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May 21, 2009
Excerpts from Transcript of [Medvedev] Meeting with Students from Pacific National University

Khabarovsk

QUESTION: A summit between Russia and the EU will be held in our city. Why was our city the one selected? Was it in order to show the Europeans how expansive our nation is, so that they would fly here?

PRESIDENT OF RUSSIA DMITRY MEDVEDEV: You have just perfectly summarised the reasons I had in mind when I suggested the city of Khabarovsk to our EU partners. Last time, we met in Khanty-Mansiisk; we were sitting at dinner, talking, and they said, Wow, that was a long flight, five hours. I said, Yes, but keep in mind that in line with the concept of a united, so-called Greater Europe, which includes all of Russia, then this Europe stretches from the Atlantic Ocean all the way to the Far East, which means that we are still far from its eastern limits. Would you be interested in flying to a different place? They thought about it, and said, All right. But they didnt fully realize what that meant. I will be meeting with them tonight. I believe it is a 10-hour flight from Brussels, with a 9-hour time difference, so they will really get a sense of how big Russia is. You were right on point, this is exactly why Khabarovsk was chosen.

But at the same time, if we are to talk seriously, this choice is very important, because we really are developing a partnership with the European Union. It is essential for us to have a feel for one anothers specifics. They must understand how Russia works, how big it is, what problems it faces, but also, what advantages it has to offer, what its climatic peculiarities are, and which areas may be most favourable for some particular businesses. All this is significant because our relations have a strong economic basis. The European Union is essentially our key economic partner. We have other large partners as well, such as the Peoples Republic of China, but the EU is still greater in terms of total turnover and the total volume of trade transactions per year. Because of this, Europeans should be aware of how things work here.

***

QUESTION: It is no secret that a lot of money is currently being invested within the federal program for developing the Far East and Trans-Baikal. When all of these plans are implemented, will attitudes change toward the Far East? Will people stop referring to it as a big village?

DMITRY MEDVEDEV: You know, I think that the overall attitude toward your region has already changed entirely from what it was in the 1990s when our country lived through a fairly difficult period and the regions were to certain extent left to fend for themselves and developed through their own means only. This was a very hard time for the Far East, with many people leaving the region for other places.

Now, the situation is gradually improving. I think that the overall ideological vision of the Far East has definitely changed, and in fact, I believe it changed about some 8 or 9 years ago. True, peoples mentality does not always change fast, and economic changes do not take place overnight, but all of us who are making national policy decisions feel that the Far East is, without a doubt, a key priority in the development of our country. That is also why so many meetings are currently taking place in the Far East. After all, symbolic gestures are important. The fact that I have invited our EU partners here is also a way of drawing attention to this region. We have our traditional partners in the Far East, such as China, Japan, and Korea, but we need representatives from other countries to come here as well, in order to see how rich and diverse our country is, and how many opportunities we have for developing business and humanitarian cooperation. Thus, the political attitude toward this subject is clear; we cannot approach this issue any other way if we want to preserve unity within our great, expansive nation.

***

QUESTION: Right now, everybody is talking about Europe and the meeting with the EU. But how will we be developing our relations within the Asia-Pacific region? Are there any plans for developing the Far East and the Khabarovsk Territory, and integrating them into the Asia-Pacific regional economy? Perhaps some scientific research centres or high-tech businesses will be set in this region? Thank you.

DMITRY MEDVEDEV: We talked a lot today about our relations with Europe, but clearly, it wouldnt be right not to mention in that context the Asia-Pacific region, which is where we are at the moment. We will soon be holding an APEC forum, and we are all preparing for it. Naturally, cooperation between Russia and Pacific Rim countries is just as promising as Russias traditional cooperation with Europe. For centuries, Russia has followed European patterns in its development. But our country is both a European country and an Asian country, so we must be involved with all processes and events in the Asia-Pacific region as well.

I doubt you will be surprised to hear that Russia is interested in an utmost integration into the economic activities unfolding in the Asia-Pacific region at various levels. We are interested in a wide range of investments, and we would like for various decisions made within forums such as the APEC to directly stimulate our development. I hope that the APEC forum in the Russian Far East may give an additional impetus to cooperation in the region. When building our business relationships in the future, we should remember that the Far East and Siberias closest neighbours are our key partners in the Asia-Pacific region. In many ways, the economic well-being of the Far East will not depend on the extent of our ties with Europe, but rather, the development of economic relations will our main Asia-Pacific partners.

Thus, we should work just as hard to develop ties within this region as we do with Europe. I think this is obvious, and we have already made some good steps in this direction, in particular, in our cooperation with the Peoples Republic of China. Over the recent years, our trade has been in the dozens of billions of dollars. Hopefully, it will not decrease due to current economic hardships. Our relations with Korea and Japan are also developing very well. We must now make further steps promoting our economic interests all around the Asia-Pacific region and be involved with various regional activities.

Therefore, fostering our relationships in the Pacific Rim should be just as important as the relations we are developing with the EU, there should not be development in one direction only; after all, our national emblem is a double-headed eagle.

***

Now, I would like to talk about innovation. I discussed this issue recently when meeting with our countrys political parties including United Russia and the Communist Party. You see, our slow progress in building an innovative society does not result from lacking a proper concept of innovation; if that were the case, we would have resolved this issue long ago. The problem is that we do not have any means to encourage businesses to invest in innovation. But this can be done, and we do not even need to issue special laws for that, just a few incentives would suffice. Still, in my view, our major problem is not the lack of incentives to stimulate innovation and technological upgrades; instead, it is the fact that our businesses, as I said recently, are completely unmotivated to take on this kind of activities, because it is much easier to earn money off of what you already have and invest in other kinds of business activities (perhaps these are the problems appertaining to the economy transformations). If a Russian businessman has made 20 or 30 million roubles, will he invest it in risky business projects? No, he will buy merchandise to resell and make profit.

You see, this is a problem of business mentality and business ideology. Until businesses (and the government) realise that this is important for our country, nothing will happen. In other countries, such as Japan, China, and Korea, they have realised this already, and they are not afraid to risk their money. That is significantly more important than passing a regulatory act on innovative activities, although it isnt out of the question; still, I believe that the answer lies elsewhere.

You may be aware that just a few days ago I held a meeting with members of the Cabinet and the Presidential Executive Office and manifested my plan to establish a commission to promote innovations, modernisation and technological development of the national economy. Since this is a problematic issue, I will be heading this commission myself, to ensure the highest level of decision-making, and to ensure that those decisions will be brought to life.

***

Look at how these processes run their course in our neighbouring countries. Not so long ago, many countries, including those adjacent to our own, had a very slow rate of development. And then, suddenly, they started investing money into their national industrial production; they learned to engage in the innovative activities that we are discussing today. For them, it was possible. What about us? Are we any less smart? I do not believe that is the case. We have never had problems with intelligence. We just need to finally apply some technical know-how and learn to think in a practical way.

We have always had an enormous gap between our creative abilities and commercial application. We are always happy to invent something, but afterwards, we sit around, looking at it, or waiting for someone else to come along and implement it. We need to reduce this gap as much as possible; only then can we bring older plants that have fallen to the wayside back to life.

After all, there are many companies here that were created many years ago by our predecessors and our parents, which were once the pride of the Soviet Union. Im not even going to mention any of them; you already know exactly what Im talking about. These were large industrial companies, shipyards and airplane-building companies, as well as the defence industry, although thats different, since it is an industry which is still performing fairly well. These are areas where we need to work hard, launch programmes, and create major institutions that will resolve these problems. We have begun our way on this journey. I cannot say that I am satisfied with how things are progressing so far, but I think that when you begin your careers, all that will change

***

My young colleagues,

It was really a pleasure speaking with you. I always enjoy meeting with students, because it reminds me of my own days as a student, as well as my days as a professor. I enjoyed those periods of my life just as much as I enjoy my work as President. Sooner or later, I will return to that line of work, for a very simple reason: it will be an opportunity to stay in good form, intellectually.

I sincerely hope you will successfully graduate from this wonderful university. I hope that by working together, we will resolve the socioeconomic problems that you asked me about. And, of course, I hope that the Far East this cherished region of our nation will prosper. This prosperity depends not only on national authorities, but on all of you, as well.