23 June 2016

    Deputy Prime Minister of the Russian Federation and Plenipotentiary Envoy of the Russian President to the Far Eastern Federal District Yury Trutnev gave an interview to Rossiyskaya Gazeta, in which he spoke about the process of implementing the Far Eastern Hectare law, the problems facing the Russian Far East, and cooperation with local officials.

    The law, which grants applicants free use of a hectare of land in the Russian Far East, came into effect only recently. However, according to Yury Trutnev, “we are on the right track.” The Deputy Prime Minister noted: “It was the right kind of proposal, because people need it. It is popular. At the same time, this is just the beginning. There is currently overwhelming interest in the website. The city that has expressed most interest in the offer – and this will make you laugh – is Moscow. Most visits to the site originate from the capital. This shows that the potential interest is high, and I hope this will translate into investment demand. I’m talking about attracting investment, because land is an investment.”

    The main provision of the law was to create a straightforward procedure for submitting an application and obtaining a plot of land. Mr Trutnev explains: “There’s no need to force citizens to apply to officials, making them transfer land from one category to another. You just need to untie people’s hands and give them the right to choose.”

    The aim is not only to attract the public to this particular region, but also to create comfortable working and living conditions for the people who already live there.

    As far as the quota allocation of land in accordance with the regional principle is concerned, Yury Trutnev confirmed that he is a supporter of the idea that all land belongs to the people: “If we are able to take into account the interests of the people to the maximum degree possible, then we will create the best environment to live in and bolster economic development. And we will achieve the objective set for the government.”

    Speaking about the possibility for corruption in how the land is allocated, Mr Trutnev noted that any attempt to manipulate the process would be stopped: “This is a pilot project. I’m not going to get too tough. In the meantime, I have my eye on the governors. But when we get to the stage of allocating lands across all of the regions involved, I’ll look into the question on a region-by-region basis: we need to see which land is being held back and why, and we will take very strong action in this respect. Those cases where regions are setting aside land for their own unfair benefit will not pass muster. This is a bad situation that reeks of corruption. We will stop at nothing short of complete success on this issue.”

    Mr Trutnev was more restrained when talking about the volume of investment that has been raised, stressing that at this stage, this consists of promises by investors to invest in specific projects. But the trend has become clear, such that, as Mr Trutnev said: “We are ready to stand behind the statement that we have one trillion now, but it will be two trillion in the future.”

    With regard to regional investment projects, he noted that the picture is a little different, admitting: “There is no momentum when it comes to regional investment projects. We must be honest and recognise that there was a blatant bureaucratic error there. Some of our very smart colleagues wrote the law in such a way that there was a sort of maze that investors had to navigate, and as a result, no one was able to make it through. The law was carried out formally, as if it were a presidential order, but in actual fact it was not. I had to exercise my authority in earnest to turn the situation around completely. And now we have a law under which investors do not have to prove to bureaucrats that they are good. This is the story in a nutshell. Now we have gone in and revised everything. The new law has just started to come into effect. It will definitely be useful.”

    One of the key issues in enforcing the law in the Russian Far East relates to the work of local officials. According to the Deputy Prime Minister, they need to change their attitude and do more to help the country and the region: “We immediately came to the realisation that we need to create a new strategy, new tools and new working practices. It would have been strange to just hope that everyone would immediately buy into our way of thinking, that every official in the whole of the Russian Far East would suddenly cease acting the way they had been up until that point and begin to work exclusively in the interests of business, the economy and the country. They have to think about what benefits the country and what needs to be done to ensure that investors do not turn their backs and leave. We are gradually convincing everyone of this. The overwhelmingly majority of governors are our partners. They fully understand that we are not coming up with all these tools and support mechanisms just to satisfy bureaucratic reporting requirements. We really want to improve the lives of people in their regions. And they will be responsible for making it happen. There is still a lot of work to be done to ensure that every official is thinking about the development of the country and the benefits for every person. I kid you not: when that happens, when every federal, regional and municipal official starts to think only about the welfare of the people, we will have no competitors. It will all turn out positively for us.”

    The Russian Far East requires a comprehensive solution to its accumulated problems. First of all, the region’s economic problems need to be solved. The Deputy Prime Minister explained what he meant by this: “In order to deal with the social and other pressing problems affecting people and to invest in social programmes, it is first necessary to make money.” The government is focusing on this problem at the current time.

    Mr Trutnev noted that some concrete results have already been seen, indicating the correctness of the chosen course: “The most important indicator is the fact that we have secured 12 roubles in private investment for each rouble contributed by the state. This is the most efficient use of government funds: when we can put in one rouble and attract a further 12 from investors. It is an important point, because we cannot succeed without this multiplier. It would be impossible to develop the vast territory of the Russian Far East using only government funds.”

    Mr Trutnev also commented on plans to develop Komsomolsk-on-Amur, noting that officials would be held personally responsible and severely punished for failing to follow orders: “If a person does not feel that his work is valued, if he works mechanically according to procedure rather than towards a result, then there is no point. The programme has clear deadlines and milestones.”

    The Russian Far East has already attracted the attention of foreign investors, and in particular those from Asia. Thus, Mr Trutnev noted the unprecedented interest of Japanese businesses in projects in the region: “Interest from Asia-Pacific countries in working in the Russian Far East is growing, and fast. In all my career, never before have I experienced the types of meetings that I have attended in Japan. They were so specific. The Japanese side was already ready to work and to pin down the business details. It was just amazing.”

    In conclusion, Mr Trutnev expressed his confidence that the Eastern Economic Forum, which will take place on 2–3 September in Vladivostok, will be successful: “We are confident that we will have interesting content and competitive proposals. We will give people the information that will help them to manage their businesses, and partner more effectively with us. We are definitely looking for feedback, because we have ideas, but we all make mistakes. Surely there is something that can be done better.”