Question: We know that Russia’s relations with Latin America are on the ascendant and we are happy that they have reached a peak. Do you consider them to be strategic or are they governed by pragmatic and transient considerations, as well as the competition over the region between the United States and Russia?
Dmitry Medvedev: Our relations with the countries of Latin America and the Caribbean are not governed by transient considerations and have nothing to do with other nations, be it the United States or any other country. We believe that we have a number of friendly nations here and we are developing full-scale cooperation with them. It is a booming region with excellent economic opportunities yet with its own challenges that we could tackle together. That’s why this an area of our strategic interest, and we have our presence here and a wide array of relations – both diplomatic and economic – with the countries of the region.
Yes, Russia experienced different periods in the past. If we compare today and the 1990s, our relations with Latin America used to be much more inert. That was caused by our domestic issues: we were barely able to sustain our own development. We have to admit honestly that relations with other nations demand an economic potential, they demand political will and commitment. But those times are long gone. New times have arrived, our contacts are wide-ranging, and this is especially true of Cuba, which is dear to the heart of every Russian. A number of other nations have fairly advanced relations with our country. Let us face it: we enjoy full-scale developed relations with practically all the states in the region, which, by the way, was not the case in the Soviet times.
I have just come from Brazil. Brazil is a large nation, the largest country in the region, it is in fact the world’s fifth biggest economy and a member of BRICS, and our relations with it are very diverse. This is also true of Argentina, Chile, Venezuela, Ecuador and many other countries with which we have highly advanced relations. That’s why we are determined to stay here and we want our relations with all countries and regions to flourish.
Question: What do you think of the present-day Russian-Cuban relations and the prospects for closer ties? And could you please tell us more about your meeting with our leader?
Dmitry Medvedev: I am very optimistic about our relations, and there are ample reasons for optimism. My current visit to Cuba reflects all aspects of our long-established friendly relations.
In recent years we have successfully revived our contacts and returned to the high level of Cuba’s cooperation with the Soviet Union and later Russia.
Yesterday we held comprehensive talks on every aspect of our cooperation: economic, cultural and political. There are no problems that could have a negative impact on our relations. On the contrary, we are making progress in every field. We witnessed yesterday the signing of ten essential agreements, each containing political decisions and economic opportunities. I had friendly and outspoken talks with President of the Council of Ministers and Council of State Raul Castro Ruz. That was our second meeting in the last twelve months as our Cuban colleague has recently visited Russia and now I am paying a return visit to Cuba.
Raul Castro and I signed a memorandum on strategic Russian-Cuban relations in 2009, and our relations are developing in line with that document with it. There are many traditional and new spheres of our cooperation. I will not talk much about our energy projects because only a part of them have been implemented. I have great faith in our high technology projects in medicine, space exploration and industry. We have made good progress on them and naturally expect that we will continue moving forward. Regrettably, trade between Russia and Cuba is not as high as it should be – just over $200 million, which is not enough. There are good investment plans, and investment is developing despite its small volume. I am sure it will grow and our cooperation will expand to many new areas.
Interpersonal contacts have also been revived. Cuba received 90,000 Russian tourists last year despite a great distance separating the two countries – a trip to Cuba isn’t like one to the Crimea or another place not far from Russia. This means that vacationers are making a conscientious choice for Cuba. They like it and feel comfortable here, and enjoy their holidays.
Our relations with Cuba rest on a formidable basis that had been laid previously. I think it is essential not to squander our past achievements but to build them up.
After my meeting with Raul Castro I had an informal nighttime talk with Comandante Fidel Castro. I met with him first in 2008. I certainly enjoyed this second meeting. It was interesting to talk to Fidel and hear his views on current events. He keeps abreast with the international situation. We discussed a wide range of questions, including Cuba’s economic development and international issues. Our talk concerned even such unexpected topics as the meteorite exploding over Russia and shale gas problems. I think such conversations show that our relations don’t just have deep historical roots but also a fine future because the Cuban leaders pay great attention to relations with Russia. The situation in Cuba also arouses my deep interest.
Question: President Barack Obama has been elected for a second term. What are the development prospects for Russian-US relations in the context of US interference in Russia’s internal affairs and the Americans’ ambiguous response to practical disarmament and their position on human rights? What, do you think, can Russia do to normalise these relations in the light of the United States’ unfriendly moves?
Dmitry Medvedev: Indeed, a great deal depends on Russian-US relations if only because we are the world’s largest nuclear powers. There have been ups and downs in our relations. On the whole, they developed reasonably well in the preceding years: we drew up and signed landmark documents, including the Strategic Arms Reduction Treaty and a number of trade agreements. Our American colleagues supported Russia’s WTO accession. These were all positive strides. I feel optimistic about contacts with the US Administration and I am sure President Vladimir Putin can say the same.
However, there are matters on which our opinions differ strongly. One of them is armament, including the so-called anti-missile defence. We have made many attempts to explain to the United States that we regard the European anti-missile defence system, the way it has been proposed, as essentially spearheaded against Russia and its nuclear potential, which is a pillar of global nuclear parity. However, both the United States and NATO have turned a deaf ear to our arguments. They try to reassure us that the system has nothing to do with Russia, it is directed against other states. Regrettably, we don’t find these reassurances convincing. We have presented all our arguments but the situation has not changed. Unfortunately, time for reaching an understanding is running out.
Even during my Presidency, I said that our deadline for a relevant decision was at the end of this decade or even a bit earlier. If we fail to reach an understanding by then, the consequences for international relations could be very unfortunate because we will have to take response actions. Any Russian Government and leader will have to make a due response because this affects our strategic interests.
There are other complications, too. It may appear that our trade and economic relations have improved since our WTO accession and the abolition of various well-known discriminatory legal amendments. The Americans like adopting such amendments, and some of them concerned my country. Then, there is the economic embargo against Cuba. I say outright that we have not changed our position on this issue. We think it is outrageous and outdated, and the sooner it is lifted the more everyone will gain – the Americans even more than the Cubans.
Unfortunately, as soon as the Jackson-Vanik amendment was abolished, a blatant anti-Russian document – the Magnitsky Act – was adopted. I have analysed it repeatedly. I think it gives a political dimension to lamentable fate of a Russian national. I am not even saying that the US Administration was involved in this as well as the American legislators. We had to respond. I spoke about it during my Presidency, and President Putin has also warned the Americans about it. Now, we have had to retaliate with a law on the accountability of persons encroaching on human rights and Russian citizens’ interests, and some other measures. It’s a bad road we are following, and the fewer such instances there are the more Russian-US relations and international relations as a whole will gain.
Question: The economic downturn has affected many countries. What is its impact on Russia and its socioeconomic development plans? Do you intend to cut housing programmes, orphan support and other social initiatives? Or do you have practical plans on ways to meet the challenge and preserve social benefits at their current level?
Dmitry Medvedev: Every crisis is a challenge that brings about many problems. However, a crisis can also be an impetus because it drives the Governments to work harder. This wholly applies to Russia. No one likes a downturn. Russia saw plummeting production during the crisis of 2008-2009, and the gross domestic product fell sharply. We had to combat the crisis, including by freezing certain projects. However, we preserved all our social programmes and did not cut wages. On the contrary, we increased them and are adjusting them to inflation as before. Nevertheless, these were hard things to achieve.
Now the Russian economy is in a fairly good state compared to the global situation: our economic growth last year was at 3.6% of GDP, exceeding the global average. Inflation is relatively low by Russian standards though it is worse than in the long-established strong economies. However, it is good in the Russian context, and we must not allow it to gain pace. Russia has the lowest unemployment of all developed economies. We have regained the level of 15 years ago. In this sense, the crisis has not affected the employment market. This is a critical factor because unemployment grew in 2008-2009. Now, we have improved things thanks to our social programmes.
Our domestic and foreign debt is very small compared to GDP. This is among the most important indices, considering the huge sovereign debts of the majority of European economies, to say nothing of the United States. The debt burden hampers their decision-making. Russia’s situation, on the contrary, is quite good in this respect. There are no obstacles to our development though the Russian economy faces many challenges we haven’t yet responded to.
First, our economy strongly depends on raw materials’ prices and we must diversify it. Meanwhile, almost half of our national revenues come from oil and gas exports. However, Russia has a tremendous potential in science and technology and excellent conditions for a high-tech economy – what we call smart economy. That’s why we should do everything to enhance the role of high-tech industries vs. raw material industries. This also concerns raw material processing, which can also be based on high technology. As for the exports of oil and gas, they are no longer as lucrative as before. So this is a big problem.
There is another challenge we face – improving the living standards. Though we have achieved a great deal since 1991, we still have problems in this area. The incomes of public sector employees are below the current level of Russia’s development. That is why we have made decisions on this matter, and the President issued relevant executive orders followed by Government decisions on raising the salaries of doctors, teachers and university professors. We are streamlining the outdated pattern of their remuneration.
Public sector employees face another problem: housing. We build a lot of housing, about 70 million square metres a year, but that is not enough; we need to build over 100 million square metres a year to address this issue. What we need is affordable housing. That’s what we must achieve in the years to come, and I am confident that we will succeed.
Question: There are forecasts of Russia’s future as one of the leading world economies. It has every prerequisite for that. How, do you think, can Russia attain this goal, considering its problems with economic competition and efficiency and the need to diversify the economy? How can Russia get into the global economic forefront and what do you plan to do to achieve it? Do you intend to develop science, including biotechnology and space exploration?
Dmitry Medvedev: I have already answered this question in part. One of our top priorities is to make the transition to a new economy while retaining its traditional potential, including the export and processing of raw materials, as I mentioned. To do this, we need new production facilities and well-paid high-tech jobs.
You mentioned a number of programmes we are implementing. We are allocating major funding from the budget plus extra-budgetary resources. We have excellent opportunities for cooperation with Cuba in the industries you have just referred to – nanotechnology and biotechnology, including biomedicine, considering Cuba’s achievements in these fields.
We are ready to cooperate in these areas, to provide financial backing and research facilities, and to pool our creative efforts. We have experience with many pharmaceuticals, and we are co-producing several highly effective new drugs. As for the cost of these industries’ development, it demands considerable funds. The total cost of nanotechnology projects approaches $20 billion. Nanotechnology has already become a vital part of the Russian economy. It is present in every sphere of Russian life from space exploration to products used in everyday life such as flooring and other commodities that improve the quality of our life.
Russia is a unique country where the space effort is concerned. We were the first to reach space, and we believe that our space achievements give us our competitive edge. However, space exploration requires continuous investment. If we make do with contented reminiscences of the first sputnik and Gagarin’s flight, we will soon fall behind.
Space exploration today implies not only research but also commercial services. The Programme Of Space Exploration to 2020, which we have recently adopted, will cost around $60 billion. We also want to take part in satellite launches and other international programmes. We will build up our satellite group in that period. Russia offers services to other countries and wants to increase its participation in the world space effort from 10% to 15%. In other words, Russia doesn't want to remain a leader in space researcher; we want to be active in the space services market. We have posed this goal because, I reiterate, today’s space effort implies not only research but also business, whether we like it or not. That is why I think that we have every chance for all-round diversification of our economy, which will help us take a deserved position in the global division of labour – a place Russia was destined to occupy from the start.
Question: What part does Russia intend to play in the future world economy?
Dmitry Medvedev: It will be a very active part because someone else will play it if we don’t – and I am not sure it will be played well enough. The modern world is such that the international model of economic and other cooperation must be polycentric, as you have rightly said. No nation, regardless of its economic power, can aspire to lead the world or the global economy even if it emits hard currency and the reserve currency, be it the US dollar or some other currency. The world is very diverse, and the 2008 downturn showed that every economy is vulnerable, even the United States and the European Union, to say nothing of other economies. That is why our decisions should be well considered and coordinated.
Let us consider the recent world order, with the Bretton Woods system of monetary management. It was lucrative for a number of economies at some time. It was even progressive. Now, things are quite different: other countries are anxious to take part in key decision-making in the global finance. We did not have this opportunity – I mean the new rapidly developing economies. The BRICS countries, for instance, account for a quarter of global GDP. Nevertheless, we did not play any notable part in the IMF’s and World Bank’s decision-making. The situation changed due to the concerted efforts of Russia, China, India, Brazil, South Africa and other countries with which we cooperated in this field. Now, the arrangement has shifted towards nations previously not represented in transnational financial decision-making.
However, if you ask me whether the present financial world order is just, I will say no, it isn’t. It demands further system-wide efforts by all countries, not only the G8 and the G20 – all countries in the world because when a country cannot make itself heard, its citizens’ interests are not protected. In this sense, we are ready to cooperate with our Cuban friends and our partners in Latin America and other parts of the world to update the financial order and make it more just. This is a formidable challenge but I think we can meet it together. Our economies recovered from the 2008 crisis through joint efforts. So we will work on and feel confident in our success.
I would like to wish joy to all people of friendly Cuba – the Freedom Island and a beautiful place. Russians like Cuba very much, as I said before. I also wish you every success with your national development and economic reforms. We will work together for the best possible results.
Correspondent: On behalf of all Cuba I wish you every success in your work and happiness in your life. I assure you that Cubans love the Russian people.
Dmitry Medvedev: Thank you very much, we appreciate it.