OREANDA-NEWS.   Sergei Chemezov reported to the President on the state corporation's performance in 2013.

The CEO of Rostec also informed the President about the corporation’s reorganisation, which has been in progress since 2009. According to him, arms exports increased from USD 3 billion in 2009 to USD 13.2 billion in 2013. The share of high-tech civilian products today is nearly 40 percent and should reach at least 50 percent by 2020.

Other matters touched upon during the discussion included personnel training for the corporation, cooperation with foreign companies and approaches to social issues.

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PRESIDENT OF RUSSIA VLADIMIR PUTIN: Good afternoon, Mr Chemezov.

Do you have an annual report ready?

CEO OF ROSTEC STATE CORPORATION SERGEI CHEMEZOV: Yes, we had a Board of Directors meeting yesterday that approved the corporation’s annual report. In accordance with the law on state corporations, I must report to you on the results of our work.

VLADIMIR PUTIN: Please, go ahead.

SERGEI CHEMEZOV: A few background facts. In 2009 we acquired 443 businesses. Most of those companies were in dire financial straits, with a complicated ownership structure. Many businesses were being controlled by various criminal groups.

VLADIMIR PUTIN: There’s no need to frighten me.

SERGEI CHEMEZOV: There were some cases like that.

The total losses for 2009 amounted to 63 billion rubles [about USD 1.8 billion]. In the years since then, we did an enormous amount of work, first and foremost by corporatising state unitary enterprises and created an effective governance system. Today, instead of 443 enterprises, we have 663, and all these enterprises are divided among 14 holding companies. Nine of the holding companies are part of the military industrial complex, while the remaining five operate in civilian industrial sectors. Currently, all of them are working effectively. Proceeds have grown significantly: in 2009, that figure was just over 500 billion, whereas in 2013, we reached over one trillion rubles.

We already have large profits: 40 billion rubles, compared to losses of 61 billion. Our average salary is significantly higher than the national average; currently, it is 31,200 rubles per month, whereas the national average is between 27,000 and 29,000 rubles. In 2009, it was only 17,000. In other words, the volume and numbers already show that the creation of the corporation was justified. The results are clear.

Our arms exports are growing significantly as well. Rosoboronexport is our subsidiary company. If we compare to 2009, when we were just creating the entire military technical cooperation system with your direct involvement – at that time, the volume was just over USD 3 billion. Currently, Rosoboronexport alone shipped USD 13.2 billion worth of military products last year.

Our corporation is exporting over 350 billion rubles worth of goods it manufactures itself, including both military and civilian products. This is a very large figure.

Key importance is given within the corporation to fulfilling the state defence order. In 2013, 209 of our corporation’s organisations participated in fulfilling the state defence order, and all these enterprises fulfilled the state defence order 100%. Compared to 2012, the state defence order volume grew by nearly 40%.