 We have exactly an hour here, so I'd really like to get started as close to on time as possible. We are on the record, and this is live streaming as well to the international community. Good morning to all of you. I'm Ian Bremmer, President of Eurasia Group, and this is the Russia Outlook. There is plenty for us to talk about this year. We have oil prices just above 30 right now, never an easy environment for a country like Russia. We have Ruble hitting record lows yesterday, breaking through 85. Last year, significant contraction in the Russian economy, the worst performance in the BRICS this year, expectation of more shrinkage both from the World Bank, the IMF, and Russian domestic indicators. We've got sanctions still from the international community, from the United States, and from Europe. The Americans continuing to talk about punishment and isolation. Sounds horrible. And yet, when you look at Russia in the context of every other energy producer among the emerging markets, this is not meltdown. This is not Venezuela. People aren't as concerned as they are about Saudi Arabia. It's not Angola. The level of stability is high. The approval ratings for Putin remain through the roof. The Japanese government, the Prime Minister, just came out a few days ago and said Russia should be brought back into the GA. And the Europeans certainly seem to be much more inclined to engaging with the Russians than they were a year ago. President Obama had a bilateral that was much more focused on Syria than it was on Ukraine. It reminds me of when President Yeltsin was asked about this joke about the outlook for Russia in one word. He said, good. He said, can you answer me in two words? He said, not good. So we've got plenty of things to talk about here. We've got the audience to do it. Let me introduce them briefly. It's really quite a crew. To my left immediately, we have the Russian Deputy Prime Minister and Presidential Envoy to the Far Eastern Federal District, His Excellency Yuri Trutnyev. To his left, I'm just going to go right down the line. Good friend, Ambassador Wolfgang Isinger, who you all know is the chairman of the very shortly upcoming Munich Security Conference, lots on the agenda there this year. Most of Vladimir Dmitriev, who is the chairman of Russia's State Corporation Bank for Development and Foreign Economic Affairs. Ms. Elzaveta Asetsinska, who is the editorial director of RBC Media Holding and before was running Forbes Russia, one of the most independent business publications in the country. And then finally known to everyone at the WEF, Professor and also Minister Alexei Gudrin, he's now a professor and dean at the St. Petersburg State University, but he was Minister of Finance, of course, very outspoken in Russia from 2000 to 2011. We're running this in simultaneous translation. For those of you that don't have both languages, please put these on. And let me start right in with Deputy Prime Minister Trutnyev. And let me ask you to just kick us off with your outlook economically for 2016. When Putin came out, I think it was a few weeks ago and said that the Russian economic crisis has already passed its peak. So are we in smooth sailing now? I mean, what are you worried about? What kind of a, what is your view of the outlook of the Russian economy given where we are with oil, with the world's inflation challenge, I mean, all the issues that are out there. Tell us what you think. Thank you very much. You mentioned the oil price. You mentioned the sanctions. And I also want to mention another important fact is that in response to these sanctions, the president enjoys and the government enjoys unprecedented level of support and one needs to draw conclusions from it. And perhaps these sanctions are not affecting the Russian people the way they were intended to. And they, it motivates them to act differently. I don't think that the sanctions were designed to make the Russian people more cohesive as it were. Now back to the economy. We're operating based on the premise that the crisis has two components. One is a threat and the other is opportunities. Speaking about opportunities, I'd like to address three groups in particular. First of all, the crisis underlines the need for reforms. We dealt with reforms earlier. We think that the reforms should be aimed at creating a competitive environment for business. And in the last couple of years, Russia, in terms of ease of doing business, has moved from 121st place to 51st place, but a lot of work needs to be done still. Second, the consequences of the crisis, devaluation, devaluation of our currency, which is not very good for the population, but it's very good for the investors. The costs are lower and investment projects in Russia cost completely different money. And solidarity of the people offers a great deal more in terms of opportunities, in terms of changes for the people. How are we going to capitalize on these chances? I don't want to speak about plans. This doesn't sound very convincing. Instead, I will speak about my area of responsibility, the Far East. We began developing this region not so long ago. The President set this objective two years ago. Two laws have been adopted about the territories of advanced development and the Far East. Well, there's nothing new there. We've borrowed, well, let's put it this way, we've analyzed our neighbors, Malaysia, Singapore, China, Japan, and past laws based on the world's best practices. And what sort of results can we talk about today? In these advanced regions, more than 300 billion rubles have been invested, 200 billion rubles have been planned in terms of investment projects and enjoy support from the state. 30 billion in investments went to Vladivostok, a free port. So six months ago, these laws have been passed and the total scope of investments reached 600 billion rubles. So we expect to see tangible results this year and the portfolio that we have today shows that we can triple this result potentially. We are convinced that we have created a new competitive space in Russia's Far East and so that the world community can see it better. We held the first Eastern Forum last year. 38 countries were represented. Agreements have been signed for 30 billion rubles and following the forum we created a Russian-Chinese agricultural fund with $10 billion capitalization. This year we'll hold the forum in September in Vladivostok and we've got a lot to talk about. The situation has changed for the better and we will be happy to see Davos as guests at this forum and this is my response to your first question. So I'm certain we have opportunities to further develop moreover. The crisis to a certain extent is a challenge for us. How effectively we will be able to capitalize on these opportunities remains to be seen and this will be our grade that somebody will have to give to the Russian Federation's government. Ambassador Esinger, let me ask you the broad strategic question, same general direction. When you look at the beginning of 2016, do you think that Russia is in an increasingly strong or weak position internationally and what do you think the outlook is going to be over the course of the year? Well Ian, let me start by going back a step or two. I think we are looking at essentially four wasted years, more or less four wasted years in terms of failing all of us together, Russians, Americans, Europeans, failing to get a grip on this bloody civil war in Syria. A couple of years of what I consider a failed Russian policy vis-à-vis her Western neighbors. I mean is it a success for Russia that your immediate Western neighbor Ukraine is now essentially, you know, by 80 or 85 percent of the Ukrainian population is now anti-Russian? Was that necessary, is that a success story? So I think we've had four, three, four wasted years. 2016 in my view can be if it is handled well, not only by Russia but by the United States and by us the Europeans could be a year of opportunity. Russia is weak not only for the obvious economic reasons but also because the Russian military engagement in Syria, it's not clear to me how that is going to result in a success story. It's a costly exercise. We have learned in the West that these types of military adventures sometimes end badly. So I think there are so many reasons for all of us, maybe not to try again to push a reset button but to get back to normalcy. Let me add a final point. This crisis that we have created, it was not made by the Lord, it's a human made serious East-West crisis. It has created in military terms the most serious danger and risk situation for the international community in its totality. The risk of unintended escalation is huge as all the military experts, Russians, Americans, Europeans will tell you. And even more importantly and what makes overcoming this crisis so hard is that we have allowed the development of totally and diametrically opposed narratives. When I listen to my Russian friends, the story of the last number of years is a totally different story than the story we in Western Europe have to tell. We think we've been the good guys and the Russians have been the bad guys. And you think that Russia is the victim, you know, the undisserved victim of bad behavior and negative decisions taken by the first, the Bush administration, the Obama administration and the rest of us. A huge divide and overcoming that will be part of the job for this year. I think there are opportunities but they need to be taken. We need good diplomacy, not a continuation of bad diplomacy which is what we've had for the last four years. I suspect the Deputy Prime Minister is going to disagree on the narrative point. I'm going to let him get back to that later. But first, everyone gets a chance. Mr. Dmitriev, same basic question, outlook 2016, the geoeconomic position of Russia. Is it improving? If not, does it have the potential to improve? What needs to be done? Ian, I think in your introduction you've already answered the question and you answered it by saying that it needs to be addressed globally in a global context. If we look at the figures at the first glance, our economy will not find anything good in these coming year. But we need to look at the global context in which we are developing. Undoubtedly, the figures for the last year show that our economy has in many respects shrunk. We have a budget deficit that testifies to the same point, the falling GDP, the falling investments. Suffice it to say that last year, the total investments in the world reached a trillion dollars and the largest alliance share of these investments were accounted for by the United States while Russia's direct foreign investments fell 92%. And so Russia ended up as the greatest loser followed by Kazakhstan, 66%. Well, this is indeed very bad. On the other hand, and in this respect I do agree with our Deputy Prime Minister, this situation creates great opportunities to move from words to actions and to launch structural reforms in our country. And in this respect, it's important, and I'm going to draw the analogy with Mr. Shingar's words about diplomacy. We need to move from bad diplomacy to good diplomacy, enough to speak badly about our economy, enough to speak badly about our government and our managers. Let's look at the positives. Last year, and I'm talking just about our bank, last year, through financing from our bank, we launched 10 major projects. We have President of Tatarstan here in the audience. In the Republic of Tatarstan, we launched the largest in our country, combining that processes associated gas, which enables them to produce competitive products for our agriculture and for all sorts of fertilizers. Ammonia, for instance, the largest project in our country. Last year in Tatarstan, we opened the largest plant in our country producing engines for Ford. We launched two new models, Ford models. Otovaz used our financing to launch two new models, Vesta and X-ray, car models, that is, near Moscow, the largest and the only plant since the Soviet Union times has been launched and it produces micro-electronic components and nanoparameters from 0.13 to 0.16, exceedingly vital for any industry. So all of these projects have the total cost of 18 billion rubles and the budget will receive 600 billion rubles benefiting from this work. So these are the positives we need to talk about. And indeed, if we talk about the figures that we are so used to presenting to audiences, well, we are not downshifters by any stretch of imagination. We are a country that continues to develop in a way that unfortunately is allotted to those countries that have to fall back on their energy resources and exports. On the other hand, our economy continues to develop and hopefully, if God is willing, we will, this will enable us to move from words to action to structural reforms. Ms. Hastings, could you please talk to us about how the business community reacts to all of this? If they were hearing these presentations thus far, these numbers, this sense, what's the mood right now among the Russian business community? What are they hearing and what do they want to hear? Well the Russian business community, their mood is fluctuating in the same manner as does the oil price and the currency exchange rate. We've seen three, four crises and so people have nerves of steel. People are used to living in such a volatile, nervous environment but naturally nobody really expects anything good and positive from 2016. Not just the oil sector will suffer but also other sectors that target the middle class, the retail sector, the banking sector, lending, real estate, construction and others. Our business community is saying that not just external factors are to blame, the oil price and the sanctions, there are a great deal of internal factors and the business community speaks about the traditional relations between the business community and the government and I'd like to quote a businessman, Dmitry Potapenko, who at the Moscow Economic Forum recently described these relations as follows, the dialogue between the government and business reminds us of a dialogue between the butcher and the cow. He looks into the cow's eyes, holding a knife and says what are we having for breakfast today, milk or beef? And if we speak about specific domestic factors, well the businessmen are talking about the domestic product embargo, high lending interest rates, high taxes for retail business, for large businesses, recently duties have been imposed on trucks, new taxes are being discussed for the oil industry, it's the ever-growing inspections that many businesses are subjected to and well these are objective factors that the business community openly discusses and speaks about often but to wrap it up on a positive note, I had several conversations with large business owners here in Davos and they say that in principle if several basic things are done throughout 2016, this year can be not so bad, it can become a transition from the good, from the bad to the good, well we're talking about political settlements abolishing the sanctions, large scale reforms and large scale privatisation on a par with the 90s and me as a journalist, I'd be interested to ask the government about the specific measures that they're going to take in this regard. Mr. Kudrin, you've been very outspoken both about the opportunities as well as the problems in the Russian reform process, you've also said very clearly that you think that if they don't have 5% minimum growth going forward we've got severe social problems coming in the country. How do you think the government is doing right now? Let's leave aside oil, let's leave aside the externalities, even leave aside the sanctions. How's the government doing internally on reforms? What do you want to see? What do you need to see? How bad is it? How good is it? Thank you, 2016 will bring risks and I will join the others and say that there are opportunities and I will address them shortly. Under presidential aids, nor I could imagine that the oil prices would fall so badly, this reshaped our reality and the peak of this crisis is still ahead of us. And by peak I mean the fall of the GDP. I think we will see a fall of the GDP to a lower rate in real terms. What concerns me is that during this same year investments will fall and these are the foundation for the future. So this foundation will be small, it will not be very serious. I am very concerned that the real income of the population will fall, the standard of living will fall. Last year it continued to fall and this year it will continue to do so as well, which is a very painful thing for the population. It reduces the demand, which could also act as a driver. All of these things show that this year will be difficult. But what can we convert into a positive factor of influence? Our major problems always are in our head, in our expectations, in our moods, in our erroneous expectations perhaps. And at the end of the day we saw what I would call cold shower, cold rain. We knew that the oil prices would be low. Even if by the end of the year the oil price is at $40 or $50 it will still be a very low price. And that means that the government will have to learn to live without the extra premium from selling oil at a premium price. So if we turn on our brain today and try to forecast how we are going to want to live given the oil price, if that can be done then we can mobilize new opportunities. What concerns me? For instance if we, the experts, the community and the government reach an agreement whereby our target oil price would be about $40, it could be lower. We can never hope for a higher oil price and in that case we will have to understand that we have excessive costs that need to be reduced. So my question today is as follows. What will the government do in this respect in the next two to three years? Reduce costs, increase debt, increase taxes. What is the government going to do? This is the question that needs to be answered. If within two months the government, and I believe it will do so, if the government answers these two questions. Now in the next two years this gap can be bridged, then we'll have more clarity vis-à-vis many questions. The second thing that concerns me is that we now economically have become weaker. And subsequently it may affect our defence, our role in foreign policy rather, and we will be hit primarily because we're lagging behind technologically. Devaluation of our currency made it more difficult to buy technologies for our companies so it has become a very expensive thing for them. So the answer is in this area, in the high-tech sector, what answer can we provide in this area? Well, this is what we need to focus on. And the third thing, today the system of governance in place is completely inefficient. It needs to be improved and by and large the different layers of governance realize that. Previously our programs were fulfilled, development programs I mean were fulfilled at 50% and the last program has been fulfilled at 30% which means that we need to make a few adjustments in our planning mechanism, targeting mechanism and accountability mechanism for achieving the goals we set. I'll give you an example. The Putin in his address gave an example, out of 400,000 criminal cases opened against businessmen in 2014, 83% turned out to be futile, that is to say there was no result, but the business was partially or fully lost. So this is a very powerful example cited by the President, which goes to show how inefficient the monstrous methods are, the monstrous methods that are used by the law enforcement against business and the example that the President cited gives me hope that in the near future we'll be able to do away with these methods and revisit the way our judicial authority and law enforcement authorities work and in that case we can increase our investments and improve our chances. I guess listening to that, I see a difference between challenging external environment but internal business as usual is not problematic to there needs to be some fundamental changes in actually the way that the business of government is conducted, especially vis-a-vis the business community. So I'll let you answer how the business community feels about that but before I do I want, I'd like to have our Russian officials tell us a little bit of how do you respond to that? I mean is there, we've heard about anti-corruption for a long time, we've heard about rule of law, we've heard about the need to make the legal process efficient and yet we're still hearing from people that are very respected that they don't feel like that's happening. Do you dispense with that criticism, say it's not warranted or do you say it is and here's what we need to do? Mr. Deputy Prime Minister. Thank you. Thank you. You know, there is no perfect government, there is no perfect government where you could say that nothing could be done better. Naturally the Russian government has its weaknesses and we're looking for new ways to work and a number of points of criticism that have been voiced just now are on point but I'd like to go back to what I said in my opening address. Russia can develop even given such external circumstances in the Far East, industrial production is growing at 3% and investments are growing at 5%. At the first forum we signed agreements for over one trillion rubles so at doubles agreements like that will not be signed so can we work efficiently? Yes we can. The recipes match. We do need to give more freedom to our businesses. There is no other driving force that could lead the country out of the crisis. Only those who do business, only those who choose to be entrepreneurs can do that and one other important factor that I'd like to point out apart from these obvious external factors where we definitely need to be more efficient and work faster, there are other factors. Given this situation our budget needs to be regrouped significantly, we need to focus predominantly on investment areas to support the business and the government is discussing these factors and I probably will not be bold enough to say what decisions are going to be taken. We need to calculate how much each ruble bring in terms of return and investments for our economy. If we distribute our budget based on this analysis I hope the population will understand us and within two to three years we can build a foundation for Russia's new economy. I don't see any other way for us. Thank you. Frankly. To turn to Mr. Asensienska, do you see when the business community is responding to what you've just heard, what do they need from the government? What do they need to see that's going to make them feel? We've heard that there needs to be more patriotism, there's been capital flight and they need to keep it in Russia. Do you see a sense from the business community that if the Kremlin doesn't change present sort of operating procedures that you're going to see a lot more pressure for these guys to leave or do you think they're in it for the long haul? We continuously discuss the subject matter how to improve the relationship between the government, the power, the authorities and the business community and each time we are waiting for another crisis situation so that to push further this process. I quote from my memory, one businessman said that it would be nice if the work of the courts would be improved. It's not that difficult to do. We have to find qualified individuals and with the help of these individuals to improve the arbitration procedures and the work of court. This is a specific measure, institutional measure that would improve the life of the business community significantly or to restrict business inspections. Even the president says that too many of them are being conducted and more and more of these inspections we see now are being done. I have respect to the idea that we have a balanced budget but I don't believe that under these conditions that we're going to have this investment budget. We should abide by the orders of the president that we should comply with the social obligations but we would not have enough money to do that. But of course we have to support the population and it's the oil industry is under the threat of extra taxes because we don't have enough money other than that. So this is the range of specific issues and items and it is not my idea. This is the voice of the business community. I brush in the international community on the economic side. We haven't yet spoken of China. Clearly the relationship that has improved dramatically over the course of the last one, two years for the Russians has been towards the Chinese. It has largely been economic but it's been strategic as well. They have a very different model. They've got a lot of reserves. They're writing a lot of checks. They're doing more business with the Russians. How do you feel about this, Mr. Dmitriev? How strategic is this relationship going if the Russians feel isolated from the Europeans and the Americans are the Chinese driving too hard or bargain? How close would you expect? What areas do you think we're going to see real improvement and redirection of the Russians with the Chinese over the next year or two years? Thank you for this question. I think that this question should be addressed to the vice prime minister who is responsible for the forest economy or Mr. Galuzhka who is responsible for forest and Baikal region because they became key experts on China because these regions they interact specifically with this country. But answering your question nevertheless, I would like to state that our relations with China, it's not a dramatic change in international and economic policy of our state. Traditionally we developed our economic relations over the years and if to talk about our contacts, our banks contacts with the business community in China, I can say that we've been doing it for the last 15 years and traditional partners of the Development Chinese Bank, Exim Bank and other partners private and state partners in China. So I don't see any dramatic changes. I mean this dynamics of building our relations in terms of strategic development. I don't see it as a strange development but it coincided with the global worsening of the economic and global situation in the world which had a significant impact on the economic situation in our country. And of course we don't have these illusions in terms of the readiness of our Chinese partners in terms of our relations with them. They are quite pragmatic. Their civilization is older than 5,000 years and our Chinese friends learned how to behave in a very complex geopolitical situation in the world and regional situation. So we don't have any illusions in terms of endlessly sort of growing, pushing for, on their part for the relations with the Russian Federation. But the fact is that we're still common interests regional and global and of course this country tries to the maximum to use its geopolitical situation and position in the world. As for specific areas, I think that we have absolutely unique opportunities to improve and to build our relations in China apart from traditional ones, military, technological, building major projects, construction projects in China, nuclear power stations. But agricultural imports from Russia to China and in that sense we have quite unique possibilities and opportunities to increase our experts to obtain the currencies, free exchange of currencies. And we count on the reciprocal steps on the part of China in terms of their investments in Far East and Baikal region. This is key in terms of our interaction with Chinese partners. Finally, I would like to say yes, we increase our relations with China. This is not our reply to the Western sanctions, but there are limits here and we don't have any illusions about our free friendship with Chinese partners. Mr. Deputy Prime Minister, we could expand it a bit. We speak increasingly not just of an American pivot to Asia, which hasn't been on the agenda as much recently, but an expanding Russian pivot to Asia too. And in the context of what we've heard from Prime Minister Abe recently, do you think there's an opening with the Japanese? There's been a long-term territorial dispute. At the same time, it would provide a lot of balance for the Russians in the region if you could see a breakthrough and a desire to have a summit between Mr. Abe and Mr. Putin. Where do you see that and how do you see strategically this pivot from the Russians towards Asia? What does it look like over the coming years? What does it mean for how we think about Russia at the web? You know, periodically we discuss this issue within the framework of Russia turning to China and in Asia to Asia, but it's not exactly the same. It's 36% of the territory of Russia, the far east, and we have to develop this territory, and we don't see any major differences between creating conditions for Korean, Chinese, or Japanese businesses if talking about intensity of our activities. Well, of course, Japan, Korea, and China. These three countries invest in Russia more and particularly in the far east region. As for the expansion of this list, well, recently I had quite a few meetings with the Indian major companies, so that will be the fourth investing country. So we create this base for Russian business community, and also this is opportunity for our partners. Europe is further away from our region, so the interest is less, maybe sanctions, maybe distances. I don't know, but here I would like to quote one of the Chinese leaders. It doesn't matter what color is a cat, the most important thing that the cat should catch mice. Well, this is it, and I'm very happy when I can see that investment are coming back to Russia. We had quite a few situations when people invested in other countries, and then they're coming back to Russia. They're ready to invest, reinvest in Russia. It means that we're on the right track, and it means that we can work there. A thousand years of history and Confucianism. So I do think there's cultural alignment at least at the high level. Ambassador Isinger, when we then take the Russian-European relationship, the traditional relationship, and also where it is now, and you see the challenges of the European economies from those sanctions, you see the governments in Hungary, in Poland, in Greece, many that are even Italy and France in a different position than where the Germans have been historically. How much do you think the Russians need to do? How likely do you think it is we're going to see reproach mods between at least Russia and Russia? Is that a different question for you than a rapprochement between the Russians and the United States? There may be folks in the U.S. Senate or elsewhere who believe that it is in their interest or in our interest, the Western interest, to see a Russia that is as weak as possible. Some people have said this. That is not our view. Certainly not the German view. I see a couple of CEOs of major German companies in this room. They would love, and I have great sympathy for that, they would love to see the sanctions ended rather today than a year from now. And there is no enthusiasm at all about the sanctions. We want a stable, a prosperous Russia that is a comfortable partner for us. We have had over the last few decades, my memory serves me correctly, approximately 6,000 large and small German companies who have done business with and in Russia. Many of them have invested in Russia. So we want to go back to a more normal situation. That is why I think 2016 can be a year of opportunity. The buzzword is compartmentalization. What does this mean? We need to understand that even while we went into this crisis over and in Ukraine, Russia was actually a good and constructive partner in getting the Iranian nuclear deal accomplished and ratified. While we are still struggling over how to complete the Minsk accord over Ukraine, Russia is at least sitting down with Sergei Lavrov with John Kerry, et cetera, in trying to create an environment, a framework for addressing the Syrian civil war. We have failed to do that, unfortunately, for four years. And we carry collective responsibility, the West and Russia, by the way, for having failed to do this and for having created the biggest crisis in and over Europe because of the refugees and the largest number of refugees worldwide ever. In other words, our track record, our collective track record, whether you speak of the G7 or of the G8, is really bad. And let me end by saying that I hope that a way can be found to reestablish the membership, the participation of Russia in the G8. I thought it was not a great diplomatic idea to exclude Russia from the G8 because as we now find out, we need Russia in various decision-making areas. But as I have learned in my career, one of the key problems is face-saving. How can the G7 face safe, safe face if they now re-invite President Putin to the G8 if the Ukrainian crisis is not sufficiently resolved? They would probably lose face, certainly as seen from the Republican side in the U.S. Senate and seen from many on the more conservative side in the European Union. So this is not going to be a very easy exercise, but it is our interest to see Russia inside the tent to have a more normal business climate re-established and to get Minsk completed. And there needs to be active and strong Russian participation. And then we can address the Syrian conflict. And then we can overcome, hopefully, this huge divide over these narratives that I mentioned earlier, which is really a big problem because it is poisonous in terms of how our peoples, our nations, relate to each other. Germans and Russians actually like each other. And we need to go back to that. The hard to compartmentalize, as you say, the G8 issue compared to others. But am I, I'm getting the sense that in terms of the geopolitical crisis that we've experienced with Russia, would you say that we've all, in your view, have we passed the peak of that geopolitical crisis with Russia? I certainly hope so. You think so? I certainly hope so. I'll mention just one tiny bit of where I think there's a, you know, a small positive sign. In three weeks, as you mentioned, we'll have the Munich Security Conference. The Russian government yesterday released a press release announcing that it's an unusual move, I thought, but it's a good move. Russia will be represented in Munich not only as has been a tradition by Foreign Minister Sergei Lavrov, but they're sending your boss, the Prime Minister himself, to, I interpret this as a gesture of Russian goodwill to have more dialogue, not less. And to have less confrontation and more, more, more, more, trying to do things together again. Hopefully. I hope I'm not wrong. I hope you're right, and I think everyone here does. I'm going to get a question or two from the audience. Before I do, though, I'm going to have a last question for Minister Kudrin. If we've passed, if we've maybe passed the peak of the geopolitical crisis with Russia, it certainly doesn't sound from your perspective like we've passed the peak of the economic crisis. And I mean, I only look at the Russia house this year being at coffee clutch as opposed to a big three-storey thing and feel like there's still a level of less integrated, Munich Security Conference, bigger, but on the economic side a little more withdrawal. Tell me, in the coming year, what are the one or two things that if we see them, if all of us see them, it would make you feel that the economic crisis, we'd actually pass the peak. And a little unfair, if that doesn't happen, where do you think this starts to go? How do we actually look at Russia that continues to deteriorate economically, sir? The peak of the economic crisis, it is related to the oil prices. And of course, partially sanctions, because we are limited in terms of attracting financing and certain technologies. But this crisis will pass. And the economy is going to adapt to a new level of prices, restructuring the institutions, and 2017 will be the year of zero growth or even positive growth. But as I said before, the most important and profound issue is the reforms in Russia. Whether we start to launch reforms and whether we will be able to get away from stagnation situation, low rate, low growth rates would be able to build competitiveness and protect and defend investments. But in our discussion here, I would like to stress another thing. Russia never, ever refused the objective of the development of the democracy integration and the world economy. We don't refuse that. We don't deny that. We are now probably going through the geopolitical crisis, but it will pass away. This is not even the Cold War years in the Soviet Union. Unlike the times of the Soviet Union, we don't have different ideological objectives. We are not in confrontation as systems. We don't try to prove to each other that we are a unique individual and cannot work together. We have basically the same values, democratic values, market economy, the constitution of the Russian Federation, and maybe we make some mistakes and maybe we don't comply with what we all talk about. But this is an issue of revolution. And I'm sure that Russia, after certain discussions, negotiations, or a new dialogue, will come back to all world organizations, including G8. Not because of its strengths as a superpower, but because it has certain qualities, including military, geopolitical qualities, which were basically the reason to include Russia in the G8. But G8 is going to change too. And G20 will be different. They will be pursuing different objectives. Maybe the Security Council will be reformed in the United Nations and will be performing a totally different set of functions. But Russia should be in G8 so that we would be able to solve these important, crucial issues and problems for the rest of the world, for the whole world. So we understand our objectives and our task is to follow, to implement these objectives. I believe that the sanctions are going to be decreased this year, next year. Nobody in Russia is going to be able to do that. But if you are looking for continuing these confrontations and on the basis of Minsk agreements, these sanctions are going to be reduced. If you can identify yourself and direct the question before you start, I've got one and two. If you can do them quickly, I'll try to get to both of them. I'm talking about $18 billion and some of those debts are because of credits you gave for the infrastructure in Sochi and you gave the credits not directly to the infrastructure but to major business people like Mr. Deripaska, Mr. Wexelberg or Mr. Putanin. Now my question is do those businessmen have to pay back the credits or is it the taxpayers who have to pay back them finally? And is there some agreement on this? Thank you very much. Thank you. Of course our objective is to that investors would pay back all these credits, not taxpayers but you should address this question to them whether they are going to return this credits or not. I hope for a positive answer on their side. But I think that you read my thoughts and conscientiously asked this specific question but I would like to remind you what Alexei Kudrin just said that we have to switch on our brains in a different fashion. We have to reformat our attitude towards reality even in the fat years, at least in now Russian situation, I mean years when we had everything okay when the oil prices exceed $100 per barrel and when we have big social expenditures but even in these years we have to abide by a very conservative scenario I mean in Russia and Olympic Games and in essence what we actually did we national project but that was again in fat years in that period when the state didn't think where to take money for this project we have a bank probably they should think about it we took credits in other foreign countries in currency and now we are facing this situation but this problem should have been resolved by the state to develop a federal program Olympic Games and the national bank should be a point as a bank financing this construction and to agree with the investors that this money will be returned not within 10 years but within 50 years and this is the situation when many federal programs should be financed in a way they should be financed when we put money thoughtlessly in the programs and projects and then they say that they are inefficient so we have to change our attitude our mentality and we have to approach many of these programs in terms of the business project to select institutions that would borrow money under the condition that they will be paid back even in 100 years but this should be the example how the state and investors should interact in terms of implementing state scale projects thank you about project financing not so bad not as bad as you say I was in Sochi in winter and many many tourists there of course we cannot compete with Swiss resorts but to create a new tourist cluster winter cluster in Russia this is the right approach and the right choice thank you quick question you are mentioning all these opportunities coming from the crisis but the truth is that most people in Russia are much worse off than they were two years ago what is your message to them looking at the exchange rate and the oil prices because it looks like it is not going to get any better for them any time soon thank you first I have already stated that this is the responsibility of the government to conduct the reforms quickly so that to diversify the Russian economy and to replace the diminishing income from oil prices well in Perm in my city in the beginning of 90s when I started to work the average income was 30 dollars per person and now 500 so you can see there is a difference and I believe that if there is indeed we have the task of independence of our country of diversification will be strong enough to do it question to a couple of the panelists before we close a little summary there are lots of challenges for the Russians both geopolitically and geoeconomically and yet the level of urgency clearly nowhere near as sharp right now on either of those issues as we have heard on so many other issues that are dominating the forums agenda this year and I think that is interesting in the sense that it provides both space for the Russians to formulate responses if they choose to but also rope for them to hang themselves with if they choose not to I wanted to close this to refer back to what I thought was a really big and important structural question that was raised by my friend Ambassador Essinger which is that of the narrative so often and it is not just in the cold war but surely there is some hangover that the west and the Russians have different narratives that we have written the stories over the course of the last 25 years with different historical points with different perspectives and calculations with different national interests and with different feelings of slight and peak even more than perhaps with the Iranians in the west over the past years and there has been a breakthrough there there hasn't been a breakthrough in the narratives between the Americans and the Russians even the Europeans and the Russians yet I wonder you put that fairly starkly so that was the big issue I was going to ask to close this first Minister Kudrin and then our Deputy Prime Minister could you talk about just briefly what you think can be done to try to bridge these divergent narratives so it's not just about geopolitics and geoeconomics but it's also about cooperation on the same page start with you sir you know Russia has never moved away from its goal to join OECD the Organization for Economic Cooperation and Development we maintain our contacts and we still plan to accede to various international institutions, conventions to fight poverty, corruption improve governance we perceive ourselves as a part of the world as a country that in its international relations so we'll take on board the requirements that are developed by the international community will be another stakeholder in this process and I think all parties involved Russia, the West have to rethink the crisis that we're faced with it is not accidental it is not artificial it occurred because at a certain point we count each other's interests enough but now as a result of this crisis we went back to this objective it is back on the menu so I do hope that during the Munich conference the first steps of rapprochement will be taken the first proposals will be made and I think this will be a good example but there are many formats of this kind, bilateral meetings between our leaders between our business communities and in this respect I'd like to propose to all stakeholders to use these formats for a step forward for a compromise inevitably will reach an accommodation and I'm absolutely sure of that whether this period of negotiations will be prolonged or it will happen quicker remains to be seen you know indeed different people have different cultures different traditions different histories at the same time when we want we can understand each other what in my view would help us to understand each other better and faster we need to do away with double standards I don't think that all situations in the world are viewed similarly and that the members of G7 do not do anything that other countries would view as unjust something that brings sorrow upon other people so the world needs to become more fair and just and we will understand each other better I'll please join me in expressing some appreciation for our panelists for this years project