Russian Prime Minister Dmitry Medvedev is in Crimea - the most senior Russian to visit the region since Russia seized it from Ukraine earlier this month.
Mr. Medvedev says he is leading a delegation of Russian officials for a meeting on what he calls the "development" of the peninsula.
The prime minister says Russia will create a special economic zone in Crimea, offering incentives for business with lower taxes and simpler rules. Mr. Medvedev also promised to boost salaries and pensions in Crimea.
His meeting Monday comes a day after U.S. Secretary of State John Kerry demanded Russia pull back thousands of its troops massed along the eastern and southern Ukrainian border.
Kerry told Russian Foreign Minister Sergei Lavrov in Paris Sunday that the troops are creating a "climate of fear" in Ukraine and that their presence does nothing for diplomacy.