WEBVTT

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Good afternoon, colleagues,

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I am very pleased to welcome members of the German Eastern Business 

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Association, leading German entrepreneurs and our 

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colleagues and friends.

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This is the third meeting held in this format.

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I hope that today’s meeting will also prove useful,

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and we will have a sincere and business-like discussion of the current 

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issues related to Russian-German trade and investment cooperation 

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and prospects for further development.

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Our regular direct contacts have practical importance,

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above all because Germany is one of Russia’s largest economic partners;

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the second largest after the People’s Republic of China.

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Bilateral trade grew 23 percent to $50 billion in 2017,

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increasing another 24 percent in January-August.

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German investment in various sectors of our economy now 

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exceeds $20 billion. Accordingly,

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Russia’s investment in the German economy is $9 billion as of today.

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There are about 5,000 companies with German capital in Russia with 

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about $50 billion in total revenue.

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Industrial sites are being built and modernised 

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as a collaborative effort.

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Autos, agricultural equipment, trains, electrical equipment,

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and other high-tech products are being manufactured with 

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the latest German technology.

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For decades, our countries have been effectively 

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cooperating in the energy sector.

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Russia’s supplies to Germany cover about a third 

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of Germany’s natural gas and oil needs.

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Many landmark projects, such as the legendary Gas for Pipes and Nord 

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Stream projects, have made a significant contribution to ensuring 

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energy security not only of the Federal Republic 

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of Germany, but all of Europe.

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The construction of the Nord Stream-2 pipeline system is well underway.

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We highly appreciate German business’ commitment to cooperation,

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your pragmatism and constructive attitude,

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and hope that business ties between our countries will continue 

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to expand progressively even amid the current difficult political 

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and economic international situation.

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We are convinced that investment and trade not only bring tangible 

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profits to all the participants in this process,

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but also securely improve relations between our states.

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Based on the opinion of the business community,

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work continues in Russia to improve the legislative 

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framework and law enforcement practices.

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We will remove unnecessary administrative barriers and invest heavily 

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in the infrastructure; in a word,

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we will do our best to make sure that foreign investors,

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including German investors, feel comfortable in our country.

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Foreign entrepreneurs can receive assistance from the Russian Direct 

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Investment Fund and have access to much government support provided 

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they localise production in Russia, which, frankly,

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is not practiced much around the world.

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Practical assistance in exporting Russian-made products is provided 

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by the Russian Export Centre.

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Special economic zones and priority development area have been created 

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in many Russian regions.

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Investors receive benefits that allow them to drastically,

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by up to 30 percent, reduce their capital costs.

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Notably, the Russian economy is on the rise.

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In January-September, industrial output increased 3 percent,

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including the manufacturing industry,

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up 3.3 percent. The output of agricultural products increased by more 

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than 20 percent over the past five years.

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Russian exports of food and agricultural raw materials increased 21 

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percent last year, exceeding $20 billion,

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further growing by another third in January-July.

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Our agricultural exports have outpaced military equipment 

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exports in terms of money.

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Our military-industrial complex exports stand at $15 billion,

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whereas agricultural exports, as I mentioned,

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totalled $20 billion.

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Our country is the largest supplier of wheat to the world market.

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Unemployment remains at a record low of 4.5 percent.

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Indeed, inflation is slightly up from 2.5 percent in 2017 at 3.5 percent this year. 

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The financial market remains stable.

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We have a trade surplus of $180 billion and a positive 

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current account value of $100 billion.

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Please note that the current account value is somewhat lower,

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by $80 billion, because it includes services and various kinds 

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of payments, including dividends, some of which you received.

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This means that our foreign investors,

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our friends and colleagues work in an open market,

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without restrictions on the movement of funds and capital, which,

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in my opinion, creates very good,

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favourable environment for the further development 

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of business activities in Russia.

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The relatively low external debt, the Central Bank’s growing reserves,

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its foreign reserves and the Government’s reserves are creating a very 

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stable macroeconomic situation.

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Investment in core assets of enterprises and organisations 

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has increased by 3.2 percent, freight turnover has gone up by three 

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percent and retail trade by almost three percent,

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or to be precise by 2.7 percent,

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  which points to the growth of domestic demand.

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We are doing much for the country’s dynamic technological development.

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We have launched the Digital Economy programme under which we plan 

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to increase labour productivity by 30 percent by 2024.

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Of course, this is a very ambitious goal. We realise this full well.

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But we must set such goals if we want to achieve something at all.

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We must make the economy’s innovative sectors create over 

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10 percent of Russia’s GDP.

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All the afore-mentioned figures are not just dry statistics but 

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evidence of the sustainability of key macroeconomic indicators 

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and the improving business climate in Russia.

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We have gone up several points in the Doing Business 

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ranking. What is our rank now?

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31st.

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We have risen to the 31st place,

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which allows businesses to feel confident,

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to build and implement long-term development plans.

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Colleagues, you see at this meeting many senior officials of ministries 

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and departments, members of the economic bloc of the Russian Government 

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and heads of major national companies.

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We are ready to discuss the subjects that are vital for you and review 

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specific proposals on stepping up bilateral cooperation.

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And, of course, as always it is important for us to know your opinion,

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the opinion of our German colleagues on what is still 

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complicating business in Russia. Such problems are bound to exist.

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What additional assistance can the state,

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the Government of the Russian Federation render 

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to investors working in Russia?

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Let’s have an open and engaging discussion,

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as we are used to here.

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I am pleased to give the floor to the Chairman of the German Eastern 

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Business Association MrWolfgang Buechele. Please.

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Mr President, ministers, ladies and gentlemen.

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It is a great honour for us to meet with you again in Moscow.

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On behalf of the German Eastern Business Association 

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and the representatives of German enterprises in attendance,

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I would like to thank you for the opportunity to get together and talk.

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For all the crises and conflicts,

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business has turned out to be the strongest link binding Russia 

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and Germany, Russia and the European Union.

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Starting from 2017, our bilateral trade has again been on the rise.

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In 2017, trade hit 55 billion euros in absolute terms,

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and we hope it will again exceed 60 billion euros this year.

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Let me remind you that in 2012 we reached a record high –

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80 billion euros. In other words,

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we are once again on the right path to growth.

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Certainly, as representatives of business,

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we would like to grow at an even faster pace.

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I believe that we are on the right track to implement our joint 

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projects, promising projects that we are planning 

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to discuss at length today.

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Just a month ago, representatives of the St Petersburg Dialogue 

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gathered here, in Moscow, to discuss the future 

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of German-Russian relations.

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German Minister for Economic Affairs and Energy Peter Altmaier,

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in his speech at the gathering,

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spoke about prospects for creating a common European space 

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of prosperity.

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Promoting economic growth in Europe and Eurasia is our common goal 

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on which Russia and the European Union need to work together.

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The German Eastern Business Association is convinced of this and is 

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trying to build bridges.

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Therefore, we need to focus more on joint standards,

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certification and ways of easing customs and visa barriers.

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This would be the first step on a long path towards creating a joint 

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economic space of the European Union and the Eurasian Economic Union.

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In the interests of our descendants,

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we hope that this prospect will become a reality some day.

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The European Union and Russia are facing similar challenges 

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on many major issues.

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Guided by global trade rules and a strong multilateral organisation 

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like the WTO, we both need nuclear security in Europe,

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climate protection, stable access to energy resources,

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and we would like to make joint investments in resource projects.

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And finally we need to handle the challenges posed 

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by the digitalisation of the economy.

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It is no secret that we, Europeans,

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have to redouble efforts in such areas as artificial intelligence,

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blockchain, unmanned transport, 3D printing, supercomputers,

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and biotech. I worked at Exyte AG and I can say that the projects 

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to build up-to-date semiconductor production facilities are mostly 

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implemented in China and the United States and very rarely in Europe.

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Today, China is becoming our global competitor in all spheres;

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the United States is focused on its America First strategy.

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Modern and innovative enterprises from the European Union and Russia 

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must work together to secure an adequate place for Europe 

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in the competition for global markets.

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I hope that we will take a big step in this direction today.

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Our meeting will focus on five areas: developing cooperation 

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in healthcare, increasing labour efficiency and productivity.

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Mr President, you have just mentioned this important issue.

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We want to talk about further developing our energy ties,

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joint initiatives related to the digital economy,

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as well as cooperating in the agricultural sector and food production.

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These are big challenges we face,

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and we should spare no effort to achieve our goals.

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In closing, I would like to mention the concerns that we have 

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to contend with and that can result in problems.

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The situation with reciprocal economic sanctions, sadly,

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has not changed, in particular with US sanctions,

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and they have to be handled with the utmost seriousness.

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We have to expect tougher sanctions.

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We are deeply concerned that these sanctions are worded vaguely 

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and ambiguously, and it is very difficult for certain enterprises 

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to see whether they will be affected or not.

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Mr President, you said that we still operate 5,

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000 companies here in Russia.

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That is, in these difficult times,

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the number of companies has decreased,

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but the quality has improved significantly.

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Our trade is on the rise, but prospects and forecasts for the coming 

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months, as I mentioned, are marred by additional sanctions.

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We hope we can find a way to deal with this.

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These sanctions may apply to both Russian and German companies.

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Separate sanctions are imposed by the United States extraterritorially.

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We have heard about them and, unfortunately, now have to deal with them.

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At this point, we see that most of the issues are related 

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to ​​financing projects, since global banks subject projects 

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to in-depth screening and tend to make negative decisions about 

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financing them, without considering the sanctions.

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We all want changes for the better,

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but there are still lots of reports about cyber attacks 

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and special service operations.

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While we very much hope and strive for improvement, all this,

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of course, makes the prospects for improving the situation bleaker.

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We also hope, despite the problems, that the Nord Stream 2 project,

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currently under construction, will be seen to completion 

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within the deadlines.

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Nord Stream 2 is important because Germany is about to abandon the use 

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of nuclear energy and will no longer use electricity 

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generated from brown coal.

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So, we need additional natural gas not only from Nord Stream,

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but also gas delivered through Ukraine,

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in order to achieve our climate goals and provide Europe 

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with competitive and clean fuel.

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I would like to say openly that German and Russian companies will see 

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improvements if political relations improve.

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Then, we will have another détente process,

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which assumes many participants.

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Russia is a powerful and influential country.

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Of course, you will not be surprised if we say that we hope that Russia 

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will contribute even more actively to international detente.

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This is our request. This will be good for Russia,

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Europe and the global economy in general.

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We also positively assess the fact that politicians from our countries 

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are meeting often now.

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A major summit on Syria was held several days ago.

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The chances of detente are improving, and this is the right approach.

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As businesses, we are willing to contribute to building confidence.

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In this sense, we, of course, are waiting for the projects that we will 

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be able to implement next year in conjunction with our partners.

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At the upcoming St Petersburg International Economic Forum, we,

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the representatives of German businesses,

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would like to play a prominent role.

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We hope that representatives of the German establishment 

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will take advantage of this forum in 2019.

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I would like to thank you for meeting with us.

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If I may, I will now let the members of our delegation speak.

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Let's get to work.

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