Mikhail Mishustin’s remarks:
Good afternoon, ladies and gentlemen,
At the special session of the 17th Annual Meeting of the Valdai International Discussion Club. With Chairman of the Board of the Foundation for the Development and Support of the Valdai Discussion Club Andrei Bystritsky
I am happy to welcome participants and guests to this annual session of the Valdai Club. This forum has long-standing traditions and a history, but this is the first time it has such complicated issues on the agenda. We are talking about the global problems that the whole world and, of course, Russia have faced this year.
The coronavirus has reminded us how destructive infectious diseases can be. It has compelled humanity to face an unpredictable and very serious threat. This new and dangerous disease has already taken a toll of over one million lives. It has upset and forced the cancellation of plans for people and has seriously affected many industries. It has put the economies of even the strongest and most influential states into the most difficult conditions.
Most countries have taken urgent and tough measures to protect their citizens and have revised their approaches to foreign and domestic policy to adapt to a new, coronavirus reality and to reduce losses, especially human losses, to a minimum.
We have managed to learn the lessons of this difficult situation and, of course, received priceless experience for today. We are countering the coronavirus with consistency – without fits and starts. The Government understands what needs to be done in the economy, in healthcare and in other key areas. We have many opportunities to be proactive.
We are proud that the first coronavirus vaccine in the world is from Russia. Moreover, we are planning to get other vaccines to the market. This shows that Russian science has great potential. Over a short period of time, a competitive product both for the domestic and international markets has been created. But it is more important that it gives us confidence that we can defeat this virus and protect people.
As you know, today there is no lack of personal protective equipment or test systems. Over 51 million tests have been carried out. We continue this to detect the virus as soon as possible and help those infected, now that Russian doctors understand how to treat the illness. Our healthcare system has the capacity to counter the spread of the coronavirus.
The example of other countries where events have taken a tragic turn shows that we have to act quickly and decisively. We had to work proactively because delays would literally have been fatal. First, we audited our healthcare system, including beds at inpatient facilities and the available medical equipment in the regions. We then assessed the possibility to quickly deploy mobile hospitals using our military and rescue services. We learned from others’ mistakes and considered others’ successful experience, but we mainly wanted to find our own way, the best way to protect our people and support the economy. We have prevented the shock and collapse we were concerned about.
In line with the President’s instructions, the Government adopted a number of immediate measures. We were among the first to close our borders to protect people. Emergency centres in the regions and the Coordination Centre to control the incidence of the coronavirus infection worked almost around the clock. The operation of emergency services, inpatient facilities and the primary care was repurposed and a system of incentive payments for medical staff and, of course, our doctors who treated patients with coronavirus, was introduced. We have allocated over 142 billion roubles for this. The regions have received help in deploying new beds and purchasing equipment and medicines. These measures have helped stabilise the situation.
The state repeatedly allocated funds to help people from the most vulnerable social groups, primarily families with children, the older generation and the disabled. We had to take care of them. At the same time, we updated the most important social support tools, made them more accessible and more transparent, and eliminated bureaucratic hurdles. We moved as many services as possible online, including public services, which was very convenient for people. This way mothers with many children, retirees and everyone who receives assistance from the state did not have to run around to agency offices to collect certificates and stand in queues.
We significantly modernised the social safety net, having made it more convenient and understandable for people, so they could receive the available social services in a targeted manner, without applications, but online and proactively. This was a very important step in the creation of the so-called social treasury, but this was not the only result of these months of hard work.
Following the President’s instructions, large-scale measures were taken to support those economic sectors that were hit especially hard by the coronavirus, and the sustainable operation of key, systemically important enterprises was ensured. Businesses received incentives to retain staff, and those who lost their jobs received increased benefits. We allocated about 23 billion roubles for this.
Contrary to negative predictions, we went through this difficult period better than many. The government supported small and medium-sized businesses, companies from the most affected industries. These measures were substantial – primarily in terms of the amount of funds allocated.
We understood very well that it was necessary to minimise the costs for small and medium-sized businesses and individual entrepreneurs. We introduced deferrals for mandatory payments and a two-time reduction in social security contributions for workers earning more than the minimum wage. Indeed, unlike large companies, SMEs have no reserves for employees' wages in the conditions of restrictions and forced downtime. It was very important to help these entrepreneurs get through the most difficult times.
Therefore, we decided to issue interest-free loans for paying out wages. In addition, we launched a loan programme for the resumption of activities with a complete write-off of the principal debt, provided that a company retained the majority of its employees. And these measures applied not only to small and medium companies, but also to large businesses in affected industries and industries requiring support, including those focused on the consumer market.
In working to protect the economy and the people from COVID-19, we did not forget about the strategic matters that would allow us to continue developing the country even in the most difficult days. We must put this on a new qualitative foundation, pursue new opportunities in the labour market and education, fast and quality housing construction, export orientation, investment growth and active import substitution, and the large-scale introduction of the most advanced technology, including digitalisation.
These moves will allow us to accelerate decision-making, put the economy back on track of sustained long-term development, and make it durable enough to resist potential shocks in the future.
These actions have become part of the national plan of action that many of you are aware of. The most important areas of socioeconomic transformation will be developed through modern flexible management methods. There are about 30 of these. The most important ones are aimed at increasing real income and developing small and medium business. There is also a package of measures to help self-employed and individual entrepreneurs and further develop the labour market.
Timeframes, responsible executives and funding have been determined for every measure. Over two years, funding for the plan will total about 6.5 trillion roubles, although the overall amount of government support is much higher.
Some measures are not financial like the decisions to simplify administrative procedures and to cancel or postpone the introduction of regulations. They are creating a good foundation for streamlining regulation in many sectors.
The plan also contains steps designed to launch a new investment cycle. One of these measures was taken quite recently. This is a new mechanism for protecting and encouraging investment. These are special agreements that will guarantee businesses stable terms for conducting their affairs, tax cuts and other preferences when large and long-term projects are carried out in this country. Thus, it provides for subsidies on the construction, upgrading and reconstruction of the infrastructure and the paying of interest on loans and coupon profits on bonded loans attracted for investment purposes. This will allow us to support large projects in diverse areas – from healthcare to manufacturing.
Now, regarding Russia’s strategy: it is based on national goals outlined by the President. This includes preserving the population; people’s health and well-being; creating conditions for everyone to be able to achieve self-fulfillment and develop their talents; shaping a comfortable and safe environment for people; decent and effective jobs; successful entrepreneurship; and, of course, digital transformation. Digital transformation is, generally, a basic condition for any country to make a breakthrough in development.
Of course, creating a strategy did not start from scratch. The national projects were approved two years ago and have provided certain guidelines for moving forward. However, they covered a relatively short period of time and, of course, could not factor in serious risks like the coronavirus outbreak. Not all projects are making progress like we planned a couple of years ago. Many things have to be revisited.
It was important to develop in detail and finalise a consolidated plan to achieve our national goals. This also requires a serious review of the tools that were used earlier.
The world has changed considerably over the two years that have passed since the national projects first began. These changes are far from complete. There are no answers to many questions as yet: for instance, whether or not protectionist sentiments are on the rise globally, and how can they affect world trade.
Many countries and companies are updating their long-term plans. We have a clear understanding of the fact that Russia also needs to update its strategy.
We decided to focus on the results that help improve people’s lives. Of course, in so doing, we need to ensure continuity in our goals and objectives, in particular, those that the President set two years ago. An approach like this requires a new governance system and modern flexible methods and, primarily, it needs to ensure feedback from people.
Today, work on a consolidated plan is nearing completion. It is no exaggeration to say that we are engaged in lively debate and discussion every day, including with Russian State Council working groups, as well as deputies and senators. After the discussions we plan to submit the consolidated plan to the Council for Strategic Development and National Projects for consideration.
A new format of relations between the government and citizens is expected to play a key role in achieving national goals. We are not just talking about the introduction of information technology and modern tools everywhere but rather about the crosscutting transformation of whole industries. This will create a new level of cooperation between people, businesses and the government.
The coronavirus outbreak has shown how much we need this. We had to test our solutions under, as the saying goes, battle conditions. Businesses, government-funded companies, schools and universities had to convert to distance-working and distance-learning modes. The service sector has also adapted to new conditions.
The Government has converted the documentation on sick leave and other benefits into the e-format. Employment services have started to assist those who lost their jobs remotely. Importantly, they have been relieved of visiting public places to stay healthy and save time and energy.
It is important to continue creating an integrated digital environment and an eco-system where all services designed for cooperation between the state and businesses are created for the convenience of the people. This system must be understandable and simple. The main emphasis must be based on a proactive attitude where the recipients of services do not address the state, where government officials inform them about the services they can receive and the benefits they are entitled to, like it was with the second presidential payment benefit for children up to 16 years. These payments were transferred automatically in a matter of hours and without any applications.
We have an enormous number of support measures and people often do not know what assistance they can receive from the state. Thus, young people do not always apply for the childbirth benefit. The state must, of course, keep them informed.
The coronavirus situation has shown the importance of digitalising other industries, such as healthcare. The information systems at medical institutions will be linked to each other. This will help patients avoid the constant search for their paper medical records. Medical information that may save human lives will be stored in one place.
The transfer of schoolchildren to remote education was also a challenge not only for them but also for their parents and teachers. Now it is important to focus on both the introduction of digital programmes in education and on the quality of online education. Needless to say, remote education will never replace traditional communication between students and teachers. But we must have our own programmes and developments, applications for online learning.
An integrated digital platform will also be developed for science and technology. This will make it possible to conduct joint research remotely. This is an excellent platform for collaboration. Scientists will receive a digital system that will give them complete access to digitalised information and the data bases of research organisations.
Online broadcasts of theatre plays, excursions to major exhibitions, lectures and films have become more in demand than ever before as restrictions have been introduced and people were compelled to stay home. The work to make culture more accessible in a digital format will continue.
We are removing digital inequality inside the country to effectively resolve all these tasks. Hospitals, outpatient clinics, schools and universities continue to be switched on to the internet. Almost 40,000 socially important facilities will have internet access by the end of the year. The work on advanced 5G networks continues.
Our goal is to create technology that changes the future. This will determine our country’s place in the so-called fourth industrial revolution.
What is needed for this?
First, a favourable environment for IT companies, for the leaders that create this technology. With this aim in view the government has taken a number of measures on the industry’s priority development, under the President’s instruction. Starting next year, the profit tax for IT companies in Russia will be reduced to 3 percent while insurance premium rates will be reduced to 7.6 percent. These benefits will be granted to businesses that receive 90 percent of their profits from the sales of software and services on software development and introduction, as well as to Russian electronics producers. This will make Russia one of the world’s most attractive jurisdictions for IT development.
There are also other support measures, including financial measures. Starting this year, over 40 billion roubles have been earmarked for grants to such companies. Competitions have already been launched to support projects by small companies that develop products, services and platforms based on IT technology.
We will support those who develop artificial intelligence under the relevant federal project. Today, this is one of the most promising areas in the world.
To develop all this we need qualified personnel, people who can create new technology, who know how to work with it and promote it in the market. Within four years, we will increase the admission of IT students to universities to 120,000 per year.
One more important condition is freedom for IT related creativity. Without this, innovations will just collect dust in offices. We need a modern and flexible legal foundation. We need understandable rules that will encourage the development of IT technology and competition in this area.
The law on experimental legal regimes, the so-called digital sandboxes, will enter into force next year. It will allow innovators to test in practice their developments in such areas as transport, finance and other areas. These experiments will be used to develop fair regulations.
The government’s actions are aimed at reaching a main goal – improving the quality of life for each person through economic growth and the social sphere development. This is the goal the President has set for us.
Of course, the COVID-19 situation has forced adjustments. Today, it is clear that the infection will not retreat quickly. It is necessary to be as vigilant as possible. Some time will pass before herd immunity to the new disease is developed. The struggle continues and requires a maximum concentration of energy and an intensive cooperative effort. We know what to do and how to react to new challenges and we will do all we can to protect the people.
Despite the objective difficulties, we will continue pursuing our goals. We want the results of our work to be seen by students, doctors, pensioners, teachers and entrepreneurs – every citizen of our country that we are working for.
The coronavirus has taught us very serious lessons and put an end to the illusions of those who considered themselves invulnerable. The infection does not distinguish countries or continents. It attacks strong and weak, rich and poor and does not classify people by ethnic origin, political view or conviction.
The events of this year have shown again that a common threat can only be countered by a concerted effort. Our world is very fragile and to preserve its balance and the wellbeing, health and lives of billions of people we need to unite the efforts of all humankind, the accumulated knowledge and best practices of all states.
During these months we have seen more than once that it is difficult to give up stereotypes when domestic political interests or prejudices prevented states from developing full humanitarian ties. This suggests only one conclusion – we need to identify what unites us.
The new vaccine that we have developed may become such a uniting international factor in countering the coronavirus. We are ready to help and share any experience we have gained during this time. We are always open to dialogue despite political, cultural or any other differences. This is our principled approach.
Today, each of us can contribute to this work as doctors that are treating patients do, scientists that are creating new medications in their laboratories, or teachers that are helping children understand the world. This hall has brought together those who create public opinion that is heeded throughout the world.
Needless to say, journalists and political scientists are also contributing and can contribute even more through objective assessment of events.
If we manage to overcome our differences, we will take a step forward to the life that we want for ourselves and our children – without any restrictions or enmity. I am sure we can do this.