Dmitry Medvedev’s opening address:
Today we are holding a regular meeting of Vnesheconombank’s Supervisory Board. As usual, we’ll discuss a lot issues but before we start doing it, I’d like to say a few words about what we are supposed to do.
We need to support the Bank for it to operate and carry out its statutory tasks. To this end, we’ll have to make decisions and adopt a plan to optimize the Bank’s operations through various forms of government and non-government support. This issue is under consideration at various meetings in the government.
These decisions should be made in the most immediate future because Vnesheconombank remains our country’s key financial development institution. The government cannot leave it completely alone to deal with the problems stemming from the financial and economic situation in the country, as well as from various sanctions imposed on our financial sector too.
We held various meetings and discussions and in the near future final proposals should be formulated. I entrust this task to the Finance Ministry. Anton Germanovich (turning to A. Siluanov) take the matter in hand, get proposals prepared and report to the Government of the Russian Federation and VEB’s Supervisory Board having in mind that the central part of the work is to be performed by the Finance Ministry as the country’s main financial authority.
Today, we’ll discuss a whole number of issues that are included in the agenda. Here I’d like to mention my recent business trip to the People’s Republic of China. Vnesheconombank’s Chairman was there too. An agreement was signed on raising a credit worth 10 billion yuans from the China Development Bank. This agreement was signed in the course of our meeting with Premier of the State Council of China Li Keqiang.
The funds will be used to finance Vnesheconombank projects in which Chinese companies participate. We want the number of such companies to increase. We already have a specific project and we’ll hope that other projects will emerge too.
We’ll also look into financial statements and other documents that were submitted for consideration by VEB’s Supervisory Board.
Vladimir Dmitriev’s briefing after a meeting of Vnesheconombank’s Supervisory Board
Transcript:
V.Dmitriev: A regular meeting of Vnesheconombank’s Supervisory Board is over. The keynote of the meeting is that the state is ready and finds it necessary to provide maximum support for Vnesheconombank in terms of the Bank’s liquidity, balance sheet, foreign debt repayment and internal debt repayments in the coming year.
To this end, a specially formed working group is working. And it is to submit proposals until the year-end for implementing measures for providing the state’s support for Vnesheconombank.
It is obvious that these measures would require optimization of Vnesheconombank’s operation and here I mean optimization of administration and other expenses not related to the Bank’s operation as a development institution. And this line of activity is its priority. Vnesheconombank is and remains to be a key financial development institution as the Prime Minister said today in his opening address.
There is no doubt that due to its status VEB has to carry out certain tasks which could at some point of its activity worsen its balance-sheet indicators. Here I mean the so-called special projects. But (the state is aware of these projects giving us certain instructions) the state should share responsibility with the Bank for funding these transactions and if required shore up Vnesheconombank’s balance sheet.
We also discussed issues related to specific investment projects and here I’d like to stress some progress in restructuring debts and the whole scheme for funding Concern Tractornye Zavody. We and our partners did a lot to structure transactions related to optimizing this concern’s operation both in the military and civil sectors.
A decision was made to approve a transaction on raising by Vnesheconombank a credit worth 10 billion yuans from the China Development Bank, with the funds to be used for implementing joint investment projects. A decision was also made on funding administration costs and expenses related to fixed assets for the 1st quarter of the next year. And it is very important for our work with investors that decisions proposed by Vnesheconombank on restructuring a number of Olympic facilities were approved. The main idea of these decisions was to improve investors' financial standing and prolong decisions related to cash sweep until July 2017 not to worsen our borrowers’ financial and economic situation. In general, we made this sort of decisions, so we are ending the year with optimism.
Question: Could you be more specific about support for VEB? In what form does the state intend to provide support for VEB?
V.Dmitriev: The working group is working and concrete proposals for state support measures are to be made to Vnesheconombank’s governance bodies in a week’s time.
Question: What are in your opinion the most urgent measures?
V.Dmitriev: The Finance Ministry and personally member of VEB's Supervisory Board are responsible for addressing this issue. The proposals he voiced are the ones of top-priority on our working group’s agenda.
Question: Is it now a matter of lump sum support for VEB?
V.Dmitriev: It’s a matter of systematic support for VEB related to liquidity, foreign debt repayment and internal debt repayments, implementation of projects for which VEB is responsible, funding of new projects using among other things financial resources worth 300 billion rubles from the National Wealth Fund.
Dmitry Medvedev’s Opening Address:
Good afternoon, dear colleagues.
Our agenda is as usual overcrowded. Today, we’ll discuss issues related both to a strategy for development of Vnesheconombank as our main development institution and individual but at the same time important, large-scale transactions conducted by Vnesheconombank.
Negative conditions persist – crisis developments on the largest markets and on capital markets, our domestic problems. So, we have to monitor Vnesheconombank’s performance, given that VEB is not just a credit institution but a development institution and its efforts should be aimed at providing increased volumes of funds to finance major investment projects in order to fund large-scale programs and leading enterprises. This concerns not only all economic sectors the Bank traditionally works with but especially new import-substitution projects. Significant funds were committed to the Bank from the National Wealth Fund for it to be able to perform the above-mentioned functions in the most efficient way. Moreover, I would also like to inform you that not long ago, procedures were approved for granting subsidies to various companies operating for example in agricultural and timber processing sectors under credits raised earlier including with the participation of Vnesheconombank. The monetary funds were used for technical retooling and reconstruction under the industrial development program and they also contributed to import substitution.
Now a few words about issues we’ll discuss today. Specifically, a credit is to be extended to R-Farm Company to develop pharmaceutical industry, manufacture advanced pharmaceutical substances and finished pharmaceutical products in the Yaroslavl region, the most part of which we imported earlier. The funds will be also used to finance research and development work. I hope that all this will be highly instrumental in developing our own pharmaceutical sector in Russia, creating high-tech production facilities, new jobs and of course saturating the market with advanced pharmaceuticals at affordable prices. A lot has been already done in this respect including with Vnesheconombank’s participation. Money is provided as part of project finance.
We’ll also discuss today the first project that can be implemented through using monetary resources of the National Wealth Fund. Here I mean funding for pre-project stage of developing the Udokan copper territory in Baikal region – the largest in Russia and the third one in the world b reserves. This is a very large and very important project for East Siberia and the Far East. Energy and transport infrastructure needed not only for the project but for the entire region is to be created in the course of this project’s implementation but the most important thing is that new industrial and smelting facilities are to be created. We need to discuss today what we can do and complete coordination on this project as well as take an optimal decision taking into account the current economic situation.
There are also other projects related to the real economy. We still have to fund another major project – the Yamal LNG project. The project is designed to produce and liquefy natural gas on the basis of the South Tambey gas condensate field. Let’s discuss all these projects and weigh up all the options. We never have predetermined decisions. So, we hold meetings of our Supervisory Board in order to agree upon key lines of activity and take balanced decisions on the basis of collective discussion.
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Origin: Internet site of the Government of the Russian Federation
