23 November 202119:30

Foreign Minister Sergey Lavrov’s remarks at the meeting of the Russian Union of Industrialists and Entrepreneurs “International agenda of Russian businesses: Challenges, risks and cooperation strategies with the state,” Moscow, November 23, 2021

2396-23-11-2021

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Mr Shokhin,

Colleagues and friends,

Thank you for inviting me to the Russian Union of Industrialists and Entrepreneurs (RSPP) forum, which is devoted to the most urgent issues on the international agenda in the global economy and international activities of Russian businesses, including the numerous challenges and risks, many of which are objective, and many are manmade.

The Russian Foreign Ministry has always proceeded and continues to proceed from the premise that our work and that of other government structures must be in harmony with the efforts of business associations, the main participants in foreign economic activity. Together this should enhance the competitiveness of Russian companies, expand their opportunities abroad and help protect their lawful interests. This is one of the priority goals of Russian diplomacy. It is set forth in the Concept of Foreign Policy approved by the President of Russia. A new version of this concept is being drafted now, and this goal will be expressed even more prominently.

Obviously, both you and we are working in difficult conditions with challenges and risks. The use of politically motivated unilateral restrictions by the majority of US-led Western countries has become a sign of the times. Sanctions are introduced for everything, both for a reason and without it. A flagrant example is what is being done with Nord Stream 2.

We respond to such unfriendly steps in a balanced and appropriate manner, being guided by the need to maintain the sustainability of the domestic economy and financial system. At the same time, we offer our own positive agenda for ensuring equitable cooperation and a balance of interests in international economic relations without discrimination.

The problems are largely rooted in the system. A system of globalisation built on trade, financial and investment institutions was established after World War II, primarily following the West’s templates.

We did not join them immediately, however, such work got underway in 1991. It took tremendous effort to secure our interests when joining the WTO, negotiations were ongoing for 17 years.  All of a sudden, the West changed its mind because it began losing in that globalisation system, primarily to China which has been playing by the rules invented by our Western colleagues and began to pull ahead. Issues emerged which the Westerners try to solve artificially. Nowadays they do not speak about international law, they speak of the rules the world order must rest on. One such rule (they don’t say it, but it is obvious) was a demand to reform the WTO.  Americans have, in fact, disrupted its operation. The Dispute Settlement Body does not work as it simply lacks a quorum. The US single-handedly blocks the appointment of new members so that a quorum can’t emerge until a situation evolves which is favourable for Washington. Public statements are made that WTO reform must be done by the US and the EU and not anybody else. The other participants are sidelined on the assumption that when the new rules are presented to them, they will comply with them. Look at the developments in the World Bank, in the European Bank of Reconstruction and Development (EBRD) regarding their projects in the Russian Federation. The banks where we are significant stakeholders are blocking projects not only in the Russian Federation but also in such countries as the Syrian Arab Republic, even though all the standards currently in effect are being fully met.  This is outright politicisation. I don’t think the West is creating a good reputation for itself through such actions. An increasing number of countries are beginning to realise the need for a safety net: establishing systems that will not make them dependent on the whims, unreliability and intractability of our Western partners. 

We are stepping up coordination with like-minded partners. There are many of them – EAEU, CIS, SCO, BRICS. The Russia-India-China troika remains fairly active within BRICS.  Relation are being built up via bilateral channels with a broad circle of nations in Asia, Africa and Latin America and with their integration associations. Both (I mean individual countries and their sub-regional structures) show a growing interest in establishing cooperation and moving towards free trade with the EAEU. If we consider these countries, they are home to practically 80 percent of the world’s population. 

As a UN and WTO member, we oppose the attempts to change the multilateral trading system’s rules in such a way that they no longer reflect a balance of interests. We are also interacting at the G20, which is a unique mechanism. On the one hand, it represents an understanding that the G7, in its previous incarnation, is no longer able to address problems in the way it did 15 to 20 years ago. On the other hand, the creation of the G20 also means recognition of the trend towards multipolarity in the modern world, since all BRICS members participate in the G20. A number of G20 countries share the BRICS Five’s position concerning the importance of keeping up fair play not in words, but in actions when it comes to global economic development.

I’m convinced of the counterproductive and futile nature of the self-serving policy of our Western partners and its incompatibility with the principles underlying broad-based international cooperation.

We discussed information and communication technology which has become part of all spheres of life. This creates challenges and risks for government authorities, businesses and individuals. In the diplomatic arena, we advocate equality and consideration of the interests of all participants, and oppose major technology companies’ attempts to monopolise global digital markets which we observe quite regularly. We try to convince our Western colleagues of the need to establish joint actions to cut short ICT’s negative impact on the economy and politics and to make rational use of the vast opportunities in this area that become available as more technology breakthroughs come along.

We also discussed the energy transition, which is picking up momentum, and the related green transformation of the global economy. While these processes are fraught with something I wouldn’t call risks, but rather real dangers posed by green protectionism, the development of green technology will strongly stimulate growth around the world. Russia plans to engage in this. It is important to take advantage of this window of opportunity in an expert and timely manner, to rely on our own balanced and science-based position and to steadily consolidate it as an integral part of multilateral discussions.

Thank you for your kind words about the October 2021 meeting of the Foreign Ministry’s Business Council where we discussed these issues in the context of preparing for a conference of the participants in the UN Framework Convention on Climate Change in Glasgow. I must say that a better part of the concepts and lines of thought enshrined in Glasgow were provided by Russian agencies and ministries. These proposals reflected the approaches practiced by Russian businesses, the elevated consciousness (to use a lofty phrase) of entrepreneurs, their sense of responsibility for the efficiency of their business, the environment and the future of humanity, no matter how high-flown it may sound. In fact, this is life.

Not everyone was happy with the outcomes of the Glasgow summit. We must realise that self-centred approaches are unacceptable. Clearly, the developed Western countries with their post-industrial economies are trying to do their best to make sure the rest of the world stops polluting the environment and growing their economies. The balance between climate protection and environmental protection and the legitimate interests of the socioeconomic development of less developed economies has always been the cornerstone of our position. This line of thinking prevailed in Glasgow, which found its way into the decisions adopted by the summit.

We will continue to work consistently at international platforms in order to promote a balanced and non-discriminatory approach to the energy transition and to insist on taking account of the specifics of all countries without exception. We are promoting the concept for forming universal and transparent climate regulation and low-emission growth rules. We plan to continue to be proactively involved in talks aimed at developing techniques to preserve a friendly environment for human life.

The experience of science diplomacy in the Federal Department of Foreign Affairs of Switzerland was mentioned here. We don’t have one of those, but we do have a sustainable, useful mechanism of cooperation with the scientific community.  We have the Business Council at the Foreign Ministry of Russia and we also have the Scientific Council that represents Russia’s largest research institutes. We regularly learn from their experience and assessments of what is happening in the world, including on climate issues.

Returning to the problems of the green agenda, I must say that a number of influential countries, including EU members, are trying to politicise it and use it as an instrument of protectionism. The development of the Carbon Border Adjustment Mechanism (CBAM) by Brussels is a source of serious concern for the business community. Its use (the EU is declaring that it intends to do this and is not going to hold talks on this issue) is fraught with the risk of creating new unnecessary barriers that impede international trade and destroy established value chains. This is especially sad considering that many of them are already in a highly vulnerable position due to global supply chain problems caused by measures to counter the coronavirus.

I would like to assure you that we continue this conversation and have submitted relevant proposals. Everything that was now said about the connection between success in countering climate change and the continued policy of unlawful unilateral economic and financial restrictions requires serious consideration.

Speaking about our plans on the climate agenda at the expanded meeting of the Collegium on November 18 of this year, President of Russia Vladimir Putin said that our goal is to achieve carbon neutrality by 2060. Maybe sooner but not later. This will depend upon the extent to which our interests will be taken into account. First, it is important to consider the absorptive capacity of forests, marshlands, seas, and rivers. But success in reaching the goals set forth in Glasgow (this concerns everyone) will also largely depend on the ability of the West to realise the harmful effect of banning many states from using advanced technology, including the one that is required for work on the shelf and at Arctic latitudes.

This is not a question of Russia’s relations with the West but of global success or failure to work together to address climate change. I must emphasise that all these problems are real, not invented. They have a source – the attempt of the West to do all it can to preserve its dominant position in the international system that has dramatically changed and is moving towards a multipolar structure. Many argue about what this multipolarity will entail, saying it may be tantamount to chaos. It is in our interests to prevent it from turning into chaos and to root it in a  balance of approaches reflecting the development goals of all states. It is a fact that the new centres of power have learned the ropes of the international arena and are growing stronger as centres of economic development and financial might (which is followed by political influence). The task of politicians is to prevent this multipolarity from turning into chaotic competition by illegal means and methods that are not universally accepted. Our initiatives are aimed at harmonising the interests of major players in the world arena. This applies, for one, to the proposal of the President of Russia to hold a summit of the five permanent members of the UN Security Council that will review issues we are discussing here as well.

All these alarming trends do not rob us of the will to continue regular contacts with foreign partners and business circles. They are more interested than their rulers are in depoliticising economic ties. This is a big resource for humanity. We support the aspiration to continue pragmatic, mutually beneficial cooperation. The interest of foreign businesses in the Russian market invariably remains high, as evidenced by the work of such venues as the St Petersburg International Economic Forum, the Eastern Economic Forum, Russian Energy Week, and the Russia is Calling Forum, to name a few. We will actively support and encourage any constructive plans and undertakings.

Colleagues,

The Foreign Ministry is invariably willing to continue to strengthen our close and truly comradely interaction with the Russian Union of Industrialists and Entrepreneurs in the interest of improving our economic diplomacy. We value your feedback. On-the-ground assessments of a situation or a vision of various ways to resolve emerging issues give us an opportunity to work with our foreign partners in a well-argued manner, to provide specific examples and to come up with concrete proposals. This is a two-way street: the more effectively Russia upholds its positions in the international arena, the better positioned specific Russian businesses will be. We are not only interested in having major domestic businesses make forays into global markets. We want to follow the example of the countries whose small- and medium-sized businesses enjoy a wide and growing presence on international markets. I think if we keep going down that road, we will contribute to the stability of the global economy and create an environment where all kinds of conflicts will become increasingly less necessary for humanity.

Today we are signing an updated cooperation agreement which means that our partnership is not only alive but thriving.

***

Regarding the vaccines, there are objective things stemming from the rules set by the World Health Organisation. There have never been problems like these before as all vaccines that were used to fight previous pandemics were developed on the basis of well-known platforms. We are also seeing subjective factors obstructing these processes. At the G20 Summit in Rome we suggested that instead of waiting for the completion of all bureaucratic – in a way legalistic – procedures, we should support the trend that has already emerged. It is not about the mutual acceptance of vaccines but rather of vaccination certificates. This works. Hungary has taken this decision – we have reached a corresponding agreement with them and we expect several other countries to follow suit before long. Russian President Vladimir Putin said that 120 million people in Russia and abroad had gotten the Sputnik V jab. Nobody has recorded side effects. We will support this as much as we can.

As for the social responsibility of both businesses and the leaders of the world community, President Putin, speaking at the G20 online summit dedicated to the pandemic, supported the initiative to mutually waive patent protection for [coronavirus] vaccines until this evil has been finally defeated or until the situation stabilises and is brought under control. There was no response whatsoever. Clearly, this has to do with the commercial interests of leading pharmaceutical companies. A company producing the most popular Western vaccine was reported recently to have already earned $30 billion. This is quite a sum. Profit [like this] and the craving for more might weaken the desire to waive patent protection.

Nonetheless, we will support these initiatives. It is encouraging that the association of industrialists abroad – in the West and in Europe – is also offering its support.

 

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