Attraction of Japanese Investments in the FEFD – a Topic of Discussion between Yuri Trutnev and the Head of the Japan Bank for International Cooperation
Mr. Yuri Trutnev, Deputy Prime Minister and the Plenipotentiary Representative of the President of Russia in the Far Eastern Federal District and Mr. Tadashi Maeda, governor of the Japan Bank for International Cooperation (JBIC) discussed the perspectives of Japanese investments in the Russian Far East.
Mr. Yuri Trutnev thanked JBIC for the attention that this bank pays to the issues of cooperation with Russia and the Russian Far East, in particular. Russian Deputy Prime Minister also expressed gratitude to the Japanese side for active participation in the work of the Eastern Economic Forum.
-You are familiar with the position of Russian President Vladimir Vladimirovich Putin regarding the expansion of our country's cooperation with Japan. I am sure that such a desire for cooperation on both sides should yield good results. We positively appreciate the creation of a joint Russian-Japanese platform. At the same time, we are sure that it is possible to work more effectively, - said Yuri Trutnev.
One of the issues discussed at the meeting was the work of the platform to support Japanese investments in the Russian Far East. A joint Russian-Japanese company – a platform for the implementation of projects in the FEFD was established in March this year. Its founders are the Japan Bank for International Cooperation (JBIC), Far East Agency for Attracting Investments and Export Support, and Far East Development Fund (FEDF). The main objectives of the platform are to attract Japanese investors to the ASEZes and Free Port of Vladivostok, as well as assistance and support of investors from the moment of investment decision to launching the project.
Mr. Tadashi Maeda said that at the first meeting of the platform’s advisory board, which discussed the business plan and the platform’s development strategy, the issue was also “what role should this platform play, in particular, in increasing investment from JBIC”.
- We also discussed the project of construction of LNG transshipment terminal in Kamchatka and the possibility of supporting this project by our platform. Negotiations are underway with the Japanese companies Marubeni and Mitsui about their participation in the project to build such a terminal. In September, JBIC signed a cooperation agreement with these companies.
According to Mr. Tadashi Maeda, the Japanese government pays great attention to this project, considering its importance for the development of the Northern Sea Route and the formation of key LNG supplies to Asian markets. Therefore, JBIC and the Russian-Japanese platform should unite efforts for realization of this project.
The governor of the Japan Bank for International Cooperation informed the Japanese government about the platform creation.
- I told about our platform to Prime Minister of Japan Shinzō Abe. We believe that this format is important, said he.
Eight cooperation agreements have already been signed between the platform and Japanese companies Arai Shoji Co. Ltd, Hokkaido Corporation, Megatech Corporation, JFE Engineering Corporation, Prospect Corporation, Marubeni Corporation, Mitsui O.S.K. Lines, and Hotel Okura Co. Ltd.
According to Mr. Tadashi Maeda, this is a great achievement for the platform. Projects implemented with the participation of the platform in the Russian Far East are the priority for JBIC financing, they can also benefit from the support of the Russian-Japanese Investment Fund created by JBIC and the Russian Direct Investment Fund.
- We consider the possibility of using financing from JBIC for small and medium-sized businesses, as well as for financing investment projects of Japanese companies engaged in cooperation through “Sberbank”, said Mr.Tadashi Maeda.
The head of JBIC spoke separately about the relationship of the bank with the Sakha (Yakutia) Republic, with the government of which it signed a memorandum of cooperation. Now, the Russian-Japanese platform supports a project aimed on construction of year-round greenhouses in ASEZ “Industrial Park Kangalassy” (Yakutia). “Sayuri Ltd” develops this construction in cooperation with Hokkaido Corporation. It is expected that the products of this company will satisfy 40 percent of the needs of the capital of the republic in vegetables. After commissioning of the second stage, the enterprise will supply 2.1 thousand tons of vegetables to the market every year. Increasing the area of greenhouses up to 3.3 hectares, (third stage) will allow growing 800 tons of tomatoes and about 1300 tons of cucumbers annually. According to the investor's plan, the project should pay off in 2025.
“I visited the Sakha (Yakutia) Republic and got acquainted with the work of this farm,” said Mr.Tadashi Maeda.
- Yuri Petrovich Trutnev instructed us to prepare proposals for creation of permanent profile working groups on priority sectors of cooperation, including those of the field of energy, aquaculture, medicine & tourism, agriculture, timber industry, and logistics on the basis of the platform. We have submitted these proposals to our Japanese colleagues. The Russian side also proposed to develop a plan of action for these working groups by the end of November, which should include carrying out “road-shows” for the projects and escorting Japanese business missions to the Russian Far East, says Mr. Leonid Petukhov, director general of the Far East Agency for Attracting Investments and Export Support, chairman of the Board of Directors of the Platform for Support of Japanese Investments in the Far Eastern region.
A separate aspect of the discussion was the promotion of high-tech projects implemented by Russian and Japanese companies in the Russian Far East, including those supported by the Far Eastern High Technology Fund, created in May this year by the Far East Development Fund (FEDF), Rusnano and RVC. In September, at the Eastern Economic Forum (EEF), the first agreements were concluded with companies, which develop promising innovative solutions in various industries. Promotion of modern Japanese technologies is one of the activities of the Russian-Japanese platform.
In particular, the possibility of using equipment that improves the environment and reduces energy production costs for the Far Eastern coal-fired power plants, as well as Japanese technologies and equipment for equipping the proton- radiotherapy center is considered. Japanese technologies and expertise for cultivation of vegetables in the closed ground have been already used for the project of a greenhouse complex construction in Yakutia.
Japanese investors have already started to implement several projects in the Far Eastern ASEZes and FPV.
In ASEZ "Nadezhdinskaya " (Primorje) "Mazda SOLLERS Manufacturing Rus " has opened the industrial production of motor vehicles and engines of Mazda.
The resident of ASEZ “Gorni Vozdukh” (Mountain Air) HONOKA SAKHALIN plans to open a balneological clinic next April. Now the project is at the stage of construction and installation works.
In ASEZ “Khabarovsk” and ASEZ “Industrial Park Kangalassy” (Yakutia), with the participation of Japanese investors are being implemented the projects to create year-round greenhouses.
JGC Evergreen has already implemented the second stage of the agro-complex in Khabarovsk Krai. The area of greenhouses has increased to five hectares. The Russian-Japanese agrarian company intends to increase the area of its greenhouses to 10.3 hectares.
From such areas, it will be possible to receive a harvest of up to six thousand tons of vegetables and greens a year. Last year about two hundred and fifty tons of tomatoes and four hundred tons of cucumbers of different grades were delivered from the greenhouses of the Russian-Japanese enterprise.
With participation of the Japanese investor in ASEZ “Komsomolsk” the project on creation of manufacture of fuel pellets is realized. This project is already under construction.
In the Freeport of Vladivostok registered three residents with the participation of Japanese Capital: OOO "Stroymechanisation" (the company has built and commissioned a modern apartment complex "Premiere"), OOO "Medical Center" JGC Hokuto Medservice "(this summer, they have launched an outpatient rehabilitation center).
Currently, the share of residents with participation of foreign investments in ASEZ and in FPV is about 6% (76 out of 1,248 resident companies; 4.7% in FPV, 10.2% in ASEZ), the volume of foreign investments in ASEZ and in FPV is 7.7% (5.3% - in FPV, 8.2% - in ASEZ). Of the 76 residents with the participation of foreign investment, 40 are residents with investments from the PRC, 10 residents with Japanese investment, 10 with investment from the Republic of Korea.
The Russian delegation also included Alexander Krutikov, Deputy Minister of the Russian Federation for the Development of the Far East, Leonid Petukhov, director general of the Far East Agency for Attracting Investments and Export Support, Vladimir Yevtushenkov, chairman of the Board of Directors of AFK Sistema, Alexei Chekunkov, director of the Far East Development Fund, Alexei Bezprozvanny, Deputy Minister of Industry and Trade of the Russian Federation, Murad Kerimov, Deputy Minister of Natural Resources and Ecology of the Russian Federation, Anatoly Chubais, Chairman of the Management Board of Managing Company, OOO RUSNANO ”, Sergei Sergeyev, Deputy General Director of PAO “Rosseti”, Sergey Shmatko Special Representative of the President of the Russian Federation for International Cooperation in the Energy Sector and others.
By Eugenia Vasileva