14 june 2012

Prime Minister Dmitry Medvedev chairs Government meeting

Dmitry Medvedev issued a directive to draft proposals on introducing amendments to Russia’s competition promotion programme and an action plan for its implementation before 2015, and submit them to the government.


Dmitry Medvedev: Good afternoon everyone! Please be seated. I believe we should start on time because life is easier that way, is it not? Okay.

Colleagues, let’s get down to work. The first item on the agenda deals with the state of competition in Russia. I would like to say a few words on this issue. Obviously competition is a major incentive for the development of any economic system, and largely shapes the modern market of goods and services and determines the investment climate. Consequently, the creation of the conditions to ensure fair competition and compliance with global trends, including anti-monopolist activities, remains a strategic and long-term government objective.

It cannot be said that we have done nothing over the past few years to promote competition. Of course we have. In terms of the legal aspects, we discussed this issue yesterday, a great deal has been accomplished. In 2011 alone, the legislation was amended in order to promote liberalisation and simplify state control in the economic sphere, to eliminate administrative barriers for the registration of new companies and enterprises and for their initial entry into the market. These amendments are also expected to create modern conditions for foreign investors who put money in various sectors of the Russian economy. We prioritised efforts to ensure that purchases of state companies and natural monopolies are transparent and non-discriminatory. Everyone, including the state itself and representatives of civil society, are monitoring these processes. This is very useful, as for that matter, other processes as well. For example, the privatisation of public and municipal property has been analysed recently. All of these are system-wide moves designed to make doing business in Russia a comfortable and convenient pursuit. Nevertheless, last year’s World Bank rankings placed Russia in 120th place among 183 countries for insignificant improvements in its business conditions. Earlier, we ranked 123rd. Frankly, this is far from a brilliant performance.

As I said at an expanded meeting of the State Council in April, and repeatedly after that, we are pursuing some very difficult, and I would even say, ambitious goals. We must move up at least to the 40th place in the world and prospectively join the top 20 countries before 2020 at the latest. It will not be easy to achieve this goal but we can do it if we work openly and with a sense of purpose, which we have been trying to do. Feedback is greatly important in this respect, as is the vision for how the decisions we have approved can be implemented in practice.

Yesterday, as we have originally arranged, I held yet another Open Government meeting and met with experts. We had a concerned and very constructive discussion on how to overcome existing administrative barriers, reduce monopolisation in the economy, and improve the investment climate. Above all, we discussed the Federal Antimonopoly Service’s report on the state of competition in this country. This document is of fundamental importance and contains a number of sound assessments and proposals. Naturally, it received both criticism and praise: there was plenty of both. In any case, the report should be supplemented with analytical material on the state of competition in such key markets as construction, oil products, power generation, heat supply, transport and communications. Yesterday, incidentally, it was noted that there is a nationwide dearth of analytical materials on this subject. On the face of it, there seems to be a lot of relevant writings, but you cannot obtain them neither freely nor for money.

I think it necessary to take into account that public discussion and today’s government meeting as we work to streamline the report. Therefore, I issue the following directive. You must draft and submit to the government proposals on introducing amendments to Russia’s competition promotion programme and an action plan for its implementation before 2015. I would like to stress this point once again: joint work involving the authorities, entrepreneurial associations, consumers association (they also participated in the discussion yesterday), and the entire expert community should be conducted on a permanent basis. I will continue to proceed in this way in the future.

Today we will also take stock of how the federal budget was executed in the first quarter of 2012. I will quote just a few important figures. The GDP amounted to over 12.8 trillion roubles, an increase of 4% on the same period last year; this means there is some growth. The federal budget ran a deficit of 70 billion roubles, or 0.54% of the GDP. As of April 1, 2012, the National Welfare Fund amounted to 2.6 trillion roubles and the Reserve Fund to 1.8 trillion roubles, growing by one trillion roubles after absorbing oil and gas revenues in accordance with the established procedure. The oil and gas revenues themselves amounted to 1.5 trillion roubles, or almost 28% of the predicted 2012 earnings. By and large, this is the result of growing world oil and gas prices, which have been on the rise for a lengthy period this year. The so-called non-oil-and-gas revenues amounted to 1.4 trillion roubles, or about 23% of the forecast indices. This growth is mostly due to VAT and customs receipts. There are also increased receipts from the administration of the Reserve Fund and the National Welfare Fund. Generally, the federal budget’s cash expenditures during the period under review amounted to 3 trillion roubles, or almost 24% of the specified budget revenue and expenditure for 2012. The quarter-year figures are approximately the same as in 2011 and 2010.

Implementing federal targeted programmes and targeted investment programmes is yet another subject I would like to speak about. The open federal budget for 2012 will fund 53 federal targeted programmes (FTP) and two public programmes. The total amount of funding should exceed one trillion roubles, including 615 billion roubles for capital investments, about 180 billion roubles for R&D and about 250 billion roubles for other needs. A mere 11.7% of budget allocations in an appropriate line of spending came in for these purposes in the first quarter. Cash performance in respect to 14 FTPs failed to exceed 5%, and funding was not forthcoming at all for seven programmes. Fifty two billion roubles was allocated out of 911 billion roubles earmarked for the Federal Targeted Investment Programme 2012, or 7% of the total. These are the kind of unpleasant figures we are working with.

I understand, of course, that we have all just started our work. The new government members have been taking over from their predecessors and familiarising themselves with essential matters. It’s a cumulative result, not a result of current activities. Nevertheless, these rates are going to persist into the latter half of this year and, of course, everyone will be reduced to rushing frantically about. This state of affairs needs to be radically reversed. Let's hear reports on how the lag in implementing the FTPs and the FTIPs is going to be addressed, including the names of those in charge, the timeframes, and the ministries that are more heavily in arrears than others. We will come back to this matter in two months’ time and take a look at the results. No references to the transitional period will be accepted. Hopefully this is clear to everyone.

Let's get to work. Our first presenter is Mr Artemyev (Head of the Federal Antimonopoly Service Igor Artemyev), who will cover the state of competition in the Russian Federation.

Igor Artemyev: Mr Medvedev, ladies and gentlemen. It is a great honour for FAS to present its sixth report on the state of competition to the government. This report is linked with the adoption of the first anti-monopoly package. FAS must submit such a report to the government every year in accordance with item 10, part 2 of Article 23 (the first slide) of the law On Protecting Competition.

I’d like to note that in preparing these long reports (this is the sixth one), we usually pick two or three key subjects and about 15-20 different markets that we have had the time to study over the past year in order to report to the government what competition is like in different industries. In other words, today we are presenting to the government the sixth chapter of a big book that contains all the previous chapters. In presenting this report I’d like to discuss vital systemic issues in the context of what we have declared and proposed in the past.

Please take a look at the third slide. In each report we have discussed major issues and it was the reports that produced the second and third anti-monopoly packages. Today I am able to report to the government that the third package adopted by parliament last year has actually tailored Russian national law on competition to the practice of OECD, WTO norms and provisions of all of Russia’s fundamental international agreements (a fact that is recognised today). In this context our national law on competition is one the best in Russia, and I will speak about this a bit later.

There are other laws that directly have to do with competition. Many amendments were made to the Forestry Code and the Water Code but I’d like to emphasise (as is clear from the third slide) our major request… We’d like to ask the government to consider the annulment of the 1995 law On Natural Monopolies. There are many areas of conflict between this law and the law on competition. This less general law produced the law on gas supply and other specific laws that have already become obsolete and are aimed against competition. Quite often courts apply a specific law, with good reason, instead of the general law On Protecting Competition, which leads to major collisions and harms competition. This is why this issue is of key legislative importance.

Now let’s look at the fourth slide. We have talked for many years about the need to get rid of MUPs (Municipal Unitary Enterprises for Housing and Utilities) and GUPs (State Unitary Enterprises) in different industries where they are subsidised from the budget at all levels, on the one hand, and compete as fully-fledged economic operators against other companies, on the other. Unless they are abolished in the near future in all industries, probably with the exception of defence and the like, we will never have any competition, say, in the housing and utilities sector. We’ll never be able to bring private companies into this sphere because they will be unable to compete against these fossilised state-subsidised entities. We have brought up this issue in the past, but nothing has changed since 2000.

The next issue we have emphasised concerns the activities of state corporations with competition-killing potentialities. In this context we welcome a whole number of the government’s decisions on privatising state corporations and restricting the term of operation for many.

Please look at the fifth slide. We have spoken more than once about the need to liberalise many Russian industries that are still under tariff regulation. For five years, we have discussed the need to stop tariff regulation of stevedore companies in our ports – they must be allowed to compete against each other without any restrictions. But this industry is still being subjected to tariff regulation, which brings parallel structures into being – quasi-stevedore companies. As a result, we are faced with market price formation bypassing tariff regulation. This always happens with competition. Tariff regulation won’t help us to prevent these companies from getting their incomes and fixing their prices if they occupy dominant positions.

Needless to say, we have stressed the need to adopt the rules of non-discriminatory access to infrastructure facilities. It is now easier to get connected to a power grid. Credit goes to the government for adopting this multi-page document that serves as a navigator for business and monitoring agencies. Things have been more or less put in order here. However, there are no rules for non-discriminatory access to infrastructure in the communications industry; the relevant rules for the access to railway infrastructure have become obsolete and we are facing enormous problems as a result. We don’t have these rules in too many industries. If there are no rules, then the principle of “might makes right” and monopoly of stronger players always prevail. This is a very important point.

We have said that many reforms, including those in railway transport, have been suspended. The proposals that are being implemented today date back three or four years, although they are still important today.

The potential of the reforms of natural monopolies… In the power industry we are moving backwards in many respects; railway reform has been discontinued; changes in the communications industry must be carried out more quickly because the entire economy depends on these infrastructure facilities and cannot move forward without them.

We have justified the need to liberalise air transport in our lengthy talks with the Transportation Ministry. Changes took place only last year as regards Italy and France. But we have still had completely discriminatory bilateral agreements since the 1990s, when the Soviet Union was disintegrating and air links between the CIS countries and Western Europe had to be preserved at all costs. Now these agreements have two companies from both sides – one from Russia and the other from another country. As a result, we have skyrocketing aviation tariffs. If we could liberalise this system and allow two or three companies to operate flights that are in demand, and there are many routes in demand…

There is a very simple formula that has been tested in the real world – the emergence of a competitor reduces the cost on any flight by about 25%. We have calculated this by analysing what the government has done in the past. We must do the same in this country and the rest of the CIS. Twenty-first century Russia has no law governing the basic principles of public transport, by this I mean the basic principles for passenger transport regulation. The State Duma has been examining this law for seven years. The document contains an excellent section on anti-monopoly measures, but we have failed to get it approved. I get the impression that Russia is the only industrial country without a corresponding law.

The report also mentions some other important issues. We should, at long last, introduce fair rules for the distribution of non-renewable resources. By this I mean the frequency spectrum, which cannot be reproduced in some parallel form. Those auctions and tenders which have been held, especially in previous years, were severely criticised by the business community. That much is clear. The introduction of the principle of technological neutrality, the elimination of “mobile slavery,” as instructed by Dmitry Medvedev, might ensure real competition and would arouse quite understandable public interest. This would apply to mobile content companies and also companies providing stationary telecommunications services. It would mean families and individuals have the right to retain their telephone numbers when they switch providers. I have already mentioned this at the Open Government meeting.

Consequently, everything which has been said and many other issues which have been raised… Right now, I am not touching upon the issues of paid-for public services, which were settled by the federal law. And, thank God, there is now a register of public services, which anyone can consult to see what specific services the state allows individuals to pay for, and what other services have been outlawed. And many other things that have been mentioned… But, on the whole, the competition promotion programme was created in order to implement all the things we are discussing. This amounts to proposals and a report, rather than a system for implementing specific measures and everything that has to be done. The competition promotion programme was created on the initiative of Elvira Nabiullina... This was her proposal, and it was a wonderful proposal, this programme was approved by the government as a set of clear goals, deadlines, responsible officials, etc. But we can now say that the programme has failed to produce the results we were all expecting. We have assessed the situation, and virtually all the deadlines for all the projects have been postponed, aside from pure paperwork when we wrote all the reports, including a report submitted by the Federal Antimonopoly Service to the government. Under the 2009 plan, we were supposed to have assessed the development of competition in certain sectors, including the railways, for example. Naturally, this plan was put off until 2012. In 2012, it was postponed until 2013. The end effect is that the programme of measures to improve competition in each sector, the systematic issues, including ones raised by me, were frozen. Today, Dmitry Medvedev has noted the need to finalise this programme, to activate it, to demand its implementation from all of us, if we really want to make the Russian economy more effective and ensure it is based on the principles of competition. This is one of the most important tasks and, of course, for the FAS it is the main task.

And we would like to stress that the purely protective activities of the FAS, shown on slide No. 7, are incapable of improving the situation regarding the development of competition because this is only one protective aspect. We clearly have to implement much more radical measures regarding active policies in the field of business, in industry, in removing administrative barriers, which is what the Commission on Administrative Reform is doing. These are the measures that have to become much more radical if we want to achieve real results and achieve them quickly. That is why I very much hope that the new approaches that were outlined yesterday at the meeting of the Open Government will prevail. We have a real opportunity to make this happen.

Point number nine:  I believe that each ministry, not just the Federal Antimonopoly Service, should promote competition principles and their own programmes for their respective industries. Industries, such as manufacturing, construction, communications and transport play key roles in this regard. Most often – and we believe that this is true – we see that ministries are not just passive with regard to combating monopolies. Most if not all ministries seek to create monopolies and save budget funds using economies of scale. There is a theory behind this. Certain measures outlined by the government in order to improve this situation met with opposition, which means that the mindset of many executives doesn’t even include the notion of competition. It is a second-tier problem for them, which means that if we don’t change this mindset we will simply tread water in real economic life and invariably get back to square one no matter what we do. Of course, something will be built and certain things will get done, but we will never make a breakthrough and achieve a sustainable self-adjusting economy if we leave things as they are.

I believe that we have a historical chance and opportunities to do so now that we have ripe civil society institutes, a proper administrative system, and modern generally accepted legislation. We can make this step forward today without it being too painful, and this will be real progress. In our report, we urge the government to make certain steps in several areas.

Slide 12. Indeed, Russia ranks 19th in the world in terms of legislation and the enforcement of laws. This is an independent evaluation and it’s true. At the same time, as I mentioned earlier, we are somewhere near 120th place in terms of actual competition, which is also true. We have good results in one area and nothing to show in others. Mr Medvedev, I would like to ask you and the government to make an earnest effort and make this work mandatory for ministries and departments. I would very much like you to look into the possibility of creating a government commission for promoting competition. This commission should be led by a deputy prime minister or anyone of your choosing. It should meet on a monthly basis and consider the systemic issues that I mentioned earlier. It could focus on all industries the way it’s being done by the commission on administrative reform. All industries should be examined by this commission.  

This will be an effective venue for preparing your decisions, as well as decisions by the government, the president and the parliament. The commission will draft legislative initiatives, since the work will be done on a regular and mandatory basis. That way we will get the work done. Currently, the Federal Antimonopoly Service is working in a chaotic manner. It has surges of activity that quickly die and has so far failed to achieve any meaningful results. Therefore, we believe that competition warrants action by government institution. It’s a system-wide phenomenon at the foundation of an effective economy, which, we believe, is very important.

I think I will stop here. To conclude, I want to reiterate that we now have such a chance… I enjoyed our Open Government discussion yesterday, since it was very honest and open. Things that were said yesterday, things that are said by experts and civil society confirm that we can do it today. If the government deems it possible to make these steps in the near future, then we will achieve good results. Thank you.

Dmitry Medvedev: Thank you, Mr Artemyev. Colleagues, any comments on this report? We discussed it at yesterday’s Open Government meeting. Mr Belousov, please go ahead.

Andrei Belousov: I just wanted to comment briefly on the report.

Mr Medvedev and colleagues, of course we can criticise the report – and it was criticised at the Open Government meeting yesterday – but in reality it objectively reflects the current situation. Our ministry holds the work performed by the Federal Antimonopoly Service and Mr Artemyev to promote a competitive environment in high regard. I would like to point out a certain paradox here. We have submitted the first anti-monopoly package, then the second and the third. We have also harmonised our legislation with international legislation. The Federal Antimonopoly Service has been recognised as among the best in the world. This is well-deserved recognition. Meanwhile Russia’s competition rating is not going up; it is actually going down in some assessments. The situation here is not improving. Of course, one can blur the problem by saying this is a common problem of the investment climate. However, it has its subject, and the quote from Saltykov-Shchedrin [Mikhail Saltykov-Shchedrin, Russian writer, 1826-1889] is probably especially true for this area, the quote which says that the rigidity of Russian laws is mitigated by the fact that their enforcement is not mandatory.    

The problem lies in enforcement. The main problem in this area is that these good and wonderful laws are not enforced everywhere at all times. Therefore, I propose that we pay attention to this problem and look at this problem primarily through the eyes of the whole entrepreneurial community. Because we can adequately interpret only a small part, because we see only part of the issues. And I would propose (we have the relevant experience) to ask four leading entrepreneurial associations to prepare a joint report on law enforcement in the area of competition and submit this report to the government so that the government could discuss this report in some three months. We carried out such work with experts when we prepared this programme. It produced good results. I propose that we make use of this experience in this area as well. Thank you.

Dmitry Medvedev: Thank you, Mr Belousov. Any other ideas?

Svetlana Orlova (Deputy Speaker of the Federation Council): I’ve got some.

Dmitry Medvedev: You’ve got some? We will give you the floor soon. First, Mr Dvorkovich, then you.

Arkady Dvorkovich: Thank you. The report presented by the Federal Antimonopoly Service is indeed comprehensive and, together with the previous reports, reflects all actions concerned with antimonopoly regulation, law enforcement in this area and support for competition. It also reflects the fact that almost nothing that had been planned or proposed by the Federal Antimonopoly Service has been implemented in the past two or three years in the various sectors. And I support most if not all the measures regarding the specific sectors mentioned by Mr Shuvalov. And in the short-term we will carry out this work with ministers that are responsible for specific blocs, and I think we will make progress in some areas rather quickly.

As for government management of this process, I think – Mr Belousov has just briefed us on this – that the Ministry of Economic Development is the key ministry to deal with competition policy. The Federal Antimonopoly Service primarily deals with law enforcement. Policy in this area, nudging all the departments, coordinating all the departments in competition policy is one of the main authorities of the Ministry of Economic Development, in my view. I propose that we not rush to create a governmental commission (I feel that in this case all of us should join it and the commission will shadow governmental meetings, if we have such a commission, otherwise we will continuously miss some areas), but to confer more responsibility and more powers to coordinate work to the Ministry of Economic Development. Naturally, First Deputy Prime Minister Igor Shuvalov is responsible for this area, and he will continue to coordinate this work as before. But for one ministry to have such powers could indeed move the process in the right direction.   

Dmitry Medvedev: Thank you. Do any government members want to comment? Go ahead, please.

Mikhail Abyzov: Mr Medvedev, colleagues, I absolutely agree with Mr Shuvalov. In his report he stressed that the Federal Antimonopoly Service is operating in such conditions that essentially its only real instrument against monopolies on the markets are administrative and punitive functions. But the most important components of competition management should be the engines, which are the executive bodies that regulate economic relations in various economic environments.   

In this respect, I think that in the course of implementation of your instruction on developing a new system of efficiency indicators for executive bodies, the issue of competition should be reflected as a major component. I also think that we should, jointly with the Ministry of Economic Development, discuss the issue of evaluating regulatory impact specifically of antimonopoly regulation on the work of ministries and departments because they manage the economic environment and this should be translated into engines and the development of competition and not the punishment of monopolies. Then it will provide the right stimulus for the development of a competitive environment in all economic sectors without exception and, most importantly, in the interests of the final consumer. 

Dmitry Medvedev: Thank you. Mr Shuvalov, go ahead please.

Igor Shuvalov: Mr Medvedev, colleagues, regarding the report and its correlation with the competition promotion programme, indeed Minister of Economic Development Elvira Nabiullina came out with this initiative when she held this post. I think this was a great achievement when this programme was adopted. However, while implementing this programme, we have observed a certain contradiction between the bodies, that is, between the ministry and the Federal Antimonopoly Service. Nevertheless, I hold that the Federal Antimonopoly Service is responsible for law enforcement and ensuring a competitive environment in this country, although all ministries and departments and principally the Ministry of Economic Development have their responsibilities. The accents are somewhat shifted here.

When we say that the measures included in the programme were not implemented… They were not implemented, including by the Federal Antimonopoly Service. Indeed, we have an administrative commission in the government, and maybe we should consolidate the activities of the existing commissions including the administrative commission, Mr Medvedev, and look how antimonopoly regulation and the creation of a competitive environment could be harmonised with the existing large blocs because there are many of them as it is.  

We have a commission for sustainable economic development consisting of several sub-commissions. We have an administrative commission – an extremely important mechanism for work – including for the competitive component. And what we discussed with experts when preparing for this government meeting… Everybody wants to see, of course, another report on the situation with competition, and another programme providing for competition in this country. And we ask you to approve the protocol decision that has been prepared.

Dmitry Medvedev: Thank you, Mr Shuvalov. Do other government members have any ideas? None? Then Ms Orlova,  go ahead please.

Svetlana Orlova (Deputy Speaker of the Federation Council): Thank you very much, Mr Medvedev.

Dmitry Medvedev: Yes, Ms Orlova, did you want to speak?

Svetlana Orlova: Yes, thank you very much.

Dmitry Medvedev: You’re welcome.

Svetlana Orlova: Mr Medvedev, colleagues, we have been conducting monitoring over the past three years to see what’s going on in the sphere of competition. You were right when you said that competition is of key importance for economic growth. However, I have several points to make.

The first has to do with indiscriminate access to power grids. On the face of it, we have done everything we needed to do: we have developed investment programmes, established interregional distribution grid companies and we have a working Federal Antimonopoly Service. However, we do not have a clear understanding of how the tariffs in these investment programmes are being calculated. Therefore, we should take concrete measures in this regard.

My second point is that we are talking about promoting competition by removing administrative barriers that stand in the way of connecting customers to grids. Indeed, a lot has been done in this area. Many things work fine, but the sticking point is that most Russian regions are lacking long-term energy supply programmes. Mr Belousov mentioned these things: in addition to businesses, we could get regions involved in this work and do some serious work together.

Now, about retail electricity companies. I will give you just one example: there are up to 40 retail companies in the Tver Region. They accumulate debt, cheat customers, raise tariffs and give no explanations. We must decide what we are going to do with retail companies. The government has been examining the law on using natural gas as motor fuel for two years now. We have positive findings from the Energy Ministry. Our colleague, Mr Novak, knows that we have looked into this bill together, because initially the Finance Ministry turned it down, but we then pushed to have them approve it. There are natural gas filling stations in 17 Russian regions. They can become a serious competition, and the law would be of great help. Of course, we are counting on the law on the contract system and hope that it will be instrumental in addressing these issues. Of course, we should also look into mandatory insurance for motorists, which no one has yet mentioned, including Mr Artemyev. It has hidden premiums and intentionally lowered tariffs. We have a bill that has been sent to the government. I believe that we could do some serious wok in this area as well.

Here’s my final point. Mr Medvedev, I believe you remember the work that we have been doing with regard to terminals. You actively participated in this work as a professional. Finally, the bill has been adopted in what seems to be a palatable and functional form. However, they are charging 8% on each payment, and we let it go unnoticed. The Federation Council has come up with an appropriate initiative, and we have an agreement with Mr Surkov. If you have no objections, then we will look into it together with him and the State Duma. Thank you.

Dmitry Medvedev: Thank you. I have no objections, please go ahead and discuss it. Thank you for the specific examples, Ms Orlova.

Let’s sum up the discussion of the first issue. Of course, there is a disconnect mentioned by everyone today and at the Open Government meeting yesterday: we have adopted a very good law, everybody praises it and the work performed by antimonopoly authorities, but the state of competition in our economy is very poor, to put it mildly. Clearly, we ourselves are the problem. We should honestly admit it, because many people who have been sitting at this table for decades are not interested in competition at all just because they are trying to uphold their respective industries. This is not the way it should be. So, if we decide to go ahead and promote competition, then we should start with ourselves.

Now, about what Mr Artemyev just said. Let’s take a look at our legislation in perspective, including the law on natural monopolies. Mr Artemyev strongly believes that this law has to be repealed. In fact, if it is inconsistent with the fundamental provisions of the law on competition, then we should remove these inconsistencies, since the rule is that specialised laws supersede general laws. However, specialised laws may have provisions that override everything that’s written in a general law. I’m not saying that we should eliminate this law, but let’s first assess its relevance. It was adopted at a certain period of time. I’m sure it has a role to play, but let’s look at it from the current perspective.

We share the position regarding unitary enterprises leaving competitive markets. I believe that everyone agrees that we should do it and do it without delay.

Now I’ll say a few words about state-owned corporations. I started working on this issue several years ago, and this work should be continued. State-owned corporations should have a clear vision of the terms of their activity. They should be dissolved once the time allotted to them expires or when they achieve a goal that they were supposed to achieve in the first place, be it Olympic Games or something else. Otherwise, they should be privatised. Some of state-owned corporations were reorganised as joint stock companies, which is good. The next step involves selling them. I am not against taking a careful look at the possibility of re-launching reforms in railway transport, power generation and communications. I hope that the ministers sitting in this room will facilitate this work in every possible way. This is also true of indiscriminate access, transport access and several other problems raised in Mr Artemyev’s report.

Now, regarding our approaches to work. We discussed it yesterday at the Open Government meeting. It’s a very useful thing, because you come to a government meeting being already in the loop as they say, and don’t have to skim through papers in order to get on top of issues scheduled for discussion. I learned a lot of useful things during the Open Government meeting yesterday; therefore, I would like to invite other members of the government to attend as well. If you ask me, I wouldn’t reject outright the idea about the commission on competition, because we ourselves are the main problem, and as head of the Federal Antimonopoly Service, Mr Artemyev has no power over ministers for obvious reasons. The decision should be made by a higher government authority. I mentioned yesterday that things may boil down to me chairing this commission and summoning all members of the government to attend its meetings. However, this scenario may be too tough, but nevertheless this commission could be instrumental in removing a host of contradictions. Is there a need to merge it with the commission on administrative issues? Perhaps, there is. We can merge them. Of course, I am not in favour of multiplying these commissions. We have the Ministry of Economic Development that deals with these issues, but in some instances, when the issue involves contradictions between industries, such issues should be taken to the higher government. Please give it a thought. Mr Shuvalov, I would like you to come up with proposals regarding these commissions: should we merge them or should we set up a new one.

However, this is not the most important thing. Most importantly, we should start to do some real work, otherwise our ranking will remain low as it is now. I just took a look at another ranking – they have included a nicer one for my remarks. According to this rating, Russia is down three spots since last year, not up. Well, this might be a fluctuation error, but clearly we don’t have much to brag about anyway. Let’s focus on this work. Let’s continue our work and thank the press for their time.

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