Cisco to develop “Virtual Skolkovo”

Cisco and the Skolkovo Foundation in February unveiled further details of joint efforts under the Skolkovo Project plans to develop a “Virtual Skolkovo”.  Based on the proposal from the Cisco Internet Business Solutions Group (IBSG), Virtual Skolkovo will be a business innovation ecosystem that pushes the advantages of traditional clustering beyond physical boundaries into the virtual realm of new possibilities. It is founded on being:

• Community-driven by common interest, not physical proximity
• Open to borderless and global collaboration, and
• Enabled by a hybrid of communication technologies

The memorandum of understanding signed during a Cisco Telepresence meeting between Victor Vekselberg, President of Skolkovo Foundation and Mohsen Moazami, a Vice President of Cisco IBSG, outlines a three-tiered approach for Virtual Skolkovo that will look at operational collaboration for faster decision-making, creating a community from across different ecosystems, and building global alliances through a multitude of networks and exchange with international research centers, universities and economic players in various markets.

The project will culminate in a pilot business case, assessing Skolkovo-specific factors for generating innovative ventures and capital, intellectual property, partnerships and business models around research and development, as well as smart work centers and smart homes.

“I’m very happy to be accelerating our cooperation with Cisco through this MoU for Virtual Skolkovo. It’s very important that every aspect of the Skolkovo city embodies a new vision, a new approach and new technologies. Cisco’s proposal of Virtual Skolkovo which uses collaborative and virtualization technologies and business models to deliver services, first to the “virtual” and then “physical” tenants of Skolkovo will make this project a forerunner,” said Mr Vekselberg.

“Most industrial clustering in recent times has regarded technology as an industry to be attracted or supported, rather than as a catalyst for their own innovation and growth. Virtual Skolkovo is therefore a fantastic opportunity to exploit all the opportunities of the digital economy in terms of collaboration, partnerships, virtualization, and resource sharing to generate capabilities and innovation for Skolkovo city,” said Mr Moazami, Vice President of Cisco IBSG Emerging Markets and Globalization.

MoU on Virtual Skolkovo follows up a memorandum of understanding signed last June by Cisco Chairman and CEO John Chambers and Victor Vekselberg during President Medvedev’s visit to Ciso headquarters in San Jose, California. According to that MoU, Cisco will share with the Skolkovo Fund global best practices and expertise in the creation of innovation centers and put forward this expertise to the development of the Skolkovo Project. One of the areas of focus for Cisco and the Skolkovo project will be for Cisco to play a key role in the design of 'Technopolis Skolkovo'.

Investment Portrait Of Modern Russia

The Russian magazine «The Capital of the Country» has inquired 35 Russian regions (for inquire there are 83 regions in Russia) and constructed the investment portrait of modern Russia. 


Nowadays direct  investments have reduced all over the word especially it concerns developing countries.  Russia is not an exception.  The questionnaire was filled out by the members of the investment departments of the local government. This research has been carried out together by the Chamber of Commerce and Industry and the Investment department.

The key industries in Russia according to experts are as follows:

Main branches of industry

 

So, we can see that traditional branches create  the center  of region's economy. (For  Tomsk  fuel handling equipment composes almost a quarter of the region's economy. For  Yakutia (the area where diamonds are produced)- 80 percent of all economy are nonferrous-metals industry and fuel-energy complex).

Priorities  - branches need to invest. So we come to the conclusion that main branches of industry coincide with the branches' center. But the  area of the branches ' priorities is more than the center. It includes two directions:  transportation industry and tourism. 

The next slide demonstrates us pain spots and regions' requirements.



Ranked distribution shows us the next picture (in the order of reduction)

So, we can see visible connection between pain spots and regions' priorities. 

It's interesting that pain spots don't agree with regions' requirements (or real market demand).  For example undeveloped tourism is considered as problem area, but there isn't demand for this subject of sale.  Exception is sector of building materials, in this branch there is permanent demand for cement.

We draw a conclusion that pain spots aren't support by demand. So the government to address the concerns of infrastructure and energy problems. Organizational structures and facilities (e.g. buildings, roads, power supplies) needed for the operation of Government of the Country, not local administration. And businessmen have never begun to invest without good foundation. I mean developed infrastructure.  It concerns foreign and Russian businessmen equally. For example in Sochi - the future capital of the winter Olympic game 2014 there aren't small ships which can go off the shore and solve a transportation problem. The first Government decides that businessmen are interested in this subject and they will organize public marine themselves. But nobody has done anything. Now moorages are built by administration.  Only after that private investors will buy some ships for public use.

The second  example.  Kaluga region is not far from Moscow. The minister of economy of this district Maxim Shereikin told us about their strategy.  Five yeas ago  they didn't understand why the investors didn't want consider Kaluga region for business.  But then they had understood - investors don't want to solve the documents problems.  Execution of documents  for land is very bureaucratic process in Russia. In addition power supplies needed for beginning business.  And the local administration decided to create industrial parks equipped by all necessary things - power and water supplies and typical building. In results the cluster of motor industry  exists in this region. A few week ago Lars Himmer - Deputy Managing Director of  the company Volvo Trucks Russia said us that they are very glad to choose Kaluga for business. They produced there Volvo Truck and want to increase output.

Many other districts pattern.  In Karelia  (this region is closed to  Finland) try to create transport infrastructure and build deep-water port. Near Moscow logging and timber processing complex is organizing now.

Most investment projects have been realized produced foreign investments. Companies from more than 25 countries work in Russia.

German companies work in 40 regions.

German	40
USA	36,7
Swedish	30
Chinese	20
British	16,7
French Finnish	13,3 13,3

Belgium Holland Austria Italy Norway take part in investment process in Russia.  It should be added here that foreign investors take over the initiative from Russian businessmen according to real demands.

Foreign investment direct at developing such branch as logging and timber processing complex (46% regions has realized such projects (Austria Sweden Germany Belgium USA Finland China). The market of the building materials divide into parts between different countries. The investment capital works in the market of food industry (production beer,  juice cold tea).

Investment in geological exploration and mineral deposit development is growing up. For example Canadian company work in Yakytia for developing field of silver. Chinese  work out deposit of metal in Tuva,  oil pool in Tomsk is work out by British company.

So there are a lot of foreign companies working in Russia with obvious success.


By materials of "The Capital of the Country"

PwC And Skolkovo Foundation Presented Future Innovation Hub In Davos

During the World Economic Forum in Davos, the PwC Thought Cafe played host to a presentation on Russia’s Skolkovo Innovation Centre.


Dennis M. Nally, Chairman of the PwC International network, opened the event with remarks on the importance of innovation in global business today and Russia’s ambitious plans in this critical area.


“Fostering innovation stimulates economic growth around the world. The leading global companies are all strong backers of this idea. That’s been confirmed by PwC’s latest Annual Global CEO Survey, which we presented in Davos. The new Skolkovo Innovation Centre promises to be an ultra-modern, hi-tech hub that will offer outstanding opportunities for investors. PwC has experience in helping to establish similar innovation clusters in other countries. We believe that Russia, with its built-in IT infrastructure and bio-tech and energy industries, as well as its renowned academic resources, represents a unique platform for the commercialisation of advanced R&D breakthroughs.”


Next, Viktor Vekselberg, Renova Group board chairman and President of the Skolkovo Foundation, addressed the briefing. He spoke in detail about this new, innovation-driven project, describing the many partnership opportunities the hi-tech hub will offer and how companies can become partners of the Skolkovo Foundation.


Then, John Chambers, Chairman and CEO of Cisco Systems, reiterated his company’s support for the project, confirming Cisco’s plans to invest $1 billion in Skolkovo.


The PwC event took place right after President Dmitry Medvedev’s speech at the Davos Forum, in which he emphasised that Skolkovo will be Russia’s premier initiative in building an innovation-driven economy.


“This year, the [Skolkovo] project will draw in numerous enterprises, large and small in every region of Russia, as active participants. They will all enjoy special preferential conditions. I am certain that in the next few years we will see Russia give birth to entirely new global brands, and the contribution of foreign businesses to this process, especially those with a track record of innovation, will only enhance our chances of success,” Medvedev noted in his speech.


PwC Russia provides industry-focused assurance, tax, legal and advisory services to build public trust and enhance value for its clients and their stakeholders. There are over 2,000 professionals working in PwC offices in Moscow, St. Petersburg, Yekaterinburg, Kazan, Yuzhno-Sakhalinsk and Vladikavkaz. The firm applies its knowledge, vast experience and creative approach to developing practical guidelines and decisions to generate new opportunities for business development.


“PwC” is the brand under which member firms of PricewaterhouseCoopers International Limited (PwCIL) operate and provide services. The global network includes over 161,000 employees in 154 countries. 


Together, these firms form the PwC network. Each firm in the network is a separate legal entity and does not act as an agent of PwCIL or any other member firm. PwCIL does not provide any services to clients. PwCIL is not responsible or liable for the acts or omissions of any of its member firms nor can it control the exercise of their professional judgment or bind them in any way.
“PwC Russia” refers to PwCIL-member firms operating in Russia.

Successful American Companies In The Russian Market

Many business projects were developed well before this so called transformation or "reboot" in business-relations between Russia and the USA. The long term cooperation between VSMPO-Avisma and Boeing Corporation is just one example of many.

Emerson Electric, an American corporation, sets an example of successful cooperation by having organized production on the basis of a plant of Metran Industrial Group and established the high-tech engineering centre using the high intellectual potential of young Russian scientists. 

Another U.S. company - Carbo Ceramics, whose Headquarters are in Texas - is running a successful plant in the Chelyabinsk Oblast. 

John Deere agricultural machinery assembly plant is working in Orenburg and these machines are already quite popular amongst Russian farmers. 

American companies, for instance Halliburton and Baker Hughes, have been successfully working in Russian oil and gas sector for quite some time. 

Leading brands of American food processing industry - Coca Cola, Pepsi, McDonald's and Subway - are also represented in the Russian market. These companies have brought with them the background of successful corporate culture that has taken root in Russia. 

These examples of cooperation clearly demonstrate that Americans highly value the intellectual potential of Russian specialists, the well developed engineering thought, and industrial potential of the regions. This is why high tech companies, for instance Microsoft, Hewlett Packard, and IBM also work successfully in Russia. The latter are the only small percentage of companies doing business here.

KOKS Postponed IPO Due To Market Conditions

Russian producer of metallurgical coke Koks decided to postpone the initial public offering (IPO) of its shares citing market conditions the company reported on Friday. 


Thus it had to be the first of the four already announced for this year IPO of companies with Russian assets. 


Market participants do not consider it as a sign for further IPO of other companies, but recognize that from a psychological point of view, this fact may have some negative impact. 
Next week the following companies should close the book: HMS Group, CHEL PIPE,  and Nord Gold. 

Revenue of Koks, which assets are located in the Kemerovo and Tula regions in 2009 amounted to 26.9 billion rubles, EBITDA - 4,6 billion rubles.

IPO of Russian Agricultural Holding Valars Group

Russian agricultural holding Valars Group is planning an IPO on the Warsaw Stock Exchange in May 2011. The company expects IPO in early May, following reports for 2010. 


The organizer of the IPO is Deutsche Bank. Soon the company may sign a mandate with another bank.
Valars Group plans to sell 40 percent of shares and generate $ 300 million. 


According to preliminary estimates the cost of the company Valars Group is more than $ 1 billion.