Transcript of the beginning of the meeting:

Vladimir Putin: Mr Dmitriyenko, how do you rate the region's performance at the beginning of the year? What are the results for the first quarter?

Dmitry Dmitriyenko: The beginning of the year... There are certain issues we need to work on. On the whole, things have evened out – we had a slight fall in industrial production but we have caught up with the national average. I think that in the second half of the year we will be able to exceed it.

The figures for the region's main industries – mining, fishing and transport – are better year-on-year. In general, we believe that our performance will be better than last year's. Though I can say that we had some important achievements in the social sphere last year: there was only a slight increase in spending while fiscal revenues ​​increased 12.5%. Consequently, we created a foundation for the beginning of development and launched certain programmes, first of all, in the social sphere.

We have started construction of kindergartens and in three to four years, we plan to get rid of the waiting lists for kindergarten placements. We also plan to build 16 sports facilities together with the Sport Ministry, which is an unprecedented amount. We hope to exceed the national average in this area.

In parallel, we are getting ready to launch major investment projects in the region. I would like to thank you on behalf of the region's residents for the attention you have given to our region and these projects. Thank you very much for signing the relevant regulations on the establishment of a special port area, because we can see already that it has led to a visible increase in business activity.

Another project also managed by you and one you know a great deal about is a comprehensive development of the Murmansk transportation hub. These two projects are showing clear signs of progress to date. Work on designing federal infrastructure facilities in collaboration with the Ministry of Transport is to begin in May. We have submitted the first 16 applications from potential residents of the port economic zone to the Economic Development Ministry.

We can see already that it is of great interest to big business, as well as – more importantly – small and medium-sized businesses, because they know that these major projects will be accompanied by smaller projects. But these projects are very important because port activity, as you know, has a multiplier effect. We hope that the port facilities will provide at least 15,000 jobs in total. This is very important for our region, since the Murmansk Region has historically been a government project: only major projects can be developed in the Arctic, and medium-sized and small businesses can congregate around these large projects.

There are also interesting projects initiated by medium-sized businesses here. Large-scale restoration of the mining and metals industry is in progress, in particular Norilsk Nickel, Eurochem and now RUSAL have initiated similar projects. In any case, these projects will move forward, and hopefully that will increase the region's budget revenues.

Vladimir Putin: And how is your tourism programme faring?

Dmitry Dmitriyenko: We have started to implement the tourism programme in conjunction with the Ministry of Regional Development and the Ministry of Economic Development. In particular, we have launched the Russian Lapland project, specifically in the depressed Lovozersk district, and now we have found co-investors. We hope we will be able to develop this project along the same lines as our friends and colleagues in Finland. God willing, we will even surpass them in some ways. At the same time, sports tourism is developing, especially in Kirovsk. We're developing several interesting projects with the Ministry of Sport. One of these will be launched soon now...

Vladimir Putin: The skiing season lasts until the end of April, doesn't it?

Dmitry Dmitriyenko: Yes, people sometimes even go skiing during the May holidays. But that doesn't happen every year, whereas you can always ski until the end of April. This year, we launched flights to Kirovsk. People can get to Kirovsk easier now, without making a transfer in Murmansk. We'll be keeping an eye on statistics now but we hope that this too will give an additional impetus to tourism.

There is an obvious shortage of hotels, so we've started recruiting investors to build a chain of affordable three-star hotels. This could be pre-fab buildings or some other type. We are negotiating with a number of hotel chains that will hopefully come to our region. We are ready to help them build hotel chains. We are now in a position to do so. As I have already said, we have done extensive work on the budget and are ready to help investors.

Vladimir Putin: How is the fishing industry doing?

Dmitry Dmitriyenko: The fishing industry is also evolving. Our total catch was 17% of Russia's total catch for the first time last year. It was usually 15% to 16%, and now we have reached 17%. Meanwhile, the entire fishing industry is on the rise. A total of more than 664,000 tonnes has been caught. This year, preliminary results for the first two months show an increase of about 10% year-on-year.

We are particularly pleased about the growth of fish farming, which is a new branch of the industry. Over the past year, production volume increased 150%, by 7,000 tonnes in total. And judging by the fact that the new big players have come on the scene, such as Russkoye More, which has recently arrived in our region, we hope that the industry will grow significantly. People see that they're being offered new projects, and these projects are in demand not only in the Murmansk Region but around Russia.

Vladimir Putin: Tell me, what is your assessment of the situation with housing construction? You had certain problems in the past.

Dmitry Dmitriyenko: These problems still remain, and they can be broken down into two categories. The first problem is that we have excess housing stock. On the other hand, we have built housing, which for one reason or another people do not buy. We are working on it now. Moreover, we are now planning to construct at least two residential buildings for allocating housing under social programmes. These concern primarily orphans and young professionals. We have a programme for attracting young professionals to the region, and allocating housing is part of it. Orphans will get housing in line with a federal programmes. This year alone, we spent 200 million roubles on orphans, although our situation is better than in the whole Northwest Federal District.

Vladimir Putin: How much housing will you commission compared to last year?

Dmitry Dmitriyenko: We will commission the same amount or slightly more, but we are working with the Regional Development Ministry, which has special standards for us. What is the issue? Take the city of Murmansk – its entire infrastructure is designed for 500,000-550,000 people, but the actual population is 309,000 people. In other words, we have major problems with power grids because we have excess capacity. The extra expenses become a burden for the consumers. So in our case the issue is not so much growth as more efficient use of the existing infrastructure and renovation. This requires administrative action. Because there are many vacant flats, where people have moved to another region and their flats remain empty. We need to introduce different mechanisms, such as buyouts. We are keeping an eye on this.

Vladimir Putin: I remember, you have told me about this.