OREANDA-NEWS. January 21, 2011. “Our objective is to radically change the situation in the North Caucasus, primarily by improving the quality of life of the people, ensuring their security and giving them the opportunity to work and live in peace. We must eradicate the roots of terrorism and extremism, first of all poverty, unemployment, ignorance and inadequate levels of education, and corruption and lawlessness. We must create a modern social infrastructure in the North Caucasus.”

Transcript of the beginning of the meeting:

Vladimir Putin: Ladies and gentlemen,

Today we are holding the first meeting of the government commission on the socio-economic development of the North Caucasus Federal District.

I’d like to remind you that the decision to establish a new federal district, the North Caucasus Federal District, was made exactly a year ago. We managed to consolidate the efforts of the federal and local authorities to launch a public dialogue on the central problems that concern people in the North Caucasus. It is very important that the people feel that we hear their concerns and respect their opinions.

Working jointly with all regions in the North Caucasus, with representatives of public organisations, we discussed and drafted joint action plans and attracted experts in business and other areas to that work. As a result, we have created a development strategy for the North Caucasus through 2025; we approved it in September of last year; we compiled a list of priority investment projects in the region.

I would like to reaffirm that our objective is to radically change the situation in the North Caucasus, primarily by improving the quality of life of the people, ensuring their security and giving them the opportunity to work and leave in peace. We must eradicate the roots of terrorism and extremism, first of all poverty, unemployment, ignorance and inadequate levels of education, and corruption and lawlessness. We must create a modern social infrastructure in the North Caucasus, which is another priority, and an effective economy based on the region’s advantages and natural growth factors. These factors include the great potential of the people above all, rich traditions (including business traditions) and a unique natural environment.

In the next ten years, we plan to create at least 400,000 jobs in the North Caucasus, implement major projects in agriculture, fuel and energy, construction, infrastructure and tourism, and create an environment conducive to attracting investment and encouraging small and medium-sized businesses. I can tell you that in 2011 alone 37 large projects with a total investment of 400 billion roubles will be implemented in the region.

In 2010, unemployment in the region dropped by 86,700 people, but the number of registered unemployment still remains very high: 381,000 people.

A considerable amount of budget funds, as well as allocations from major companies and development institutions, will be sent to the North Caucasus Federal District. The Investment Fund has been increased by 6 billion roubles specifically earmarked to finance projects there. We have established the North Caucasus Development Corporation, which should, in part, provide expert recommendations and assistance to the regions and local businesses in the implementation of investment programmes and in the preparation of financial documents and business plans. We have set up a joint-stock company North Caucasus Resorts, which will implement projects in the four special tourism zones in the Caucasus. Total government investment in these zones’ infrastructure has been approved at 60 billion roubles.

On top of that, we will use state guarantees to encourage business in the region. The starting size of these guarantees will be 50 billion roubles. I will speak about the effectiveness of these guarantees later: it is not very high yet. Anyway, we are investing huge amounts of funding in the development of the North Caucasus and we expect that the payoff will come in the form of improved quality of life for the people. This is why both the federal and the regional authorities must act as a team, uniting their efforts to ensure the success of their undertakings. This is why we have established the government commission, which has gathered here for its first meeting.

I must tell you that there is hard work ahead of us, and I’d like to ask all of our colleagues to act responsibly. During our planning meeting today, we will discuss a wide range of issues, above all, the implementation of three large federal programmes: the South Russia, the Development of the Chechen Republic, and the Development of the Republic of Ingushetia. These programmes are currently the main instrument for resolving socio-economic problems in the North Caucasus. In the last three years, we allocated over 91 billion roubles for their implementation, including 75 billion from the federal budget.

These funds were used to build and renovate dozens of social facilities such as schools, hospitals and sports facilities, to improve water supply to towns and villages, to connect outlying mountain villages to the gas distribution network, and to commission hundreds of kilometres of motorways.

I would like to remind you that in 2012 we will introduce a new financing system to provide federal funds only for approved federal targeted programmes. Therefore, these three federal targeted programmes…