 Hello and welcome to this Russia in the world session. I think it's going to be one of the most exciting sessions taking place here in Davos. We've got a fantastic panel, who I'm going to introduce you to in just a few moments. This panel we're going to look at basically in broad terms Russia's position in the world in geopolitical terms, but also economic. Thank you so much to the World Economic Forum for hosting this. What a year it's been. This time last year, the future for Russia looked a lot bleaker than it does now. Russia's asserted itself on the geopolitical stage to the consternation of some, but it also has a nascent economic recovery. The question is, is that recovery going to gain momentum this year? But there are some big opportunities ahead, possibly some pitfalls, which we're going to be discussing together. But for real change, there is consensus among many economics that there is going to be a need for real structural reform in Russia's economy. And I'm sure the gentleman here will be able to tell us a lot about that. There are also opportunities. Of course, the elephant in the room is Donald Trump. What will that represent? And we'll be discussing that too. But also European elections. There could be a shift in Europe with some key European elections, which could move Europe closer to Russia. I'd say if 2016 taught us anything, it's to expect the unexpected. Let me introduce you to our guest straightaway. On my left, of course, we have Mr. Igor Shuvallov, who is the first deputy prime minister of the Russian government. He's held that post since 2008 when Vladimir Putin took office as prime minister during the presidency of Mr. Dmitry Miedvedev. Since 2012, Igor Shuvallov has carried on in that same capacity in government with Dmitry Miedvedev as prime minister, of course. Mr. Shuvallov has overall responsibility in general terms of economic affairs. We're also delighted to have Mr. Miroslav Lychek on the panel. He's the minister of foreign and European affairs of Slovakia. So an important European voice on this panel. He's previously held the post of deputy prime minister, but has got a wealth of experience in international affairs with key engagement in EU and UN issues. It's great to have Mr. Kirill Dmitriev with us. He is the CEO of the Russia Direct Investment Fund. Now, that was created just five years ago by the Russian government and the presidency. And the key role of that is to get sovereign wealth funds to invest alongside RDIF in promising Russian companies, but also leading Russian companies. Mr. Dmitry Kostigin, fantastic to have you with us. Dmitry Kostigin is the chairman of Yulmat. Yulmat is Russia's leading e-commerce retailer, very well known in Russia. For those who don't know it so well, I saw a great description of it by your CEO, who said it's a combination of IKEA and Amazon. And last but not least, of course, great to have Mr. Ray Dalio with us. Ray Dalio is the founder and chairman of the investment firm Bridgewater Associates, which is the largest hedge fund in the world, no less. And Ray Dalio brings absolutely fantastic economic perspective to this discussion. He's created a model where he looks at economies like machines. And I think that perspective is going to be extremely interesting. So we're going to begin this by just going to all of you to see how you see Russia's economy, but also geopolitically, how you see Russia fairing in 2017. And I'd like to begin with you, Deputy Prime Minister. Economically, this year will be better for us than 2016. The main issues that accompanied us in 2016 and from the end of 2014 were also very vibrant in 2014. This stage is behind us. We have successfully dealt with this. Recently, in Moscow, we had a forum that joined together famous economists from all over the world. And this was their position, including Mr. Liptonko introduced the IMF. They said that Russia has passed this very severe times with flying colors when we have encountered external and internal shocks. Today, the situation is not so bad. We've achieved growth at the end of last year. And we hope that this year will grow by one or two percent to understand what needs to be done. Yesterday, there was a very important meeting held in the president's office. And we took a key decision that in this volatile situation, we cannot afford to spend our oil money. And everything we earn from selling crude oil above $40 will be invested in our reserve funds. And we're not going to spend this money through the budget, which, on the other hand, will allow us to ensure a greater transparency for pricing and less volatility for the ruble, which is what people want from us when they open up new enterprises and want to export more. On the whole, the situation looks quite healthy. And frankly speaking, we are currently in a situation where we have no bubbles, not a single bubble in the single market, not in the real estate market, not in the stock exchanges. We have no bubbles. And we are hoping that foreign direct investors will start flowing very soon. But you've been listening to this. What's your take on Russia's economy in 2017? Well, I think it's difficult to predict because Russia is part of the global world and we are facing many uncertainties from the European Union perspective. Of course, it's the Brexit and now negotiations, the role of the new US administration. Then there are problems that we have inherited and carry on from the previous year, migration or terrorism. And obviously, when it comes to our relationship with Russia, we have the continuous issue of sanctions and the absence of dialogue or absence of a format, of a framework. It's very bad that there is practically no legal framework for the engagement with Russia, which is not really normal. And neither party is showing appetite to change that, which I don't think is normal and would be good if we are able, in the course of 2017, to define what the relationship is. It's to go beyond no business as usual because after almost three years, it would be good to know what no business as usual means. No. It's not quite so. From our side, we continuously express our desire and our wish to cooperate. The Russian side has never said that we sever dialogue or that we refuse to participate in any formats. We had formats. We had an initiative of the EU and other countries as soon as your wish to cooperate will be formulated by the EU. We're entirely open for that. We shall immediately get down to this cooperation at the level of the government, the MFA, or the presidential administration. We are willing to participate in any type of dialogue. The conditions, yes. Yes, but let us deliver on the normal group, on the Minsk plan, and then, of course, we are back to normal situation. Kirod Dmitriev, do you feel that we're close to a turning point in Russia? Yes, I think we're beyond the turning point. I think we'd like to debunk some myths that exist about Russia. One of the myths is that Russia economy is heard by sanctions. It was, but no longer so. As Vice Prime Minister Shovalev mentioned, we'll have a growth of around 2%. A very important deal for us was OPEC deal, which stabilized oil prices and really reduced fluctuation of oil and uncertainty. As a result, our stock market is up 50% in dollar terms in the last year. It's a very significant, significant result. One of our companies we invested in Detskimir will take it public. The revenue last year grew 30%. EBITDA grew 50%. So Russia is beyond the turning point. We believe we'll have major growth and even if sanctions are not lifted. Now, we believe they may be lifted, but even if sanctions are not lifted, Russia in a very good position and went through this crisis very well. Just a quick question before I go to our other panelists. You had a very interesting meeting with Donald Trump's economic advisor. What does that herald? Well, we are quite optimistic on communication with Trump administration. We believe that they treat Russia with respect and that's very important and it's very important to have dialogue on issues. And I still remember as Vice Prime Minister Shovalev two years ago mentioned here in the audience about Russia in light of sanctions that will be united with President Putin moving forward despite sanctions. And this is what we hear understanding of some of the people of Trump administration. Mr. Skramuchi also said he understands that sanctions actually united Russia rather than reduced popularity of the president. So we want to have a good dialogue and we believe we have a basis for this dialogue. Okay, well, we'll get back to those questions of sanctions and Donald Trump later on in the discussion but I'd like to bring Mr. Kostigin in and get a sense of business confidence in Russia. How's the business community feeling? Well, I started to do business under Gorbachev in 88 and at that time I was buying jeans in the market in Moscow and then I was reselling them in a tiny town that I come from near Nizhny Novgorod which was a criminal offence under the Soviet legislation, by the way. And so I have comparisons to draw, I can draw comparisons. You can say whatever you like but together with my business partner we have been investing hundreds of millions of dollars in Russian industry for the last few years. Yes, of course one can be afraid of black swans, you know, the fable about a clever fisherman who was afraid of everything but then of course you can search for golden swans. So I think future will bring golden swans mostly in the territory of the Russian Federation. That there is an economy in transition and if we take the way you look at economies as machines, what stands out for you about Russia? Russia is a country with incredible potential but for those who don't know I'm somewhat like a doctor, I'm not ideological, I'm not political, I just compare countries one to another and across measures I have a health index that looks across countries. And there are three major things that drive whether an economy is going to be good. The first is, are you blessed with natural resources? Russia has more natural resources by far than any country so per capita it should be the richest country in the world. Second, the most important influence is the how expensive educated people are. It has a highly educated population that is very cheap in world terms and therefore should be very competitive, very attractive. Another blessing. The third most important influence is level of indebtedness. The level of indebtedness in Russia is one of the lowest in the world. So what we have is a country with all of those elements and then it has some problems and some challenges to that. And I think the biggest challenge to that, well, we'll go into that. It is a country in which its development of its capital markets is very undeveloped. The ability to borrow and lend and invest is very low. The issues in terms of capital rights and property rights are a problem. So it has a great, great deal of potential. When I look at the last year or last couple of years, I'd say it had two big problems. We all know. It had sanctions and it had oil. Those problems are behind us. When I think of Prime Minister Shavallov's comments, I'm exactly right. They have no bubbles at all. What the real situation I think here is the question of whether you can get those problems behind you. Economically, it's behind and you will have a growth rate. That'll be in the vicinity of what you said and one or 2% I agree. But this is a moment of potential to think about the next 10 years and to restructure the economy to live up to its potential, I think. What do you say to that, Deputy Prime Minister? I absolutely agree. I fully agree. You think we're not thinking about structural reforms? Of course we're pondering them. We've been thinking about them and developing them when oil was expensive and then we talked about it when the price for oil fell sharply. At the moment the government program is being developed and in May this year we'll have a preliminary presentation of this program to the public. A number of public think tanks, non-governmental think tanks are preparing their own agenda, perhaps not alternative, but their own agenda. Where do we see main obstacles for our economic growth and where do we see important actions for this year? Of course we look further than this year and next year in order to make this growth sustainable and to move it from 2% to something a little bit more acceptable. We think 2% for Russia is a rather low growth rate for Russia. Now, what is in the forefront at present in our thinking? We should not make any mistakes for this growth to stumble. So we need very responsible macroeconomic policy. We are undertaking that. We haven't made any mistakes and we're not planning to make any mistakes. It could be painful but we'll continue going along this very severe strict policy. Now, if we look a bit further, the main problem is the human capital, education levels of other populations, skills necessary in the market. What should we do for our education system and our labour market to adapt to world competition? We understand that we are losing out in terms of competitiveness here. It's a real challenge for us which we're trying to deal with. There are many proposals here and many ideas, not simply dealing with financing this education system from the budget, but finding motivation for the industry to train and to scale up its own personnel to give certain signals to the market and to be interested in working with better technology. That's another issue. In terms of structural reform and long-term, we have to check it all out, not to be swayed from one extreme to another. We should check it all out, discuss it all publicly and perhaps we'll do this in the remaining time of this political cycle and then during the next political cycle we'll implement this agenda. Dmitry Kostigin, this brings me to you because it's very interesting. You're obviously tapped into the younger generations who are tech-orientated. What do you see they want to change? And you as a businessman, what are the main hurdles you're facing? Well, I have a favourite little song of mine, rather boring for those who are not in the know, but this to do with Russian accounting standards. In the mid-2000s, there was an idea that we should move at least to GARP Russia or to the international accounting system. But however, people have forgotten all about the system, but we must move on to international accounting standards. That's my favourite lament. And we should move this out of the remit of Ministry of Finance. I can't forgive Mr. Kudrin that he never pulled it out from the Ministry and didn't make it a more neutral system with maybe a tiny thing. But if we talk about non-material asset economy and development of IT, in my view, the Silicon Valley owes its success more to accounting system than to anything else. Yes, indeed, we have a problem here, I'll react immediately. We are simultaneously applying two systems, the Russian accounting system and the international accounting system. We have started with state assets at the moment. This is our first responsibility. And in 2017, we will determine the dividends only according to international accounting system. So, we are sending the right signals. But Mr. Lychik, do you feel that there is an enhanced trust when it comes to Russia? And you have all mentioned sanctions. Do you feel, in terms of the European Union in particular, that cracks are forming there, that you lack the unity in the EU to maintain sanctions on Russia? Well, ever since the sanctions were introduced almost three years ago, there have been speculations about the cracks in the unity of the European Union. But up until now, the EU was always able to extend the sanctions. There was no lack of unity on that issue. Mr. Lychik, continue to push for sanctions? Mr. Lychik, continue to say that we are not fans of sanctions. We don't think that sanctions are the best instrument to achieve our goals. But the top priority for us is the EU unity and we will never go against this unity. Speaking about sanctions, yes, they should be the policy tool, not the policy in itself. The sanctions were introduced in reaction to the violation of international law by Russia, by the annexation of Crimea. The conditions for lifting the sanctions are well known. I wish we get there. I wish we will be able to go back to normalization of relations. But right now, I understand it's popular for journalists to speculate who is going to break the unity of the European Union. At the beginning, people didn't want to believe that the eight member states... The sanctions were put in place for a particular reason, obviously, relating to Ukraine mostly. Will that be set aside, therefore? Is that the feeling you're getting? No, no, no, that's not the feeling I'm getting. On the contrary, the sanctions are directly linked to the implementation of Minsk agreements. And there has been not much of progress on that one, so therefore, we still have time until July and I wish to see progress on Minsk implementation. Without implementation, you'd say... No, I think the European Union is very clear on that point. But, Kirill Dmitriev, you've said to yourself that sanctions aren't really a problem in Russia, that they probably helped the economy. Well, a couple of points. First of all, sanctions did not achieve their objectives, which was to change the policy and they actually unified Russia to move forward. Lots of our businesses have restructured and we can do very well without sanctions. As I said, the growth will continue. But we believe sanctions are bad because they cost European business around 100 billion euros in value. That means employment is low. It means that revenues of German and other businesses are lower because they're not working with Russia, which is a very natural partner. And we believe with Trump administration, it's possible to start having discussions on reduction of sanctions because we can do so much with the U.S. together. Imagine the world where Russia and the U.S. jointly fight terrorism. We had a very difficult relationship with Turkey when they had an incident, but we were able to completely change this relationship in about six months. And now we are jointly with Turkey fighting terrorism in Syria. Imagine what it would be like if we do the same thing with the U.S. So we believe that the thinking will be changing in the U.S., the thinking will be changing in Europe, and that's a good thing. Well, as I work in the government, this positive stance of Kirill, I cannot share that. I cannot share that. Perhaps the market is expecting improvement of our relationship with the U.S., etc. In our work, we base our plans on possible, continued, severe conditions externally. And our agenda is formed on the basis of continued sanctions. If they're lifted, the situation will improve. But we operate on the basis of continued sanctions. You mentioned that a possible breach in the European Union is possible and somebody might start the procedure of cancelling and lifting the sanctions. And there's a lot of public speculation on that point. I can tell you quite honestly that the Russian Federation has never been interested in discord between European countries. We're keen on Europe remaining united and strong. It's painful for us to watch Brexit and other phenomena. We are quite happy for the EU to be unanimous. If we look to the long term, we want a partner which is strong with its own institutions, etc. And of course we want no cracks appearing between EU countries. Now you want to cut in. I also have just a quick question for you. How do you evaluate sanctions on Russia? Can you put a cost on them in terms of the economy? The biggest impact of sanctions was the cutting back of lending so that they didn't receive the money to borrow. And that was quite a bit of money. It was about $220 billion. And that is a two-edged sword. They adjusted to those. So when you have a shock and you don't get the money lent, I think that this, while it creates a short-term shock, it also probably created a realization that there's too much foreign currency-denominated debt and exposures. And it created an adjustment, just like Prime Minister Shavallov said. That adjustment has been made. And when you think about that and you think about the oil price, it was another shock. Those are temporary shocks. So those are past them. So I would agree that it would be better if the sanctions were lifted and it would be better for everybody. But in addition, I think the real question is the development of their capital markets so that they don't have so much dependence on foreign capital. If you contrast the development of China and the development of Russia, Russia's come an enormous way over the last 16 years. So you have to see its progress. But if you compare that with China's progress, it's been much less. One of the reasons is the development of a local currency-denominated debt market and the development of its economy. So I think that there are lessons here to be learned in terms of developing a capital market internally that doesn't have as much dependence on foreign capital and I think will work better. So I think in the long run, it'll be beneficial to create that independence. And I think in the short run, the adjustment's been made. Kirill Dmitriev, I'd like your reaction to what Ray Dalio said and also to give some perspective on who you see Russia's partners being and maybe mentioning China here. Is that relationship going to develop in 2017 significantly? Yes, I think Ray Dalio has really great ideas and I think increasing debt in Russia, domestic debt is definitely very positive. And what we've been doing, we've been forming partnerships with different countries. We have great relationship with China and we jointly invested with them and lots of things. We have great relationship with Saudi Arabia. We have some Saudis here in the audience, which is very important for us to jointly invest. We have great relationship with Middle East. So frankly, what happened when European companies and some US companies pulled out, lots of Asian companies went in. And there is lots of strategic work being done with China and obviously Russian economy benefits from the growth we see having been resumed in China in the last six months. So Russia is interested and our fund is interested to partner with European Union. We have done an investment in ARC International, which is a French company creating lots of jobs in France. So I think joint investments is really important to create jobs because job creation is a big item on Trump's agenda, on European agenda, and on Russian agenda. On China? Yeah. In the government, I'm responsible for partnerships and for China, I'll say a few words. Our relationship with the People's Republic of China is developing an extraordinarily positively. The strategic dialogue at the level of top leaders was very good, but in terms of strategic agreements, we have a border agreement, strategic agreements on oil and gas in our economy. But when sanctions were applied against the Russian Confederation, we started to work with the Chinese and agreed that we'll work at all levels with them. Members of our government, family friends now with each other, we have very good links with China beyond the government. Chinese companies come to Russia, they open up new business. We help Russian private companies to export their products to China where certification or other state support is required. But private companies are doing this now. And we continue witnessing the position of the Chinese banks. They don't want trouble. They watch the sanction regime very carefully. But in terms of relationship development at every level and in every sphere, that is obvious. This is very interesting for us and also for the Chinese. Just going to add one thing that the development property rights, the size of government is a challenge. Governments are less efficient. Those are the challenges that I think are important. I was just wondering what Prime Minister Chavallov thinks about those. In terms of these challenges that you mentioned, we discussed them widely. We accept them and understand them at the same time. I have to say, and this would be fair, in terms of not very efficient governance and in terms of property rights. Russian Federation in 2012 was 120th in World Bank rating. Now we're the 40th in the same list. If we look at specific criteria, we move forward a lot. Of course, it's not ideal. Now, Singapore, for instance, is very critical about everything that's going on in the world. Three or four years ago, when I visited them, they always asked us about property rights, the inefficient government, judicial protection. Last year, when we had the Intergovernmental Commission, we were all sitting at the same panel and they kept saying significant improvement of property rights, significant improvement on business climate in Russia and doing business in Russia. But you're right, there are problems, but the overall picture is changing. So, yes, they're challenges, but we'll tackle them. I agree with that completely. I want the development. I think Russia's got to be looked in the context of its evolution. And it has so much potential, but there has been those improvements. But another issue, and I'd like to bring in Dmitry. Another issue I'd like to ask Dmitry Kostygin is about corruption. This is a big problem. I'd like to know how, from a business man's point of view, it prevents corruption in Russia, in your work? Well, our business is a large scale, a relatively large scale, so we have not come across any of such matters for a long time. So, well, I don't know, we have professional lawyers, professional consultants. St. Petersburg is our home base, our native town, the administration of the city, the government of the city is transparent, understandable. So I don't quite understand. I mean, we work in retail, we work in manufacturing for private consumption. It's mainly a business-to-consumer platform. So we don't depend on licenses, on permits, on subsidies. Now, where we could get benefits, we'll get the benefits, and we'll try to get exemption, et cetera. Start talking about Donald Trump and his potential effects on Russia, because we've got a much more business-led administration. And in terms of deal-making, I'd like to understand from our Russian contingent, and maybe Ray Dalio, how they see that progressing in 2017. And whether you were able to, if you're going to permit yourself to forecast a little bit about how things will go, because, Kirill Dmitriev, I think you're going to have a U.S. delegation arriving to Russia. It was one of the first high-level meetings of that kind that took place here in Davos. Yes, we'll be in a U.S. delegation in the spring of 2017, containing the largest funds and the largest companies from the U.S. And this dialogue is very, very important, because one of the problems we have as a U.S. is the mutual investment level and mutual trade is much less than with the European Union. So basically, we don't have enough of commercial and enough of investment dialogue, and we believe it's very important. And we would love to have Ray and other people be there as dialogue partners to discuss what can be done jointly with Russia. And by the way, we have one example of a company where Titan International, a U.S. company, invested with us in tires. It became the lowest-cost manufacturer in the world of agricultural tires. And now we're exporting to European Union to other places. So there are good examples of U.S. companies doing very well in Russia. And we believe that should be encouraged, given Trump's administration agenda of job creation in the U.S., and being able to access Russian market for U.S. companies. And, Deputy Prime Minister, how do you see that relationship going? Is there going to be a greater emphasis at the beginning on the economy, or will it be more on security? Once more. Once again, I'll say, in our government, we have a very cautious approach to any statement that there is a possible, fast scenario of Russia development with anyone. We have to work based on the notion that the situation will continue to be complex, and then we'll have the potential of the upside. We have a good export agenda. We work with Asian markets quite well. We have our own agenda on economic openness, free economic zones, et cetera, and we'll continue doing that. So lack of trade with the U.S. is not an obstacle for us here. There is a huge interest towards cooperating with Russia on open economic zones, on buying our goods and selling goods to us, et cetera. And if you want to know my personal opinion, I think it's much more important for the Americans to deal with the global security agenda. And I think if the dialogue is built up here, then economic relations will get a serious impetus. The St. Petersburg Economic Forum is in about six months. Could we expect Donald Trump to be dropping in there? Well, I would like to invite you all, first to the third of June, St. Petersburg Economic Forum. This is the main event for our calendar year when a Russian agenda should be discussed there, really. Best experts, politicians. This is the president's event. And investors can talk to the president directly, put questions to the president. There's a multitude of sessions, a variety of sessions. The members of the government, members of local governments all work with the forum, bankers work with the forum through the internet. So please come there when you learn a lot about Russia there, much more about Russia there than here in Davos, where Russia is seen through the global context. Whether Trump will visit St. Petersburg, I don't know, I have my doubts. But were he to drop in? Or would be delighted to welcome him and to discuss all the internationalists with him. But coming back to what you were asking, global security agenda first, and then economic operation second, I think. Something we've been hearing here at Davos is this pullback from globalization. And it does almost seem paradoxical also with Donald Trump who is wanting to push ahead with the more protectionist measures. So as Russia opens out, how do you see that dynamic working? I think that the big issues are political issues that have stood in the way of the relationship developed making economically. So I think that they'll supersede anything else. So as we move forward, I think that there's a lot of benefit. As I say, Russia is very cheap, meaning, in other words, good value in Russia, particularly if there's development. And I think that the one thing that Donald Trump has done is he's changed the world outlook for growth. The world outlook for growth is going to be greater because there's a greater business environment. Now how that becomes manifest in the politics that will allow the economics to develop, I'm not sure. I hope that the politics will be dealt with so that the economic potential can be realized. Mr. Leitich, you advocate a dual-track policy when it comes to Russia. Can you explain that to us and how that could help us in understand this context better when it comes to the European Union, possibly the US as well? Sure. Dual-track policy or dual-track approach to Russia is currently the official position of the European Union reflecting the two things. First, that Russia is a global reality, is a global player, a permanent member of the UN Security Council, nuclear power. There are a number of global problems and issues that cannot be solved without Russia. So we need to engage with Russia on all these issues. And at the same time, we have the problem that I already mentioned that was the reason for introducing the sanctions. And therefore, we want to engage more with Russia on all the issues of common interests or of global responsibility. And in parallel track, we would like to achieve some progress also on the issue of Ukraine and Crimea so that we will be able to leave the sanctions. So this is it. And I really personally disagree with the fact that from the perspective of the European Union, we have no political dialogue and we have no contractual framework. There is not a single agreement. We have agreements with all kinds of agreements with almost every country in the world. But the legal basis for EU-Russia relationship is actually our membership in the WTO, which is not normal. So it would be good to achieve a level of engagement that will reflect the global role of both European Union and Russian Federation. So we are facing the global problems and global challenges. And it would be good to have Russia fully integrated into the global effort. Deputy Prime Minister, who's going to take that first step? We are. There's nothing for me to say and nothing to add to what I've already said. We did not curb our relations with the EU. We think that there is a legal framework for our dialogue amongst others. This framework mobilizes twice in a year for the ministers to meet and the commissioners from the EU to meet. And there were high-level meetings. We have this legal framework. Nobody canceled it. And it has not lost its legal significance. We were discussing a new partnership agreement with the EU. Now, of course, we're not discussing it now. It's not being developed at the moment. But the old framework has not disappeared. In any case, legal mechanisms will never force anybody to talk to each other. For that, we need the interest of the EU. If the EU continues waiting for Minsk agreements to be fulfilled where Russia has no influence, then that's a bit bizarre, because the Ukraine has best some responsibility under the Minsk agreements. This is a political agenda. This is not my topic. I don't want to talk about that too much. But it's not so easy. If people ask us why a Minsk agreement is not being implemented, you have to ask all the participants in signatories of a Minsk agreement why it's not being implemented. The picture is much more complex than the media tries to tell us. But we are ready and willing to bilateral interaction with the EU countries. We are ready and willing to work between the government and the commission people. Know each other. We have all the mechanisms. We should stop trying to scare each other off. Nobody will achieve anything through sanctions. We took our sovereign policy and will continue undertaking our sovereign policy. It's impossible to make us change our course through sanctions as sooner everybody understands that the better it will be for everyone. OK, we're going to, in just a minute, take some questions from the audience before I do. I've just got one quick question for Kiro Dmitriev in your perspective as CEO of the Russia Direct Investment Fund and briefly now. But what are your goals in Europe? Well, we would like to bring in capital from Europe into Russia because lots of, for example, middle-sized German businesses can benefit by going and investing into Russia and growing their revenue. We would also like to invest in Europe jointly with our partners because our partners are the leading sovereign wealth funds of the world. And we have produced positive return in dollars for them for the last five years. So our goal is to build partnerships with the leading investment banks and banks of Europe and invest jointly. And we believe that's a good thing. OK, well, thank you very much, gentlemen. We're going to be taking questions from the audience. Before I do, I would like to thank our Euronews viewers who've been watching this live on Euronews and invite you to go over to uronews.com where you'll be receiving and hearing more about what's being said in this room. So thanks so much for having been with us. So we've got a few hands raised. Has anybody got any questions they would like to ask? Please do. If you could just keep your questions concise and tell us who they are for and also who you are. Angela Charlton with the Associated Press. I will be concise and perhaps a little bit provocative. Could you imagine and envision a world a year from now, based on what I'm hearing today, where the Ukraine peace process is essentially forgotten, where Russia's economy pivots away from Europe toward the US, and where, who knows, maybe Russia and the US work together to hack their joint enemies? And who would you like to direct that to? Maybe to the Deputy Prime Minister? Shavala and perhaps to. Maybe Miroslav Lychik. Yeah, I'd find myself in a strange situation because I'm not hawkish enough to defend the sanctions because I'm a professional diplomat and I don't believe in sanctions as a tool of solving problems. I really believe in a critical dialogue and critical engagement rather than not talking to each other because I don't recall a single problem having been solved through the parties not talking to each other. At the same time, as I said, we are members of the European Union and for us, the unity of the EU is of utmost importance and therefore, we are part of the agreement of 28. If you ask me, if I can imagine the world when this will disappear, my answer is no. Knowing the dynamics in the European Union, I simply cannot imagine that. And therefore, I really would like to see a mutual engagement on the means agreement I didn't want to quarrel with the Deputy Prime Minister on what you said that I would wish to see a single interpretation of Minsk commitments because right now you hear one story when you go to Kiev and a completely different story when you go to Moscow and it makes our life quite difficult. So it would be good if we could agree on the sequence of steps and of course of responsibility of parties in the implementation. Leaders of Normandy Group met in October. They tasked the foreign ministers to do exactly that by the end of November. They were unable to deliver and since then there has been no progress. So we have to continue trying to find a solution but believing that the current EU position will simply fade away. I just don't see that. So Deputy Prime Minister, I'll let you answer this lady's question, but are you ready? Well, I won't forecast anything but I'll say the following. Mr. Trump is a businessman. He's a large leading businessman. It's impossible to survive in business if you are not dying, dying for victory. He'll want to have results in politics as well. He'll have to get results. This is part of his personality. If he will want to achieve results, now he'll only achieve results if he interacts with Russia. So my hope is that Donald Trump, a superb professional entrepreneur, will become a professional president and in order to achieve results for global security, he will agree with another great politician, President Putin, on how to solve the problem of Ukraine and other problems. But for results, one needs to communicate and to talk and negotiate with Russia and not push Russia in the corner. And I hope that this dialogue will take place. We need questions, we need discussions, we need new formats and only then there'll be victory. Otherwise there won't be any victory for anyone. Mr Leitchick was very specific in what he said and he asked whether you'd be willing to implement the same steps because there obviously seems to be a confusion in the implementation of Minsk. Now is Russia ready to make that move? I think we need a few hours to discuss this. I am often present when we're explained how Minsk agreement is being implemented. This is an ungrateful task, let the MFA work on that, but the main problem is lack of dialogue. If all those involved in the Minsk process are impartial and read the text of the agreement itself and look at what is taking place to achieve results, then we'd have more practical results. But recently we see that the Minsk format is not as intensive as before. Gentlemen, yeah. Fubini, Correa de la Sierra from Italy, it's a question for Deputy Prime Minister Shuvalo. Recently, a Russian battleship appeared in front of Libya, lending support to General Haftar, who is in fact waging war on the UN officially recognized government of Libya. So how that makes sense in your view and why Russia should get involved in that region? For me, these are empty speculations. Please don't ask me such questions. Please ask Mr. Lavrov, our Minister of Foreign Affairs. He'll give you a professional, knowledgeable answer. This is not my subject and I don't see myself fit for answering such questions. I beg your pardon. Hi, thank you a lot from Fox News and this is a question for Mr. Shuvalo. The dossier that the former British MI6 handed over to U.S. intelligence services on Donald Trump has been basically dismissed by the Kremlin, but I'm just curious whether you have any further information to add since part of the dossier, the less sort of colorful part of the dossier had to do very much with business interests. Thank you. Dear friends, I deal with specific questions in the government or at the federation. I don't deal with the dossier. I don't deal with special services dossiers and all this nonsense and forgive me and I'll put these questions please to those who are dealing with that by nature of their job. I know nothing about this dossier, whether it's false or true. It doesn't touch upon my practical work, my everyday work. There will be special people when the Trump's administration appoints people who deal with the economy. They will be my vis-a-vis and I'll work with them, I hope. And all this nonsense, all this delirious nonsense that's being published about President Trump and prior to that about President Putin, it has no practical impact on my work and life. People would like to see progress in real economy. They would like to know what sort of income they can count on. They want to know where consumer activity is to be expected. That's important because for a normal citizen, for an ordinary citizen, the life is totally different. Journalists and politologists are concerned with completely different matters from those which concern ordinary citizens and my job is to answer to the concerns of ordinary citizens, I think. I was wondering if anybody would have a question for any of our other panelists because we do have some other great panelists with us. And if we don't, what I think we'll move on to now, which is often the most interesting part after the questions from the audience, which are great, is to get your final thoughts. How you see 2017 moving forward, the obstacles, your hopes, and in practical terms, what you're going to be doing. And let's begin with a European voice on that. I think I alluded to it in my introductory remarks. It's going to be a very difficult year full of challenges. We have the global problems that we continue coping with. Terrorism being number one problem and we really need to form a real global alliance against terrorism. The migration is a global phenomena. We shall switch from a responsive or reactive mode into the proactive mode because it's a generational issue. It's not a crisis that will disappear like a storm. It's something that we have to learn to live with. From the EU perspective, obviously to establishing new relationship with the new US administration. We have heard many messages, sometimes contradictory messages from the members of that new administration. So we have to wait and see starting tomorrow what the official government line will be on a number of issues. Probably for the first time, we might disagree on some very important issues. So this will be a challenge for European Union. And obviously the most important from our perspective will be to deal with, to start a negotiation with the United Kingdom about Brexit and in parallel to project the future European Union of 27, the EU minus UK, EU which is attractive to its citizens. And obviously I would like to, again as a professional diplomat, I would like to see an international arrangement that is able to deliver on the expectations of our citizens, which is the peace, jobs and security. And where the rules are respected by everyone regardless whether the country is big or small. Dmitry Kostigin, now we're gonna take obviously a Russian perspective on this. But is there anything in particular that struck you about the conversation with having something that might change the way you think or the way you're gonna expect 2017 to unfurl? For us, the most important thing is to create competitive products as cheaply as possible. So we'll continue building it up. And I hope we'll make huge leaps towards becoming a Russian Amazon. Now, obviously you mentioned a lot about the strengths of Russia during the conversation. And I know you'll probably have other closing thoughts. We also mentioned some of the drawbacks, but I just wanna understand the dynamic of all of that and how that will push forward in your opinion. In Russia? In Russia, yeah. Obviously if sanctions are lifted, it would be better for the Russian economy. And it would. What do they represent? It doesn't represent. But I think the issues of these reforms is a very important thing. And corruption was mentioned as a factor in terms of that scenario of potential. China has dealt very well with the corruption issue. There's a negative correlation between, 51% negative correlation between corruption and the growth rate in an economy over 10 years. Those types of reforms, capital markets and so on, have a tremendous potential for Russia. We're now, let's put this in the world context then. In the world context, we're gonna have a higher rate of growth. This will be the first year, I think, in which we'll come out of a malaise because of a more business-like environment and also because of deregulation. So that'll be good. I think what'll characterize the world economy as a whole is a new phenomenon that's developed over the last year or two, which is characterized by a word called populism, which was not used very much before that. So whereas central banks in the world will be much less important than they were, populism will determine whether we have a cohesive union or not and will determine, I think, a lot of directions around the world. So I think the new year will have a faster amount of growth and I think then it'll be a key question of how populism is dealt with to create a united, harmonious world or will we have a more factionalized world like we had in the 30s? So I think there are questions. I think in terms of the US administration, the question is, we know that Donald Trump is an aggressive man. Is he aggressive and thoughtful or is he aggressive and reckless? We're going to find out, I think, in the new year. We have new administration. Many of the people that he's put into positions are very responsible, thoughtful people. So we will start to see these things in the new year. So there are many questions, I think, for the new year, but I think it's likely that we'll have a faster growth rate and I think a lot of potential in Russia if they realize it. Keo Dmitriev, thoughtful or reckless Donald Trump, that must be something that plays on your mind. Well, we see very professional people in the Trump administration. It's probably one of the most professional cabinets that existed with lots of very accomplished people. But something I'd like to mention as far as this discussion, I think it shows that there are lots of myths around Russia that are just not true and those myths prevent making some of the right decisions because if you think the Russian economy is destroyed by sanctions, then you approach it in a certain way. But if you understand that it's actually doing pretty well within sanctions, you have to approach it very differently. So my prediction for 2017 is that this narrative about Russia is going to change and is going to become more realistic. And I was just with Bob Schiller who is a Nobel Laureate and he talked about narratives and important of narratives for economics. So we believe that narratives about Russia have to be more reasonable, have to be more realistic and they cannot be manufactured with the idea to isolate Russia, but they have to be realistic what Russia really is. And Mr. Igor Shivalov, the final word to you. 2017 for us will be a complex year. We will have to ensure growth, not curb it, not create any obstacles. I think we'll manage no popular steps, hopefully, and the most important thing in 2017 for us is to achieve a public consensus on those reforms which need to be undertaken. Our citizens have a different attitude to increasing the retirement age. We have other contentious issues. But for us to succeed in the next political cycle in 2017, we should not only say that we know what should be done, we should work in such a way that the majority of people who go to presidential elections would share our views. Agenda for the next political cycle and acceptance of this political agenda amongst the voters for it to give us results in the end and not simply remain as planned. In terms of global scene, we think that 2017 will be warmer for Russia and there'll be an understanding that perhaps it's complicated, perhaps it's difficult through dialogue, but that global security requires agreements with Russia step by step, that it's much better to agree step by step than to push each other into opposite corners. Absolutely. Fascinating discussion. I'd like you all to thank our speakers. Obviously, the Deputy Prime Minister, Kirill Dimitriev, Ray Dalio, Dimitri Kostigin, and of course, the Foreign Minister of Slovakia, Miroslav Lychak. Thank you very much. And thank you very much to the World Economic Forum. And thank you. Thank you. Thank you so much. Thank you. It's been great.