Transcript of Mr Kudrin's speech:

Dear Mr Cable, ladies and gentlemen,

I am happy to see such a high-ranking British delegation here in Moscow.

The limited attendance meeting held by the secretary and myself was our first, and it was highly productive.

We are happy to see that Russian-British relations have been improving lately, and political contacts have intensified at various levels. Russian President Dmitry Medvedev and British Prime Minister David Cameron confirmed the two governments' policy to develop broad constructive cooperation at their meeting in Seoul during the G-20 summit.

I attended that meeting and would like to highlight the positive atmosphere and the two leaders' eagerness to find more opportunities to improve relations. We hope that your current visit will reaffirm this determination.

Russian-British trade and investment contacts form the groundwork for bilateral relations as a whole. I am happy to note that these contacts have weathered the changing political situation and the unfavourable trends in the global economy and global finance. Great Britain has remained an important trade and economic partner and one of Russia's key foreign investors. In January-September 2010, bilateral trade totalled $11.2bn, up 22.4% year on year. Accumulated British investment amounted to $19.4bn as of the end of June 2010, while accumulated Russian investment in Britain was $2.8bn.

We appreciate the increase in British projects in Russia, which are not traditionally limited to mineral resources, such as oil and gas projects in Sakhalin and Irkutsk, and gold mining projects. There are other projects, too – the upgrade of the Tula ice-cream plant by Unilever Russia, the expansion of the Marks & Spencer retail chain to Russian regions, and the development of a solar power station in Kislovodsk.

Today we will discuss a range of Russian-British economic cooperation issues, including key aspects of trade and investment as well as specific results attained on six main cooperation programmes that were mapped out at the 7th meeting of the ISC. These include financial services, the business environment, small and medium-sized businesses, power generation and energy efficiency, high technology (including nanotechnology) and the use of the "Olympic heritage." We expect Russian and British participants to share their opinions on ways to increase cooperation under these programmes and to draft a plan for the Committee's work next year.

Our two countries are making energetic efforts to overcome the economic downturn. We in Russia are closely following your experience and the steps your government is taking. We think highly of the programme the British government has announced until 2015. This conservative programme incorporates the best traditions of supporting the economy and businesses. We have much to learn from your experience and know where to apply it.

EU countries pool their efforts to resolve difficult problems, such as the debt crisis now being widely discussed with regard to Ireland. They would like to curb this crisis, and so would Russia: we certainly want the European Union's financial zone to remain stable, because the EU is our key partner. Stability and growth in that region is bound to promote stability and growth in Russia and the CIS.

I am happy to add that the Standard & Poor's rating service has upgraded the UK's credit ratings to "stable" after the British government announced its spending review. We can see that the concerns about the British government's ability to fulfill its budget plans were misguided. This is good news; I hope you can keep it up.

Russia's economy has also started to grow. We know that not all of the growth factors are in place yet, and we need to do more to ensure growth. In particular, the government must make consistent efforts. The Russian parliament has approved a three-year budget this week, aimed at bringing the budget deficit down to 2.9% by 2013. It also incorporates policies to fulfill the G-20's requirement that all countries halve their deficit from the "crisis year."

We expect to meet this deadline. At the same time – I have already shared my estimates with the secretary – 2.9% deficit is sufficiently high for Russia when oil price stands at $78-$80 per barrel. We should also be ready for lower oil prices and try to bring the budget deficit down even more. If oil prices remains at the current level, we must try to balance the budget by 2015. This is a difficult task, which will require an emphasis on consolidation.

This year, we expect 4% growth; we will also try to keep annual growth at the same level for the next three years, which will be still a difficult time for the global economy.

We would like to use this opportunity to reiterate the proposal to set up an International Financial Centre in Moscow, as several important representatives of international finance have accompanied Mr Cable to Moscow. We count on a trust-based and productive dialogue with the representatives of the international business community, which would also take into account the recent discussions during Lord Mayor of the City of London's visit to Moscow and Russian IFC project coordinator Alexander Voloshin's visit to London.

Innovation projects are an important part of our cooperation. British officials have confirmed their interest in Russia's Skolkovo high-tech project at the Medvedev-Cameron summit. The British prime minister said several British companies wish to participate in the project. The innovation hub in Skolkovo is one of Russia's priority projects. We will discuss specific projects the British companies could join.

I suggest we ask our experts to draw up a joint declaration on cooperation in innovation (a declaration of modernisation), which we will consider as a supplement to the Joint Statement we release today. This declaration should list the specific areas for interaction.

I would like to add that our cooperation is expanding in this sphere. At the end of this meeting we plan to sign three important documents. Britain's GlaxoSmithKline and Russia's Binnopharm (AFK Sistema) will sign an agreement to supply bulk vaccines and provide technology and expertise to enable Binnopharm to manufacture vaccines in Zelenograd in line with our National Immunization Calendar. The two companies also plan to set up a joint research centre. GlaxoSmithKline will also sign two protocols of intent with the governments of the Vologda and Tomsk regions on a strategic partnership in healthcare.

The cooperation between Russian and British businesses is as productive as ever. Last year, the Chamber of Commerce and Industry and the Russian-British Chamber of Commerce sponsored a series of forums in Moscow and London. I believe the representatives of Russia's Union of Industrialists and Entrepreneurs and the Chamber of Commerce and Industry can tell us more about these cooperation projects at our next ISC meeting.

Between the two ISC sessions, Russia's Economic Development Ministry, together with British partners, prepared a Memorandum of Understanding on small and medium-sized businesses. The memorandum will be signed today and will be used as the basis for an action plan.

I must also mention a very important cooperation programme often referred to as the "Olympic heritage." It was discussed at a meeting of ISC deputy chairs in July in Kazan, where Russian representatives showed their British partners the facilities built for the World Summer Student Games-2013 in Kazan. The sides also discussed potential respective visits by business leaders to Kazan and London. I believe these plans should be implemented. I am confident that such visits will produce more mutually beneficial contracts.

I conclusion, I would like, once again, to wish that all participants a very productive and rewarding day. I hope this meeting will help us find common ground on many issues of mutual interest on the international agenda, and to share information on structural reforms underway in each of our countries, as well as to determine further guidelines for the committee's work. Thank you very much.