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OF THE RUSSIAN INVESTMENT FORUM

Dmitry Medvedev attends ASEAN Business and Investment Summit

14 November

Dmitry Medvedev’s address at the first session of the ASEAN Business and Investment Summit 2017:

I am truly delighted to have the opportunity to address such a representative forum as the ASEAN Business and Investment Summit, to have the chance to meet business leaders, politicians and experts, and to discuss the outlook for the region’s economy over the coming years.

This summit is focusing on infrastructure development and building for the future – a perfect reflection, I believe, of the current situation. Today, the outline of the future global economy is emerging; it is an economy of new ideas, new technologies, new materials; this new economy will certainly require a new global infrastructure and new regulatory mechanisms.

Despite the explosive growth of e-commerce and digital technologies, international regulation of global trade remains within the old framework, within a paradigm that is 40 years old. Commodity markets are still unstable, corporate and sovereign debt is on the rise, the techniques of the so-called new protectionism are increasingly being employed, with economic sanctions used as a competitive tool.

The countries of the Asia-Pacific region are also facing some unique challenges. Many economic growth resources that have been successfully utilized only recently are no longer yielding the same returns. Today, it is difficult to develop relying solely on cheap labour and raw materials. This is a radically new development paradigm for the so-called Asian Tigers, too. These are the nations that have been driving world economic growth for the last 20 years, and that makes it an issue for the global economy as a whole.

Like other countries, Russia is looking for ways to adapt to the new economic reality. We have succeeded in improving the health of Russia’s economy somewhat by slightly altering its current course and freeing it of its excessive reliance on exporting raw materials. Positive shifts took place last year and have taken place this year. We are seeing decent regenerative growth. By the end of this year, we expect GDP growth to exceed 2%.

What is the purpose of this economic policy? First and foremost, it was about offering support to promising sectors and the banking industry to help them weather the crisis. Some support measures are still in place, as is the floating exchange rate and inflation targeting regime. The budget deficit is strictly controlled to ensure a balanced budget system given the relatively low oil prices, which are still extremely important for our country. We are also working to improve the business and investment climate.

Structural imbalances are being corrected. Economic sectors unrelated to oil and gas production are developing well and have gained a competitive edge on the domestic market.

Currently, we have a trade surplus. There are trends towards increasing international reserves. It is quite logical that foreign investors are demonstrating a greater interest in projects in Russia. Over the first six months of this year, the volume of foreign direct investment grew by more than 100%. We will make every effort to reinforce these positive trends going forward.

Dmitry Medvedev: “Like other countries, Russia is looking for ways to adapt to the new economic reality. We have succeeded in improving the health of Russia’s economy by altering its current course and freeing it of its excessive reliance on exporting raw materials. Positive shifts took place last year and have taken place this year. We are seeing decent regenerative growth. By the end of this year, we expect GDP growth to exceed 2%.”

But this is not enough. Like the rest of the world, we understand that the future belongs to the digital economy. We are facing a difficult and unconventional task: on the one hand, we need to encourage international cooperation in the field of information technology, and promote e-commerce and cross-border business; on the other hand, we need to ensure national security and protect information, including personal data; ultimately, we need to establish transparent rules of the game. These tasks are not easy to combine. Like most other Asia-Pacific countries, Russia is ready to engage actively in this work. We have adopted a digital economy programme and a special strategy for developing an information society.

For 20 years, Russia and ASEAN have been linked by a special type of collaboration – a dialogue partnership – and by our shared intent to step up mutually advantageous cooperation. The Russia–ASEAN Dialogue Partnership was launched in July 1996. It primarily focuses on trade and investment, although, frankly, mutual trade figures are still rather modest, especially compared to our trade and economic ties with other countries in the region.

Naturally, there are still things to be done on investment, too. There are plenty of opportunities for this, especially since we have all the necessary tools, including collaboration mechanisms, programme documents, and successful experience of implementing joint bilateral projects. But the key thing is that we see real interest within our countries’ business communities in cooperating in energy, transport, agriculture, satellite navigation, high-tech, and financial services. Opportunities exist in virtually all major industries. This is all the more logical because, today, ASEAN is the world’s sixth largest economy and the third biggest in Asia.

Dmitry Medvedev: “Currently, we have a trade surplus. There are trends towards increasing international reserves. It is quite logical that foreign investors are demonstrating a greater interest in projects in Russia. Over the first six months of this year, the volume of foreign direct investment grew by more than 100%. We will make every effort to reinforce these positive trends going forward.”

Business delegations of Russian entrepreneurs regularly visit Southeast Asia. We hope that you will visit us in return, and we look forward to seeing you in Russia.

Between 2014 and 2017 alone, comprehensive business delegations travelled to Indonesia, Malaysia, Singapore, Vietnam, Cambodia, Brunei Darussalam, Myanmar, and the Philippines.

We are also ready to sign up to ASEAN’s initiatives on developing energy, transport, and information infrastructure. We are placing special emphasis on establishing optimal transit routes, which is very important for business. We are developing our maritime ports and airports in Russia’s Far East; we are building cross-border oil and gas pipelines.

The key purpose of these efforts is, first, to make freight transport by Asia–Europe routes as quick and cost-effective as possible. Second, we intend to establish a major transport and industrial hub in Russia’s Far East to meet the needs of the entire Asia-Pacific region. We are trying to create a special business environment there that measures up to global best practices.

I am pleased to note that business leaders from various Asia-Pacific nations, including ASEAN member countries, China, Japan, South Korea and India, are already making extensive use of these opportunities. Many are coming to Russia, to Russia’s Far East, to see how our development tools are working, and to attend our investment forums. These forums are held in St. Petersburg, Sochi, and Vladivostok and offer an opportunity to identify potential partners. Over 500 joint investment projects have already been launched in the Far East of Russia. Just a short while ago, we held the Eastern Economic Forum in Vladivostok, at which many contracts were signed, worth about USD 50 billion in total. So we are seeing development in that regard.

Dmitry Medvedev: “We are placing special emphasis on establishing optimal transit routes. The key purpose of these efforts is, first, to make freight transport by Asia–Europe routes as quick and cost-effective as possible. Second, we intend to establish a major transport and industrial hub in Russia’s Far East to meet the needs of the entire Asia-Pacific region.”

A large market, clear regulations, and good infrastructure are the basic prerequisites for doing business successfully. This is the environment we are striving to create within the new integration union, the Eurasian Economic Union, established as part of our cooperation with five states. It is important that many Asian and Middle Eastern companies already appreciate this, as well as the good prospects for exports to third countries.

Together with our Eurasian Economic Union partners, we are interested in cooperating as extensively as possible with ASEAN countries on the basis of universal principles and the norms of international trade. A year ago, the first fully-fledged agreement on free trade between the EAEU and an ASEAN state, Vietnam, came into force. Talks on a similar EAEU–China agreement were recently concluded, and discussions are now under way on establishing a multilateral EAEU–ASEAN free trade zone. Similar talks are being held with other individual ASEAN countries.

Friends,

For geopolitical, historical, and economic reasons, Russia is part of the Asia-Pacific region. We have set a strategic course of developing cooperation with all of the region’s countries and active involvement in resolving the region’s problems. This region is of special significance for us.

This year, the Association of Southeast Asian Nations celebrates its fiftieth anniversary. The organization’s history demonstrates convincingly that, despite all our differences, mutually acceptable solutions may be found for the most complicated issues. This experience is of utmost importance for us in today’s world.

I would like to offer you my heartfelt congratulations on this anniversary! I hope that forum participants will enjoy interesting discussions and, once again, I invite you all to the Russian Federation.

Thank you!

Source: http://government.ru/news/30099/ (Russian)

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