Sinopec and Sibur to Produce Rubber in Krasnoyarsk

May 15 – China Petroleum and Chemical Corporation (Sinopec) and Sibur, the Russian petrochemicals group, have entered into a cooperation agreement to form a butadiene nitrile rubber joint venture in the Siberian city of Krasnoyarsk.

The cooperation deal was signed by Sibur’s CEO Dmitry Konov and Sinopec’s president Wang Tianpu at the recent Russian-Chinese Forum on commercial investment cooperation in Moscow.

The cooperation agreement includes a mechanism for the financing of the joint venture, and arrangements relating to share capital, management, raw material supplies and marketing. Read the rest of this entry »

Russian Businesses Losing Out Due to Language Inadequacies

May 3 – Cultural differences and linguistic barriers are keeping Russian companies from expanding internationally, according to research released on Tuesday.

Unfamiliarity with foreign mores and a poor command of languages are perceived to be obstacles to global business success by 89 percent of Russian companies surveyed by the Economist Intelligence Unit and language-teaching firm Education First in a report titled “Competing Across Borders.”

The report, conducted in February and March 2012, showed that 49 percent of Russian respondents admitted that their companies had been hit by financial losses as a result of linguistic and cultural difficulties — 6 percent higher than the global average. Read the rest of this entry »

Russia Needs to Decentralize Power to Attract Investors

Apr. 26 – Russia needs to decentralize power to lure a greater number of investors, former Finance Minister Alexei Kudrin said at a conference run by Russian lender VTB Capital in New York.

“The vertical of power that’s built today is flawed and the effectiveness of state governance is very low,” Kudrin said, adding that “the power to regulate currently held by federal ministries should be passed to municipal governments.”

Should the government boost social spending to fulfill promises made during Prime Minister Vladimir Putin’s successful campaign for president, taxes will “inevitably” increase, Kudrin said. Read the rest of this entry »

Russia’s M&As Face Slow Start to 2012

Mar. 26 – Russia’s M&A market experienced a strong reduction in value in 2011, dropping by almost 28 percent year-on-year to an overall market activity of US$71.1 billion, global audit and consulting firm KPMG said in its annual report on the M&A market. Worldwide, the value of M&A activity decreased by about 6 percent.

Almost one-third of the total deal value was transacted just by four companies: Moscow-based internet investor Digital Sky Technologies, state gas monopoly Gazprom, Novolipetsk Steel, and VTB Bank. The 21 deals made by those companies came to US$23.1 billion. Read the rest of this entry »

Marriott to Expand Presence in Siberia

Mar. 21 – The second Marriott Hotel will be open in Russian Siberia from December 2014, the Marriott International announced this week. The group’s first hotel was Courtyard by Marriott, built in Irkutsk with 208 rooms at an estimated cost of 25 million euros.

The new Marriott Hotel will be constructed in the Siberian city of Krasnoyarsk.

“We are excited to announce this great new addition to our portfolio,” Amy McPherson, president and managing director of Marriott International Europe said. “We currently operate 14 hotels in Russia and see tremendous opportunity to expand across our brands here.” Read the rest of this entry »

Miners in Tyva Republic to Subsidize Reindeer Breeding

Mar. 15 – The government of Siberia’s Tyva Republic has asked foreign and domestic miners operating in the region to pay subsidies to local reindeer breeders, according to the republic’s web site.

Under the agreement, China’s Longxing and the local Golevskaya Mining Company will allocate 600 rubles (US$20) for the maintenance of each reindeer in the Todzhinsky District of Tyva, where both companies operate and where 77 percent of the region’s reindeer population is located. The funds will go to the district’s reindeer breeding farms. Read the rest of this entry »

The Republic of Tuva and the State of Russian Coal Exports

Mar. 14 – Russia’s US$8 billion investment into Siberia to develop the Tyva Ulug-Khem Coal Basin, estimated to have 2.5 times more reserves than the Mongolian Tavan Tolgoi field, could double the country’s metallurgical coal exports by 2020.

“Annual coal production in Tyva may reach 40 million metric tons in 2020 should all the companies implement the announced plans in full,” Dmitry Sakhno, project manager at OAO Severstal, Russia’s second- largest steel producer, said in an interview with Bloomberg.

At the same time, according to Sakhno, the delays by some of the mining companies as well as complexity’s of developing the region may curb production by 2020 to 15 million to 20 million tons. Read the rest of this entry »

French Vostok to Become Pioneer in Russian Electricity Market

Feb. 29 – French grid company Vostok has been contracted to run the Tomsk Distribution Company of Russia’s grid firm MRSK for an initial 18-month probationary period, the companies announced on Tuesday. It’s the first time a foreign entity has been permitted to manage an operating entity in Russia.

“This is the first instance of such cooperation with Western partners. The French party has made the right decision by choosing Siberia for its operations,” Prime Minister Vladimir Putin noted.

Tomsk is a city in the southwest edge of the great Siberian Taiga, the administrative center of Tomsk Region, located about 3,500 kilometers from Moscow. Read the rest of this entry »

Russia-China Venture to Build Aircraft Plant in Inner Mongolia

Feb. 17 – A joint Russian-Chinese venture will invest US$1.27 billion towards the construction of an aircraft factory in the town of Ordos located in China’s Inner Mongolia Autonomous Region, Xinhua reported yesterday citing a company agreement.

Construction on the plant will begin later this year and it will eventually be equipped to assemble small general aviation aircraft.

China Oriental Sciences Group will hold 52 percent of the venture, China-Russia International Investment Co. will hold 38 percent, and Russian aircraft designer “Modern Aircraft Technology” will hold 10 percent, Xinhua said. Read the rest of this entry »

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