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Putin calls for new energy charter
Russia has called for a new energy charter to form the basis of energy security.
- By Francis Matthew, Editor at Large
- Published: 22:59 January 29, 2009
- Russian Prime Minister Vladimir Putin at the opening session of the World Economic Forum.
- Image Credit: EPA
Davos: Russia has called for a new energy charter to form the basis of energy security.
"We need to tie suppliers and consumers together," Prime Minister Vladimir Putin said in his address to the World Economic Forum.
"The collapse of the oil price will encourage irrational investment, leading to a price surge. We need balanced prices we need common tariffs for the movement of energy, with diversification of routes and types of transport," said Putin, who did not choose to mention his own government's recent unilateral decision to suspend supplies to many European Union states for many weeks.
Putin outlined plans to build several new pipelines to achieve the security of transport he was describing. He spoke of new lines through both the Baltic and the Black Sea in the west of Russia, through the Caspian in the south, and in eastern Siberia reaching the Pacific in the east of Russia.
The Russian prime minister's call came after a review of the world recession, which he likened to a perfect storm, in which all the elements come together and multiply their effects.
"This was a crisis which has been treated as though it was totally unexpected, but in fact it was as unexpected as winter, which comes to Russia every year," Putin said.
"It was due to the collapse of the system, low quality of management, a mis-match between risk and gain, one economy printing money [referring to the US] and another saving money [China], and inflated expectations supported by nothing."
Looking ahead, Putin said that all countries should "avoid any drastic step that we will regret later. We have to avoid protectionism, and have no barriers to trade, which will simply worsen the global financial crisis."
He promised that Russia would work with the US, Europe and other countries to resolve the crisis, saying "We must all act together. We cannot afford to be isolationist and egotistic."
He also counselled against too much interference from the state. "There is a temptation to expand the state's role. In Russia we have already paid a very dear price for that," he said, referring to the experience of the USSR.
Putin then rattled of a list of steps that he recommended for stopping the recession. "We should draw the line now. Write offs should be efficient. We should clear up the bad assets and stop fake money. The rating system should be based on fundamentals. We should encourage the emergence of several reserve currencies," he said.
Finally, he echoed calls from many others at the WEF to change the international bodies that monitor the financial system. "We need global multilateral organisations, with more equitable economic architecture," he said.
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