Largest Wind Power Plant Construction in Russia

Construction of Russia's largest wind power plant (WPP) up to 100 MW is planned in the vicinity of the city Yeisk in Krasnodar region, the chief specialist of the Institute "Rostovteploelektroproekt" Adolf Cherniavsky reported.
"The site selected for construction is currently being pre-worked" - he said. 

Investments in the project amounts to 200 million dollars. Construction of the plant expected to be funded through private and public funds. The cost of one kilowatt of installed capacity will amount to 2,000 dollars.

Central Bank of Russia Remained Refinancing Rate Unchanged 7,75%

Board of Directors of the Central Bank of Russia upheld the refinancing rate on the level of  7,75% - and other rates on its operations against the background of slowing inflation and an acceptable level of inflation risks in the coming months.

The Central Bank in June completed a cycle of declining rates started in April 2009) . During this period the refinancing rate decreased 14 times - up to 7,75% from 13%.

BP Sells Its Assets To Russian TNK-BP

BP offered Russian company TNK-BP to buy its assets in Venezuela, Executive director of TNK-BP Viktor Vekselberg reported.
'We are now in process of due diligence of the deal"- said the businessman. V. Vekselberg added that Venezuelan authorities do not object to this transaction to take place.
According to British media, BP may sell TNK-BP's minority stakes in two joint ventures for exploration and extraction of oil from the Venezuelan state company Petroleos de Venezuela. The possible value of the deal - $ 1 billion. However, BP's representative called these reports "rumors and speculation."

AvtoVAZ Returned to Profit Earning Almost 2 Billion

Russian automaker OAO AvtoVAZ for the first time since 2008 showed profit for the quarter ended. According to a company report, in April-June 2010 Togliatti auto giant earned 1.97 billion Rouble. This profit is calculated in accordance with Russian Accounting Standards (RAS).

Russian Government Will Sell 11 State-Owned Shares to 1 Trillion Rubles

Ministry of Economic Development (MED) of Russia and  Ministry of Finance of Russia have agreed on a preliminary list of the largest state companies and banks for privatization in 2011-2013. 

Russian Government hopes to raise additional funds in the budget in the amount of $ 1 trillion rubles by selling shares in 11 state-owned enterprises.

The state does not intend to go beyond the state-owned stake of 75% of shares. Such companies, in particular, are "Transneft" and FGC.

Creation of Insurance Agency of Export Credits And Investments in Russia

Today the Supervisory Board of VEB approved the establishment of the Russian Agency on insurance of export credits and investments.
The Agency will be created to improve the effectiveness of export support of Russian industrial output by creating a system of insurance of export credits and investments, as well as providing national exporter of a wide range of insurance products.
The authorized capital of the Russian Agency on insurance of export credits and investments will be 30 billion rubles.

The agency will be created in the form of open joint stock company with 100 percent participation of VEB in its charter capital. Insurance Agency would support Russian exporters of high technology products to attract bank loans for longer periods and on concessional terms.
The agency may start work in 2010. Necessary changes in Russian legislation should be done before. The agency would deal not only with insurance of Russian exports, but also importers of Russian products.

The Russian Government Offers Tax Incentives to Funds of Scientific Activities Support

The RF Government has made to the State Duma amendments to the Law "On Science and State Science and Technology Policy" and to  the Tax Code, aimed, inter alia, to provide tax incentives for the fund for scientific, technological and innovation. Information about the document was posted on Wednesday on the official site of the Duma.
The bill regulates a form of state funding of scientific, technical and innovation activities through the appropriate state funds and is aimed at streamlining its system of providing tax incentives to establish features of their legal status and organizational structure, as well as determining the requirements for the selection of fund-financed projects.
The changes proposed to the Law on Science, establishes that the objectives of the fund are to support not only the scientific and (or) scientific and technical, but also innovation. The bill defines this type of activity.
The bill includes a provision that public funds are state budgetary institutions. Also provides that legal and (or) physical persons can set up a fund of support of scientific, technical and innovation activities, the legal position is determined by federal law "On the non-profit organizations".
The document establishes the structural features of public funds management organs and introduces a mandatory examination of applications for funding of scientific, technological and innovation projects.
The bill also establishes general provisions on the procedure and conditions of public funds of the competition for funding of scientific, technical and innovative projects, including the general requirements for the examination of applications submitted for the contest.
Amendments to the Tax Code establish a system of tax incentive of funds organized in accordance with the law of science.
In particular, it stipulates that income is not taken into account in determining the tax base, comprised of funds derived from funds established in accordance with the law of science, as well as funds received in the formation of these funds (Article 251 of the Tax Code). Also amends articles 262 and 270 of the Tax Code in the recognition of expenses allocated to the formation of these funds.

KAMAZ Returned To Profitability

Russia's leading manufacturer of trucks KAMAZ Inc. returned to profitability in the II quarter of 2010. 

This is evidenced by statements of one of its shareholders - the German auto concern Daimler, which is up to the last quarter received from participation in the share of KAMAZ profit of 1 million Euro.

Russian Economy Has Grown In II Quarter 2010 on 5,4%

Russia's GDP in the II quarter of 2010 grew at an annual rate to 5.4%, taking into account the seasonality - 1,1%, Deputy  Minister Economic Development Andrei Klepach told reporters. 

"This shows a certain acceleration of growth. The first quarter was given the seasonality minus 0.2 for the fourth quarter of last year", - explained the Deputy Minister. 

According to him, in the second quarter a factor in export demand weakens, but increases the dynamics of import growth followed by growth in consumer demand.

New Metal Exchange In Russia

Federal Antimonopoly Service (FAS) of Russia proposes to create Metal Exchange of the Russian Federation, said the head of FAS Igor Artemyev, speaking at a meeting with Prime Minister Vladimir Putin on the development of ferrous metallurgy in Chelyabinsk. 

"We do not have Metal Exchange. And we have created a commodity exchange in St. Petersburg, where a large part of oil today is trading and will be trading, we recommend you to think about Metal Exchange here in Russia, particularly as regards to export contracts. Then no transfer prices would exist. Export contracts in Russia would be in rubles, "- said I. Artemyev. 

In turn, Prime Minister Vladimir Putin said that the situation in the steel industry is very good, industry is developing at a good pace. He said the joint efforts of the state and companies in the industry enables steel to reach new frontiers.

Russian Foreign Investments Climate: Warm Or Cold?

During the Russian-German summit held in Ekaterinburg in mid-July, 2010, German businessmen raised the question of easing the visa requirements between Russia and the countries of the European Union.  This issue came as a surprise to Dmitry Medvedev and Angela Merkel. It was the Germans who asked, not the Russians, proving once again that Western businessmen are interested in Russia and this interest is growing steadily.  Investors are beginning to think about where to put their post-crisis cash.


It’s no secret that Russia today is not terribly attractive to investors.  That’s a fair assessment. On the World  Bank’s list of the 183 most business-friendly 
countries, Russia is ranked 120th. Major investors are primarily interested in the so-called strategic industries, which are still the most highly-regulated. 


Acquiring more than a 5% equity stake in a company from one of these industries requires the approval of a government commission. Mentioning that kind of a commission would scare off any private investor, but especially a foreign one... So, on one hand, there’s not a favorable investment climate, and on the other, the government’s cautious attitude toward foreign investors has resulted in Russia being nowhere near the top hundred rankings on the World Bank list…


Russian laws are formulated on the principle of ensuring that  foreign investment is treated favorably.  This is the very principle that guides the laws. Foreign investors can operate and use the profit they earn under terms just as favorable as those enjoyed by Russian investors. In addition, Russian 
laws guarantee full protection of a foreign investor’s rights within the Russian Federation, guarantee the reimbursement of any damages resulting from the illegal actions of a government agency, and so on.  Russia is also bound by a number of international treaties and ratified conventions on the protection of foreign investments.


At a meeting in early 2010 about the problems in the investment climate, Russian President Dmitry Medvedev identified investment activity as the deciding factor for the modernization of the country’s economy and announced a set of measures that should be implemented in order to warm "up" investment activity. Some of these are already in effect, including the suspension of quotas on highly-qualified foreign professionals. 

Krasnodar Region of Russia Is InTop Ten of Forbes Ranking

The volume of investments into the economy of the Krasnodar Territory in 2010  increased by more than 30% - up to 481 billion rubles, said Alexander Tkachev, Governor of the region on Wednesday during the 36th session of the regional Parliament.  

"In 2009 the region became one of three leaders of inward investment (358 billion rubles), just ahead is Moscow and Tyumen Region ... As a result of 2010, we expect to receive at least 481 billion rubles of investment in the economy of the Region" - told Tkachev.  


The authority of the territory gained unique experience for Russia to "create a comfortable business climate in the region.The best confirmation of this is not only investment growth in the economy of the region. For the third year Krasnodar Region one of the leaders in Forbes ranking.
This year two of our cities are in the top ten of the rankings - Krasnodar was the first, and Sochi - the ninth. In addition, Novorossiysk took 25-th line, "- said Tkachev.
Totally in 2010 there were implemented 20 major investment projects (38 billion rubles). Only for the I quarter of this year, the region's economy was invested 69 billion rubles of investments, that is 1,5 times more than during the same period in 2009 .

Russian Aviation Cluster Represented in Farnborough 2010

The Delegation of the Ulyanovsk region will present economic and investment potential of the region at the International Air Show Farnborough 2010, passing from 19 to 25 July in a suburb of London, said on Tuesday the press office of the regional government.
 "Taking part in this prestigious Air Show, Farnborough, the Government of Ulyanovsk Region intends not only once again represent to the world's elite its aviation cluster. Our main task is essential: to expand the geography of business partners" - Deputy Prime Minister of Ulyanovsk region Vildana Zinnurova said.
 The concept of the stand of the region reflects the idea "Ulyanovsk - Aviation Capital of Russia ". There is also announced the International Air Transport Forum, which will take place in Ulyanovsk in April 2011.

Russia's Largest Silver Producer Polymetal Increased Revenue

Russia's largest silver producer Polymetal increased production of precious metals and revenues in the second quarter of 2010 compared to the same period last year, the company said. In April-June 2010, Polymetal silver production increased by 13 percent to 4.7 million troy ounces and gold - at 61 per cent to 109.000 ounces.
Revenue increased by 2,3 times to $ 249 million.
"The main priority in the second half of this year will be  factories in Kubaka (Magadan region) and Albazino (Khabarovsk Territory)," - said Vitaly Nesis General Director of Polymetal.

The company confirmed plans for 2010, which include  increase in output of precious metals up to 19-20 million ounces of silver from 17.3 million ounces last year, and gold - up to 310.000 430.000-450.000 ounces.

Christies's Sold A Fake Painting

Russian millionaire Viktor Vekselberg, said that Boris Kustodiev's painting "Odalisque" which he had bought in 2005 at Christies's auction in London  for 1.7 million pounds is a fake, Daily Telegraph reported. 

The newspaper sais that Vekselberg filed a claim against the auction house Christies's, which will be addressed in the High Court in London. According to the publication, the firm representing interests of Vekselberg, requires the auction house to return funds and make compensation for losses associated with this transaction.
The paintung was sent back to Christie's last year, Daily Telegraph sais. The newspaper quoted the representative of Christie's, under which they relate to this issue "very seriously", but it is too early to talk about the future of the court case.

Formula 1 Racing in Moscow Today

In the center of Moscow there are traffic restrictions in connection with the Formula 1 "Moscow City Racing" races today.

Last year, Mayor of Moscow Yuri Luzhkov signed a decree according to which demonstrative cars race Formula-1 will take place in Moscow annually. In 2009 the racing took place on July 19, then about 100 thousand people visited the show.

For many years Russia has been discussing various projects of full stage Formula 1 racing of the World Cup. In 2007 coordination of the project was completed on the construction of track in in the north of Moscow, but the creation of racing track has not been initiated.
Another project involves creation of the track in Sochi after the Winter Olympics 2014. This project is considered by the Ministry of Regional Development of Russia.

Russia Suspends Import of Products of the Finnish Valio

Russian authorities have temporarily banned imports of meat and dairy products from 14 Finnish companies. The reason is violation of Russian sanitary norms.

What exact violations of the Rosselkhoznadzor notification took place is not clear. The restrictions will apply from 23 July 2010.  

According to the Finnish radio YLE,  four plants major suppliers of dairy products to the Russian market - the company Valio and two other companies - Atria and HK Ruokatalo have been banned. 

Finnish newspaper Helsinki Times, wrote that the "forbidden" list includes six companies, and quotes the spokeswoman of the company that the Russian ban touched about 10% of all sales.  

Minister of Agriculture and Forestry Sirkka-Liisa Anttila reported that officials are considering. She suggested that Russian officials want to consider the problems arising directly with Finnish suppliers.

"Formula 1" is going to Russia

 

Russia will soon be able to join the countries hosting the race "Formula 1". The General promoter of Formula 1 Bernie Ecclestone did not rule out the possibility that the Grand Prix in the future may take place in Russia.
"Russia for us - it is a big question mark." Formula 1 "should be in Russia, but still it was not" - Ecclestone said in an interview to BBC.  

Ecclestone is busy in recent years with implementation of the program expansion of racing class "Formula 1", while he concentrates mainly on those countries where tobacco products are advertising and has long expressed special interest in Russia, which bid for the World Cup In 2018 and conducts a Sochi 2014 Winter Olympics.

"Olympic Games have become minor sporting events compared to the World Cup. Interest in the championship in South Africa was extraordinary. In terms of commerce, I would prefer to participate in the World Cup, but not in the Olympics" - the businessman said.

A.Merkel: "We need Russian beacon projects in Germany"

"Russia would like to enter into modernization alliances with Germany, France, Italy, other European countries and the USA. Germany is number one in this list", emphasized Dmitry Medvedev by resuming the results of the two-day summit in Ekaterinburg.

"Germany is the most highly developed country in Europe, and it has always been comfortable for us to cooperate with this country. We would really like to take a more active part in the German economy. We have the wish for it and the money, which is even more important".

 

In her turn, the German Chancellor Angela Merkel said: "We say ‘welcome' to the Russian investments. We need Russian beacon projects in Germany".

Russian & German Businesses Have a Jump-Start

Russian President Dmitry Medvedev and German Chancellor Angela Merkel visited Ekaterinburg on July 14, 2010 for a two-day summit that devoted special attention to strengthening the business relationship between the two countries.

The Siemens corporation was one of the key players in the process. Siemens is going to partner with the Rostekhnologiya corporation in a joint venture to produce hydroelectric power plants and also plans to supply the public corporation Rossiiskie Zheleznye Dorogi (Russian Railways) with over 200 commuter trains worth 2.2 billion euros. In addition, Siemens is ready to help build Skolkovo, the Russian science town.

Representatives of Volkswagen, Airbus, E-On, BASF, and Metro were a part of the German delegation. The last two companies are well known in Ekaterinburg - BASF is an active participant in the Energy-Efficient City and Metro operates two stores in town. 

In January - April  2010 total trade between Russian and Germany increased by 50%, amounting to $15.2 million, and the total German investment in the Russian economy has been calculated to be more than $20.2 billion.

Dmitry Medvedev and Angela Merkel Met in Ekaterinburg in Russia

On July 14th 2010 Ekaterinburg  welcomed Russian President Dmitry Medvedev and German Federal Chancellor Angela Merkel who came to the city with a two-day visit.

On July 15th D. Medvedev and A. Merkel held the 12th round of Russian-German summit-level intergovernmental consultations. Heads of the states discussed development of economic relations, construction of the Nord Stream gas pipeline and transition to a visa-free regime between Russia and the European Union. 

In addition, the President and the Chancellor  took part in the plenary session of the 10th Russian-German Forum "Petersburg Dialogue". The Forum opened in Ekaterinburg on July 14th with the discussion about cultural interaction of the two countries. The participants of eight workshops are also planning to talk over the issues of European security, development of small business, cooperation in protection of cultural heritage, and religious education at schools.

At the Forum Dmitry Medvedev and Angela Merkel  will outline their vision of the Russian and German societies in the next ten years.

Castorama Opened New Hypermarket in Russia in Moscow Region

Yesterday the laying of the foundation stone of hypermarket Castorama in Shchelkovo (Moscow region) took place.

Totally Castorama plans to open another 15-20 hypermarkets in the Moscow region.

Investments in construction of a new hypermarket of  Castorama in Schelkovo reached $25 million, will create more than 200 jobs. The total area of the store is12,000 square meters.

Low-Cost Hotels Will Appear In Moscow

In Moscow there will be a network of low-cost hotels. The cost of accommodation will be reach $ 15. Network hostel for students from Europe will be opened shortly in the capital of Russia, said the chairman of the Moscow Committee for Tourism Grigory Antyufeev. Hostels are similar dormitories, a popular youth variety of public accommodation, which offer rooms for overnight or short-stay accommodation without additional amenities. 

Among the disadvantages of such habitats there is accommodation in one room of a few strangers. Among the advantages is its low cost. Typically, such housing is for students interested in traveling without spending a lot of money on a hotel.


"Three stars hotel accommodation costs of one hundred dollars, plus the need to include the cost of travel, visas, etc. For students this is too much. Therefore, such hotels will attract tourists and diversify their age segment" - the General Director of Hotel Consulting and Development Group, Alexander Lesnik said.

Marina Smirnova, senior vice president and head of consulting at Jones Lang LaSalle Hotels, says that "this format is quite interesting and popular among young people in Europe. Moscow is in need of such hotels and ready to invite more tourists".

Russian Stock Market 2% Growth

Trading on Russian stock market began today with the reduction of the leading stock indexes. However, shortly after the beginning of the trading session the quotations of most blue chips took to the positive territory. In the afternoon, the growth of leading indicators continued.
Currently, the MICEX index is rising by 1.87% - to 1369.65 points. RTS Index rose by 1,411.76 points to the mark, which is 1.83% higher than the closing of the previous trading day. Index RTS Standard adds 1,93% - to 9409.72 points.

Russian Contract Law Distinctions

Russian and Western approaches to entering into and execution of contracts are different.  

We have different legal culture, which naturally has its impact. Unfortunately, in some cases transactions fall through, sometimes because a European entrepreneur does not understand the requirements put forward by the Russian colleague. 

Russian legislation specifies explicitly: transactions that are made between legal entities and with individuals must be executed as a written contract (Article 161 of the Civil Code of the Russian Federation). This applies directly to international (foreign economic) contracts made with foreign partners.

Only in this case, the written contract, which sets forth the subject matter of the arrangements, rights, obligations and liability of the parties, is not only a legal guarantee, but also an "authorization" document for completing formalities related to the performance of a foreign economic contract. 

For example, a bank acting as an agent of currency control requires submission of a written contract to perform currency transactions, which include, in particular, cash settlements between Russian (resident) and foreign (non-resident) parties. A foreign economic contract is also required for the customs clearance of the goods crossing the Russian border.

Russia Expects Increase of Its Ratings After the Crisis

Russia can expect increase of ratings after the country's economy is out of the crisis, the Minister of Finance Alexei Kudrin said. 

"At the end of the crisis we expect to improve the financial ratings of Russia and thus again confirm stability of our financial system" - the inister said at an investor conference in Yalta on Friday.
Now Russia's rating is BBB from agencies S&P and Fitch and Baa1 by Moody's, outlook on all ratings is stable. Rosstat data shows confident economic recovery in the first quarter of 2010. President Dmitry Medvedev said today that Russia is rapidly emerging from the crisis and economic growth almost reached the annual forecast of the authorities -  4 per cent. 

Russia may place Eurobonds this year, but this time in rubles: "We will promote ruble to world markets, we now borrow in dollars, but this time we can borrow on the international market in rubles," - "Kudrin said.

Amendments to Criminal Code of Russia

Russian President Dmitry Medvedev today said that he approved changes to the Criminal Code and Criminal Procedure Code in terms of raiding. "Raiding is difficult and very dangerous crime. It essentially strangles the economy. In addition, recently the number of such crimes has increased," - the President said at a meeting with Interior Minister Rashid Nurgaliyev.

Approved amendments criminalize activities related to raiding, that is, seizure of property, economic and moral rights, funds of enterprises. Criminal prosecution is also subject to the provision of fake documents to the executive branch. In addition, the law criminalized such acts as deliberate misrepresentation of voting results at a general meeting of shareholders. The changes should allow to bring to justice raiders at the early stages of raider attacks. 

"Before we faced with the fact that the property already seized by criminal means. The law will seriously change the situation in this sector. I believe that this changes will significantly advance the work to identify, prevent and struggle such crimes," - Nurgaliyev said.

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