The meeting was attended by Prime Minister Mikhail Mishustin, Chief of Staff of the Presidential Executive Office Anton Vaino, First Deputy Prime Minister Andrei Belousov, Presidential Aide Maxim Oreshkin, Minister of Economic Development Maxim Reshetnikov, Minister of Finance Anton Siluanov and Central Bank Governor Elvira Nabiullina.
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President of Russia Vladimir Putin: Colleagues,
Today I would like to revisit the topic that we discussed a week ago at VTB Capital Russia Calling! Investment Forum. I am referring to the current situation in the Russian economy.
I would like to note that recent economic trends have been generally positive. After ten months of this year, as you know, Russia’s gross domestic product grew by 4.6 percent. This is not the fastest growth in the world, you are well aware of this, but it is not the slowest either, and given today’s circumstances, for the Russian economy, this is a good indicator.
Investment added 7.6 percent over three quarters of 2021, which is also good. Please note that this is happening – just as the volume of lending in the economy has not decreased either (Maxim Oreshkin reported all this data to me today) – despite the increase in the Central Bank's key interest rate.
Employment in Russia has reached 72.3 million people, which corresponds to the second half of the pre-COVID year 2019. We still have many unresolved problems, including some new ones we will need to address. Nevertheless, I must note that the Government’s primary task this year – to revive the labour market – has been completed.
As for the coming year, I would like to highlight a number of tasks the Government and the Bank of Russia will need to specifically focus on.
First, rising inflation, which was 8.4 percent as of late November, is the main problem plaguing the economy and consumers. It is imperative to bring inflation back to the benchmark level of 4 percent in 2022.
What do I consider important here? I mentioned that prices are going up all over the world. We are well aware of this. The main reason for this is the extremely soft budgetary policy in a number of developed economies.
With that in mind, we must implement effective mechanisms to counter inflation. Please focus on increasing the supply of goods, primarily food, and services in the domestic market. The Government is taking strong measures; I hope they will be effective like they were in other areas earlier. Among other things, the production and supply of meat, sugar and vegetables should significantly increase in 2022.
Second, it is necessary to increase real disposable individual incomes at a rate that is not lower than the estimated level, that is, not lower than 2.5 percent. I mean real inflation-adjusted incomes.
We have agreed to expand the Government measures to support the people as more financial opportunities become available based on federal budget resources, which look good now and in the long term, for the next year. Today, I expect to hear your proposals on an economic policy that will make it possible to achieve sustainable real growth of wages and entrepreneurial revenue.
With regard to the growth of real wages, we see positive dynamics, but of course, we must monitor this situation very carefully and maintain these dynamics.
Third, as I mentioned at the Russia Calling! forum, our strategic goal regarding the growth of individual incomes, the implementation of national projects and programmes is to ensure long-term sustainable economic growth, or as your colleagues, analysts, say, to increase potential growth rates.
I want the Government to analyse the main factors that hold back the long-term growth of the economy and propose additional measures to speed it up. It is important to maintain high rates of economic growth going forward.
I want to note that this task will have to be addressed amid the challenging circumstances of the pandemic and the spread of a new coronavirus variant, even though some say, it is not as bad as the previous one and some experts even call it a “living vaccination.” But let’s not get ahead of ourselves. In any case, the markets have rebounded, and fears about the new variant have turned out to be premature. Still, we must proceed based on our experience of the previous 18 months. We are aware of the pitfalls, and I think we have a pretty good idea of what they can do to the economy. I look forward to hearing your reports on this matter soon.
Let’s move on to the proposed agenda.