Video and Full Text of Putin’s Annual News Conference

Video and Full Text of Putin’s Annual News Conference



[link to www.youtube.com (secure)]

President of Russia Vladimir Putin: Good afternoon, colleagues, friends. Let’s begin.

We have agreed with my assistant here that I will not make any lengthy opening remarks, so let us get down to business, to your questions. Go ahead, please.

Presidential Press Secretary Dmitry Peskov: Following a tradition we have, I propose that we give the first question to one of the most experienced members of the Kremlin’s press pool, who, I think, has been working in it since the end of last century. Valery Sanfirov, Mayak radio station, your question, please.

Valery Sanfirov: Mayak radio station, Vesti FM, Radio Rossii.

Mr President, the year is coming to an end, so it is time to take a look at the state of the Russian economy. At meetings on economic and other matters held throughout this year you have often used such terms as ‘turbulence,’ ‘hitting the bottom’ or ‘reaching yet another low’. I can even quote a joke you shared with us at last year’s news conference, saying that 2015 was not as bad as it could have been. How could you describe the current state of the Russian economy? Thank you.

Vladimir Putin: This is a traditional question and a natural thing to ask. Of course, we are analysing our performance over the past year. As usual, this performance needs to be put into perspective. We need to look at the macroeconomic indicators of 2015 and compare them with what we have achieved in 2016.

As you can probably guess, I have the latest figures that we reviewed yesterday with colleagues and a number of experts.

Last year, Russia’s GDP, which is the key indicator, dropped 3.7 percent. This year GDP also declined, but we are not talking about a contraction of this magnitude any more. Initially we believed that the GDP would fall by about 1 percent, but this figure was later adjusted to 0.7 percent and then again to 0.6 percent. In November, national GDP inched up. Overall for the year we are expecting a decrease in GDP in the range of 0.5 percent – 0.6 percent.

GDP increased thanks to growth in industries of the real economy, such as machine building, truck manufacturing, heavy machine building, manufacturing of road-building equipment, transport machine building, the chemical industry, light industry, processing and, of course, agriculture. Growth in agriculture was substantial – 2.4 percent last year. We expected 3.2 percent growth this year but the current figure is 4.1 percent and the yearend figure will be at least 4 percent. I think this is a very good trend and we must try to maintain it.

There is also the inflation rate. You remember that it was rather high last year, even for our economic system. One of the reasons was the import replacement programme in agriculture and the ensuing market disproportions. We could not substitute everything we had imported. But agriculture has demonstrated very good dynamics, and the inflation rate will be different this year. I would like to remind you that the previous lowest inflation rate – 6.1 percent – was reported in 2011. It will be below 6 percent this year. We had thought it would be around 5.7 or 5.8 percent, but it will be most likely around 5.5 percent. That is a record low inflation rate and a reason to believe that we will soon be able to reach the target inflation rate of 5 percent and subsequently 4 percent.

I believe that our budget deficit was 2.6 percent [of GDP] last year. It will be slightly larger this year – I will explain why later. The figure for the first 10 months is 2.4 percent, but the yearend figure will be 3.7 percent. I believe that it is an acceptable figure, in part because we have a foreign trade surplus of over $70 billion. We have maintained our reserves.

It is true that the Government’s Reserve Fund has decreased a little bit, but the National Welfare Fund is almost intact. The Government’s reserves are estimated at some $100 billion, while the Central Bank’s foreign reserves have increased. They amounted to $368 billion at the beginning of the year, if memory serves, and by now they have grown close to $400 billion, or more precisely more than $385 billion. In other words, we are doing well in this respect, too, and this is a solid safety net.

Read more
[link to twitter.com (secure)]