Moscow. June 18. The St. Petersburg economic forum in its history, has undergone several reincarnations, each time broadening the scope and at the same time away from the city centre. Once he was placed in the Tauride Palace, where not so many participants were given the chance to briefly introduce themselves deputies of the pre-revolutionary Duma. Then moved on Vasilievsky island, “Lenexpo”: area larger, but apparently “obsolete”: only colorful giant banners on all the free surfaces concealed the dire need of forum for infrastructure investment.
Finally, forcing the participants a couple of years to wait, SPIEF moved to a new, without quotation marks, place “Expoforum”. Justifying territorial proximity to Pulkovo, the Convention center is really reminiscent of the airport. Distress “Lenexpo” forgotten like a bad dream: in addition to the already familiar to the SPIEF giants to place their stands got the opportunity the companies of the second and further levels, many regions and even “competitors” (Yalta economic forum). If last year the visitor to the main pavilion of “Lenexpo”, like it or not (towards the end didn’t want for almost no one, ran into a talking robot from the stand of Sberbank of Russia, now and robots became much more – if desired, one could be collected in a separate session, and space to avoid a conversation with an anthropomorphic mechanisms.
Forum in Davos, as the arrogant daughter of an American billionaire Vanderbilt, received a well-aimed kick. Such high-quality infrastructure, he does not have and is unlikely to be: in Switzerland there is “Gazprom” to Finance the construction of a colossus like “Expoforum”, and in Davos are not banal enough for this place. However, to challenge the right to Davos shaping the global agenda, infrastructural superiority is not enough: as a minimum you need to ensure that the forum is not “cool” just around the program of participation of the first entity and its key guest, as the Earth around the Sun. So far, only in Davos you can see a huge queue at the entrance to some kind of “laboratory of ideas”, which, oddly enough, is not any one President or even the head of the Central Bank. The organizers Pmef try to diversify the program and make it more modern, but to win “a hierarchical agenda” is hardly in their power.
Therefore, the center of attraction of the forum was, and remains a plenary session. Session without any specific theme, that is, with the theme – “the President’s speech about the economy” (and then respond to questions from the moderator, a foreigner about politics). The main guest this time was Matteo Renzi, Prime Minister of Italy, a country that even now retains the image of a friend of Russia, without breaking, however, the General lines of the EU. Overall feeling: before normalization of relations far away, but much closer than a year or two ago, when Russia was still struggling to look to the East in search of new partners, and this is strongly reflected in the agenda and ideology of the forum.
Economic issues have little chance to get into the session of questions and answers with the President – while business cooperation with the West remains “frozen down”, foreigners are more interested in Syria, Ukraine, and now doping. Sporty another relevant question is about the behavior of fans, not sounded, but so obviously was in the air that it didn’t need to ask. The President called the fight in France with the participation of Russian fans a “complete mess”, not failing to note that “two hundred of our fans “beat up” a few thousand Englishmen.” And all Russian-European relations: constructive intentions and mutual injections. While Matteo Renzi thanked Vladimir Putin for the good news of the victory of the Italian national team on football, the EU extended the “Crimean” sanctions, and the Russian athletes were banned from the upcoming Olympics.
The macroeconomic agenda of the forum again suffers from desync of commodity cycles: a year ago, the rebound in oil prices (as it turned out, temporary) was not conducive reformist brain storm and right now the picture came out the same. Oil near $50, and the economic bloc vehemently argues, it’s a windfall or just income?
The principle of “project office” in public administration good not only striking, modern name, but the fact that everyone understands it differently. New bureaucratic superstructure or the revolution in public management? While life on this question is not answered, but the formation of the project infrastructure is in full swing and even more ambitious than expected.
“It is clear that the challenges facing us require new approaches to management development, we intend to actively use design principle. In the near future Council will be established under the President for strategic development and priority projects. Your humble servant will lead it, and by the Presidium of the Council will be chaired by the Chairman of the government Dmitry Medvedev,” – said Vladimir Putin at the plenary session. Heavy the title of the new body is not too consistent with the spirit of “project management”, but, of course, not in the title – most importantly, how everything will work. Nobody on this question has not been answered, except for a universal definition of Igor Shuvalov (“platform for consolidating all administrative efforts in order to achieve a particular result”).
It is not clear yet whether the overlap composition and functions of the new body with another “neophyte” – economic Council, which was recently restarted. There is a Presidium headed by the President and his Deputy is Alexei Kudrin, who left at the time the government because of disagreements with Medvedev.
The main task of the authorities in the field of business climate Putin formulated at a meeting with heads of major international companies: “I Really hope that I won’t affect people like you”. Just a couple of hours before the Minister of culture Vladimir Medinsky one such company, must be greatly puzzled. “For example, Danone. Hi I convey to her you will have problems. I promise. In the nearest time,” was the comment of the Minister to dispute “Soyuzmultfilm” with Danone on the rights to use the brand “Prostokvashino”.
The budget is the most fair rules
A place of intellectual and economic power of the forum – business Breakfast of the savings Bank. This time it was held under the title “Life after oil”, but the provocative title knocked participants off. Oil is not going away, and the price is not so low. So mainly at Breakfast talked and debated about how to live in a time of oil, not after.
Only Herman Gref managed to bring together Ministers of economy and Finance (in the official forum program common events not found, even macroeconomic panel on the first day of SPIEF without representatives of the Ministry of economic development – there were Minister of Finance and the Central Bank, whose views on the target model for fiscal policy now obviously close). Anton Siluanov, Alexei Ulyukayev urged to stop guessing on oil, but has invested in these appeals fundamentally different meaning.
“From the point of view of public finances it seems to me that it is absolutely clear what to do – need to stop trying to guess what oil will be tomorrow, day after tomorrow, in determining our estimates, because we create our own shocks, the problems for the economy, for the budget, for a course for monetary policy. We want to hope that suddenly something happens – the oil will grow, will return to $100 a barrel, and we will increase salaries, pensions, and begin to put all this in our plans. So that was our mistake. And, maybe, lack of rigidity of budgetary policy of previous years has led to the fact that we very much feel the decline in oil prices,” – said Siluanov.
“What to do? You need to take when planning the budget, economy and financial policy of the structural price of oil at $40-50, I think that within these limits we need to focus in shaping our plans,” – said the head of the Ministry of Finance.
“That’s how my friend Anton Siluanov: let’s head take some price and it will build our lives. The chances are that this price is correct – exactly the same as that outside, you will encounter green monkey. 50% – either meet or not meet. Similarly, with the price of oil – will or not. Let’s take the zero, let’s take a minus 10 (per barrel), and we will have still better from the point of view of macroeconomics,” retorted the Minister.
“I think that this is a completely pointless exercise. This short answer – give the excess money will bring in reserves, is the answer to poor governance in the state. When the control system of the state poor, not to create the temptation of inefficient spending, you take away somewhere and hide in a jug these funds,” Ulyukayev said.
“The challenge is not in it, and how to build correct and high-quality decision-making system in the budget, the economy, investments. That’s what is important, so we need a fiscal rule, but we need the right budget. The right budget is the budget that focus us on development, ” the Minister said.
A dispute between two Ministers – not personal, but “officials”, said the rector of Ranepa Vladimir Mau.
“The debate is absolutely right and natural between the Ministry of economy and the Ministry of Finance. I think if Ministers were swapped, she’d be about the same, so this is not some kind of personal position. The Ministry of Finance should be conservative, in the end, it is primarily responsible for the stability, not growth. Ministry of economy is responsible for growth. In this sense, the debate is absolutely clear and healthy. This, incidentally, is one of the reasons why the Ministry, these to unite is not necessary”, – he said.
The fiscal rule in the resource economy is needed, you just have to decide how to set it up, says Mau.
“The notion that the abundance of cheap money makes life easier the government is wrong. Yegor Gaidar in 2004-2005, when he was paid the external debt, said, “I thought, it is difficult to be Minister of Finance when there is no money, but now I see, that it’s much harder to be Minister of Finance, when a lot of money”. Indeed, when there is no money, can you explain this to the Minister of labour and Minister of defense, and understand everything. When a lot of money to explain that on the basis of macroeconomic considerations long-term stability, they are not much more difficult. Budget management in the context of resource Economics with the understanding that she is unsteady and the income range is very difficult. Every time there is the illusion that this time things will be different, and we have reached a new price plateau. Therefore, a fiscal rule is necessary, but further, there is a fork in the road,” said Mau, part of the presidential economic Council.
To find a balance between the positions of the Ministry of Finance and Ministry of economic development ultimately possible, he said.
“A fiscal rule should have a rigid cut-off price, not associated with the average. And it should establish certain rules for spending the interest income (those in English called windfall money). And here I am willing to accept that, in principle, the task of keeping this money in reserve for the worst of times – wrong. The money must be spent to reduce dependence on market fluctuations and invest in projects that do not require fixed costs (roughly speaking, investments, not social obligations). Or on tax cuts, for example,” he said.
About how important economic mechanism for the use of rental income, says not only the Russian experience. “Just look at the history of the USSR, Russia, Venezuela and Norway. Venezuela and the USSR was spending all of the oil rent on the current development, and there is a disaster. Norway did not spend anything, and there is some slowdown from 2% to 0.5% with minimal fluctuations of currency. Russia spent partially, and accordingly, is somewhere in between – the situation is quite stable, but clearly worse than in Norway. One of the lessons of the budget rules of the last decade suggests that the presence of significant budgetary resources provokes populism is not an economic adjustment to new challenges (including crisis), namely populism,” – said Mau. Large reserves can help prevent disaster, but can the problem: “when you have a lot of money – you start it is inefficient to expend in a period of high prices and to plug holes when they fall, and then the crisis does not lead to structural reforms, and the delay in structural reforms, because you have a lot of money.”
Oil theme – traditionally one of the basic SPIEF still is the Foundation of the Russian economy. The only difference is the vector discussion: depending on oil prices, the speakers talk as all bad or all good. The forum reflected that now in the Russian oil industry “all is calm” – the price of oil climbed out of the pit, but to the level of windfall she might not rise.
In addition to the sanctions the oil companies have adapted, foreign business is once again seeking a partner, and have no need to show on the forum a flurry of activity. If in recent years, large oil and gas Corporation packs signed agreement at SPIEF, this year “Rosneft” and “Gazprom” cost a modest number of signatures.
Foreigners struggled made overtures, albeit modestly, so as not to Shine too much. The number of representatives of foreign energy companies on the forum 2016 has increased significantly. Their attention to the Russian oil and gas sector showed a downtrodden audience into sessions hydrocarbons: these sessions were among the most populous willing to listen to the speech were forced to stand close, sit on the floor and bravely to withstand the heat.
The price of oil is discussed. But perhaps as brief as possible on this occasion said the President of Kazakhstan Nursultan Nazarbayev, by summarizing the opinions of analysts, OPEC representatives and even speculators. The price of oil at $50 per barrel is not the best, but at the moment it reflects the reality in which we must live and look for the positive aspects, he said.
“Fall in oil prices has lost everything: importers, exporters, of course, lost to developing countries. Bad – Yes, bad, but every bad has a good side. All of our countries, finally, took up the refining, manufacturing, industrialization, the development of other industries,” – said Nazarbayev.
Despite the fall in oil prices, producing countries will continue to produce raw materials. “In the coming decades, well, probably until the middle of this century the need for oil and gas will not decline. We, the oil-producing countries, will still work without slowing the pace,” said the President of Kazakhstan.
The head of “Rosneft” Igor Sechin, speaking at one of the specialized sessions, assessed the current situation on the world market: “the Result of the current crisis, I think, becomes a rethinking of the role that have played and will play three largest countries-oil producers with not only a geological resource potential, but also a wide range of factors required to influence the markets. Crystallization occurs the major players. These countries – Saudi Arabia, USA and Russia. Each of them finds the answers to these challenges, relying on their resources and technological capabilities, market structure, features of making political and economic decisions,” – said Sechin.
Meantime, Russian oil companies continue to keep the bar production in any conditions and retain investment. The head of “Gazprom oil” Alexander Dyukov said that against the background of falling oil prices in the world in Russia, such situation has developed thanks to the tax system. “Yes, the low price of oil we are losing in dollar revenues. But the ruble helps to offset a shortfall in revenues,” he said. The head of “LUKOIL” Vagit Alekperov said that “with the devaluation of the ruble in ruble mass to maintain the activity in Russia.”
A new equilibrium in the industry Alekperov described as follows: “Today, our suppliers, contractors, have begun to reduce their prices on goods and services. We begin to work together to balance on a single ROI, which allows us to operate quite successfully at $40, and $50 and $60. That is, this psychological change from the prices of $110 per barrel to $30 per barrel of our contractors has passed. Today they really look at how the market develops and the actual prices set for their goods.
While the leaders of “Gazprom oil” and LUKOIL stressed that the Russian oil industry need ponastroila tax system, because it requires support for older fields and the introduction of new technologies in the industry. Return oil to its favorite tax topic clearly demonstrates that in the industry everything has calmed down and returned to normal – for lobbying.