Vladimir Dmitriev: “Above all, top priority line of activity of all development institutions is infrastructure”

TV Channel Russia 24
Live program
19.06.2015, 13:45
Host Alexei Bobrovsky

CORR: Thank very much. I am very happy to introduce our guest, VladimirAlexandrovich Dmitriev – VEB Chairman at the Petersburg International Economic Forum.

Good afternoon Vladimir Alexandrovich

Vladimir DMITRIEV: Good afternoon.

HOST: What sessions are you participating in? I know that one of the sessions you spoke at is called “Russia’s regions, creating and enhancing growth points “. Do you know where these growth points are, do you understand them?

Vladimir DMITRIEV, Vnesheconombank Chairman: Naturally, we understand themand it’s no coincidence that our loan portfolio is comprised of projects that are being implemented in all theregions. There is no doubt that that we attach key importance to the territories and regions that are of top-priority significance in terms of socio-economic development and in the long run,in terms of national security protection in all its aspects: military, food and energy ones.In this sense, the Far East, the North Caucasus, the Kaliningrad region and other regions that are in need of our investments, long-term money are undoubtedly of top priority for us.

HOST: As to the lines of activity, you’ve mentioned food, military and infrastructure sectors…

Vladimir DMITRIEV: These lines of activity include of course infrastructure and providing support for high-technology sectors. As to the Far East, we have to mention Komsomolsk-on-Amur where with our assistance they are implementing a project on the assembly of SukhoiSuperjet 100 aircraft as well as advanced military fighter planes. So, these sectors are of top priority for us.

HOST: In late May,you participated in the third meeting of the Heads of the G20 financial development institutions, it is called the D20 by analogy with the G20. VEB initiated and organized these meetings. Bu we don’t know much about development institutions in other countries. Are these meetings really important, how can we benefit from them?

Vladimir DMITRIEV: It’s no coincidence that it was our initiative to create a constant working platformas part of the G20 to discuss topics of common interests for development institutions and not only national but also international ones. Our initiative was backed. We met for the first time in Moscow three years ago and our third meeting was this year in Istanbul. It confirmed again the need for discussing joint projects as well as the need forfor putting forward concrete initiatives. It’s a good thing that our partners and colleagues from other development banks including countries from countries with developed economies believe that they can expand their investments not only in their own countries and regions surrounding them but also in the countries with developing economies. In this sense,I’d like to mention SACE agency which started to undertake in investment activity and the Italian Development Bank that intends to expands its cooperation beyond the country. It’s of overriding importance for development institutions to synchronize ouractivity in relations with financial regulators because our activity associated with raising financial resources and extending long-term credits is not always in line with the Basel regulations. So we want special regulations special standards to be applicable to us for us to be able to engage in our core activities and invest in the economy.

HOST: This is also a problem for development institutions beyond Russia?

Vladimir DMITRIEV: Absolutely.

HOST: You study their strategy, it is similar to VEB’s strategy, they also invest in infrastructure and all the sectors you’ve mentioned.

Vladimir DMITRIEV: Above all, top priority line of activity of all development institutions is infrastructure.And another top-priority line of our activity is providing support for small and medium-sized enterprises. And here the most important issues deal with social responsibility, sustainable development and with funding green economy. These issues are top of the agenda for international and national development banks and we also place overriding emphasis on them in our policy and our strategy.

HOST: It’s very interesting because in many economic aspects we are moving in opposition to the world’s trend.And as far as development institutions are concerned we outstripped the existing trend if I get it right. I am under impression that in many countries a role of the state as a main investor is on the rise, is this really the case.

Vladimir DMITRIEV: Let’s remember a 15-year old debate in our country when we argued about the need for development institutions and the need for the state’s participation in the economy. There is no doubt that we should develop free competition and form our national economy on the basis of liberal views.We do not argue about these issues any more, now it’s a matter of boosting the state’s participation in our country’s economic development. It goes without saying,that we should not return to a Soviet centrally planned economy.But efficiency of the state’s participation in the economy is very important in formulating government policy. And I think that in this sense a potential of development institutions, the bank for development, our subsidiaries has not been exploited to the full. But it’s important for us to rely not only on private entrepreneurial initiative but also on the state’s participationand above all through development institutions.

HOST: Are you worried about investments in Ukraine? Have you identified long-term major projects for your Bank to fund? Premier Medvedev spoke about it at a meeting of VEB’s Supervisory Board

Vladimir DMITRIEV: We have serious increased risks in Ukraine, given the developing situation there and given the current attitudes towards Russia. Suffice it to say, that yesterday the management of our subsidiary bank in Ukraine got into trouble – the bank and its head office witnessed violence. There were ‘mask shows’ in the best traditions. They turned offices inside out,copied all the information and took in a blatant way a picture of the Russian President’s portrait in the office of the bank’s head. This is a Russian bank and probably it’s of no interest for special services. Of course, it’s very difficult to work under such conditions. In Ukraine, credit repayment rate last year, and banks with Russian participation are no exception here, was 20 percent of the projected one. These are non-payments The situation in the economy is catastrophic.

HOST: And what about investments inside the country – do you have any plans here?

Vladimir DMITRIEV: The Bank’s Supervisory Board showed once again that the state attaches great importance to Vnesheconombank. 300 billion rubles were allocated to Vnesheconombank from the National Wealth Fund for funding investment projects. These are projects in automotive industry, aviation industry, military industrial complex and agriculture. We are to report to our Supervisory Board with regard to each project to be funded from the National Wealth Fund. And our Supervisory Board is to make an individual decision on each project

HOST: Thank you very much Vladimir Alexandrovich for finding the time to come to our studio. Thank you.

Vladimir DMITRIEV: Thank you.