:25:21.014 --> 00:25:24.363
8 with the dollar you said the ruble is too strong,

347
00:25:24.363 --> 00:25:30.512
you criticized that. And a ruble is now come down to 65 to the dollar.

348
00:25:30.512 --> 00:25:32.147
Is it weakened enough to make you happy? Or do you want 

349
00:25:32.147 --> 00:25:33.736
to see it weakening further?

350
00:25:33.736 --> 00:25:38.306
I did not criticize the Central Bank's position.

351
00:25:38.306 --> 00:25:44.124
I have always thought and I still think that the Central 

352
00:25:44.124 --> 00:25:48.071
Bank should act independently. Indeed, it does,

353
00:25:48.071 --> 00:25:49.672
you can take my word.

354
00:25:49.672 --> 00:25:52.942
I do not interfere in the decisions of the Central Bank and I do not 

355
00:25:52.942 --> 00:25:57.860
give instructions to the Bank management or to its head.

356
00:25:57.860 --> 00:26:03.806
The Central Bank observes the economic situation and, of course,

357
00:26:03.806 --> 00:26:08.420
I keep in touch both with the managers and the President of the Central 

358
00:26:08.420 --> 00:26:11.398
Bank, but I never give instructions.

359
00:26:11.398 --> 00:26:16.847
If I said that the ruble had become too strong,

360
00:26:16.847 --> 00:26:20.745
I did not say that the Central Bank's position was wrong,

361
00:26:20.745 --> 00:26:26.995
I said that it added pressure to export‑oriented sectors of economy.

362
00:26:26.995 --> 00:26:29.531
We all understand that this is true.

363
00:26:29.531 --> 00:26:33.719
When the ruble is weaker, it is easier to sell,

364
00:26:33.719 --> 00:26:39.387
to produce here for a cheap ruble and sell for an expensive dollar,

365
00:26:39.387 --> 00:26:43.183
get revenue in dollars and then exchange it for rubles 

366
00:26:43.183 --> 00:26:47.604
and get a bigger income. This is simple.

367
00:26:47.604 --> 00:26:51.025
But if we speak about fundamental things,

368
00:26:51.025 --> 00:26:59.795
regulation of the rate is actually the function of the main regulator,

369
00:26:59.795 --> 00:27:01.993
namely the function of the Central Bank.

370
00:27:01.993 --> 00:27:08.330
And it should think of how the economy and industry react,

371
00:27:08.330 --> 00:27:12.660
but also of its fundamental tasks in order to ensure 

372
00:27:12.660 --> 00:27:14.064
the stability of the rate.

373
00:27:14.064 --> 00:27:19.226
The stability of the rate is the main issue and the Central Bank 

374
00:27:19.226 --> 00:27:22.084
manages to ensure it one way or another.

375
00:27:22.084 --> 00:27:26.373
This was finally achieved after the Central Bank switched to a floating 

376
00:27:26.373 --> 00:27:28.545
national currency exchange rate.

377
00:27:28.545 --> 00:27:31.889
The Central Bank should take into account other things as well: 

378
00:27:31.889 --> 00:27:34.498
the stability of the bank system in the country,

379
00:27:34.498 --> 00:27:42.696
the increase or decrease of money supply in the economy,

380
00:27:42.696 --> 00:27:45.243
its influence on inflation.

381
00:27:45.243 --> 00:27:49.457
The Central Bank has a lot to handle and it is best not 

382
00:27:49.457 --> 00:27:51.570
to interfere with its competence.

383
00:27:51.570 --> 00:27:57.139
You personally, would you like to see ruble a little bit weaker still,

384
00:27:57.139 --> 00:28:01.334
with their help? I know it is not you job but you made 

385
00:28:01.334 --> 00:28:04.652
a comment before. What do you say now?

386
00:28:04.652 --> 00:28:09.079
You know, my position is that the rate should align with the level 

387
00:28:09.079 --> 00:28:11.423
of economic development.

388
00:28:11.423 --> 00:28:13.964
Because it is always about a balance, a balance of interests,

389
00:28:13.964 --> 00:28:15.961
and it should reflect this balance.

390
00:28:15.961 --> 00:28:21.896
A balance between those who sell something across the border and those 

391
00:28:21.896 --> 00:28:26.232
who benefit from a low rate, as well as a balance between the interests 

392
00:28:26.232 --> 00:28:31.084
of those who buy, who need the rate to be higher.

393
00:28:31.084 --> 00:28:35.038
A balance between national producers, for example,

394
00:28:35.038 --> 00:28:37.769
agricultural producers who are interested in it.

395
00:28:37.769 --> 00:28:40.858
Here we have 40 million Russian citizens involved in the sphere 

396
00:28:40.858 --> 00:28:43.663
of agriculture one way or another. This is very important.

397
00:28:43.663 --> 00:28:46.216
We should not forget either about the interests of the regular 

398
00:28:46.216 --> 00:28:51.620
consumers who need the prices in supermarkets to be a little bit lower.

399
00:28:51.620 --> 00:28:57.186
Therefore, let me reiterate that the rate should not meet the interests 

400
00:28:57.186 --> 00:28:59.956
of a specific group or one or two groups,

401
00:28:59.956 --> 00:29:05.860
it should meet the fundamental development interests 

402
00:29:05.860 --> 00:29:07.086
of the economy itself.

403
00:29:07.086 --> 00:29:11.085
So you are no longer complaining.

404
00:29:11.085 --> 00:29:13.611
I will take it that you are not too unhappy where it is?

405
00:29:13.611 --> 00:29:15.393
I did not express any disagreement,

406
00:29:15.393 --> 00:29:18.662
did not complain. I simply noted that one of the groups,

407
00:29:18.662 --> 00:29:23.175
especially exporters, would prefer to have a weaker rouble.

408
00:29:23.175 --> 00:29:32.029
You mentioned earlier Russia used to have $500b.

409
00:29:32.029 --> 00:29:35.784
Now it is $400 billion.

410
00:29:35.784 --> 00:29:39.220
You have this target to get back to $500 billion.

411
00:29:39.220 --> 00:29:45.554
What you think is the realistic target? And your opinion: should 

412
00:29:45.554 --> 00:29:49.062
the central bank be buying more dollars in order to push it 

413
00:29:49.062 --> 00:29:51.235
back up towards $500 billion?

414
00:29:51.235 --> 00:29:53.603
The Central Bank is constantly purchasing,

415
00:29:53.603 --> 00:29:55.549
purchasing and selling and vice versa –

416
00:29:55.549 --> 00:30:01.885
this is their job. I believe that over the last six months gold 

417
00:30:01.885 --> 00:30:05.148
and foreign currency reserves increased by 14 percent.

418
00:30:05.148 --> 00:30:12.105
They gone back up a little bit,

419
00:30:12.105 --> 00:30:13.972
but they haven't been buying dollars in the same systematic 

420
00:30:13.972 --> 00:30:14.817
way as they did once.

421
00:30:14.817 --> 00:30:22.831
You and I know very well about the necessary level of reserves 

422
00:30:22.831 --> 00:30:28.061
of the Central Bank as well as the purpose.

423
00:30:28.061 --> 00:30:33.234
We can tell the general public that the gold and foreign currency 

424
00:30:33.234 --> 00:30:36.530
reserves of the Central Bank are not designed to finance the economy,

425
00:30:36.530 --> 00:30:39.341
but rather to ensure foreign trade turnover.

426
00:30:39.341 --> 00:30:45.977
Therefore, we need this level to be able to provide the necessary 

427
00:30:45.977 --> 00:30:50.354
foreign trade turnover for such an economy as Russia’s for a period 

428
00:30:50.354 --> 00:30:51.423
of at least three months.

429
00:30:51.423 --> 00:30:54.704
If everything stops functioning our level will be able to ensure our 

430
00:30:54.704 --> 00:30:58.916
trade turnover using its gold and foreign currency reserves 

431
00:30:58.916 --> 00:31:01.309
for at least six months or more, which is more than enough.

432
00:31:01.309 --> 00:31:06.188
Therefore today we have an absolutely sufficient level of gold 

433
00:31:06.188 --> 00:31:10.254
and foreign currency reserves in order to ensure economic stability 

434
00:31:10.254 --> 00:31:13.604
and sustainable foreign trade turnover.

435
00:31:13.604 --> 00:31:17.835
All other issues – purchasing and selling of currency –

436
00:31:17.835 --> 00:31:22.055
are related to the regulation of the national currency market.

437
00:31:22.055 --> 00:31:23.159
However, it is still difficult to say what will be the reaction 

438
00:31:23.159 --> 00:31:27.607
of the Central Bank and if it would lead to increasing the gold 

439
00:31:27.607 --> 00:31:29.308
and foreign currency reserves.

440
00:31:29.308 --> 00:31:33.037
Let us not forget that we have two governmental reserve funds: 

441
00:31:33.037 --> 00:31:39.933
the Reserve Fund and the National Wellbeing Fund that 

442
00:31:39.933 --> 00:31:44.358
represent together $100 billion.

443
00:31:44.358 --> 00:31:50.757
Can I ask you about the oil price — your favourite subject.

444
00:31:50.757 --> 00:31:57.313
Almost two years ago you said that if crude oil fell below $80 a barrel 

445
00:31:57.313 --> 00:32:01.430
there would be a collapse in oil production.

446
00:32:01.430 --> 00:32:05.647
The price is still below $50 and production hasn't stopped.

447
00:32:05.647 --> 00:32:07.601
Has your thinking changed on that at all?

448
00:32:07.601 --> 00:32:14.237
If I said that oil production would collapse I was wrong.

449
00:32:14.237 --> 00:32:16.878
By the way, I do not remember when I said this,

450
00:32:16.878 --> 00:32:22.887
maybe in the heat of the moment, but I do not think I even said it,

451
00:32:22.887 --> 00:32:25.948
but I may just not remember it.

452
00:32:25.948 --> 00:32:30.979
I was saying that at a certain level of oil prices new 

453
00:32:30.979 --> 00:32:35.685
deposits will not be explored. That is what is actually happening.

454
00:32:35.685 --> 00:32:41.746
However, surprisingly, our oil and gas workers 

455
00:32:41.746 --> 00:32:47.050
(mainly oilmen) continue to invest.

456
00:32:47.050 --> 00:32:56.083
Over the past year, oilmen have invested 1.

457
00:32:56.083 --> 00:33:02.062
5 trillion rubles, and if we take into account government investments 

458
00:33:02.062 --> 00:33:08.113
into the development of pipeline transport and electric energy,

459
00:33:08.113 --> 00:33:10.768
general investments into the energy sector were 3.

460
00:33:10.768 --> 00:33:14.692
5 trillion rubles last year. It is a considerable amount.

461
00:33:14.692 --> 00:33:21.385
Oil production, energy production are growing,

462
00:33:21.385 --> 00:33:25.146
though the latter has gone down by about 1 percent here,

463
00:33:25.146 --> 00:33:30.042
I believe… By the way, we occupy the first place in the world in gas 

464
00:33:30.042 --> 00:33:32.683
export, accounting for 20 percent of the world market.

465
00:33:32.683 --> 00:33:45.014
We are also first in the sphere of liquid hydrocarbons export.

466
00:33:45.014 --> 00:33:48.850
Though we still come first in the sphere of gas export,

467
00:33:48.850 --> 00:33:57.897
national production has diminished due to the increasing volumes 

468
00:33:57.897 --> 00:34:04.147
of hydrogenation for the electric power industry and therefore there is 

469
00:34:04.147 --> 00:34:07.050
a lower need for gas at thermal power plants.

470
00:34:07.050 --> 00:34:11.465
This is the result of the restructuring of the situation 

471
00:34:11.465 --> 00:34:13.434
at the national energy market.

472
00:34:13.434 --> 00:34:18.872
In general, Gazprom is doing well and is increasing export 

473
00:34:18.872 --> 00:34:24.008
in its traditional partner countries.

474
00:34:24.008 --> 00:34:29.964
You're going to talk to Saudi Deputy Crown Prince Mohammed 

475
00:34:29.964 --> 00:34:34.005
bin Salman at the G-20.

476
00:34:34.005 --> 00:34:38.934
Would you still be in favor of the production freeze if 

477
00:34:38.954 --> 00:34:41.132
the Saudis want that?

478
00:34:41.132 --> 00:34:42.610
As far as I know, Mr.

479
00:34:42.610 --> 00:34:48.322
Salman is deputy Crown Prince, but this is not so important.

480
00:34:48.322 --> 00:34:56.453
He is a very active statesman, we have really warm relations.

481
00:34:56.453 --> 00:35:00.766
This is a person who knows what he wants and can achieve his goals.

482
00:35:00.766 --> 00:35:03.904
At the same time I consider him to be a reliable partner with whom one 

483
00:35:03.904 --> 00:35:10.745
can negotiate and be sure that agreements with him will be implemented.

484
00:35:10.745 --> 00:35:21.315
However, it was not us who refused to freeze oil production;

485
00:35:21.315 --> 00:35:26.904
our Saudi partners changed their point of view at the last moment 

486
00:35:26.904 --> 00:35:32.124
and decided to slow down the adoption of this decision.

487
00:35:32.124 --> 00:35:35.572
I would like to reiterate our position,

488
00:35:35.572 --> 00:35:41.040
it remains the same. Firstly, in my conversation with Prince Salman 

489
00:35:41.040 --> 00:35:47.088
on this issue I will reiterate our position: we think that this is 

490
00:35:47.088 --> 00:35:52.081
the right decision for the world energy sector.

491
00:35:52.081 --> 00:35:58.630
Secondly, it is well known what we were arguing about: if we freeze oil 

492
00:35:58.630 --> 00:36:00.353
production, everybody should do so,

493
00:36:00.353 --> 00:36:07.223
including Iran. But we understand that the Iranian position is very bad 

494
00:36:07.223 --> 00:36:11.521
because of the well-known sanctions against that country,

495
00:36:11.521 --> 00:36:15.660
and it would be unfair to leave it on this sanction level.

496
00:36:15.660 --> 00:36:20.688
I believe that in fact it would be economically reasonable and logical 

497
00:36:20.688 --> 00:36:25.773
to reach a compromise, I am sure that everybody understands this.

498
00:36:25.773 --> 00:36:29.602
This issue is not economic but political.

499
00:36:29.602 --> 00:36:38.630
I hope that all market participants interested in maintaining stable 

500
00:36:38.630 --> 00:36:44.455
and reasonable world energy prices will finally make the right decision.

501
00:36:44.455 --> 00:36:52.175
So you would be in favor of a production freeze but giving Iran 

502
00:36:52.175 --> 00:36:53.964
a little bit of leeway to do what they need to do?

503
00:36:53.964 --> 00:36:54.646
Yes.

504
00:36:54.646 --> 00:37:04.539
I want to jump back — all these things affect budget.

505
00:37:04.539 --> 00:37:12.253
You have budget deficit, you just given some more money which you 

506
00:37:12.253 --> 00:37:18.203
mentioned earlier to pensioners. You will have to borrow sometime.

507
00:37:18.203 --> 00:37:21.076
Are you likely to go this year? And will you go to the domestic market 

508
00:37:21.076 --> 00:37:23.326
or will you go to the international market to borrow money?

509
00:37:23.326 --> 00:37:25.446
There is no such need at the moment.

510
00:37:25.466 --> 00:37:28.513
We do not have to borrow in the external market,

511
00:37:28.513 --> 00:37:35.688
but we have used and are using this traditional instrument 

512
00:37:35.688 --> 00:37:38.048
in international financial relations.

513
00:37:38.048 --> 00:37:42.314
We have issued financial instruments in the past,

514
00:37:42.314 --> 00:37:47.075
and there is a strong demand for them,

515
00:37:47.075 --> 00:37:49.710
it is simply unnecessary now.

516
00:37:49.710 --> 00:37:56.463
Given the cost of borrowings and the $100 billion in Government 

517
00:37:56.463 --> 00:38:03.025
reserves, there is no reason for us to borrow.

518
00:38:03.025 --> 00:38:06.222
We should review the situation carefully.

519
00:38:06.222 --> 00:38:09.736
Besides, borrowings are possible,

520
00:38:09.736 --> 00:38:13.999
but we must understand what is more profitable at this 

521
00:38:13.999 --> 00:38:15.489
point. This is one point.

522
00:38:15.489 --> 00:38:18.599
The second. The deficit.

523
00:38:18.599 --> 00:38:22.561
Last year the federal budget deficit was 2.6 percent.

524
00:38:22.561 --> 00:38:26.827
I think you would agree that this is a rather acceptable level.

525
00:38:26.827 --> 00:38:31.274
This year, we expect a slightly higher deficit of about 3 percent,

526
00:38:31.274 --> 00:38:33.150
maybe a little more than 3 percent.

527
00:38:33.150 --> 00:38:36.609
It is also an absolutely acceptable level.

528
00:38:36.609 --> 00:38:40.232
But what are we seeking to achieve? We are seeking 

529
00:38:40.232 --> 00:38:42.665
to optimize budget spending.

530
00:38:42.665 --> 00:38:48.277
I believe that even in such uneasy times we employ a very pragmatic 

531
00:38:48.277 --> 00:38:51.157
approach towards economic and social issues.

532
00:38:51.157 --> 00:38:55.583
We do address major social problems and deliver on our 

533
00:38:55.583 --> 00:38:58.053
promises to our people.

534
00:38:58.053 --> 00:39:03.381
The Government has just announced a four percent indexation 

535
00:39:03.381 --> 00:39:08.508
of pensions. There has been no indexation in the second half 

536
00:39:08.508 --> 00:39:14.677
of the year, but early next year we will make a one-time payment 

537
00:39:14.677 --> 00:39:17.952
of 5,000 rubles to each pensioner,

538
00:39:17.952 --> 00:39:23.272
which is actually comparable to the indexation.

539
00:39:23.272 --> 00:39:26.808
We act in a pragmatic and careful manner.

540
00:39:26.808 --> 00:39:32.814
We reduce spending on budget items that do not constitute a priority.

541
00:39:32.814 --> 00:39:40.514
We are not going to waste our reserves and burn them 

542
00:39:40.514 --> 00:39:44.872
for any political ambitions. We will act very carefully.

543
00:39:44.872 --> 00:39:53.168
I hope that there will be no particular need for us 

544
00:39:53.168 --> 00:39:54.655
to attract external funding.

545
00:39:54.655 --> 00:39:58.693
It is worth noting that despite the fact the turnover is smaller now we 

546
00:39:58.693 --> 00:40:01.923
are still maintaining a trade surplus.

547
00:40:01.923 --> 00:40:06.220
I believe that we now have a trade surplus of $45 billion 

548
00:40:06.220 --> 00:40:11.209
for the first half of the year.

549
00:40:11.209 --> 00:40:20.700
Year-on-year inflation has dropped several-fold.

550
00:40:20.700 --> 00:40:37.329
Several-fold! Year-on-year it was about 10 percent compared to last 

551
00:40:37.329 --> 00:40:40.825
August, but now it is only a slightly more than 3 percent.

552
00:40:40.825 --> 00:40:45.602
The unemployment rate of 5.7 percent is also acceptable.

553
00:40:45.602 --> 00:40:50.518
Our microeconomic indicators are stable and it gives me reason 

554
00:40:50.518 --> 00:40:56.754
to believe that we will calmly and steadily pass this uneasy period 

555
00:40:56.754 --> 00:41:00.631
in our economy, which has already no doubt adapted 

556
00:41:00.631 --> 00:41:03.049
to the current situation.

557
00:41:03.049 --> 00:41:10.444
Can I ask you about privatization and oil again? The privatization 

558
00:41:10.444 --> 00:41:15.320
of Bashneft – you've delayed it.

559
00:41:15.320 --> 00:41:20.470
And now as we reported Igor Sechin of Rosneft just come forward 

560
00:41:20.470 --> 00:41:25.000
and said he would like to buy the half of it for $5 billion.

561
00:41:25.000 --> 00:41:28.409
You have always said that you don't want for big state companies to be 

562
00:41:28.409 --> 00:41:33.762
buying the newly privatized ones. You wouldn't allow that, would you?

563
00:41:33.762 --> 00:41:38.336
You know, you have just mentioned state companies.

564
00:41:38.336 --> 00:41:42.071
Strictly speaking, Rosneft is not a company.

565
00:41:42.071 --> 00:41:49.904
Let us not forget that BP has a stake in Rosneft and BP is 

566
00:41:49.904 --> 00:41:54.555
a British company. You are a subject of the UK,

567
00:41:54.555 --> 00:41:59.984
are you not? It means that you also to a certain degree…

568
00:41:59.984 --> 00:42:06.989
You may have more control over Rosneft than Theresa May has over BP.

569
00:42:06.989 --> 00:42:11.032
We may have more control, but my point is that, strictly speaking,

570
00:42:11.032 --> 00:42:12.586
it is not a state company.

571
00:42:12.586 --> 00:42:15.918
I think that this is an obvious fact,

572
00:42:15.918 --> 00:42:19.486
as a foreign investor has a 19.7 percent stake in it.

573
00:42:19.486 --> 00:42:23.513
However, given the fact that the State has a controlling stake 

574
00:42:23.513 --> 00:42:27.780
in the company, it might not be the best course of action when one 

575
00:42:27.780 --> 00:42:31.450
company under State control buys another one fully owned 

576
00:42:31.450 --> 00:42:35.186
by the State. This is one point.

577
00:42:35.186 --> 00:42:39.914
Another point is that ultimately, as far as the budget is concerned,

578
00:42:39.914 --> 00:42:47.822
of major importance is who offers more money during the bidding that 

579
00:42:47.822 --> 00:42:51.370
must be organized as a part of the privatization process.

580
00:42:51.370 --> 00:42:54.597
In this sense, we cannot discriminate against any market participants,

581
00:42:54.597 --> 00:42:59.529
not one of them, but this is not relevant at the moment,

582
00:42:59.529 --> 00:43:03.978
as the Government has decided to postpone the privatization of Bashneft.

583
00:43:03.978 --> 00:43:11.051
That's gone. But on the question on privatization,

584
00:43:11.051 --> 00:43:15.680
you said back in 2012 that you wanted to expand privatization,

585
00:43:15.680 --> 00:43:19.233
you've had a difficult time on this.

586
00:43:19.233 --> 00:43:23.785
Why has that not worked? Is there a case,

587
00:43:23.785 --> 00:43:27.392
why does Russian government need to own 50 percent of these 

588
00:43:27.392 --> 00:43:29.045
companies? May be you could sell more?

589
00:43:29.045 --> 00:43:34.532
There is no need for the Russian state to hold such large stakes and we 

590
00:43:34.532 --> 00:43:36.865
do intend to put our plans into practice.

591
00:43:36.865 --> 00:43:40.179
It is not about whether we want it or not,

592
00:43:40.179 --> 00:43:44.171
it is about this being practical or not and the best timing.

593
00:43:44.171 --> 00:43:47.403
In general, it is practical from at least one point of view –

594
00:43:47.403 --> 00:43:50.957
from the point of view of structural changes in the economy.

595
00:43:50.957 --> 00:43:53.711
It is true that the role of the state in the Russian economy may be too 

596
00:43:53.711 --> 00:44:04.671
big today, but from the fiscal standpoint,

597
00:44:04.671 --> 00:44:06.621
it is not always practical to do this in a falling market.

598
00:44:06.621 --> 00:44:13.453
That is why we are careful, but our trend in the privatization process 

599
00:44:13.453 --> 00:44:18.046
and gradual withdrawal of the state from certain assets 

600
00:44:18.046 --> 00:44:20.883
remains unchanged.

601
00:44:20.883 --> 00:44:24.457
By the way, you have mentioned Rosneft.

602
00:44:24.457 --> 00:44:31.865
We are actively preparing a partial privatization of Rosneft itself.

603
00:44:31.865 --> 00:44:39.011
It is the best proof that our major plans have remained unchanged.

604
00:44:39.011 --> 00:44:42.456
Another example would be one of the largest Russian diamond 

605
00:44:42.456 --> 00:44:46.949
mining companies in the world.

606
00:44:46.949 --> 00:44:51.935
We are privatizing part of our stake in that as well.

607
00:44:51.935 --> 00:44:52.813
ALROSA?

608
00:44:52.813 --> 00:44:55.220
ALROSA. We are working in other areas as well,

609
00:44:55.220 --> 00:44:58.227
so there are no radical changes to our position.

610
00:44:58.227 --> 00:45:01.796
It is not the case when we have to, as we say,

611
00:45:01.816 --> 00:45:02.529
make a lot of fuss about it.

612
00:45:02.529 --> 00:45:09.289
In other words, we do not have to be obsessed with privatizing 

613
00:45:09.289 --> 00:45:10.801
immediately and at any cost. No,

614
00:45:10.801 --> 00:45:12.274
we will not do it at any cost.

615
00:45:12.274 --> 00:45:14.783
We will do it in a way that ensures maximum benefit 

616
00:45:14.783 --> 00:45:16.975
for the Russian state and the Russian economy.

617
00:45:16.975 --> 00:45:22.030
So you would do Rosneft this year,

618
00:45:22.030 --> 00:45:25.599
you would sell those shares in Rosneft this year you hope?

619
00:45:25.599 --> 00:45:30.072
We are getting ready for the deal this year.

620
00:45:30.072 --> 00:45:33.600
I do not know whether the Government will be able to get ready 

621
00:45:33.600 --> 00:45:38.529
to conduct this transaction together with the management of Rosneft 

622
00:45:38.529 --> 00:45:41.919
itself, whether the appropriate strategic investors will be found.

623
00:45:41.919 --> 00:45:45.172
And I believe it is about such investors that we should talk.

624
00:45:45.172 --> 00:45:47.067
But we are getting ready, and it is in the current year 

625
00:45:47.067 --> 00:45:50.186
that we are planning to do this.

626
00:45:50.186 --> 00:45:55.704
And do you, do you again just to push you on that 50 percent,

627
00:45:55.704 --> 00:46:01.440
would you be happy in a world where the Russian state had less than 50 

628
00:46:01.440 --> 00:46:02.919
percent of these big companies?

629
00:46:02.919 --> 00:46:06.057
We do not consider this disastrous at all.

630
00:46:06.057 --> 00:46:11.535
You know, I remember that when foreign shareholders, foreign investors,

631
00:46:11.535 --> 00:46:19.674
got 50 percent in one of our companies, I will not name it now,

632
00:46:19.674 --> 00:46:26.928
their contribution to the federal budget and tax payments increased 

633
00:46:26.928 --> 00:46:34.060
several times over at once and the company's efficiency did not 

634
00:46:34.060 --> 00:46:37.730
decrease. Therefore, in terms of the interests of the state,

635
00:46:37.730 --> 00:46:43.240
the ultimate interests of the state, in terms of its fiscal interests,

636
00:46:43.240 --> 00:46:47.231
we have a positive experience, most likely, not a negative one.

637
00:46:47.231 --> 00:46:53.422
Can I push you on this a little bit? Because when I look on your record 

638
00:46:53.422 --> 00:46:59.094
over all these years, in foreign policy you're been very aggressive,

639
00:46:59.094 --> 00:47:00.287
very decisive, very bold and everyone agree on that.

640
00:47:00.287 --> 00:47:02.563
On economic policy you seem a little more timid.

641
00:47:02.563 --> 00:47:07.520
I do not agree with you. I have acted firmly but not aggressively.

642
00:47:07.520 --> 00:47:07.820
Yes, firmly, rather.

643
00:47:07.820 --> 00:47:15.479
I have acted in accordance with the circumstances.

644
00:47:15.479 --> 00:47:23.814
But on the economy on the contrast you've been slightly more,

645
00:47:23.814 --> 00:47:27.626
you've been less decisive in terms of pushing reforms.

646
00:47:27.626 --> 00:47:29.858
If you look at countries like China and Vietnam, you know,

647
00:47:29.858 --> 00:47:33.073
they have changed their economies completely.

648
00:47:33.073 --> 00:47:35.969
Russia, as you've said, is still dependent on oil,

649
00:47:35.969 --> 00:47:37.927
still dependent on a few companies,

650
00:47:37.927 --> 00:47:43.125
still run largely by the same people.

651
00:47:43.125 --> 00:47:45.500
Do you think that's been failing through out the years that 

652
00:47:45.500 --> 00:47:46.538
you have not reformed enough?

653
00:47:46.538 --> 00:47:48.498
No, I do not think so.

654
00:47:48.498 --> 00:47:56.837
Moreover, look, we have carried out a land reform,

655
00:47:56.837 --> 00:48:02.010
and it was hard to imagine that ever being possible here in Russia.

656
00:48:02.010 --> 00:48:09.402
Note that, unlike many countries in the world with a well-developed 

657
00:48:09.402 --> 00:48:17.953
market economy, we have, say, the oil sector that is almost 

658
00:48:17.953 --> 00:48:20.228
completely privatised.

659
00:48:20.228 --> 00:48:24.619
Here you have named Rosneft and Bashneft,

660
00:48:24.619 --> 00:48:27.509
all the rest are private companies.

661
00:48:27.509 --> 00:48:31.774
And look what is happening in this sector in Saudi Arabia,

662
00:48:31.774 --> 00:48:35.981
in Mexico and in many other oil-producing countries.

663
00:48:35.981 --> 00:48:40.924
Why do you think that Russia is less advanced in regard to these 

664
00:48:40.924 --> 00:48:45.409
reforms? It’s another thing that, with the high oil prices,

665
00:48:45.409 --> 00:48:51.791
it is very difficult to reorient economic actors from the sectors where 

666
00:48:51.791 --> 00:48:57.516
they get big profits and to encourage them to invest money 

667
00:48:57.516 --> 00:48:59.667
and resources in other sectors.

668
00:48:59.667 --> 00:49:04.951
To do that, we need to carry out a whole set of measures,

669
00:49:04.951 --> 00:49:07.562
so we are gradually doing that.

670
00:49:07.562 --> 00:49:10.861
Regrettably, the effect might not be as impressive as we would like it 

671
00:49:10.861 --> 00:49:14.610
to be – I will finish in a second, be patient –

672
00:49:14.610 --> 00:49:16.722
but still the result is there.

673
00:49:16.722 --> 00:49:21.686
Look, the year before last, the budget received 53 percent from oil 

674
00:49:21.686 --> 00:49:28.994
and gas revenues, it was the year before last — 2014,

675
00:49:28.994 --> 00:49:40.734
in 2015 it was 43 percent and this year it will be around 36 percent.

676
00:49:40.734 --> 00:49:45.299
So, structural changes also occur.

677
00:49:45.299 --> 00:49:54.934
And it is not just the price but also economic growth,

678
00:49:54.934 --> 00:49:56.909
the growth of specific production sectors.

679
00:49:56.909 --> 00:49:58.630
For example, we currently see a 0.

680
00:49:58.630 --> 00:50:02.033
3 percent increase in industrial production in the country in general;

681
00:50:02.033 --> 00:50:03.835
it is small but it is still in place.

682
00:50:03.835 --> 00:50:06.255
And, say, in the Far East, where we are now,

683
00:50:06.255 --> 00:50:07.779
the growth of industrial production,

684
00:50:07.779 --> 00:50:12.462
industrial in particular, is 5.4 percent.

685
00:50:12.462 --> 00:50:17.050
Let me give you an example.

686
00:50:17.050 --> 00:50:21.101
You've recently made changes on the political side within 

687
00:50:21.101 --> 00:50:23.039
your administration. If I look at the business,

688
00:50:23.039 --> 00:50:25.677
if I look at a company like Gazprom, for instance,

689
00:50:25.677 --> 00:50:28.924
I just checked in dollar terms,

690
00:50:28.924 --> 00:50:35.436
Gazprom is worth less than a fifth of what it was ten years ago,

691
00:50:35.436 --> 00:50:41.845
and it's fallen from being in top-10 companies in the world to 198th.

692
00:50:41.845 --> 00:50:42.949
And you've had the same manager,

693
00:50:42.949 --> 00:50:45.723
running it for 15 years — Alexey Miller — you've now given 

694
00:50:45.723 --> 00:50:46.731
him another 5-year contract.

695
00:50:46.731 --> 00:50:52.284
What I'm saying, you're not as tough on business people who are running 

696
00:50:52.284 --> 00:50:54.987
the oil side as you might be on other people.

697
00:50:54.987 --> 00:51:00.405
Why have you put up with this? You're famously efficient man.

698
00:51:00.405 --> 00:51:04.431
Look, Gazprom is clearly undervalued,

699
00:51:04.431 --> 00:51:07.161
that is absolutely obvious.

700
00:51:07.161 --> 00:51:14.115
We are not going to sell it yet and it is due to peculiarities 

701
00:51:14.115 --> 00:51:20.724
of the Russian economy, social sphere and the Russian energy sector.

702
00:51:20.724 --> 00:51:27.151
One of Gazprom functions is to ensure smooth operation in the country 

703
00:51:27.151 --> 00:51:34.358
during the autumn-winter peaks and to supply Russia's large energy 

704
00:51:34.358 --> 00:51:37.156
sector, and it copes with this task well.

705
00:51:37.156 --> 00:51:42.880
I think Gazprom’s valuations today are quite speculative and we have 

706
00:51:42.880 --> 00:51:45.757
absolutely no worries and cares about that.

707
00:51:45.757 --> 00:51:50.221
We know what Gazprom is, what it is worth and what it will be worth 

708
00:51:50.221 --> 00:51:56.102
in the coming years, in spite of, say,

709
00:51:56.102 --> 00:51:59.884
gas development in the United States or somewhere else in the world.

710
00:51:59.884 --> 00:52:04.307
Pipe gas will always be cheaper.

711
00:52:04.307 --> 00:52:11.206
And Gazprom is now increasing its exports to the countries that are its 

712
00:52:11.206 --> 00:52:12.114
traditional partners.

713
00:52:12.114 --> 00:52:15.229
In Europe (see the reports of Gazprom there)

714
00:52:15.229 --> 00:52:18.535
, especially in recent months, the sales have been growing.

715
00:52:18.535 --> 00:52:20.251
I am sure, that will continue in the future.

716
00:52:20.251 --> 00:52:23.895
Why? Because in the near future,

717
00:52:23.895 --> 00:52:27.329
even despite the development of alternative energy,

718
00:52:27.329 --> 00:52:36.179
if we look at the economic component and the environmental 

719
00:52:36.179 --> 00:52:40.186
requirements, there is no other primary energy source,

720
00:52:40.186 --> 00:52:44.350
except for gas, in the world. It could be only nuclear power.

721
00:52:44.350 --> 00:52:49.429
But here, there are also many problems and opponents of nuclear power.

722
00:52:49.429 --> 00:52:51.807
With gas, there are no such opponents.

723
00:52:51.807 --> 00:52:58.168
But there is a country that is undoubtedly the leader in gas reserves.

724
00:52:58.168 --> 00:53:00.483
This is our country, the Russian Federation.

725
00:53:00.483 --> 00:53:05.791
And Gazprom performs all the functions its management has 

726
00:53:05.791 --> 00:53:06.540
been entrusted with.

727
00:53:06.540 --> 00:53:10.883
There are, of course, questions and there are problems. We see them.

728
00:53:10.883 --> 00:53:16.067
I know that Gazprom management is taking the necessary steps in order 

729
00:53:16.067 --> 00:53:19.057
to solve these problems; it is fighting for its interests 

730
00:53:19.057 --> 00:53:20.067
in the world markets.

731
00:53:20.067 --> 00:53:23.719
It is another question whether it is being done well or badly.

732
00:53:23.719 --> 00:53:27.629
Many criticise Gazprom, saying that it should have been more flexible 

733
00:53:27.629 --> 00:53:35.402
and should have introduced floating prices depending on the current 

734
00:53:35.402 --> 00:53:37.047
situation in the economy. However,

735
00:53:37.047 --> 00:53:43.339
the gas business is very peculiar. It is not even like oil trade.

736
00:53:43.339 --> 00:53:48.873
This is a separate business that involves large investments 

737
00:53:48.873 --> 00:53:51.137
in production and transportation.

738
00:53:51.137 --> 00:53:55.946
And it means that the production companies need to be sure that they 

739
00:53:55.946 --> 00:53:58.504
will be able to sell and sell at a certain price.

740
00:53:58.504 --> 00:54:01.876
You can, of course, negotiate with partners on some floating limits 

741
00:54:01.876 --> 00:54:04.366
depending on some conditions.

742
00:54:04.366 --> 00:54:10.720
I think it may also be a subject of negotiations, but if, for example,

743
00:54:10.720 --> 00:54:16.074
our European partners want to ensure their competitiveness in global 

744
00:54:16.074 --> 00:54:21.331
markets, they should ultimately be interested in long-term 

745
00:54:21.331 --> 00:54:22.882
contracts with Gazprom.

746
00:54:22.882 --> 00:54:27.070
Look, when the prices were high,

747
00:54:27.070 --> 00:54:31.082
Gazprom faced a lot of complaints that something should be done 

748
00:54:31.082 --> 00:54:36.245
in order to cut a little the ceiling price.

749
00:54:36.245 --> 00:54:39.696
Oil prices currently dropped, and while gas prices depend on oil,

750
00:54:39.696 --> 00:54:43.999
nobody thinks about increasing gas prices,

751
00:54:43.999 --> 00:54:45.648
everybody is fine with that.

752
00:54:45.648 --> 00:54:51.203
It means that buyer and seller have natural contradictions.

753
00:54:51.203 --> 00:54:55.600
But there is some space for them to reach an agreement 

754
00:54:55.600 --> 00:55:00.251
in order to minimise their risks. I suppose they can talk about it.

755
00:55:00.251 --> 00:55:07.081
I know you're a generous man, but if you had a general who had lost 80 

756
00:55:07.081 --> 00:55:11.436
percent of his army, you might not keep him as a general.

757
00:55:11.436 --> 00:55:12.919
Gazprom still has the export monopoly,

758
00:55:12.919 --> 00:55:14.871
you wouldn't think of taking it away from them, given that performance,

759
00:55:14.871 --> 00:55:17.497
because it is worse than other gas companies.

760
00:55:17.497 --> 00:55:21.750
It's a different case.

761
00:55:21.750 --> 00:55:25.409
Speaking about the general, in this context he lost nothing,

762
00:55:25.409 --> 00:55:30.172
he simply moved it to reserves that can be drawn upon 

763
00:55:30.172 --> 00:55:32.884
and used at any moment.

764
00:55:32.884 --> 00:55:38.819
The G-20, this one will be the last times when you'll see Barack Obama.

765
00:55:38.819 --> 00:55:44.653
And as you well know there is American election on the way and as you 

766
00:55:44.653 --> 00:55:47.011
well know there is a choice in that between Hillary Clinton 

767
00:55:47.011 --> 00:55:53.152
and Donald Trump. Who would you rather have at the other end 

768
00:55:53.152 --> 00:55:55.809
of the telephone if there is geopolitical situation — Donald Trump 

769
00:55:55.809 --> 00:55:59.735
or Hillary Clinton? Do you have a feeling at all?

770
00:55:59.735 --> 00:56:05.297
I would like to deal with a person who is able to take responsible 

771
00:56:05.297 --> 00:56:11.183
decisions and implement the agreements reached.

772
00:56:11.183 --> 00:56:15.875
The name does not matter.

773
00:56:15.875 --> 00:56:18.948
Of course, this person is to have the trust of the American people,

774
00:56:18.948 --> 00:56:23.585
then he or she would not only have the wish but also the supported 

775
00:56:23.585 --> 00:56:26.349
political will to implement all these agreements.

776
00:56:26.349 --> 00:56:33.471
We have never meddled in the domestic affairs of any state 

777
00:56:33.471 --> 00:56:38.008
and we never will. We will keep a close eye on what is happening 

778
00:56:38.008 --> 00:56:42.325
and wait for the election results and after that we will be ready 

779
00:56:42.325 --> 00:56:46.003
to work with any Administration given that it wants to work with us.

780
00:56:46.003 --> 00:56:53.824
Can I just push you on that? Back in 2011 you accused Hillary Clinton 

781
00:56:53.824 --> 00:56:59.165
of seeking to trigger the protests that you were facing 

782
00:56:59.165 --> 00:57:01.077
in Russia at the time.

783
00:57:01.077 --> 00:57:03.153
And by the contrast when I look at some of things that Donald Trump 

784
00:57:03.153 --> 00:57:05.776
said about you back in 2007 that Putin is doing a great job,

785
00:57:05.776 --> 00:57:08.887
in 2011 he praised your no-nonsense way,

786
00:57:08.887 --> 00:57:14.317
the next year he said you is new best friend,

787
00:57:14.317 --> 00:57:17.263
next year he said you're outsmarting the Americans,

788
00:57:17.263 --> 00:57:18.594
he said you have good ratings to get …

789
00:57:18.594 --> 00:57:19.249
And I can go on like that.

790
00:57:19.249 --> 00:57:20.638
And you are really telling me that if you have a choice between 

791
00:57:20.638 --> 00:57:25.173
a woman, who you think may've been trying to get rid of you, and a man,

792
00:57:25.173 --> 00:57:28.951
who seems to have this great sort of affection to you,

793
00:57:28.951 --> 00:57:32.650
almost bordering on the homoerotic,

794
00:57:32.650 --> 00:57:34.707
you not going to make a decision between those two,

795
00:57:34.707 --> 00:57:38.367
because one of them would seem to be more favorable towards you?

796
00:57:38.387 --> 00:57:42.189
You know, actually I have already answered your question,

797
00:57:42.209 --> 00:57:47.432
but I can put it differently, say it in other words: we are ready 

798
00:57:47.432 --> 00:57:52.695
to deal with any President, but of course, and I mentioned that,

799
00:57:52.695 --> 00:57:56.378
it depends on the readiness of the future Administration.

800
00:57:56.378 --> 00:57:59.682
We always welcome when somebody says he or she is ready 

801
00:57:59.682 --> 00:58:03.908
to work with Russia. But if anybody, just like you said, 

802
00:58:03.908 --> 00:58:04.951
(inaccurate translation possibly)

803
00:58:04.951 --> 00:58:08.820
, wants to get rid of us, then this is a different approach.

804
00:58:08.820 --> 00:58:11.931
However, we will get over it; you never know who is going 

805
00:58:11.931 --> 00:58:13.878
to lose more with such an approach.

806
00:58:13.878 --> 00:58:21.634
Here is the thing: I have seen several times that anti-Russian cards 

807
00:58:21.634 --> 00:58:26.145
are being played during domestic campaigns in the United States.

808
00:58:26.145 --> 00:58:28.813
I find this approach very short-sighted.

809
00:58:28.813 --> 00:58:35.885
At the same time we receive different signals all around 

810
00:58:35.885 --> 00:58:38.090
that in fact, everything is fine.

811
00:58:38.090 --> 00:58:40.040
The same situation occurred with the previous administrations during 

812
00:58:40.040 --> 00:58:43.177
the election campaigns, claims that everything will be restored later.

813
00:58:43.177 --> 00:58:54.334
I do not think it matches the level of responsibility 

814
00:58:54.334 --> 00:58:56.878
shouldered by the United States.

815
00:58:56.878 --> 00:59:03.386
I suppose it should be more sound, calm and balanced.

816
00:59:03.386 --> 00:59:08.229
As for the criticism we receive, you know,

817
00:59:08.229 --> 00:59:16.010
even Mr. Trump's team criticize us.

818
00:59:16.010 --> 00:59:21.484
For instance, one of the participants or members of his team claimed 

819
00:59:21.484 --> 00:59:27.979
that Russia was giving money to the Clintons through some funds 

820
00:59:27.979 --> 00:59:35.552
and that in fact Russia is controlling the Clinton family.

821
00:59:35.552 --> 00:59:38.518
This is nonsense. I do not even know where Bill Clinton delivered his 

822
00:59:38.518 --> 00:59:44.333
speech and I know nothing about any funds.

823
00:59:44.333 --> 00:59:52.800
Both parties simply use it as a tool in their internal political 

824
00:59:52.800 --> 00:59:54.988
contention, and I am sure it is a bad thing.

825
00:59:54.988 --> 00:59:58.812
But again, we welcome the fact that somebody expresses readiness 

826
00:59:58.812 --> 01:00:04.621
to work with Russia whatever the name of that person.

827
01:00:04.621 --> 01:00:10.564
Very quickly: the other accusation you've faced or heard a lot is 

828
01:00:10.564 --> 01:00:16.886
people connected with Russia or backed by Russia were the people who 

829
01:00:16.886 --> 01:00:19.754
hacked into the Democratic Party database.

830
01:00:19.754 --> 01:00:21.219
Is that, you would also say that is completely untrue?

831
01:00:21.219 --> 01:00:26.027
I know nothing. There are a lot of hackers today, you know,

832
01:00:26.027 --> 01:00:31.813
and they perform their work in such a filigreed and delicate manner 

833
01:00:31.813 --> 01:00:37.282
and they can show their “tracks” anywhere and anytime.

834
01:00:37.282 --> 01:00:40.305
It may not even be a track; they can cover their activity so that it 

835
01:00:40.305 --> 01:00:44.616
looks like hackers operating from other territories,

836
01:00:44.616 --> 01:00:46.032
from other countries.

837
01:00:46.032 --> 01:00:51.126
It is hard to check this activity,

838
01:00:51.126 --> 01:00:52.740
maybe not even possible.

839
01:00:52.740 --> 01:00:58.069
Anyway, we do not do that at the national level.

840
01:00:58.069 --> 01:01:03.356
Besides, does it really matter who hacked Mrs.

841
01:01:03.356 --> 01:01:10.734
Clinton’s election campaign team database? Does it? What really matters 

842
01:01:10.734 --> 01:01:15.420
is the content shown to the community.

843
01:01:15.420 --> 01:01:19.561
This is what the discussion should be held about.

844
01:01:19.561 --> 01:01:22.294
There is no need to distract the attention of the community from 

845
01:01:22.294 --> 01:01:26.931
the essence of the subject substituting it with secondary questions 

846
01:01:26.931 --> 01:01:30.757
dealing with the search of those who did it.

847
01:01:30.757 --> 01:01:35.197
I would like to repeat: I know absolutely nothing about it,

848
01:01:35.197 --> 01:01:38.217
and Russia has never done anything like this at the State level.

849
01:01:38.237 --> 01:01:43.799
Frankly speaking, I could never even imagine that such information 

850
01:01:43.799 --> 01:01:50.301
would be of interest to the American public or that the campaign 

851
01:01:50.301 --> 01:01:51.849
headquarters of one of the candidates –

852
01:01:51.849 --> 01:01:55.234
in this case, Mrs. Clinton – apparently worked for her,

853
01:01:55.234 --> 01:01:59.817
rather than for all the Democratic Party candidates in an equal manner.

854
01:01:59.817 --> 01:02:03.284
I could never assume that anybody would find it interesting.

855
01:02:03.284 --> 01:02:06.318
Thus, in view of what I have said,

856
01:02:06.318 --> 01:02:10.413
we could not officially hack it.

857
01:02:10.413 --> 01:02:14.519
You know, it would require certain intuition and knowledge 

858
01:02:14.519 --> 01:02:16.430
of the U.S. domestic policy peculiarities.

859
01:02:16.430 --> 01:02:21.541
I am not sure that even our experts from the Ministry 

860
01:02:21.541 --> 01:02:26.534
of Foreign Affairs have such intuition.

861
01:02:26.534 --> 01:02:31.937
Do you not think this is sort of the time when everyone should sort 

862
01:02:31.937 --> 01:02:36.444
of come clean about it? Russia tries to hack America,

863
01:02:36.444 --> 01:02:39.870
America tries to hack Russia, China tries to hack America,

864
01:02:39.870 --> 01:02:42.936
China tries to hack Russia? Everyone tries to hack each other.

865
01:02:42.936 --> 01:02:46.524
One of the purposes of the G-20 is to come up with a new set of rules 

866
01:02:46.524 --> 01:02:50.338
so this can become a more ordered version of foreign policy 

867
01:02:50.338 --> 01:02:57.594
when everybody is doing this. Allegedly.

868
01:02:57.594 --> 01:03:00.246
I believe that the G20 should not interfere,

869
01:03:00.246 --> 01:03:02.438
because there are other platforms for that.

870
01:03:02.438 --> 01:03:08.092
The G20 was established as a forum to discuss,

871
01:03:08.092 --> 01:03:11.720
first and foremost, world economic issues. If we load it with…

872
01:03:11.720 --> 01:03:15.190
Of course, politics affects economic processes, this is obvious,

873
01:03:15.190 --> 01:03:20.604
but if we bring some squabbles, or not squabbles, rather,

874
01:03:20.604 --> 01:03:28.335
some matters that are really important but relate purely to world 

875
01:03:28.335 --> 01:03:34.181
politics, we will overload the G20 agenda and instead of addressing 

876
01:03:34.181 --> 01:03:39.430
such issues as finance, structural economic reforms,

877
01:03:39.430 --> 01:03:48.852
tax evasion and so forth, we will engage in endless debates concerning 

878
01:03:48.852 --> 01:03:52.715
the Syrian crisis or some other global challenges,

879
01:03:52.715 --> 01:03:58.037
of which there are many, or the Middle East problem.

880
01:03:58.037 --> 01:04:03.476
We should find other platforms, other forums for that,

881
01:04:03.476 --> 01:04:07.194
and there are plenty of them, including, for example,

882
01:04:07.194 --> 01:04:08.421
the UN and the Security Council.

883
01:04:08.421 --> 01:04:11.905
Can I ask one last question on Donald Trump.

884
01:04:11.905 --> 01:04:16.521
Some people say that he is too volatile to be an American president.

885
01:04:16.521 --> 01:04:19.519
You would be happy with him as American president in the same way 

886
01:04:19.519 --> 01:04:22.843
as you would be happy with Hillary Clinton in that role.

887
01:04:22.843 --> 01:04:28.953
We cannot decide for the American people.

888
01:04:28.953 --> 01:04:36.512
After all, despite the scandalous behavior of one and, by the way,

889
01:04:36.512 --> 01:04:42.187
the other candidate (they are both scandalous in their own ways)

890
01:04:42.187 --> 01:04:49.103
, they are smart, they are really smart and they are aware 

891
01:04:49.103 --> 01:04:54.013
of the leverages they should use to make the voters in the United 

892
01:04:54.013 --> 01:04:59.051
States understand them, feel them and hear them.

893
01:04:59.051 --> 01:05:07.101
Donald Trump is targeting the traditional Republican voters,

894
01:05:07.101 --> 01:05:16.765
the average person with an average income, the working class,

895
01:05:16.765 --> 01:05:22.886
a certain group of entrepreneurs and those people who 

896
01:05:22.886 --> 01:05:25.405
embrace traditional values.

897
01:05:25.405 --> 01:05:30.093
Mrs. Clinton is focusing on a different part of the voters trying 

898
01:05:30.093 --> 01:05:32.761
to influence them in her own way as well;

899
01:05:32.761 --> 01:05:39.268
so they attack each other and in some cases,

900
01:05:39.268 --> 01:05:45.811
I would not want us to follow their pattern.

901
01:05:45.811 --> 01:05:48.804
I do not believe they are setting the best example.

902
01:05:48.804 --> 01:05:54.074
But this is the political culture of the United States,

903
01:05:54.074 --> 01:05:58.066
which one should accept as is.

904
01:05:58.066 --> 01:06:04.215
The United States is a great country and it deserves 

905
01:06:04.215 --> 01:06:09.368
non-interference and no third-party comments.

906
01:06:09.368 --> 01:06:11.442
Answering your question for the third time,

907
01:06:11.442 --> 01:06:15.809
I can tell you that we will work with any Administration and with any 

908
01:06:15.809 --> 01:06:19.707
President in whom the American people have placed their trust.

909
01:06:19.707 --> 01:06:25.130
That is, of course, if they wish to cooperate with Russia.

910
01:06:25.130 --> 01:06:30.015
Let me ask you about other country.

911
01:06:30.015 --> 01:06:34.685
Another person you'll meet at G-20 Theresa May.

912
01:06:34.685 --> 01:06:39.469
Britain has ended up in the same situation as Russia, it is in Europe,

913
01:06:39.469 --> 01:06:42.201
but not, likely not to be in European Union.

914
01:06:42.201 --> 01:06:45.653
Will you approach them with a free-trade deal?

915
01:06:45.653 --> 01:06:48.487
Well, I would like to finish my answer to the previous question.

916
01:06:48.487 --> 01:06:52.554
You have been working as a journalist for a long time.

917
01:06:52.554 --> 01:06:56.584
You are quite knowledgeable and you understand all the threats that may 

918
01:06:56.584 --> 01:06:57.942
arise from a tense international environment,

919
01:06:57.942 --> 01:07:01.334
don't you? Especially if there is tension between major 

920
01:07:01.334 --> 01:07:04.791
nuclear powers of the world. We all understand this.

921
01:07:04.791 --> 01:07:05.773
Of course, you are the one asking me questions.

922
01:07:05.773 --> 01:07:07.230
It is you who is the interviewer,

923
01:07:07.230 --> 01:07:11.032
not I. However, let me ask you a question: do you want 

924
01:07:11.032 --> 01:07:18.083
another Cuban Missile Crisis? Or don't you?

925
01:07:18.083 --> 01:07:18.730
No, nobody does.

926
01:07:18.730 --> 01:07:25.013
Of course, nobody does.

927
01:07:25.013 --> 01:07:28.532
But that is one reason why I asked about Donald Trump because he is 

928
01:07:28.532 --> 01:07:32.564
seen as a more unpredictable force than Hillary Clinton.

929
01:07:32.564 --> 01:07:37.288
And you too would prefer that Russia maintained good relations with 

930
01:07:37.288 --> 01:07:39.571
both the United Kingdom and the United States,

931
01:07:39.571 --> 01:07:44.182
wouldn't you? I would prefer it as well. If anybody in the U.S.

932
01:07:44.182 --> 01:07:47.955
or in the United Kingdom says: ”I would like to establish good 

933
01:07:47.955 --> 01:07:51.237
partnership relations with Russia“, then both of us,

934
01:07:51.237 --> 01:07:53.075
you and me, should welcome that.

935
01:07:53.075 --> 01:07:55.585
So should people like me and people like you.

936
01:07:55.585 --> 01:07:58.429
However, we have no idea yet what would actually happen 

937
01:07:58.429 --> 01:08:02.869
after the elections. That is why I am telling you that we will work 

938
01:08:02.869 --> 01:08:07.534
with any President designated as such by the American public.

939
01:08:07.534 --> 01:08:11.975
As for the United Kingdom, we have a meeting scheduled with the Prime 

940
01:08:11.975 --> 01:08:20.255
Minister in China on the G20 sidelines.

941
01:08:20.255 --> 01:08:22.873
We had a telephone conversation.

942
01:08:22.873 --> 01:08:25.944
Unfortunately, the relations between the United Kingdom and Russia have 

943
01:08:25.944 --> 01:08:31.440
not developed in the best possible way;

944
01:08:31.440 --> 01:08:33.635
however, it has never been our fault.

945
01:08:33.635 --> 01:08:37.231
It was not we who decided to discontinue relations with the United 

946
01:08:37.231 --> 01:08:40.060
Kingdom; it was the UK who preferred to ”freeze“ our 

947
01:08:40.060 --> 01:08:43.159
bilateral contacts in various fields.

948
01:08:43.159 --> 01:08:49.962
If the United Kingdom considers it necessary to start a dialogue 

949
01:08:49.962 --> 01:08:52.957
on certain issues, we are ready for that,

950
01:08:52.957 --> 01:08:59.617
we are not going to pout or sulk.

951
01:08:59.617 --> 01:09:02.670
We take quite a pragmatic approach towards cooperation with our 

952
01:09:02.670 --> 01:09:06.895
partners and we believe that it would be beneficial 

953
01:09:06.895 --> 01:09:08.380
for both our countries.

954
01:09:08.380 --> 01:09:13.124
We were speaking about our largest oil company Rosneft,

955
01:09:13.124 --> 01:09:17.083
and I recalled in the beginning that almost 20 percent of it 

956
01:09:17.083 --> 01:09:18.849
(19.7) belongs to BP.

957
01:09:18.849 --> 01:09:21.862
Who’s company is that? British Petroleum,

958
01:09:21.862 --> 01:09:25.079
isn't it? I suppose that is not bad.

959
01:09:25.079 --> 01:09:27.919
I have to tell you that British Petroleum’s capitalization is 

960
01:09:27.919 --> 01:09:34.419
significantly related to the fact that it owns more than 19 percent 

961
01:09:34.419 --> 01:09:40.258
of Rosneft, which has vast oil reserves both in Russia and abroad.

962
01:09:40.258 --> 01:09:45.183
This has its impact on the company's stability as well.

963
01:09:45.183 --> 01:09:49.896
Thus, BP found itself in a difficult situation after the tragic events 

964
01:09:49.896 --> 01:09:54.676
in the Gulf of Mexico. We did everything we could to support it.

965
01:09:54.676 --> 01:09:58.622
Britain is interested in this, isn't it? I think it is.

966
01:09:58.622 --> 01:10:00.922
The same is true of other areas.

967
01:10:00.922 --> 01:10:07.910
We are marking the anniversary of the Arctic convoys.

968
01:10:07.910 --> 01:10:11.128
You know about that, don't you? We really do consider members 

969
01:10:11.128 --> 01:10:13.491
of the Arctic convoy to be heroes. This is true.

970
01:10:13.491 --> 01:10:18.139
I am not saying this as a fashion of speech.

971
01:10:18.139 --> 01:10:20.634
Indeed, that is exactly what they were.

972
01:10:20.634 --> 01:10:24.336
We know that the conditions in which they fought were appalling.

973
01:10:24.336 --> 01:10:28.744
Time and again they faced death in the name of a common 

974
01:10:28.744 --> 01:10:33.348
victory and we remember that.

975
01:10:33.348 --> 01:10:42.706
Do you think Britain might be more compliant or more likely to do 

976
01:10:42.706 --> 01:10:45.044
a deal with Russia now it is outside or going to leave 

977
01:10:45.044 --> 01:10:46.371
the European Union?

978
01:10:46.371 --> 01:10:50.729
Britain is leaving and has de facto left the European Union;

979
01:10:50.729 --> 01:10:53.025
however, it has not withdrawn from its special relationship with 

980
01:10:53.025 --> 01:10:57.305
the United States and I believe that the UK's relations with Russia 

981
01:10:57.305 --> 01:11:02.646
depend on Britain's special relationship with the United States rather 

982
01:11:02.646 --> 01:11:05.194
than on its presence in or absence from the European Union.

983
01:11:05.194 --> 01:11:07.709
If Britain pursues a more independent foreign policy,

984
01:11:07.709 --> 01:11:09.838
it might be possible then.

985
01:11:09.838 --> 01:11:16.669
And if it is guided by commitments to its allies and considers this 

986
01:11:16.669 --> 01:11:20.083
to be of a bigger national interest than its cooperation 

987
01:11:20.083 --> 01:11:23.393
with Russia, so be it.

988
01:11:23.393 --> 01:11:26.697
After all, this is not our choice;

989
01:11:26.697 --> 01:11:30.036
this is the choice of our British partners,

990
01:11:30.036 --> 01:11:31.883
the choice of priorities.

991
01:11:31.883 --> 01:11:35.785
Anyhow, we obviously understand that,

992
01:11:35.785 --> 01:11:41.568
being a United States' ally and having a special relationship with it,

993
01:11:41.568 --> 01:11:46.435
the UK in its relations with Russian has to make an allowance 

994
01:11:46.435 --> 01:11:50.674
for the opinion of its partner ‑ the U.S.

995
01:11:50.674 --> 01:11:54.433
We take this reality as a given fact,

996
01:11:54.433 --> 01:12:02.252
but let me underscore once again that we will be ready to do as much 

997
01:12:02.252 --> 01:12:05.251
as Britain will be ready to do in order to resume our mutual 

998
01:12:05.251 --> 01:12:07.427
cooperation. This does not depend on us.

999
01:12:07.427 --> 01:12:14.329
Can I ask you about one last person in the G-20. President Erdogan.

1000
01:12:14.329 --> 01:12:18.110
You didn't protest that much when Turkish tanks rolled across 

1001
01:12:18.110 --> 01:12:20.851
the Syrian border the other day.

1002
01:12:20.851 --> 01:12:26.633
Why? Do you think Turkey has now moved closer to your idea that 

1003
01:12:26.633 --> 01:12:32.789
the future of Syria has to involve President Assad staying in some way 

1004
01:12:32.789 --> 01:12:36.095
or have you changed your mind about President Erdogan.

1005
01:12:36.095 --> 01:12:38.032
A little bit ago you were complaining that you were stabbed in the back 

1006
01:12:38.032 --> 01:12:40.785
and with the problems to do with the jet being shot down.

1007
01:12:40.785 --> 01:12:46.400
Has something changed in Turkey in terms of what you can see?

1008
01:12:46.400 --> 01:12:57.070
First, we proceed from the fact that Turkey has apologised for that 

1009
01:12:57.070 --> 01:13:01.444
incident and for the death of our people.

1010
01:13:01.444 --> 01:13:07.010
It was done in a straightforward manner without any 

1011
01:13:07.010 --> 01:13:10.444
reservations, and we appreciate this.

1012
01:13:10.444 --> 01:13:18.855
President Erdogan did so and we see genuine interest of the Turkish 

1013
01:13:18.855 --> 01:13:23.266
President in restoring the country's relations with Russia 

1014
01:13:23.266 --> 01:13:24.388
on a full-scale basis.

1015
01:13:24.388 --> 01:13:31.226
We share a lot of interests in the Black Sea region,

1016
01:13:31.226 --> 01:13:37.850
on a global scale and in the Middle East.

1017
01:13:37.850 --> 01:13:43.915
We expect to be able to begin a constructive dialogue;

1018
01:13:43.915 --> 01:13:47.670
we have quite a number of major energy projects, for example,

1019
01:13:47.670 --> 01:13:49.218
the well-known Turkish Stream.

1020
01:13:49.218 --> 01:13:51.741
I think we will finally carry it out,

1021
01:13:51.741 --> 01:13:58.556
at least its first stage aiming to broaden transportation options 

1022
01:13:58.556 --> 01:14:01.940
and increase supplies to the Turkish domestic market,

1023
01:14:01.940 --> 01:14:05.835
but also potentially providing the European partners with more 

1024
01:14:05.835 --> 01:14:08.697
transportation options if they wish so and if the European 

1025
01:14:08.697 --> 01:14:10.330
Commission supports this idea.

1026
01:14:10.330 --> 01:14:14.817
We have got a large project to build a nuclear power plant 

1027
01:14:14.817 --> 01:14:17.649
on unique terms and conditions.

1028
01:14:17.649 --> 01:14:21.984
They include several components: we extend a loan,

1029
01:14:21.984 --> 01:14:26.425
we own and we operate.

1030
01:14:26.425 --> 01:14:30.362
These unique features give us reasons to believe that this is 

1031
01:14:30.362 --> 01:14:37.493
a feasible project given the arrangements on economic parameters based 

1032
01:14:37.493 --> 01:14:40.513
on electricity price per kilowatt-hour,

1033
01:14:40.513 --> 01:14:46.471
and that this project will be cost-effective for both sides.

1034
01:14:46.471 --> 01:14:52.311
Apart from other things, though, as I have already said,

1035
01:14:52.311 --> 01:15:00.879
we share the objective of reaching an agreement on the regional 

1036
01:15:00.879 --> 01:15:03.308
challenges, including the Syrian problem.

1037
01:15:03.308 --> 01:15:06.523
I have always believed and continue to believe that no issue related 

1038
01:15:06.523 --> 01:15:10.470
to the change of political regime or change of power should 

1039
01:15:10.470 --> 01:15:11.564
be settled from outside.

1040
01:15:11.564 --> 01:15:14.980
When I hear someone say this or that president must resign,

1041
01:15:15.000 --> 01:15:17.382
and hear that from outside the country rather than from 

1042
01:15:17.382 --> 01:15:20.910
inside, I get a lot of questions.

1043
01:15:20.910 --> 01:15:27.440
I am pretty sure and my confidence is based on the events of the last 

1044
01:15:27.440 --> 01:15:34.676
decade, in particular the attempts to bring democracy to Iraq 

1045
01:15:34.676 --> 01:15:37.467
or Lebanon; we see what they have come to –

1046
01:15:37.467 --> 01:15:41.336
virtually to the collapse of statehood and the rise in terrorism.

1047
01:15:41.336 --> 01:15:46.325
Where in Libya do you see elements of democracy? They might emerge 

1048
01:15:46.325 --> 01:15:48.249
someday, and I really hope they do.

1049
01:15:48.249 --> 01:15:52.330
Or take the on-going civil war in Iraq.

1050
01:15:52.330 --> 01:15:55.555
What is going to happen to Iraq as a state in the future? So far these 

1051
01:15:55.575 --> 01:15:58.247
are just difficult questions.

1052
01:15:58.247 --> 01:16:00.826
Same thing with Syria.

1053
01:16:00.826 --> 01:16:02.487
When we hear that Assad must step down 

1054
01:16:02.487 --> 01:16:05.836
(for some reason some people from outside believe so)

1055
01:16:05.836 --> 01:16:09.020
, I have a question: what will the result be? And in general,

1056
01:16:09.020 --> 01:16:14.459
is this in line with international law? Where will this lead to? Isn't 

1057
01:16:14.459 --> 01:16:18.740
it better to remain patient and promote the changes in the structure 

1058
01:16:18.740 --> 01:16:24.048
of the society itself and, by doing so,

1059
01:16:24.048 --> 01:16:27.335
wait for the changes to happen naturally within the country.

1060
01:16:27.335 --> 01:16:29.958
Sure, this is not going to happen overnight,

1061
01:16:29.958 --> 01:16:35.152
but probably that is what political wisdom is all about –

1062
01:16:35.152 --> 01:16:40.715
never to hustle, never to leap ahead but rather to move step by step 

1063
01:16:40.715 --> 01:16:43.047
towards structural changes, in this case in the political 

1064
01:16:43.047 --> 01:16:45.133
system of society.

1065
01:16:45.133 --> 01:16:47.081
As far as Turkey's actions are concerned,

1066
01:16:47.081 --> 01:16:50.271
we keep contact with our Turkish partners.

1067
01:16:50.271 --> 01:16:53.449
We believe that everything that runs counter international 

1068
01:16:53.449 --> 01:16:59.129
law is unacceptable. But we keep contact on political level,

1069
01:16:59.129 --> 01:17:04.780
as well as at the level of the Defence and Foreign Affairs ministries.

1070
01:17:04.780 --> 01:17:10.310
I am sure we are also going to talk about this during the meeting with 

1071
01:17:10.310 --> 01:17:13.026
Turkish President Erdogan in China.

1072
01:17:13.026 --> 01:17:17.651
Very quickly on Syria.

1073
01:17:17.651 --> 01:17:22.563
Are we any closer to having Russian-American deal about how,

1074
01:17:22.563 --> 01:17:25.211
a plan for what to happen with Syria. You've had talks recently.

1075
01:17:25.211 --> 01:17:26.934
It seems that you've got a little bit closer,

1076
01:17:26.934 --> 01:17:30.928
but is there any progress on that? And do you think we're 

1077
01:17:30.928 --> 01:17:33.408
closer to that than we have been?

1078
01:17:33.408 --> 01:17:37.635
You know, the negotiation process is very complicated.

1079
01:17:37.635 --> 01:17:44.566
One of the main difficulties is that we insist,

1080
01:17:44.566 --> 01:17:48.818
and our American partners do not object,

1081
01:17:48.818 --> 01:17:53.802
that the so-called “healthy part” of the opposition should be separated 

1082
01:17:53.802 --> 01:17:56.423
from the radical groups and terrorist organisations,

1083
01:17:56.423 --> 01:17:58.886
such as Jabhat al-Nusra.

1084
01:17:58.886 --> 01:18:03.176
However, we get a feeling that Jabhat al-Nusra and those of its kind 

1085
01:18:03.176 --> 01:18:07.884
are disguising themselves, using different names,

1086
01:18:07.884 --> 01:18:09.562
but nothing changes in essence.

1087
01:18:09.562 --> 01:18:13.379
They have begun to absorb the “healthy part” of the opposition,

1088
01:18:13.379 --> 01:18:16.039
and there is nothing good about.

1089
01:18:16.039 --> 01:18:20.344
Besides, it is no longerinternal fighting we are facing.

1090
01:18:20.344 --> 01:18:24.987
Those fighters have come from abroad supplied with foreign 

1091
01:18:24.987 --> 01:18:31.964
arms and ammunition. Basically, our American partners agree with this,

1092
01:18:31.964 --> 01:18:35.353
but they just do not know how to deal with it.

1093
01:18:35.353 --> 01:18:38.763
Nevertheless, despite all these difficulties,

1094
01:18:38.763 --> 01:18:41.645
we are on the right track.

1095
01:18:41.645 --> 01:18:45.878
I should say that Secretary of State John Kerry has done tremendous 

1096
01:18:45.878 --> 01:18:49.992
work. It is astonishing how he manages to be so patient and persistent 

1097
01:18:49.992 --> 01:18:53.353
at the same time. No matter what,

1098
01:18:53.353 --> 01:18:58.264
I believe we are moving in the right direction,

1099
01:18:58.264 --> 01:19:01.476
and I do not rule out that, any time soon,

1100
01:19:01.476 --> 01:19:04.894
we will be able to reach consensus on some issues and share our 

1101
01:19:04.894 --> 01:19:06.572
agreements with the global community.

1102
01:19:06.572 --> 01:19:10.098
It is too early to speak about it, but, as I have already said,

1103
01:19:10.098 --> 01:19:13.836
I think we are moving in the right direction.

1104
01:19:13.836 --> 01:19:21.428
If you look back over all the time you've been president,

1105
01:19:21.428 --> 01:19:25.780
you could argue the relationship with the West.

1106
01:19:25.780 --> 01:19:29.177
All these problems to do with the trust and we can go through each 

1107
01:19:29.177 --> 01:19:30.521
of the individual conflicts.

1108
01:19:30.521 --> 01:19:34.725
But when you look back over that period in the way that relationship 

1109
01:19:34.725 --> 01:19:36.730
with west has not always worked ,

1110
01:19:36.730 --> 01:19:39.282
do you think there are things looking back you would have done 

1111
01:19:39.282 --> 01:19:41.188
differently if you would known about it?

1112
01:19:41.188 --> 01:19:43.974
No, there is nothing I would have done differently.

1113
01:19:43.974 --> 01:19:46.840
I think it is our partners who should have done many things 

1114
01:19:46.840 --> 01:19:57.990
differently. When the Soviet Union ceased to exist we welcomed our 

1115
01:19:58.010 --> 01:20:00.657
Western partners with open arms.

1116
01:20:00.657 --> 01:20:05.770
Just remember what it took us to disclose our wiretapping systems 

1117
01:20:05.770 --> 01:20:12.744
in the US Embassy in Moscow. Nothing like that was done in return.

1118
01:20:12.744 --> 01:20:15.597
You think the CIA does not have any taps listening to us? 

1119
01:20:15.597 --> 01:20:18.574
Of course it does. Moreover, it started working even harder 

1120
01:20:18.574 --> 01:20:19.728
in that respect.

1121
01:20:19.728 --> 01:20:24.427
We, for instance, put an end to the flights of our strategic aviation 

1122
01:20:24.427 --> 01:20:28.831
along the US border, while the United States never did so.

1123
01:20:28.831 --> 01:20:30.741
We conducted no flights for ten years,

1124
01:20:30.741 --> 01:20:32.253
but the United States never stopped,

1125
01:20:32.253 --> 01:20:39.522
they kept flying. Why? We said we were ready to create a new system 

1126
01:20:39.522 --> 01:20:42.987
of European security with the participation of the United States.

1127
01:20:42.987 --> 01:20:49.698
Instead, NATO began to expand, moving closer to our 

1128
01:20:49.698 --> 01:20:53.128
borders: one step, then another one.

1129
01:20:53.128 --> 01:20:59.469
We said we needed to address the issues concerning the ABM systems 

1130
01:20:59.469 --> 01:21:12.946
together, preserving or updating the Anti‑Ballistic Missile Treaty.

1131
01:21:12.946 --> 01:21:17.664
The United States unilaterally withdrew from the ABM Treaty 

1132
01:21:17.664 --> 01:21:22.838
and launched an intensive construction of anti-ballistic missile 

1133
01:21:22.838 --> 01:21:28.510
defence system as part of their strategic nuclear forces transferred 

1134
01:21:28.510 --> 01:21:32.022
to the periphery, and started constructing missile deployment areas 

1135
01:21:32.022 --> 01:21:34.417
in Romania and, subsequently, in Poland.

1136
01:21:34.417 --> 01:21:38.743
Initially, as you remember, it was done with the reference 

1137
01:21:38.743 --> 01:21:43.844
to the Iranian nuclear threat, but then an agreement with Iran was 

1138
01:21:43.844 --> 01:21:46.162
signed, including by the United States.

1139
01:21:46.162 --> 01:21:50.887
The agreement has already been ratified, so there is no more threat,

1140
01:21:50.887 --> 01:21:51.918
however, the construction of the missile deployment areas 

1141
01:21:51.918 --> 01:21:57.154
is still on-going. So the question is: against whom? Back then we were 

1142
01:21:57.154 --> 01:21:59.384
told, “We are not against you.

1143
01:21:59.384 --> 01:22:04.365
” We responded, “But then we will have to modernise our strike 

1144
01:22:04.365 --> 01:22:10.224
systems.” “Do what you want, we will think it is against somebody 

1145
01:22:10.224 --> 01:22:12.332
else.” So that is what we are doing.

1146
01:22:12.332 --> 01:22:19.051
Now, when we have made some progress, our partners have begun to worry,

1147
01:22:19.051 --> 01:22:21.728
“How come? What is going on over there?” Why did they give us such 

1148
01:22:21.728 --> 01:22:25.775
an answer back then? Probably because nobody believed we 

1149
01:22:25.775 --> 01:22:27.309
were capable of doing this.

1150
01:22:27.309 --> 01:22:33.278
In the early 2000s, given the total collapse of Russia's defence 

1151
01:22:33.278 --> 01:22:38.566
industry and, frankly speaking, low, to put it mildly,

1152
01:22:38.566 --> 01:22:40.235
low combat capability of the Armed Forces,

1153
01:22:40.235 --> 01:22:45.544
nobody could even think that we would manage to regain the combat 

1154
01:22:45.544 --> 01:22:48.372
potential of the Armed Forces and rebuild the national defence 

1155
01:22:48.372 --> 01:22:50.690
industry. We had US observers 

1156
01:22:50.690 --> 01:22:56.625
(you know this, right?) at our nuclear weapons production facilities.

1157
01:22:56.625 --> 01:22:59.421
They were literary there, at the plant;

1158
01:22:59.421 --> 01:23:01.319
that was the level of trust.

1159
01:23:01.319 --> 01:23:02.377
And then those moves followed –

1160
01:23:02.377 --> 01:23:07.657
first, second, third, fourth. We had to respond somehow,

1161
01:23:07.657 --> 01:23:09.815
you know. They keep telling us, “It's none of your business,

1162
01:23:09.815 --> 01:23:12.880
it doesn't have anything to do with you, it's not against you.”

1163
01:23:12.880 --> 01:23:16.991
Not to mention a very sensitive period in our history –

1164
01:23:16.991 --> 01:23:22.563
the traumatic events in the Caucasus and the Chechen Republic.

1165
01:23:22.563 --> 01:23:26.555
As a journalist, you should know what was the reaction of the Western 

1166
01:23:26.555 --> 01:23:30.724
political establishment and the media.

1167
01:23:30.724 --> 01:23:36.077
Did they support Russia's legitimate authorities in their efforts 

1168
01:23:36.077 --> 01:23:40.349
to restore and strengthen the statehood? No, quite the opposite,

1169
01:23:40.349 --> 01:23:43.658
they supported separatism, and, in fact,

1170
01:23:43.658 --> 01:23:47.074
terrorism. Everybody was turning a deaf ear to the fact that Al-Qaeda 

1171
01:23:47.074 --> 01:23:50.616
was fighting there, side by side with militants and separatists.

1172
01:23:50.616 --> 01:23:54.079
They told us, “Do not worry, we are just concerned about 

1173
01:23:54.079 --> 01:23:55.560
the development of democracy in your country.

1174
01:23:55.560 --> 01:23:58.847
” Thank you very much for such care! But still,

1175
01:23:58.847 --> 01:24:04.325
our attitude is positive, we understand the logics of political 

1176
01:24:04.325 --> 01:24:08.303
and geopolitical struggle, and we stand ready to cooperate if our 

1177
01:24:08.303 --> 01:24:11.609
partners are ready for such cooperation.

1178
01:24:11.609 --> 01:24:20.268
If I had to look at the West and to sum up where they think,

1179
01:24:20.268 --> 01:24:23.413
their side of the argument would be, that they, I think,

1180
01:24:23.413 --> 01:24:26.969
that the root of their distrust is the idea that they think that you 

1181
01:24:26.969 --> 01:24:30.415
want to expand Russia's zone of influences,

1182
01:24:30.415 --> 01:24:33.955
in some case geographically, but also the very least to control 

1183
01:24:33.955 --> 01:24:35.276
the countries on your border.

1184
01:24:35.276 --> 01:24:39.560
And on the moment, the main area of nervousness on that is 

1185
01:24:39.560 --> 01:24:42.586
the Baltics — Estonia, Lithuania,

1186
01:24:42.586 --> 01:24:45.430
Latvia. Would you be able to.. You talked about the trust..

1187
01:24:45.430 --> 01:24:48.218
Would you be able to say something that would give them 

1188
01:24:48.218 --> 01:24:50.483
reassurance on that count?

1189
01:24:50.483 --> 01:24:55.705
Look, I believe that all sensible people who are involved in real 

1190
01:24:55.705 --> 01:25:02.347
politics understand that references to threats posed by Russia to,

1191
01:25:02.347 --> 01:25:05.992
let us say, the Baltic States are absolute nonsense.

1192
01:25:05.992 --> 01:25:09.418
Do you think we are going to start a war with NATO? How many people are 

1193
01:25:09.418 --> 01:25:11.746
there in the NATO countries? About 600 million,

1194
01:25:11.746 --> 01:25:15.052
right? Russia's population is 146 million.

1195
01:25:15.052 --> 01:25:17.955
Yes, we are the largest nuclear power.

1196
01:25:17.955 --> 01:25:22.811
But do you really think we are going to use nuclear weapons to take 

1197
01:25:22.811 --> 01:25:26.349
over the Baltics? Nonsense! That's the first thing,

1198
01:25:26.349 --> 01:25:27.826
but not the most important one.

1199
01:25:27.826 --> 01:25:33.752
The most important thing is that we have a vast political experience,

1200
01:25:33.752 --> 01:25:40.021
and we are convinced that you cannot do anything against 

1201
01:25:40.021 --> 01:25:42.027
the will of the people.

1202
01:25:42.027 --> 01:25:45.155
Nothing can be done against the will of the people! However,

1203
01:25:45.155 --> 01:25:47.327
it seems that some of our partners fail to understand this.

1204
01:25:47.327 --> 01:25:51.889
Thinking of Crimea, they choose not to notice that the will 

1205
01:25:51.889 --> 01:25:55.215
of the Crimean people, 70 percent of which are ethnic Russians 

1206
01:25:55.215 --> 01:25:57.832
and the rest speak Russian as their native language,

1207
01:25:57.832 --> 01:26:02.925
was to join Russia. They prefer to ignore this.

1208
01:26:02.925 --> 01:26:05.747
In one place, in Kosovo, the will of the people can be 

1209
01:26:05.747 --> 01:26:10.356
honoured, but here – it cannot. All of this is about political games.

1210
01:26:10.356 --> 01:26:17.061
So, I can reassure you that Russia has been pursuing absolutely 

1211
01:26:17.061 --> 01:26:19.151
peaceful foreign policy aimed at cooperation,

1212
01:26:19.151 --> 01:26:21.235
and will continue to do so.

1213
01:26:21.235 --> 01:26:26.418
As to extending our zone of influence,

1214
01:26:26.418 --> 01:26:31.744
it took me nine hours to get from Moscow to Vladivostok.

1215
01:26:31.744 --> 01:26:34.721
It is slightly less than it takes to get from Moscow to New York 

1216
01:26:34.721 --> 01:26:38.253
through the entire Western Europe and the Atlantic Ocean.

1217
01:26:38.253 --> 01:26:42.006
Do you really believe we need any expansion? It is not 

1218
01:26:42.006 --> 01:26:46.022
territories we are talking about.

1219
01:26:46.022 --> 01:26:55.901
As for the influence, well, we do want Russia to have stronger and more 

1220
01:26:55.901 --> 01:27:00.715
tangible influence, but we want it to be absolutely 

1221
01:27:00.715 --> 01:27:04.066
peaceful and positive.

1222
01:27:04.066 --> 01:27:07.485
What we have in mind is economic and humanitarian influence,

1223
01:27:07.485 --> 01:27:11.832
which implies developing equal cooperation with our neighbours.

1224
01:27:11.832 --> 01:27:15.238
This is what our foreign policy,

1225
01:27:15.238 --> 01:27:18.532
as well as our foreign economic policy,

1226
01:27:18.532 --> 01:27:20.973
is aimed at. There can be no doubt about it.

1227
01:27:20.973 --> 01:27:25.257
I just want to use one example on the issue.

1228
01:27:25.257 --> 01:27:30.554
You mentioned Crimea, you mentioned what happened then and back then 

1229
01:27:30.554 --> 01:27:34.075
in terms of the reassurances as you might give is that back then March 

1230
01:27:34.075 --> 01:27:40.605
4th 2014, which is checked, three times our reporter asked you what is 

1231
01:27:40.605 --> 01:27:45.343
happening inside the Crimea, did you know anything about Russian 

1232
01:27:45.343 --> 01:27:51.650
troops, which were taking over the Ukrainian government.

1233
01:27:51.650 --> 01:27:53.082
And you said no, knew nothing about that nor the military bases.

1234
01:27:53.102 --> 01:28:02.672
And a year later you talked about directing operation 

1235
01:28:02.672 --> 01:28:05.253
to bring Crimea home yourself.

1236
01:28:05.253 --> 01:28:06.582
Do you accept that sometimes you could may be said things in much 

1237
01:28:06.582 --> 01:28:07.334
clearer way when they are actually happening.

1238
01:28:07.334 --> 01:28:10.221
Of course, I do. I have repeatedly commented on these issues.

1239
01:28:10.221 --> 01:28:12.953
It is quite simple, and I have already said that.

1240
01:28:12.953 --> 01:28:17.115
Indeed, our military personnel were there to ensure 

1241
01:28:17.115 --> 01:28:21.290
security at the voting and referendum.

1242
01:28:21.290 --> 01:28:26.461
If we had not done so, we would have faced a tragedy even worse than 

1243
01:28:26.461 --> 01:28:31.516
the one in Odessa when people were burned alive in the House of Trade 

1244
01:28:31.516 --> 01:28:35.638
Unions, when nationalists trapped defenceless and unarmed people inside 

1245
01:28:35.638 --> 01:28:37.071
the building and burned them alive.

1246
01:28:37.071 --> 01:28:40.617
Such incidents would have been rampant in Crimea,

1247
01:28:40.617 --> 01:28:42.911
so we prevented it from happening.

1248
01:28:42.911 --> 01:28:48.014
The fact is that people came to polling stations to cast a vote 

1249
01:28:48.014 --> 01:28:53.861
voluntarily; no one would have come at gunpoint.

1250
01:28:53.861 --> 01:28:56.120
This is so obvious, that there can be no doubt about it.

1251
01:28:56.120 --> 01:28:58.045
Just come over to Crimea, walk around,

1252
01:28:58.045 --> 01:29:01.062
and everything will become perfectly clear to you.

1253
01:29:01.062 --> 01:29:06.035
So, yes, our military personnel were in Crimea;

1254
01:29:06.035 --> 01:29:12.431
but they did not even outnumber our grouping that had been present 

1255
01:29:12.431 --> 01:29:16.649
there under the treaty we had with Ukraine.

1256
01:29:16.649 --> 01:29:20.939
Most importantly, though, the Crimean parliament,

1257
01:29:20.939 --> 01:29:26.389
which had been elected two years prior to the voting under 

1258
01:29:26.389 --> 01:29:29.933
the Ukrainian law, voted in favour of the referendum 

1259
01:29:29.933 --> 01:29:31.836
and later, in favour of independence.

1260
01:29:31.836 --> 01:29:35.492
It is an absolutely legitimate representative body elected 

1261
01:29:35.492 --> 01:29:38.431
by Crimean people. This is first.

1262
01:29:38.431 --> 01:29:41.850
Second, the international legal framework.

1263
01:29:41.850 --> 01:29:45.277
When the settlement of the Kosovo issue was under negotiation,

1264
01:29:45.277 --> 01:29:48.748
the UN International Court of Justice passed a judgment that was met 

1265
01:29:48.748 --> 01:29:52.727
with applause by all Western partners.

1266
01:29:52.727 --> 01:29:58.164
The Court decided that the settlement of independence issues did not 

1267
01:29:58.164 --> 01:30:02.944
require the decision of country's central authorities.

1268
01:30:02.944 --> 01:30:06.755
So, we did everything in accordance with international law,

1269
01:30:06.755 --> 01:30:11.619
the United Nations Charter and principles of democracy, which include,

1270
01:30:11.619 --> 01:30:16.076
first of all, the free expression of peoples' will.

1271
01:30:16.076 --> 01:30:22.016
One last set of questions about your legacy or your current 

1272
01:30:22.016 --> 01:30:26.665
achievements. The future..

1273
01:30:26.665 --> 01:30:29.664
have you yet decided if you will run in the presidential 

1274
01:30:29.664 --> 01:30:31.573
elections iof 2018?

1275
01:30:31.573 --> 01:30:34.682
We are having parliamentary elections soon,

1276
01:30:34.682 --> 01:30:38.399
so we should wait for results.

1277
01:30:38.399 --> 01:30:44.580
And even after that, we have almost two more years to go.

1278
01:30:44.600 --> 01:30:48.282
So, it is quite premature to talk about it.

1279
01:30:48.282 --> 01:30:53.059
You know, it is even harmful to talk about such things today when 

1280
01:30:53.059 --> 01:30:55.379
the world is changing so rapidly.

1281
01:30:55.379 --> 01:31:01.393
What we should do is work hard to see accomplished all 

1282
01:31:01.393 --> 01:31:05.073
the plans and targets we have set.

1283
01:31:05.073 --> 01:31:08.316
We should achieve the improvement of living standards,

1284
01:31:08.316 --> 01:31:13.124
economic development, social wellbeing and national defence capability.

1285
01:31:13.124 --> 01:31:14.870
Depending on what we will have accomplished on these tracks,

1286
01:31:14.870 --> 01:31:21.028
we will think about the arrangements for the presidential election 

1287
01:31:21.028 --> 01:31:26.479
campaign in 2018 and who should participate in it.

1288
01:31:26.479 --> 01:31:29.389
I have not made my mind yet.

1289
01:31:29.389 --> 01:31:35.666
Do you think Russia is getting easier to run or harder?

1290
01:31:35.666 --> 01:31:43.862
Easier than when? In the days of Ivan the Terrible or Nicholas II,

1291
01:31:43.862 --> 01:31:45.808
or maybe Brezhnev, Khrushchev or Stalin?

1292
01:31:45.808 --> 01:31:48.758
In your time.

1293
01:31:48.758 --> 01:31:53.417
I think it has become harder because,

1294
01:31:53.417 --> 01:31:58.892
even though we face harsh criticism coming mainly from our Western 

1295
01:31:58.892 --> 01:32:03.169
partners, the internal democracy has been developing in our country.

1296
01:32:03.169 --> 01:32:08.595
For example, there will be much more political parties participating 

1297
01:32:08.595 --> 01:32:11.439
in the upcoming elections than in previous years.

1298
01:32:11.439 --> 01:32:17.009
This will, undoubtedly, influence the process and outcomes 

1299
01:32:17.009 --> 01:32:18.537
of election campaigns.

1300
01:32:18.537 --> 01:32:21.653
I mean there is a practical dimension to it.

1301
01:32:21.653 --> 01:32:29.181
Now, looking at the rating of the leading Russian political party –

1302
01:32:29.181 --> 01:32:33.143
the United Russia – we can see that it has slightly fallen.

1303
01:32:33.143 --> 01:32:35.882
So, many people start to question: Is there anything wrong? What 

1304
01:32:35.882 --> 01:32:37.165
happened? Nothing happened.

1305
01:32:37.165 --> 01:32:38.919
It is just that an active election campaign has started,

1306
01:32:38.919 --> 01:32:44.695
so all these numerous parties participating in the election process 

1307
01:32:44.695 --> 01:32:49.435
appear on the screen, in media, in newspapers.

1308
01:32:49.435 --> 01:32:52.458
What is their massage? They all criticise the government.

1309
01:32:52.458 --> 01:32:54.328
They don't offer solutions to make things better,

1310
01:32:54.328 --> 01:33:00.144
though. Sometimes they simply say things that even laymen realize are 

1311
01:33:00.144 --> 01:33:03.571
hardly practicable or just unfeasible.

1312
01:33:03.571 --> 01:33:07.446
However, they look good on screen,

1313
01:33:07.446 --> 01:33:13.931
scolding and holding up to shame members of the ruling party.

1314
01:33:13.931 --> 01:33:16.297
They don't say whether they are ready to take on responsibility 

1315
01:33:16.297 --> 01:33:19.275
for making unpopular, but in the long run necessary, decisions.

1316
01:33:19.275 --> 01:33:24.994
Are you envious of the Chinese who don't have to go through 

1317
01:33:24.994 --> 01:33:26.781
these elections?

1318
01:33:26.781 --> 01:33:29.422
China has another political system,

1319
01:33:29.422 --> 01:33:30.758
it is a different country.

1320
01:33:30.758 --> 01:33:34.727
I am sure, you will not be happy to see one and a half billion people 

1321
01:33:34.727 --> 01:33:38.385
suffering any disruption in their society and government.

1322
01:33:38.385 --> 01:33:42.406
So, let China have its right and possibility to decide how it should 

1323
01:33:42.406 --> 01:33:46.830
organise its state and society.

1324
01:33:46.830 --> 01:33:51.837
Russia is a different country, with different ways and different level 

1325
01:33:51.837 --> 01:33:54.122
of political system development.

1326
01:33:54.122 --> 01:33:56.664
It is not even about the level,

1327
01:33:56.664 --> 01:33:58.583
it is about the quality of the political system,

1328
01:33:58.583 --> 01:34:01.913
which is developing and getting more complicated.

1329
01:34:01.913 --> 01:34:05.538
As a matter of fact, I am happy about it.

1330
01:34:05.538 --> 01:34:09.387
I want to see this system grow stronger in the future,

1331
01:34:09.387 --> 01:34:15.481
to see balance within the political system,

1332
01:34:15.481 --> 01:34:24.459
so that it could always be effective and oriented to development.

1333
01:34:24.459 --> 01:34:33.027
Would you have an exit strategy? In 2018 you would have been 

1334
01:34:33.027 --> 01:34:37.851
the longest serving president.

1335
01:34:37.851 --> 01:34:43.172
Do you have an idea about how eventually you will leave power?

1336
01:34:43.172 --> 01:34:47.228
I either will or will not take part in the elections.

1337
01:34:47.228 --> 01:34:54.100
If I do not, another person will be elected head of state,

1338
01:34:54.100 --> 01:34:58.310
President of Russia. The people will decide for whom they should vote.

1339
01:34:58.310 --> 01:35:06.977
Yet I would like to underscore that in any case already today we 

1340
01:35:06.977 --> 01:35:11.577
(and by that I mean myself and the members of my team: the Government 

1341
01:35:11.577 --> 01:35:12.561
Cabinet and the Presidential Administration)

1342
01:35:12.561 --> 01:35:14.416
should shape our vision of how the country should develop and what 

1343
01:35:14.416 --> 01:35:18.104
political, internal political and economic processes should take place.

1344
01:35:18.104 --> 01:35:24.003
That is why we are working on a strategy to develop the economy 

1345
01:35:24.003 --> 01:35:28.024
(primarily the economy, certainly) after 2018.

1346
01:35:28.024 --> 01:35:32.963
I am convinced that irrespective of the way in which internal political 

1347
01:35:32.963 --> 01:35:36.285
processes develop, we should offer the country our vision 

1348
01:35:36.285 --> 01:35:37.197
of its economic development.

1349
01:35:37.197 --> 01:35:44.577
And it will be up to the next president to agree or disagree with what 

1350
01:35:44.577 --> 01:35:47.187
we have offered, to update it or to offer something 

1351
01:35:47.187 --> 01:35:48.479
completely different.

1352
01:35:48.479 --> 01:35:52.845
You've just reorganized part of your government,

1353
01:35:52.845 --> 01:35:58.384
you promoted some people, some former bodyguards and people like that.

1354
01:35:58.384 --> 01:36:01.552
Do you think that might be the sort of area where the next leader 

1355
01:36:01.552 --> 01:36:03.240
for Russia will come? Will it come from the younger generation 

1356
01:36:03.260 --> 01:36:04.552
of people who are beginning to emerge?

1357
01:36:04.552 --> 01:36:11.942
Certainly. I believe that the next Russian leader should be 

1358
01:36:11.942 --> 01:36:20.412
a fairly young yet mature person.

1359
01:36:20.412 --> 01:36:25.565
As for the members of various special services and the Armed Forces,

1360
01:36:25.565 --> 01:36:28.987
there is nothing new in what I have done.

1361
01:36:28.987 --> 01:36:36.816
It has not been the first time when former members of the Defence 

1362
01:36:36.816 --> 01:36:39.732
Ministry, Federal Security Service have been promoted 

1363
01:36:39.732 --> 01:36:42.166
to head our regions. The Federal Guard Service is no exception;

1364
01:36:42.166 --> 01:36:43.378
they are just as good as the others.

1365
01:36:43.378 --> 01:36:50.508
If a person is willing to develop, is capable of developing,

1366
01:36:50.508 --> 01:36:56.232
and is ready to serve his country in an office with greater powers 

1367
01:36:56.232 --> 01:37:01.439
and responsibilities, and I can see that such person has 

1368
01:37:01.439 --> 01:37:04.121
potential, why not? They can work.

1369
01:37:04.141 --> 01:37:14.042
After all, regional leaders will also have to go through elections 

1370
01:37:14.042 --> 01:37:18.680
and put forward proposals for the people of the regions 

1371
01:37:18.680 --> 01:37:19.867
in question to judge.

1372
01:37:19.867 --> 01:37:22.544
The people in these regions need to look at these programmes,

1373
01:37:22.544 --> 01:37:24.353
study them, get themselves familiar with those persons.

1374
01:37:24.373 --> 01:37:28.224
There should be certain chemistry between the leader of the region 

1375
01:37:28.224 --> 01:37:29.846
and the people that live there.

1376
01:37:29.846 --> 01:37:41.103
People should feel their possible new leader and I believe that they 

1377
01:37:41.103 --> 01:37:45.367
have to trust such leader in order to vote for him or her,

1378
01:37:45.367 --> 01:37:48.633
otherwise they would not vote.

1379
01:37:48.633 --> 01:37:59.180
People might say there are two ways in which Russia is very 

1380
01:37:59.180 --> 01:38:03.199
difficult to rule. One is it is a very personal system,

1381
01:38:03.199 --> 01:38:06.454
where many people vote for you rather than for party.

1382
01:38:06.454 --> 01:38:14.490
And the other reason is Russian is still a fairly lawless place.

1383
01:38:14.490 --> 01:38:16.789
You have things like murder of Boris Nemtsov which I know you condemned 

1384
01:38:16.789 --> 01:38:19.387
and you have brought people in,

1385
01:38:19.407 --> 01:38:23.536
but the mastermind is still being sought.

1386
01:38:23.556 --> 01:38:26.132
Is Russia a very very hard place to govern at the moment?

1387
01:38:26.132 --> 01:38:28.907
You know, I may assure you that it is hard to govern any country.

1388
01:38:28.907 --> 01:38:35.418
Would you say that governing the United States is an easy task? Is it 

1389
01:38:35.418 --> 01:38:40.341
easy to address even uncomplicated matters? The Guantanamo detention 

1390
01:38:40.341 --> 01:38:43.646
camp, for example? During his first term President Obama 

1391
01:38:43.646 --> 01:38:46.694
said that he would shut it down. Yet it is still there.

1392
01:38:46.694 --> 01:38:49.311
Why? Is it that he does not want to? Certainly he does.

1393
01:38:49.311 --> 01:38:54.691
I am sure he does. Yet there emerge thousands of obstacles that prevent 

1394
01:38:54.691 --> 01:38:56.698
him from resolving this issue.

1395
01:38:56.698 --> 01:39:01.361
In fact, this is indeed awful, but that is a different story.

1396
01:39:01.361 --> 01:39:05.085
It is hard to govern any country, even a very small one.

1397
01:39:05.085 --> 01:39:08.293
It is not a matter of whether the country is large or small.

1398
01:39:08.293 --> 01:39:10.637
It is rather a matter of one's attitude to the task,

1399
01:39:10.637 --> 01:39:13.768
of whether one takes this task responsibly.

1400
01:39:13.768 --> 01:39:15.418
Russia is also hard to govern.

1401
01:39:15.418 --> 01:39:18.977
Yet Russia is at a stage when its political system 

1402
01:39:18.977 --> 01:39:22.573
and market economy are shaped.

1403
01:39:22.573 --> 01:39:26.156
It is a complicated yet very intriguing process.

1404
01:39:26.156 --> 01:39:29.286
Indeed, Russia is not merely a large country,

1405
01:39:29.286 --> 01:39:33.694
it is a great country that has distinct traditions and culture.

1406
01:39:33.694 --> 01:39:38.561
It is true, it also has distinct political traditions.

1407
01:39:38.561 --> 01:39:45.191
It is no secret that we used to have absolute monarchy,

1408
01:39:45.191 --> 01:39:52.645
then came the times of communist rule, the base somewhat expanded,

1409
01:39:52.645 --> 01:39:58.794
yet to a certain extent the system of the government became 

1410
01:39:58.794 --> 01:40:00.349
even more rigid.

1411
01:40:00.349 --> 01:40:05.424
We started building a completely new multi-party political 

1412
01:40:05.424 --> 01:40:08.221
system only in the 1990s.

1413
01:40:08.221 --> 01:40:13.235
This is a very complex process and there are certain stages 

1414
01:40:13.235 --> 01:40:14.361
that cannot be skipped.

1415
01:40:14.361 --> 01:40:17.582
Our citizens should get accustomed to this,

1416
01:40:17.582 --> 01:40:21.319
feel their responsibility when they arrive at the polling stations.

1417
01:40:21.319 --> 01:40:25.544
They should learn to question populist solutions,

1418
01:40:25.544 --> 01:40:31.503
deliberations or candidates' mutual accusations.

1419
01:40:31.503 --> 01:40:36.041
They should watch attentively and analyse what candidates have 

1420
01:40:36.041 --> 01:40:41.131
to offer. This concerns both the parliamentary and presidential 

1421
01:40:41.131 --> 01:40:47.008
elections. By the way, in countries with a presidential form 

1422
01:40:47.008 --> 01:40:52.704
of governance people often vote for the presidential candidate rather 

1423
01:40:52.704 --> 01:40:54.444
than the political party.

1424
01:40:54.444 --> 01:40:57.594
This is true of virtually any such country,

1425
01:40:57.594 --> 01:41:05.566
and there is nothing unusual in Russia in this context.

1426
01:41:05.566 --> 01:41:10.265
Surely if you look at Chechnya and, say,

1427
01:41:10.265 --> 01:41:17.319
the influence of someone like Ramzan Kadyrov.

1428
01:41:17.319 --> 01:41:22.691
He has a very full reign, it does not seem if he is brought 

1429
01:41:22.691 --> 01:41:23.870
under power much. That is completely different to what would happen 

1430
01:41:23.870 --> 01:41:24.952
in say Mississippi or Tennessee.

1431
01:41:24.952 --> 01:41:27.284
That is a different system, what is happening in Chechnya.

1432
01:41:27.284 --> 01:41:31.892
Surely that is different. It is more lawless and it is more personal.

1433
01:41:31.892 --> 01:41:35.582
That might be viewed from a different angle.

1434
01:41:35.582 --> 01:41:41.553
One should not forget that it was not long ago that people were openly 

1435
01:41:41.553 --> 01:41:43.976
bought and sold on the markets,

1436
01:41:43.976 --> 01:41:50.340
members of international terrorist organisations, including Al Qaeda,

1437
01:41:50.340 --> 01:41:53.364
ruled and people were beheaded in Chechnya.

1438
01:41:53.364 --> 01:41:55.810
We by no means have forgotten that.

1439
01:41:55.810 --> 01:42:02.696
The very Ramzan Kadyrov that is the leader of Chechnya today fought 

1440
01:42:02.696 --> 01:42:07.100
against the Federal troops during the so-called First Chechen War.

1441
01:42:07.100 --> 01:42:11.588
This was a very complex and large transformation, indeed,

1442
01:42:11.588 --> 01:42:14.515
when first his father, the first president of Chechnya and then he 

1443
01:42:14.515 --> 01:42:25.622
himself realised that Chechnya's future was linked to that of Russia.

1444
01:42:25.622 --> 01:42:29.871
This choice was not a result of any pressure,

1445
01:42:29.871 --> 01:42:32.336
but rather their internal conviction.

1446
01:42:32.376 --> 01:42:39.100
I remember perfectly well my first conversations with Ramzan Kadyrov's 

1447
01:42:39.100 --> 01:42:41.580
father, first President of Chechnya.

1448
01:42:41.580 --> 01:42:43.960
He told me bluntly – and at that time, in 1999,

1449
01:42:43.960 --> 01:42:51.271
I was the Prime Minister – that ''we see that the future of Chechnya 

1450
01:42:51.271 --> 01:42:53.305
cannot be dissociated from Russia.

1451
01:42:53.305 --> 01:43:01.320
Otherwise, we will become dependent on the powerful 

1452
01:43:01.320 --> 01:43:03.954
and therefore we will feel worse.

1453
01:43:03.954 --> 01:43:07.575
But the most important thing – which I also remember very well –

1454
01:43:07.575 --> 01:43:09.541
is that you should never betray us.''

1455
01:43:09.541 --> 01:43:11.100
It was a very complex situation back then.

1456
01:43:11.100 --> 01:43:14.016
The federal centre was behaving incoherently –

1457
01:43:14.016 --> 01:43:17.459
either it advanced or retreated,

1458
01:43:17.459 --> 01:43:21.874
either it agreed with something or broke agreements afterwards.

1459
01:43:21.874 --> 01:43:26.310
The Chechen people needed a consistent and clear position 

1460
01:43:26.310 --> 01:43:28.728
of the country’s central authorities.

1461
01:43:28.728 --> 01:43:33.865
But we should not forget the transformations that these 

1462
01:43:33.865 --> 01:43:36.637
people have undergone.

1463
01:43:36.637 --> 01:43:44.126
We have signed a treaty with Chechnya and it is fully in line with 

1464
01:43:44.126 --> 01:43:46.382
the Constitution of the Russian Federation.

1465
01:43:46.382 --> 01:43:52.816
We have a federal state and the federal constituent entities are 

1466
01:43:52.816 --> 01:43:57.127
granted certain rights, and the example of Chechnya demonstrates that 

1467
01:43:57.127 --> 01:43:58.744
this does not destroy or ruin the country, but,

1468
01:43:58.744 --> 01:44:00.617
on the contrary, unites it.

1469
01:44:00.617 --> 01:44:06.990
Of course, many things require improvement and to a large extent need 

1470
01:44:06.990 --> 01:44:12.228
to forget these tragic events of the mid-1990s and finally 

1471
01:44:12.228 --> 01:44:15.449
heal our wounds. But all this takes time.

1472
01:44:15.449 --> 01:44:20.480
I am sure that we will strengthen our internal political institutions 

1473
01:44:20.480 --> 01:44:25.660
and economy and I have no doubts about it.

1474
01:44:25.660 --> 01:44:27.441
I believe that Russia has already turned the most tragic 

1475
01:44:27.441 --> 01:44:33.454
pages of its history. We will only go ahead and grow stronger.

1476
01:44:33.454 --> 01:44:40.573
A personal thing. You've managed to rule Russia for 16 years.

1477
01:44:40.573 --> 01:44:45.699
If you look at the chief executives and the business people who tune 

1478
01:44:45.699 --> 01:44:48.538
in to Bloomberg and watch it, very few of them last longer than 5–

1479
01:44:48.538 --> 01:44:51.775
6 years, what advice would you give them to hang 

1480
01:44:51.775 --> 01:44:53.486
on to their jobs for longer?

1481
01:44:53.486 --> 01:44:57.436
No matter how strange it would sound but one should not 

1482
01:44:57.436 --> 01:45:01.998
cling to power at any price.

1483
01:45:01.998 --> 01:45:05.116
I have not, as you put it, just been in power for 16 years,

1484
01:45:05.116 --> 01:45:09.844
I was the President of the Russian Federation for eight years and after 

1485
01:45:09.844 --> 01:45:14.615
that, without violating the Constitution or readjusting it to my own 

1486
01:45:14.615 --> 01:45:17.214
needs, I just decided not to run for the third presidential term,

1487
01:45:17.214 --> 01:45:20.398
which was impossible; within the framework of the current Constitution.

1488
01:45:20.398 --> 01:45:24.407
Our Constitution stipulates that one can be elected for two 

1489
01:45:24.407 --> 01:45:27.899
terms running. So I followed the rules: I was elected two times 

1490
01:45:27.899 --> 01:45:31.173
and then I just left and changed my job –

1491
01:45:31.173 --> 01:45:33.659
I have worked as the Chairman of the Government for four years.

1492
01:45:33.659 --> 01:45:35.193
In accordance with the Constitution,

1493
01:45:35.193 --> 01:45:41.473
when I regained this right in four years, I run for the presidency,

1494
01:45:41.473 --> 01:45:43.106
I was elected and I am the President now.

1495
01:45:43.106 --> 01:45:45.883
So we do not speak about 16 years, but rather about four and four –

1496
01:45:45.883 --> 01:45:47.862
that’s eight years, and four more years now.

1497
01:45:47.862 --> 01:45:52.357
I have been working as President for 12 years.

1498
01:45:52.377 --> 01:45:59.324
What is the reason for your success?

1499
01:45:59.324 --> 01:46:05.086
Wait a minute. As for the time spent in office, let us say,

1500
01:46:05.086 --> 01:46:06.572
Canada is one of the examples.

1501
01:46:06.572 --> 01:46:09.444
I believe that its leader has spent 16 years in power.

1502
01:46:09.444 --> 01:46:12.725
And the German Chancellor, for how much time has she stayed in power? 

1503
01:46:12.725 --> 01:46:16.553
If we refer to the number one in the executive power.

1504
01:46:16.553 --> 01:46:22.753
Not 16 years. You have done longer than most.

1505
01:46:22.753 --> 01:46:24.434
I have not been President for 16 years,

1506
01:46:24.434 --> 01:46:27.461
but for 12 years. I suppose that she has been in power not 

1507
01:46:27.461 --> 01:46:29.152
for fewer years.

1508
01:46:29.152 --> 01:46:35.879
But this is not about it. I do not know what secrets can exist here.

1509
01:46:35.879 --> 01:46:37.057
I do not have any secrets.

1510
01:46:37.057 --> 01:46:55.766
I just always try to feel the spirits of the people, feel their needs,

1511
01:46:55.766 --> 01:47:00.156
their mood for patterns and methods of solving the tasks,

1512
01:47:00.156 --> 01:47:06.552
their priorities, and I am guided by all this in the first place.

1513
01:47:06.552 --> 01:47:10.794
I believe that it is the most important aspect in the job of any person 

1514
01:47:10.794 --> 01:47:15.820
who does the kind of work that the Russian people have 

1515
01:47:15.820 --> 01:47:17.858
entrusted me with.

1516
01:47:17.858 --> 01:47:23.866
You look around the world at the moment.

1517
01:47:23.866 --> 01:47:26.980
There are so many countries that become dynasties — 

1518
01:47:26.980 --> 01:47:32.105
the Clintons, the Bushes in America.

1519
01:47:32.105 --> 01:47:36.105
You have children who you successfully kept out of the public eye.

1520
01:47:36.105 --> 01:47:41.450
Would you ever want your daughters to go into politics? Would want them 

1521
01:47:41.450 --> 01:47:45.000
to have the same life as you?

1522
01:47:45.000 --> 01:47:50.542
I do not regard that I have the right to wish something for them.

1523
01:47:50.542 --> 01:47:56.596
They are young, but nevertheless they are adults and should determine 

1524
01:47:56.596 --> 01:47:58.621
their future by themselves.

1525
01:47:58.621 --> 01:48:02.238
In general, as I see it, they have already chosen their way,

1526
01:48:02.238 --> 01:48:07.881
they pursue science and they are engaged in some activities that are 

1527
01:48:07.881 --> 01:48:10.154
noble and needed by people.

1528
01:48:10.154 --> 01:48:18.529
They feel in demand, they enjoy their work and I am happy about it.

1529
01:48:18.529 --> 01:48:24.116
They are responsible and honest about the profession they 

1530
01:48:24.116 --> 01:48:26.846
have chosen for themselves.

1531
01:48:26.846 --> 01:48:33.963
When I flew here on Korean airlines I had a choice of two films 

1532
01:48:33.963 --> 01:48:36.509
to watch: one was Doctor Zhivago,

1533
01:48:36.509 --> 01:48:38.531
and the other was the Godfather.

1534
01:48:38.531 --> 01:48:43.625
Which would you recommend to somebody trying to understand Russia?

1535
01:48:43.625 --> 01:48:51.269
I do not know. You see, we have a famous poem,

1536
01:48:51.269 --> 01:48:53.729
which goes: “You will not grasp her with your mind or cover with 

1537
01:48:53.729 --> 01:48:55.295
a common label, for Russia is one of a kind –

1538
01:48:55.295 --> 01:48:58.734
believe in her, if you are able.”

1539
01:48:58.734 --> 01:49:05.495
But the Russian culture is multifaceted and diverse.

1540
01:49:05.495 --> 01:49:11.154
That is why if you want to understand, to feel Russia,

1541
01:49:11.154 --> 01:49:19.746
you should certainly read books – Tolstoy, Chekhov, Gogol, Turgenev –

1542
01:49:19.746 --> 01:49:24.248
listen to Tchaikovsky's music and watch our classical ballet.

1543
01:49:24.268 --> 01:49:26.645
But the most important thing that one should do is talk to people.

1544
01:49:26.645 --> 01:49:32.418
I assure you: as soon as you start to meet average ordinary people you 

1545
01:49:32.418 --> 01:49:39.653
will understand that Russians, whether they are Tatars, Mordovians,

1546
01:49:39.653 --> 01:49:44.294
Chechens, Daghestanis, are very open-hearted people.

1547
01:49:44.294 --> 01:49:47.612
They are open and a bit naive.

1548
01:49:47.612 --> 01:49:52.527
But there is one characteristic feature,

1549
01:49:52.527 --> 01:49:58.074
which many nations must have but it is particularly evident 

1550
01:49:58.074 --> 01:50:01.538
in Russians. It is a pursuit of justice.

1551
01:50:01.538 --> 01:50:07.756
It seems to me that it is one of the dominant features 

1552
01:50:07.756 --> 01:50:12.309
in the Russian mentality.

1553
01:50:12.309 --> 01:50:26.565
And another component of the Russian mentality is a pursuit of some 

1554
01:50:26.565 --> 01:50:30.827
[ideals]… Of course, this is a common feature,

1555
01:50:30.827 --> 01:50:33.179
there are millions of people and all people are different from each 

1556
01:50:33.179 --> 01:50:41.352
other, but on the average we certainly want to be well off and I will 

1557
01:50:41.372 --> 01:50:45.218
strive to do my best for people to live better 

1558
01:50:45.218 --> 01:50:47.406
and to improve their living standards.

1559
01:50:47.406 --> 01:50:59.627
Notwithstanding all this, there is a pursuit of some high moral ideal,

1560
01:50:59.627 --> 01:51:02.762
some moral values in Russian people's mentality and heart.

1561
01:51:02.762 --> 01:51:05.034
This is the thing that for sure –

1562
01:51:05.034 --> 01:51:09.159
and I am convinced of it – is our positive distinctive feature.

1563
01:51:09.159 --> 01:51:12.763
Ok then, that sounds like Doctor Zhivago to me.

1564
01:51:12.763 --> 01:51:16.312
President Putin, I thank you for talking to us.

1565
01:51:16.312 --> 01:51:18.173
You were so generous to devote your time to us.

1566
01:51:18.173 --> 01:51:20.820
Thank you very much.