21 may 2013

Dmitry Medvedev gives an interview to Komsomolskaya Pravda

Question: What were your principal achievements this year? What was the most important, the most difficult, the most unexpected and the most interesting?

Dmitry Medvedev: The first thing I realised was that the Prime Minister’s job was no easier than the President’s. The Government works round the clock: it addresses routine national problems, manages the economy, and develops and issues a huge number of laws and other instruments. That’s how governments work in all countries. That was my first emotional impression. As for the year, it was very complicated. Economic developments forced me to take decisions that I would have avoided in other situations.

The so-called budget rule is the object of a lot of discussion right now. Does it help or hurt economy? The rule demands that we meet social commitments irrespective of fluctuations in oil and gas prices. This is a good rule, I’m sure. It was approved, in particular, because of the vague economic prospects in the world. However hard it was to adopt the budget rule, its adoption was a breakthrough that helps us live within our means and not squander government resources, as too many like to do.

As for the general economic situation, I don't want to stir up any passions. It’s more or less acceptable. But we need much faster growth. It was roughly 3.4% last year – not too high but higher than in Europe, which is in recession. Government debt is at a good level. Of course, everyone should live within their means. It is only 10% of GDP, while it is practically 100% of GDP in the most developed economies – the US, Britain and Italy – and even higher in Japan.

Our employment numbers are very respectable. Last year ended with 5.5% unemployment, compared to 6% in 2011. It was below the unemployment level in any European country and many other countries as well. As we know, employment is a crucial factor. It sets the public mood. I remember how people were feeling in 2008-2009, when unemployment was rising sharply. Luckily, we were able to bend the curve downward and create many new jobs. As for current macroeconomic indices, they are acceptable on the whole, though they could be better considering that we need annual growth rates of at least 4-5% for development.

At a recent Government meeting we discussed three scenarios of Russian economic development in 2014-2016. The conservative scenario involves growth rates like we are experiencing now. The moderately optimistic scenario would be 4-5% a year, which allows us to tackle key problems. And there’s the radical, progressive version, with growth rates up to 7% a year. But I don’t think there’s much chance of this happening.

More to be posted soon...