Transcript of news conference:

Vladimir Putin: Ladies and gentlemen, today the Finnish prime minister and I held talks, and we were able to objectively and professionally consider the major issues of Russian-Finnish cooperation.

We continue to work on enhancing cooperation in trade, the economy and investment, strengthening research and cultural ties. It is possible to say even now that this year Russia and Finland have managed to reverse the negative trends caused by the global economic crisis. Over the first nine months of this year our trade grew by 23% and Russia remains Finland’s largest trade and economic partner. The Russian economy has received a solid amount of direct Finnish investment and major joint projects in infrastructure and innovation continue to be carried out.  Finnish companies have invested billions of euros in power generation. One of the clearest examples of our cooperation is the opening of the Helsinki-St Petersburg high-speed rail link, and we will open it the day after tomorrow, that is on December 12. I believe that such modern and comfortable lines actually unite our continent, and bring Russia and Finland closer together. Interaction and cooperation in real sectors of the economy, in ship-building for example, are growing deeper.

I would like to point out that United Shipbuilding Corporation and STX Finland have established a joint venture. We just witnessed the signing of the documents for this. This enterprise will control the assets of the Helsinki shipyard. We expect that this will lead to an increased capacity for the shipyard while Russian participants in the project will gain access to advanced technologies and will considerably improve their personnel and production potential.

We are continuing our efforts in energy efficiency and energy conservation.

Finnish investors are our strategic investors in timber processing. This area of activity is also rapidly developing.

On December 31 we will mark a significant anniversary: 90 years of diplomatic relations between Russia and Finland. It won’t be an exaggeration to say that over this period we have built up a mutual sense of friendship, good neighbourliness, respect and sympathy. Both sides have always shown a sincere interest in complete mutual cooperation.

I would like to thank Ms Kiviniemi as well as all our Finnish friends and Russian colleagues for preparing this event and for their hard work in the course of today’s meeting.

Mari Kiviniemi (as translated): Thank you very much for what you said. I would also like to thank Prime Minister Putin for a very productive meeting, and I’d like to express gratitude to all the experts in our delegation, who prepared this meeting, which again was conducted in a very positive and productive atmosphere.

It was our first meeting. The prime ministers of Russia and Finland have a tradition of meeting regularly. And this was the first meeting for me. I am very glad to be visiting St Petersburg again. A month ago I participated in the opening of Stockman shop here. Then I met with St Petersburg Governor Valentina Matviyenko. Now, I can say, we are having a super weekend because in addition to the prime ministers’ meeting, the new high-speed train Allegro will begin service on the Helsinki-St Petersburg railway on Sunday.

Allegro will make its first run on Sunday. And Finnish President Tarja Halonen will be on board the train.

This high-speed passenger train is a great achievement. It is an excellent example of the strong relations between our countries and a good example of effective cooperation.

I am sure that this train will be of major importance in that it will encourage individual contacts between Finland and St Petersburg, as well as Russia in general.

As Prime Minister Putin said today, we had a very objective and broad discussion of bilateral and international issues. We focused on economic questions. Special attention was given to Russia’s potential WTO membership. I said that Finland was actively promoting it. And we were very glad to receive information on drafting a treaty between the European Union and Russia concerning issues related to Russian membership in the WTO. This treaty was approved at the EU – Russian summit on December 7. We are also very satisfied that a solution to the problem of customs duties on timber was found at the same time. Russian membership in the WTO is very important both for EU-Russian cooperation in modernisation and for the bilateral cooperation between our countries.

Finland supports Russia’s intent to carry out such comprehensive modernisation in the country. The broad and active cooperation that has existed between Finland and Russia for decades is solid and it is, generally speaking, the best example of a partnership for modernisation.

Our trade is on the rise again after the global economic crisis. Russia is a major trading partner for us and its role is constantly expanding. We highly value it, and the agreements signed today here are a clear example of this.

I think that it’s very important that we considered issues related to transport, environmental protection and travels, as well as the problem of protecting the Baltic Sea against pollution. In conclusion, I’d like to mention that in Finland, we really appreciate our good neighbourly relations and cooperation with Russia, and will, for our part, continue making every effort to develop our relationship further. 

Question: It seems to me that duties on Russian timber never go off the agenda. But the Russian side made its position clear a long time ago:  Russia would like to see timber processing enterprises relocated to its soil. Yet, despite all the steps taken by the Russian government, Finnish businesses aren’t in a hurry to make the move. So the question I’d like to put to both of you: What do you think is holding them back? Perhaps the Finnish government should also do something about it? Thank you.

Vladimir Putin: The reason is quite simple. It has to do with the size of today’s [timber] market, which has shrunk dramatically as a result of the global economic downturn. In these conditions, new companies can emerge only if some old ones are shut down. This process is a painful one, but it is still moving forward. There are some joint ventures being set up in our territory. Finnish companies, among others, are showing interest. As I announced earlier, we’ll extend our terms for 2010 into the year ahead.

But in the future compromises will be possible only if Russia gains full-fledged WTO membership. But in any case, we’ll continue our efforts to draw in businesses with a high added value. To us, this is a strategic choice, and we’ll continue along this path. And of course, we’ll be looking for solutions that do not undermine the interests of our Finnish partners.

Mari Kiviniemi: I think that both in Russia and Finland everyone is happy that the issue of customs duties is finally closed. It’s essential that we’ve reached consensus on that. And we’re hopeful that our new agreement will be realised before long.

We all know what the current situation on the timber market is like. We don’t anticipate that there any large investments are forthcoming here. But I do hope that both Russia and partner countries stand to benefit from its prospective accession to the WTO.

Also, we expect that the newly reached agreement concerning customs duties on timber exports will have a highly positive effect on the overall economic relationship between Russia and Finland.

Question (as translated): My question is about scrapping visa requirements. An experiment is about to be launched between Russia and Norway to allow visa-free travel along the border regions. Do you believe it’s possible to run that kind of experiment between Russia and Finland, as well? For passengers of the new high-speed Helsinki-St Petersburg train, for instance?

Mari Kiviniemi: Finland is obligated to comply with the Schengen rules, the European Union’s policies and principles concerning entry visas. All the same, we are still working toward scrapping the visa requirements at some point in the future.

As an EU member state, Finland is unable to conclude bilateral agreements with any third country. Having said that, we’re working toward creating an efficient and flexible system for providing visas. We’ve come a long way, and Finnish visas can now be obtained much faster and for longer stays.

We already have visa-free cruises between Finland and Russia, so I can see no reason why this same scheme could not apply also to high-speed Helsinki-St Petersburg train. But of course, the Russian side will decide for itself whether it would really want to get involved in that kind of experiment.

Vladimir Putin: I think that the proposal from the Finnish press deserves close examination. The scheme already works for the ferries. So why not extend it to airplanes and trains?

Border cooperation is a classic example. It normally applies to a narrow strip of land spanning just a few kilometres on either side of the border. But in today’s era of globalisation, your proposal takes on a new, modern dimension. St Petersburg and Finland are, indeed, close enough to engage in that kind of cooperation. We’re willing to consider this idea in earnest. But, clearly, we’d be better off just moving toward the complete scrapping of the visa requirements. There’re no serious obstacles standing in the way, believe me. Even concerns about crime shouldn’t be seen as an obstacle. Criminals will find loopholes however tough the regulations, you know.

And then again, the EU has lifted visa requirements for so many countries across the world now, even in Latin America, where there are serious problems with drug-related crime. As far as I remember, there’re no visas for certain African and Asian states, either.

Where does Latin America stand and where does Russia stand? If we just compare the level of our interaction and our common interests, we’ll get a clear picture.

Our bilateral visa requirements have survived to this day for purely political reasons. They are a relic of the past, and should be put behind us.

Question: My question is about education, rather than the economy. My point is that the idea to introduce the Russian language  into school curriculum has recently become extremely popular among residents of eastern Finland. And they have brought this idea to the authorities. And it was recently reported that Ms Kiviniemi supports this initiative. Ms Kiviniemi, why do you think this initiative is important?

And my question for you, Mr Putin, is: how would you assess this initiative given that it has come from ordinary people? They have requested it. Thank you.

Mari Kiviniemi: Right, I have responded positively to the initiatives of certain municipalities in eastern Finland to give students the opportunity to select Russian language classes instead of the compulsory Swedish language. But this issue will need to be further considered because Finland has two official state languages – Finnish and Swedish. For example, to be able to occupy certain public positions a person is required to have a basic command of Swedish. So, if in some eastern Finnish municipalities schools start teaching Russian instead of Swedish this will naturally have more far-reaching consequences for other systems and legislation in Finland. This is why this issue really needs to be weighed very carefully.

The fact that this initiative has been put forward by people clearly demonstrates that Finns have a need to study the Russian language more. Unfortunately, this opportunity doesn’t exist yet and the language is still insufficiently known in Finland.

Vladimir Putin: I believe that this is a necessary initiative and is worth being supported. We all understand that it springs from life itself. If you go to the Finnish regions that border on Russia, Lappeenranta for example, you will see that each store has signs in Finnish and Russian. The number of visits from both sides is growing: Finns visit the Leningrad Region and, above all, St Petersburg, and many Russians travel to Finland.

It is important that tourists, who go there to shop or to vacation from both of our countries, respect the other country’s laws, culture and traditions. This applies to Finns visiting Russia and Russians travelling to Finland.

I remember being stopped by the Finnish traffic police for speeding. They were very professional and did not even fine me and for that I’m grateful to them. I still remember that incident. I regret breaking the traffic rules then and pledge never to do so in the future.

As for the language barrier, people naturally need some help to overcome it. St Petersburg has traditionally received many tourists from Finland. And I still remember a set, though a modest one, of strong expressions in Finnish. The Russian vocabulary of Finns living in regions bordering on Russia is not much better than mine in Finnish. And this is clearly not enough for normal communication. This is why we should introduce Finnish language classes at schools in St Petersburg. I believe people will be glad to study this language even though it is rather difficult. Certainly, Russian classes should be introduced in Finland, at least as an elective course. So, get ready.

Question (as translated): Why do Finnish and international food suppliers only learn from the media that their products fail to meet Russian standards? Over this year a few companies have been in this situation, such as Procter & Gamble and Nestle as well as Finland’s Valio and Atria. It was mainly from RIA Novosti that they used to learn that their products either failed to meet the standards or were banned for import. The main actor in this situation, the person distributing this information, was Gennady Onishchenko, head of the Russian Federal Service for Supervision of Consumer Protection and Welfare. Finnish companies believe that some arbitrary decisions have been made, without sufficient explanation. This is a question too for the prime minister of Finland. I would like to know your opinion.

Mari Kiviniemi: This could happen because there were certain interruptions in the flow of information in the summer, and complete information did not get through. However, I have just learnt from Finnish Agriculture Minister Sirkka-Liisa Anttila that the companies Atria and Hakka have re-obtained permits to import their goods into Russia. So, there is no longer a problem here.

Vladimir Putin: As for the information spreading through the media, this is connected to the fact that we trust the Russian media even with such a confidential matter as trade relations.

If you want a serious answer, look at the share of European goods in the Russian market and the share of Russian goods sold in Europe and you will understand everything. Try to sell just a Russian loaf of rye bread in Helsinki. You’ll have to spend so much time at various government offices to get the necessary permits.

In Moscow, about 70% of food products, and maybe even more, are imported. These are very sensitive issues and there are many of them. This is why we meet at the government level to identify problems like this and find mutually acceptable solutions for them. I would like to assure you that Russia is committed to finding mutually acceptable solutions on all sensitive issues.

Thank you.