 Ladies and gentlemen, thank you for joining us here this afternoon. My name is John Fraher. I'm a senior executive editor at Bloomberg. I'm very excited about this panel that we have for you this afternoon on the outlook for Russia. 2018 will be another big year for Russia at a time when the country seems to be barely out of the global headlines. We have a presidential election coming up in March. We have, of course, the World Cup comes to Russia this summer. And of course, the crisis in Russia-US relations keeps rumbling on. On the domestic front, the big question is how and whether the government can kickstart growth after years of subpar performance. In an age where other developing countries like China are pouring huge resources into AI and other technologies, there's the question of whether Russia risks being left behind. And of course, sanctions still hang over the whole economy and many of its most important actors, which raises the question, what, if anything, can be done to normalize relations with the West? So briefly, I'd like to introduce my panel on my left, Arkady Dvorkevich, the deputy prime minister. To his left is Marcelya, chairman of ENI. We have Alexei Mordeshov, chairman of Servicetal. We have Sergei Gorkov, chairman of VAB. And we have Frederick Kemp from the Atlantic Council in Washington. Mr. Deputy Prime Minister, let me start with you. We're heading into a presidential election. And by some measures, things are going very well for President Putin. He's riding high in the polls. He's increased Russia's influence abroad. And yet, when you look at the economy, things are still pretty grim and pretty disappointing. It's struggling to pull itself out of the longest recession since Putin came to power. And there are signs, there are a few signs, that the economy is managing to diversify itself away from oil and gas. How can you assure the investors and the audiences gathered here in Davos that Putin's fourth term will be different? Thank you, John. First of all, let me thank everyone in the audience for joining us at this Russian strategy session. I would not say that figures are grim, actually. If you look at the numbers, we have historically lowest inflation. We didn't have 2.5% ever in Russia, which means that we have a very good chance of real incomes going up. And actually, we started to see this already towards the end of last year, and it's the beginning of this year. And interest rates started to go down. And this makes opportunities for especially small and medium enterprises wider. And opportunities for new investment projects will be bigger and bigger. And we started seeing that in some of the sectors of the Russian economy, like agriculture, chemical industry, car manufacturing, 20% up last year. And as a result, we fully recovered from the recession of 2015 and 2016. So if you compare 2017 with 2014, we have zero growth overall. But with improvements towards the second half of 2017, the only factor under lower growth than we expected before was lower oil production. That was the result of our intentional step to enter OPEC-plus deal and stabilize oil markets with the benefits in the medium term. So we did this in open mind, and we believe that was the right step. It cost us some few decimal points in growth, but I think it was a wise decision to make. The important thing is that I think the last point makes it clear that it is not the commodity sector that grows. It is either new commodities like grain, grain production, the record high in Russia, and our agriculture is growing very quickly, or manufacturing and services. With the recovery of household income, we have higher imports of investment goods to new investment projects of both Russian and foreign companies in Russia. We don't have any direct investment outflow. We have increasing foreign investment. And as a result, we were able to increase real wages, keep unemployment low, and stabilize demographic situation in Russia. So that's the picture. The investment climate is better. And it is not just our statement and our assessment. The World Bank increased the position of Russia in its doing business rankings. We are now in the first 40 of countries. We were in 128th place just five years ago. Is it already good enough? No, not good enough. We are far from the assessment that Russia is in a great economic situation and everything is done. But the situation is positive. It is not negative. That's the statement I would like to make very clear. So are you saying that we shouldn't really expect any major change from a fourth Putin term, if presuming he wins, any big change in economic strategy? We should just continue what we were doing. I started with inflation. Why is it important? Basically, we completed macroeconomic restructuring of the economy. On the macro side, we have low inflation, flexible exchange rates, so exchange rate risks are very limited. We have increasing international reserves, very low debt ratio, below 15% of GDP. The corporate debt ratio is also going down. So macroeconomic risks are very low. Now we should focus more on business environment and structural reforms on the micro level rather than macro level. So the focus, the priorities will be different, but the overall strategy is the same. Just a very, very brief, quick question. You mentioned the OPEC deal. Do you think it would make sense to extend that into next year as well? Right now, the decision was to extend it nine months till the end of 2018 with monitoring in the middle of this year. So we will look closely together with our partners. We'll look closely at the market situation. Our Minister of Energy is in daily dialogue with his partners, including here in Davos. We'll have our joint market assessment, and we will take the decision. So it is just too early to say what we'll do next. Okay. Ms. Mordischoff, I'd like to turn to you. Two of my Bloomberg colleagues last year wrote that you built your fortune from the heat and sweat of steelmaking. But now you're increasingly becoming more and more interested in retraining, in training Russians for the industry of the future. You've been investing in this. When you come to Davos, you hear a lot about the arms race and technologies like artificial intelligence, self-driving cars, et cetera. And that's often expressed in terms of the arms race between China and the United States. Do you worry that Russia is getting left behind as the global economy modernizes? Of course, Russia should be doing better. We should do more, for sure. And well, I hope Russia is not heading behind, but as I've said, we have to do more. And what we are doing in these fields, it's one of the reflection of this trend. We are investing now in so-called tech system of online education. We see growing use of internet, about 70% of Russian population use internet. And definitely, we observe the same trends in Russia like everywhere about technological shifts, which probably will change the paradigms, shift the paradigms in the employment in general. And most probably people will change the job, not only jobs, but profession, within their career life several times. And we believe that online education, it's not education, it's just a system of development using opportunities which are provided by internet. It could be very, very helpful. And we believe it's going to be a very, very big business, business potentially multi-billion size. It's not just helpful, it's fundamental to anything we should be doing in the future. It's a new kind of training people, adjustment to the new waves of technologies that are faster and faster and larger and larger is a key. And government will support those kinds of projects. And just to briefly focus on the economy, I believe you met with, you and some other executives met with President Putin in December. Did you talk to him? Did he talk to you about his business strategy for a fourth term? This meeting was not to talk about business strategy of specific operations. But definitely we've spoken about business climate and directions which are very important for Russia. I believe that Russia should do more in order to embrace new technological development for sure. And it brings us a lot of opportunities and a lot of threats. And I'm not suggesting to spend billions of Russian state money to invest in these fields, but probably something like public-private partnership in a way could be helpful. And we see a lot of rhetoric from very top decision-makers level in Russia about necessity to invest and support from the state all these developments in related with digitalization, internet. And I'm sure that all Russian corporations, and hopefully most advanced first, will invest a lot in these fields, in digitalization and online education, in development of people. It's going to be a very, very big topic for all of us. Mr. Gorkov, we were speaking before this panel, and you were telling me that, and this is something I didn't know, that Russia is one of the leading countries in terms of establishing blockchain companies. And your bank has been looking quite closely at this. Blockchain is obviously one of the big buzzwords of Davos this year. I guess I'll start by asking you, is there a blockchain bubble? Is there an expectation bubble about blockchain and what it can see? I think it's a bitcoin bubble, not blockchain differently. But if we're talking about currently economy, the situation in Russia, of course, I agree with Deputy Prime Minister, it's quite stable in terms of GDP growth, in terms of inflation rate. It's very low, historically low. But very important, understand this basis is based on old, not old, but traditional economy. And for Russia, very important to see the future economy, because future economy will be based on different technologies, definitely. In this case, we need to create the focus for which technology could be for Russia possible to be a leader, to have leadership. And we found one of these, it's blockchain. Actually, we started this project one and a half year ago. And this period of time, when I come to many, many my partner and explain about blockchain, it was many, many discussion, a lot of people think blockchain is bitcoin. After that, bitcoin help us a lot, because hype with bitcoin help us for blockchain technology. Because it's not the same, it's quite different. And if we're talking for new technology, I think Russia, in terms of blockchain technology, have a lot of possibility to will be a leader, definitely, based on many things. First of all, if you see five top company from blockchain in the world, the three always have Russian owners. It's a lot. Second, if you see about concrete pilot, which we start to implement in Russia, not just web, for example, Sberbank. Sberbank and web create quite big hype about blockchain. And now we, yesterday, explain on blockchain conference what Russia doing in this. And actually, definitely, we have full possibility to will be leader of this technology. Not just, of course, only blockchain, we need to make a focus for another technology as well, for example, quantum technology or AI technology. But in this case, we need to understand our resources because, of course, we have, I think, about human resources, we have excellent human resources in terms of quality, in terms of flexibility, but very important creativity, but very important understand the focus for Russian economy as well. It's when we create the matrix of this and very important that government, Russian government create new program, digital agenda for Russian economy. It's actually put in this program the concrete parts of digitalization for all country and for all industries, but very important to make a focus and create the concrete steps. But in some technologies like blockchain, I think we are not could be leader, we're already leader. But are you seeing like very, do you already have concrete operations going on inside your bank that use it? Or is it still very much in the laboratory? We have, of course, project in our bank, but very important because we're developing bank of Russia. We are ready to create platform. We create open source platform calling blockchain Khamuna, which have a lot of residents, mostly residents from different countries actually, from US, from Europe, from Singapore, from Russia as well. And actually it's common work which creates a new technology because blockchain actually developing as well. It's not just stable technology which actually after one year we see how blockchain moving as well. And it's very important to will be in hype, to will be leader because you know it's speed, it's very important for all innovation, but for disruption technology it's number one. Speed is number one. Mr. Mordeshev, did you want to say something on that? Yeah. Can I make one comment? It seems to me it's all not only about the position of Russia as a country, but it's also very important and very relevant for all companies in Russia. And it's also not a state goal, but a very big task for all corporations, all companies to pay attention and to embrace this technology in day-to-day life. And we are investing in it, not only besides steel business and developed new business and online education as we discussed before, but also we are spending a lot of money in digitalization, in the job technology in order to implement it in practical business of our companies just to have fruitful results. It's not about the national leadership, it's about also practical development of companies in national economy. No, in this case, very important environment because regulation, if you see regulation, it's important because innovation is speed, yeah? And for innovation, speed is very important regulation because sometimes regulation is very positive, but sometimes it's limitation for speed. In this case, we need to have flexible regulation and not just in blockchain technology, but in many other technologies. Yes, that's what I wanted to add. The role of the government is not just to support the ecosystem, start-up, or ecosystem for large companies who develop those new platforms, new technologies, but to ensure that, yes, regulations are flexible and it's a challenge for the world at the whole, not just Russia. The world is not adjusted yet to this quick transformation of technological picture. Second is cybersecurity and many ethical and other aspects of that issue. Third is education that we already talked about and forces infrastructure. Access to internet was mentioned already, access to modern telecommunication services is a government-private project that we're doing together. So those four things the government should ensure to promote those new technologies. Well, we'll hold you to that next year. We started doing that, yeah, started doing that. Ms. Marchegaldi, I'd like to turn a little bit now to the international climate. Of course, everything we're discussing here about the domestic economy is happening against the backdrop of sanctions and the very difficult business climate for Russia. Any is what is a company that's had long ties with Russia. I think you were the first company that operated petrol stations, gas stations after the fall of the Soviet Union. And of course, you're working with Rosneft on two exploration projects and you buy a lot of Russian gas. That doesn't sound to me like you're having huge problems with Russian sanctions, it's hurting your business. Or would your business be so much better? First of all, let me remind that we are present in Russia from 1950. We were among the first to import oil from Russia. So we know Russia very well. Now we are importing around 20 billion of cubic meters of gas into Italy. This is more or less 30% of the entire consumption in Italy. As you said, we have also, so we have very strong relationship with Gazprom. We also have very strong relationship with Rosneft. Rosneft has become one of our equity shareholders also in the big giant discovery in Zur in Egypt. We are also working with them. We are giving them some of our technology also in refinery. So I mean, we have a very bold and large relationship with Russia for a very long time. As you said at the beginning, we started to drill a well in the Black Sea. This was after the new sanction arriving from the U.S. Of course, before starting this, this was a very long time thing already projected. Of course, we asked authorization to the U.S. And so we obtained the authorization from the U.S. So we started to drill this well, but then now we have to stop it because as you said, the sanctions are hitting this. So we will try to understand a little bit better what we should do, but also this situation of a little bit of uncertainty is creating some problems. But anyway, of course, we have to be absolutely compliant with the U.S. because we are also listed in the U.S. for us. We have a lot of shareholders in the U.S. So of course, sanctions are affecting the situation. I have to tell you this also from, I'm also the president of the European Federation of Indies of Business Europe. I have to tell you that overall, as you know, the relationship between Europe and Russia is anyway very important. This year, as you know, the trade has improved a little bit. We have an improvement of 25% in exchange with Russia. Anyway, we are still 45% below the level that we had in 2013 before the sanction. Anyway, the EU is still number one trading partner for Russia and Russia is fourth, is the fourth trading partner for you. So we are still very important. Of course, Russia is, I mean, the most important supplier for gas for Europe, 40%. So I mean, the relationship is very important. And as you know, I mean, business leader and business people don't like sanctions, but of course, we are not living in a vacuum. So of course, we have to take this into account. But I think my position is that even in this situation where it's not so easy to work with Russia, I think also as business people from the different, from EU and Russia, we have to stay in touch. For example, I think we have also to work to make the situation on trading better. For example, of course, they have this Eurasian association. I think we should anyway work not to have too many non-tariff barriers, to have standards that are more, I mean, closer between Russia and EU. So my point is, of course, there are sanctions. We don't like it, but we have to be compliant with that. But I think it's important to continue to work also between business and try anyway to have a kind of, to have not too many non-tariff barriers and to have the same standards. So to be ready when and if the situation of sanctions will change to restart. So what's your outlook on that? I mean, part of your job running a company is to think five, 10 years down the line. What's your view? Do you have sort of a fixed view on how long do you think sanctions will last? Or how do you sort of at the moment assess the political climate in Europe and the US when it comes to sanctions? I mean, my friend, they are good friends. Well, we get to him. Better than me. We get to that. I don't know exactly. My point is that Russia is an important player. If we look also what's happening on the geopolitical situation, Russia, if I think at the Middle East, Russia has a role. If I think also on OPEC, I think Russia played a role. So as business, we would like to have a more open situation. I don't know how long this will take. And of course, as I said, anyway, we have to be absolutely compliant with the situation. Do you sense that the position of your own government, of the Italian government, is changing and that they will pull support and sanctions? You know, the Italian government and also the Italian companies has always been close to Russia, also because of the trading, which is very important. But of course, also our government is a European government. And so we stay stick absolutely to the decision of the European Commission. One correction just for a clear understanding of figures, our trade is, yes, it is down from 40% to 50% across different countries. But there are two reasons for that. Sanctions is only a small part of that. Lower commodity prices is a key part of that. There's two effects. One is the price effect. Lower prices lead to lower volume in dollars, lower volume of exports of commodities from Russia to other countries. But there is also exchange rate effect. We had the exchange rate adjustment after prices of oil and gas and other commodities went down. And with lower exchange rate, we have lower demand for imports. And it is not covered by increased non-commodity experts. So there is a clear arithmetical effect of other factors rather than sanctions on trade. Frank Kemp, I'd like to bring you in for the view from Washington. You've been waiting patiently there. I mean, essentially, I'll ask you the same question about sanctions. I mean, how do you assess right now the political climate in Washington when it comes to sanctions? How quickly do you think it will be before we see, perhaps, even more sanctions? And just how toxic is the relationship right now, in your opinion? It's pretty toxic. I'll come back to the sanctions issue. The one thing that's important to note, and Chancellor Merkel would want me to say this, the Ukraine sanctions are not US sanctions. They're US and European sanctions. And that's what's really given them their power. And they won't be undone until there's a Minsk agreement, until people are satisfied that the fighting Ukraine is over. And so Secretary Tillerson made that very clear at the Atlantic Council that there's a desire in the US to work more closely with Russia on issues across the board, particularly counterterrorism, counter-narcotics, military to military. We don't want to get into an accidental fight with the Russians. But in terms of economic relations, he's made clear as has everyone else in the administration that that won't change until the Ukraine situation changes. And new sanctions may be coming that are election related, and those would be potentially more unilateral. I'll come to that. Preparing for this, I talked to a friend of mine in the US government, and he told me a joke. And he said, interviewer on Russian television asked Vladimir Putin what the strategic outlook is in one word. And Putin says, good. And he says, could you expand that into two words? He says, not good. And the good side is what the deputy prime minister says, which is macroeconomic stability. And that's what Putin has wanted. And most of all, what Putin has wanted is to protect the reserves. And they're now at $425 billion. And that was from a low around $350 billion. So they've come back. It is low inflation. We do have a good budget balance. We do have external balance. So if you look from macro stability element, which is where the liberal economists have been running things, it's working. The not good is you've got stability with stagnation. And you've got secular stagnation since 2004. You've got a GDP that has got the Russian now at 14th largest economy in the world. And it was number six. And so the GDP has gone from $2.1 trillion to $1.1 trillion. You have a situation where Alexei Kudrun, former prime foreign minister, who has a group of people working on a reform plan for Putin to hopefully be looked at after the election, said recently, Russia is catastrophically losing time. And this gets to these questions around technology. There is no doubt, sir, that the Russians are brilliant when it comes to technology. Anybody who in America whose computer has been hacked knows that. And there is no doubt that in terms of blockchain, as you go to the reception here on blockchain, I swear 50% of the people there were speaking Russian or Russian, living in Silicon Valley, living in Australia, living in Russia. So the talent is there. The question is, will the government take steps in structural reform to unleash that talent? And I think there's a crying need for structural reform. There's a crying need for better property rights, a better business environment. And the view of the US is not my view, but this is the view of this US official, is that the economy has been run with a view toward the maintenance of power rather than GDP growth, rather than innovation, rather than other matters. And the real question is, after this next election, will there be a significant shift in that approach or not? I don't know whether there will be, but Russia urgently needs it. Did you want to talk a little bit about the sanctions? So first of all, the IMF has estimated that sanctions take one to one and a half points off of GDP every year, and that there's a cumulative hit to GDP at this point, 9%. That's meaningful. It's hitting primarily access to financial markets and access to technology, and very much energy technology, tide oil, Arctic, deep drilling. What's coming at us potentially is by January 29th, there's supposed to be something called, has come to be known as the Kremlin report, which has been called for by Congress with the allegations of election meddling, which are embraced by almost all parts of the US Congress and intelligence community. And a list is supposed to be provided, and we know from our own work at the Atlantic Council that it's well along, and it's been being taken enormously seriously. Of Russians that are essentially in business Kremlin instruments or carrying the influence of the Kremlin in foreign policy, potentially in the issues of election meddling. The list, depending on who you believe, is going to be anywhere from 40 to 400 people. I think it's going to be more serious if it's shorter. It's going to be more serious if people can see very clearly the links and that this really is right. But it is going to come. But it's just a list at this point. There aren't necessarily sanctions against any of these people. But of course, even the publishing of the list has reputational issues and has business impact. So I'll pivot from that, and I'll just ask a very direct question to Mr. Gorkov and Mordechov. How worried are you two that you will be on that list? You're seen as being close to the Kremlin. It must be something that's on your mind. The chairman of the Development Bank of Russia, of course, is not a company. It's a state's organization. In terms of, of course, we're very close to government, anyway. But our mission is to create new economy for Russia, and create and finance the content project, which is important for high value other products, industries, for example, and technologies. In this case, my point of view, actually, any sanctions, it's opposite way of globalization. It's a real opposite way of globalization. There's not help for not just for Russian people. They'll help for all Europe, for all the world, actually. But it sounds like you think it's pretty inevitable that you think you'll be on that list. Well, the National Bank isn't the list. We're from the very beginning. Well, it's the list from the beginning, actually. And you know, it's three years. Mr. Moryshov, this must be a, you know, what impact is this having on the business climate in Moscow? It must be pretty making things much worse. Well, I don't feel too much of direct impact because sanctions are designed in a very special way against individuals, or targeting very special technology transfer, like offshore oil and gas drilling. For private companies like Savistar, we have nothing to do with government. Of course, we live in Russia and being corporate citizens. Responsible corporate citizens interact with the government, but not more than that. We don't have state participation. We don't participate in state programs. And for us, sanctions don't have immediate impact. But I believe that I feel that sanctions made overall negative impact on the business climate because they're adding anxiety, adding unpredictability. And we have enough risks already, brought by technology, by geopolitics in general. And of course, sanctions add to this anxiety and unpredictability in Moscow or in the whole Russia. But, well, we should distinguish between private and non-private business, I think, in this case. Right, Kambi, you wanted to get us. Yes, short intervention. If this sanctions list includes people just because they're wealthy or people just because they've done successful business, it will be a failure. It is not the purpose of that list, and it's not where it should go. And I don't think it is where it's going to go from what I've understood thus far. People like me who live in the geopolitical world where you want to avoid major power conflict and ultimately you want to have bring Russia, have it find its peaceful, rightful place in a Europe whole and free. That's got to be the goal over time. That's got to be the goal over time. Me and long-term, you can see yourself there. The short term's the problem. And the short term, I think one has to accept that until the Ukraine situation changes, the situation will not be normalized. I don't think the Europeans will drop their sanctions either. And I know that in Russia, this isn't entirely understood. But in the United States, the mood regarding our elections has really swung things. And it swung things with a large number of people who are deep friends of Russia, who have spent a lot of their careers working on Russia. Bob Blackwell and Phil Gordon just wrote a very important piece in Foreign Affairs of the sort that I thought they would never write. And because they've been such great friends of Russia over time. But the feeling is that this set of actions regarding our elections can't just be let to pass because it was too serious. And so I'm not reporting my opinion. I'm reporting the factual case of the situation in the United States right now. So it's going to take some time to address that. And it has economic. You actually can't separate the economic from the political at the moment. And for Russia to really be part of the world economy, we're going to have to figure out a way to address this. Because without the financing, without the access to technology, without the openness and the open relationship with Europe and the United States, I don't think Russia is ever going to be able to fulfill all of its ambitions and potential. What will it take to change this dynamic that we have, this toxic dynamic that we have right now? Well, there's talks going on now regarding Russia. Ambassador Kurt Volker, who is a person I greatly admire, is involved in those. And at various times, they've shown some significant progress. So I think on the Ukrainian side, it's just a set of decisions. Last year, unfortunately, the ceasefire violations were up by about 60%. The hostilities were up. So the trend line wasn't good last year. And the question is, what could turn that around? And so that has to be addressed first. That could be addressed relatively quickly. The election issue is going to be trickier. And I think that it's going to take a level of deep diplomacy and discussions with Russia of a sort that just really aren't taking place on that issue right now. One final question for the deputy prime minister before I take questions. We heard a little bit in this panel about the need for Russia to unleash the talents of young people, especially. And yet, there is perception and there is, arguably, also, in fact, the government, there's a clampdown on the opposition. There are concerns about free speech in the run-up to the election. Are you not concerned that this hinders self-expression? This will hinder Russia's ability to tap its creative resources? Well, first of all, let me make one remark in the last statement about elections. The issue of elections was invented by American establishment. There is no issue of elections in reality. And we cannot discuss something that was just invented by some very elaborated minds. And I don't think that economics and economic policies cannot be separated from the politics, from political considerations. But smart and stupid things can be separated. And the size of the list doesn't make the decision smart. It's still stupid. And the stupid things are not efficient, usually. When asked about efficiency of sanctions today, your Minister of Finance, Secretary of Finance, said that, well, we believe sanctions are efficient since sanctions against North Korea and Iran were efficient. But first, Russia is not North Korea and Iran. Second, sanctions against North Korea and Iran were multilateral, where all countries were part of the decision-making. And this is not the case when we are talking about American sanctions. But again, sanctions is not the most important thing in the world. It's a minor issue that we should not spend too much time discussing. We should just work more and more efficient and work better, rather than think about sanctions. And it is not Russia who is hiding from dialogue. And it is not Russia who is not open. Americans are hiding from us in Davos. It's a small village, but they don't want to talk. They're hiding from real discussion about this stuff. Did you ask for a meeting with President Trump while he's here? Of course not. I'm not the president of Russia. That's a good thing. So I'm not in the position to ask for the meeting with Mr. Trump. But certainly, I was ready for contacts with members of American delegations. And recently, I think one area where there is some dialogue is energy. Without Russia, it's very hard to discuss energy issues all together. So they didn't reply to your emails? Or how did they just? We have channels of consultation that you can imagine. But your question is much more important about unleashing talent and dealing with more important issues. I don't think we have more problems with freedom of speech than any other country. We have cases where we can state that there were problems. But the same can be stated about any big country, about any big society. And you know about these cases in other countries. I should not mention that. And some people have been fired because of their reports and because of their activities. So do we have a problem? Sometimes we have problems with all kinds of issues, but not more than in other countries. I think more importantly is what we do in our economy, in our institutional arrangements in Russia, on the micro level. And we mentioned some of the things that we have to do, judicial improvements in judicial system is very important to have a level playing field for the society as a whole, for SMEs in particular, for individuals who want to explore new opportunities. And we know all the things we are trying to improve the system. It is important to understand that we were not actually losing time but not doing some things. We just focused on the things we had to do first. And you mentioned macroeconomic indicators that show that clearly. I didn't mention but it is important that the central bank was very tough on fighting inflation and also aggressively cleaning the banking system. It comes with a cost. When you do such things, interest rates are very high and access to credit is very limited, very low. And you cannot have thousands of new projects when interest rates, real interest rates, above 10%. And we have just a few banks who can actually give credit to new companies and individuals. So it all comes with a cost. But we basically finished this phase and we can enter the new phase where we can support businesses and create new opportunities. On that, so I'll turn over to the audience now for questions. I think we have, there should be some roving microphones around the room. Does anyone have any questions? Oh, there's one over here. I can't see you, but. We can't see anyone since it's late here. Can you please identify yourself when you ask? Can you see me? You can hear me. Thank you very much for the look-on of the Russian Global Affairs Journal. I have two questions. One to our Italian speaker and to American. You, from the context of your statement, did I get right that we cannot expect any change and European sanctions before Americans will lift it? And Mr. Kempe, I assume that you don't share the view of Vice Prime Minister that the election issue was invented. You mentioned that serious work will be needed to turn this page, but what kind of action from the Russian side does US political establishment expect? Do you mean that Russia should acknowledge meddling and ask for excuse for that or what should be signed for the American political community that it's time to change attitude? Thank you. V.I., I start. Of course. No, well, maybe I didn't explain myself very well, as you know there are two set of sanctions, different one, one are Europe plus US, let's say the previous one, and these are linked to the fact, to the Minsk process, let's say. So in a certain sense until Europe and US, but also now I'm talking about Europe, didn't see, don't see a real progress on that, probably the sanctions will stay there. So this is one part of the sanction. Even though this, as the vice prime minister said, yes, they affected the economy, but not so much. So there are some problems there, but they are there, then there has been a country sanctioned from Russia to you for example, or the agri food and whatever. So altogether this first part of sanction are still there, and I think this is linked to the Minsk process. So this is one. The second one I was referring also talking about E&I are the, let's say unilateral sanction by US, the one arrived in the last month. And these are mainly on the energy part. So these are only American. Honestly, there's still some uncertainty there. Some explanation has been done for what regards us, but still is not clear where they are applied, how they are applied. And as Mr. Mordeshoff said, when you have this, when you have sanction always, business people don't like that because it creates problems. And in this case specifically, they are not so clear. I mean, you don't know exactly how to apply that to whom they are applied. So this part is very linked to the decision of the US. And of course, for a big company as E&I, as I said, we have a lot of American shareholders. We are listed in the US. This sanction could be a very tough one and can hit strongly everything. So of course, in this situation, if there is also a small risk that we can be hit by that, of course what we have to stop what we have done. So one part has been clearly and specifically authorized by the US authorities. So we decided to go on. And the other, we are still trying to understand what the US authorities will do. So in this situation, we cannot go on. So that's the situation. So there are two set of different ones. The European ones are linked to the means process. Mr. Kemper. Although the question wasn't asked of me, I think it would be very difficult for Europe to depart from the sanctions path that was done jointly with the United States. And very carefully, by the way. And by doing it carefully, one used tools that were not draconian. They were really meant to send a message and keep Europe and the US together. And without a fundamental change in Ukraine, I think Europe would be in danger of losing a lot of credibility. It must be said there are countries in Europe, as always is the case, that were more in favor of this than others. And so you'll also see, as always, political efforts to drive a wedge between different European countries, which I also expect will be the case. In terms of the, this wasn't a panel on cyber and elections and you could have two hours on that and so I won't go into that. But I don't represent the government. All I can say is in the United States, rather than more questions about whether Russia meddled, rather than fewer questions about whether Russia meddled and less evidence, there's more conviction and more evidence. And the newest is evidence that Homeland Security has come up with where there was a probing of actual voting machines. It's unclear what was done in the voting machines, one doesn't really know, but there was a probing of it, that's now prompted new legislation being brought for a vote called Deterre. Marco Rubio is one of the sponsors and then there's a Democratic sponsor. But it's looking forward to our 2018 midterms. So in the US intelligence community and the US Congress, there's a consensus that this is factual. And so my answer, I think going forward, I think it is going to be difficult for Russia and for the Russian leadership to say yes, we did that, we're sorry, here's all the information of how it came about. But you could take steps bilaterally, multilaterally, that would have to be real and verifiable in a cyber direction. I'm not smart enough to know what those would be. But you really could show behind the scenes and certainly intelligence communities would see them, some good faith steps and some de-escalation of some of the actions that take place almost on a daily basis. But as I said, I'm not the expert there, but I'm reporting the mood in Washington. Any more questions? You in the new stage. Hi, my name is Yasmin Chekhta. I'm an entrepreneur from Egypt. I have two questions actually, the first for the gentleman from the prime minister's office. Now that Russia is becoming more and more involved in the Middle East, can you tell us a little bit about what your strategy is, what your future vision is? Because for a lot of us, we don't know what the end game is. And we've already had a lot of superpowers meddling in our region and it never ends well for us. And for the gentleman in the business community, what our region really needs is not another conflict. We need investment, we need jobs. Are any of your big companies actually have plans to invest in the Middle East? Because that's what we really need right now. Thank you. Can we keep the answers short? Yeah. We don't want to get one more round of questions. Yeah, we're very short. First, we believe that Middle East is a very important region with huge potential to grow and become one of the drivers of the future economic growth in the world. And Russia has to participate in that if Russia wants pragmatically to get benefits, but also to bring benefits to the region. Second, we truly believe that only economic development and growth can reduce security concerns in the region, reduce migration and flow of people from the region to safer places. And we need all together, Russia, Europe, United States contribute to the improved economic development in the Middle East. We have our expertise competent technologists to bring to Middle East peaceful nuclear energy, agriculture, other projects. And we will do that, both in Egypt and in other countries. From the business side quickly? Well, maybe you know, E&I is a big investor in Egypt. We have made this discovery of this giant in gas in Zor. We will invest $10 billion there. And I think it's very important also to say, and you know this, in the last year, Egypt had a lot of problems because you had to import gas and energy. And I know because also in my family own company, we are in steel. I'm a very strong customer of Mr. Mardesh, but I also buy steel from Egypt. And I know that in the last years, there were a lot of problems. And some companies had to shut down because there was no electricity. And with the discover of Zor, Egypt will be independent, will not need to import gas anymore. And I think access to energy and independence of gas, it's really one of the things that can really improve the situation and make more growth in your country and also in the old area. Is there a question at the front? That's fine. Well, if one comments about Egypt, because we're Very quickly, yeah. Yeah, we're developing bank. Of course, we support the export. We have a few projects, actually, which we support for some of our Russian products. And just recently, last week, we made a decision about increasing the limit for Egypt and increased to $3 billion, actually, which is good news for Egypt. Hi, I'm Bill Browder, the CEO of Hermitage Capital Management. At one time, I was the largest foreign portfolio investor in Russia. My question is for the deputy prime minister, Dorkovich. As you know, my relationship with Russia has not been an easy one. I was expelled from the country. My offices were raided. My lawyer, Sergei Magnitsky, discovered a $230 million tax rebate fraud committed by Russian officials. He was then arrested, tortured, and killed. As a result of his murder, there are now five countries that have imposed sanctions, Magnitsky sanctions, on Russia. You mentioned that you don't like the election sanctions and it's all made up. The Magnitsky story is not made up. It would be easy to prosecute the people who did it. Why does Russia insist, why does your government insist on covering up the Magnitsky murder and not prosecuting a single person and covering for them? Thank you. Well, this question is in Davos every year. And we, I think, responded to this question many times. So I don't think I should repeat that. Actually, I didn't say that I don't like the sanctions. I don't care about sanctions. We just work. And hopefully, we will achieve good results. We care about people. And unfortunately, sanctions are used by United States. Even if we imagine there is some goal related to Russia, but sanctions are actually used by United States not just to punish Russia or to send a signal to Russia, but to compete with Europe and other countries. Sanctions are definitely used for this purpose. And I think the efficiency of achieving this goal, US getting higher competitive positions with every Europe and other countries, is much higher than the efficiency of sanctions against Russia, as it is. And this is our attitude to any sanctions that have been applied to Russia. But as far as specific case is concerned, I'm not working for law enforcement agencies for general prosecutor's office. So I'm not in the position to give any more information on this particular case. Any more questions? We'll have one more. Good evening. I'm a global shaper from Kazanhub, Russian Federation. I want to ask you some question. How shapers can help to support and help international relationship? We have a lot of relationship with other countries, with USA also. And we want to help to build a great relationship, international relationship. How we can do that? One of the best, I think, answers is to build trust among people, common people. When we are talking about that Russia did something, or United States did something, it's not the whole of the United States. Usually it's the government's DC establishment. When we're talking about Russia, even when we're talking about elections, if you find that some Russian hacker did something in the United States, it's not Russia, even if it's true. I don't think it's true, but even if it's true, I don't think he was in the Kremlin sitting at the computer of presidential administration office and doing something in the United States. But even if it is true, I'm not saying it is true. So you should build trust. Millions of people who want better relationships and getting those people together, knowing each other, coming to our countries back and forth as tourists, as businessmen, as students, as teachers and researchers is the best thing that can be done by a new generation of people. I have a really brief answer to that because I think it's quite important. We're working on a project now looking at Russia-US relations maybe out to 2040, maybe out to 2030. And this is a great exercise for a global shaper to do, which is look at your worst case outcome in 2040 in the bilateral relationship. Look at your best case outcome. Look at the middle case outcome. Obviously, you want the best case outcome. What is it and how do you get there? And then you're entitled to your own opinions, but you're not entitled to your own facts. What are the facts and then how do you get there? And I think it's a great exercise that we should be undertaking bilaterally with experts over time because this relationship is just too important to get wrong over time. And we understood that in the US-Soviet period and in many respects, we were closer then and we were talking to each other about our problems more closely then than we are now. And so that would be the exercise that I would say the next generation could go through. And we are going to go through that process. Yeah, fully revisit, yeah. Yeah, well, on that note, I mean, just to briefly sum up, I think we've heard two sides of the coin. On the one hand, some of the perhaps more surprising, some of the arguments we've heard today have argued that the glasses have full when it comes to Russia's sanctions are not as big an impact on the economy as you might think. The economy is not perhaps as bad as some people in the West argue. Blockchain is a surprising success, perhaps, in Russia. But then on the other hand, on the other side of the spectrum clearly, there are some deeply intractable issues between Russia and the West that are going to take a long time to solve. There are ongoing questions about free speech in Russia. And again, these questions will probably be with us for some time to come. But thank you all for a very stimulating panel. Thank you. Thank you.