UPDATE 3: Putin: Share of counterfeit light industry goods falls too slowly

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RYAZAN, Aug 24 (PRIME) -- The share of counterfeit and smuggled goods on the Russian light industry market is shrinking too slowly devaluing state support measures to law-abiding facilities, President Vladimir Putin said at a government meeting on light industry issues on Thursday.

He said that in 2013, when the share of counterfeit products in retail sales was 39%, he commissioned to struggle against them. “It (the share in sales) has fallen today, but as little as to 33%. I want to draw my colleagues’ attention to the fact that the three-year dynamics are unconvincing. I would like to hear today about the approach to the problem from each you, what you think prevents us from setting it right, what additional protective steps, measures are needed in order to block the flow of illegal imports.”

According to Putin, Russia puts excessive barriers to imports of good quality materials for the light industry, and the issue also needs to be tackled.

“One more question concerns raw material supplies to the domestic facilities. As far as I know, there is a deficit of natural materials on the market, their quality is often poor. We need flexible solutions here to stimulate our own production of raw materials and satisfy current needs,” the president said.

Putin also said that low salaries in the light industry is a repellant for young professionals. “Output per employee in the industry rose 60% from 2013 till 2016 while salaries rose by about a third. Last year monthly salaries amounted to 18,600 rubles in the industry on average which is much lower than in the economy on the whole.” He ordered the government to consider measures to improve the situation.

New facilities producing light industry goods must be supported, Putin said. He suggested the government consider retaining incentives to companies buying new equipment.

Industry and Trade Minister Denis Manturov suggested keeping state support for the light industry at about 3 billion rubles annually in 2018–2020.

“In order to not stop the positive processes emerging in the industry, we see it necessary to keep state support at least in today’s volume, which is about 3 billion rubles,” Manturov said.

The minister said he hopes that the government will support this proposal while working on the 2018–2020 budget.

Manturov said that the ministry plans to start tagging leather shoes in 2018 and coats in 2019. “We will create a system of monitoring on routes of the light industry on the area of the Eurasian Economic Union. Tagging of legal goods with control marks is seen as the key instrument.”

Putin ordered the government to work on the idea of introducing recycling fees for producers of cheap footwear, after head of the Russian union of leatherworkers and footwear producers Alexandra Andrunakiyevich asked to extend the measure currently applied in the car industry to footwear production.

(59.1312 rubles – U.S. $1)

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