FDI & Foreign Trade
Russian Railways is considering launching a passenger train along the route St. Petersburg – Kaliningrad – Berlin, passing through Latvia, Lithuania and Poland en route, Victor Golomolzin, the CEO of Kaliningrad Railroad, part of Russian Railways told journalists last week.
The route, which is currently connected, yet remains unused, will require some upgrading to bring it to contemporary standards. At present the most viable option for travelers wanting to reach the Baltics or Berlin is either to fly or take the bus, a lengthy journey. The Kaliningrad region is Russia’s westernmost region and an enclave on the Baltic Sea.
“We are generating the idea of launching the Berlin-Kaliningrad-St Petersburg train, taking passengers in Berlin, going through Poland to Kaliningrad, and going from Kaliningrad via Lithuania and Latvia to St. Petersburg,” Golomolzin said. He said that discussions are continuing with the Governments Railway companies of Latvia, Lithuania and Poland over the potential for increased rail connectivity. Continue reading…
Russian Railways has completed the construction of a rail link that keeps away from the Lugansk region of Ukraine, bypassing the country entirely. Service is expected to start in September.
A test train of a locomotive and freight cars has already run through the completed stretch, Russian Railways have said. The construction of the rail link between Zhuravka – Millerovo began in 2014, after the deterioration of relations between Russia and Ukraine. The new 137 kilometers stretch runs entirely within Russian territory in the Voronezh and Rostov regions.
This will increase the line’s capacity and ensure the security of freight and passenger traffic, Russian Railways said. “It will provide stability of passenger and cargo transportation, and most importantly – to reduce the economic and technological risks that could arise when the route goes through Ukraine. This includes stop and delay of trains, delivery time delays, and traffic violations.” Continue reading…
Russia and China have announced the signing of a USD13 billion Joint Venture company, the China-Russia Commercial Aircraft International Corporation (CRAIC), set up to compete with Boeing and Airbus. The license to operate in China was granted in Shanghai on Monday. The JV is between the Commercial Aircraft Corporation of China (COMAC) and Russia’s United Aircraft Corporation (UAC), with COMAC chairman Jin Zhuanglong saying the joint venture will develop wide-body aircraft and aims to produce “competitive” long-haul planes for the world’s aviation market.
CRAIC will be responsible for research, manufacturing, marketing, sales and services of its aircraft. According to an agreement by COMAC and its Russian partner United Aircraft Corp (UAC), 280-seat jets with a range of 12,000 kilometers will be prioritized.
Russian Prime Minister Dmitry Medvedev has stated in an interview on Chinese State TV that both the Chinese and Russian governments are looking at ways to link the Eurasian Economic Union (EAEU) with China’s One Belt, One Road (OBOR) initiative.
The Russian Finance Minister Anton Siluanov has confirmed that the government is preparing tax incentives aimed at improving labor productivity, during comments at the Russian Council for Strategic Development and Priority Projects. “These proposals will include measures aimed at increasing labor productivity on enterprises,” he said.
The remarks come following criticism from President Vladimir Putin concerning the overall performance of labor in Russia, who stated, “in general, in terms of indicators in this area (labor productivity), Russia is more than twice inferior to efficient economies, and thanks to the powerful technological progress that is currently developing in the world, this gap may seriously increase if we do not respond to it in time”. Continue reading…
As sanctions on Russia continue, many Asian countries are now finding this an opportune time to establish closer trade and investment links with Russia.
It makes sense: 70 percent of Russian territory is physically in Asia, and the country has a reasonably sized middle class consumer base. Europeans have stopped selling to them and the Rouble is extremely competitive right now, having lost 50 percent of its value in the past two years – Russia is capable of offering more bang for the Asian buck.
By Marina Romanova
Foreign investment inflow in Russian stock in 2016 showed first positive annual result since 2012 and has exceeded US$727 million, according to the Citibank, which based its calculation on the Emerging Portfolio Fund Research (EPFR) data. In 2012 foreign investors injected US$410 million in Russian assets. The last year results are also a record high since 2010, when foreign investments were amounted to US$3.3 billion.
Russian stocks were up 16 percent since November, 8th, 2016 based on the performance of the RSX Van Eck Vectors Russia ETF (U.S. first exchange-traded fund focused on Russia), while the other emerging markets are down 6 percent collectively, as measured by the iShares MSCI Emerging Markets ETF EEM.
By Marina Romanova
On the cusp of 2017, Sino-Russian political relations are still ahead of two nations’trade and economic cooperation.
Russia’s worsened relationship with the west after the annexation of Crimea has further pushed Russia’s leadership into China’s arms.In 2014, European Union-Russian trade stood at US$377 billion, making the bloc Moscow’s most important economic relationship. That fell to US$235 billion last year.
After Western sanctions were imposed in 2014, Moscow and Beijing had declared that they would increase their bilateral trade to US$100 billion during 2016 and to US$200 billion by 2020.
By Marina Romanova
In a way to re-establish “the special and privileged nature’ of their strategic partnership, Russia and India have set the goal of boosting bilateral trade to US$30 billion and mutual investment to US$15 billion by 2025.
However, Russian-Indian trade cooperation leaves much to be desired. For Russia, India is in 19th place in terms of turnover, according to 2014 data, while for India – Russia is in 34th place only. In 2015, this turnover was further reduced by another 18 percent which is, as Russian president Vladimir Putin phrases it, “largely associated with volatility on the global markets and in exchange rates”.
By Marina Romanova
In May 2015, after six years and eight rounds of negotiations, Vietnam signed a free trade agreement (FTA) with Russia-led Eurasian Union (EU). Although, it took another 17 months for the deal to finally come into force in October 2016, Vietnam became the first and only country so far to establish a free trade zone with EU, comprise of Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia.
Many observers believe FTA with Vietnam was possible due to special historical ties between two states.