Daniil Algulyan: Aggregate Export Support Portfolio Exceeds RUB500bn
Export support is high on VEB.RF’s list of priorities. VEB.RF is active in cooperating with Russian Export Center in this area and is deeply involved with the International Cooperation and Export national project. VEB.RF provides support for Russian non-energy exports throughout value and supply chains, from financing investment projects to manufacture export products to helping to perform supply contracts for foreign buyers.
VEB.RF can offer exporters a complete range of finance products: project financing, pre-export and export financing, performance bonds.
The year 2019 marked an important milestone in support for Russian non-energy exports. Loans and guarantees issued in this area totalled about 115 billion roubles, while the aggregate export support portfolio exceeded 500 billion roubles. The key sectors that received support in 2019 were power engineering, railway equipment and urban transport. Uzbekistan became one of VEB.RF’s largest partners in export projects in 2019.
VEB.RF contributed to the successful completion of transactions to supply underground carriages and power equipment. Belarus, Kazakhstan and other EAEU member countries remain no less important markets.
New export support projects are well under way in the Middle East, Africa and Latin America. Much of the groundwork was also done in 2019 for new projects in the years ahead. A large number of transactions are planned for Eastern Europe and South-East Asia. An important area of VEB.RF’s activities is now projects in roubles and national currencies. Last year, rouble-denominated transactions took the lead in cooperation with EAEU member countries. We expect the geography of such transactions to expand considerably in 2020.
Major transactions and agreements in 2019
- Agreement with Belarus to provide support for exports to third countries
In December 2019, the Belarusian Government and VEB.RF agreed on the terms and conditions of VEB.RF’s support for both Belarusian exports and Russian-Belarusian joint exports to third countries. The main changes in 2019 allow the export support mechanism to be used for exports not only to Russia but also to third countries (outside the United State of Russia and Belarus).
“Belarusian manufacturers can now take advantage of the Russian programme to have subsidised loan interest rates for the export of Russian-made components in their end products. Buyers from third countries will, in turn, be able to use the Belarusian programme subsidising interest rates for products imported from Belarus and containing Russian components,” VEB.RF’s First Deputy Chairman Nikolay Tsekhomsky said after the signing ceremony.
- Trade mechanism agreement between Russia and Africa
At the Russia-Africa summit, VEB.RF, Sberbank, Russian Export Center and Gemcorp Capital LLP signed a framework agreement to create a trade finance mechanism for Russia and Africa. The agreement value is 5 billion US dollars, reflecting the needs of Russia and Africa for joint financial solutions.
The agreement is aimed at developing cooperation with African countries through the organisation of lending mechanisms for joint foreign trade projects and opens up opportunities for increasing Russian exports through financial support for the supply of Russian goods to the African continent, including to Angola, Ethiopia, Mozambique, Zimbabwe and other African countries.
- Financing for the project to supply new underground carriages to Uzbekistan
An official ceremony took place in September to mark the VEB.RF-financed supply of modern Russian underground carriages to Tashkent. The rolling stock was made by Moscow-based Metrovagonmash (part of Transmashholding).
The loan agreement to finance the supply of carriages and provide ancillary equipment and services for the Tashkent Metro was signed by VEB.RF and the National Bank of the Republic of Uzbekistan for Foreign Economic Activity (NBU) in late May 2019 in the presence of the Russian and Uzbek heads of state, Dmitry Medvedev and Abdulla Aripov.
OECD Praises VEB.RF’s Contribution Towards UN SDGs of City Development
The Organisation for Economic Co-operation and Development (OECD) has praised VEB.RF’s contribution to the development of a new system measuring the quality of city development in pursuit of the UN Sustainable Development Goals (SDGs). Headed by VEB.RF’s Deputy Chairman Vyacheslav Shulenin, a team of VEB.RF and Russia-OECD Center RANEPA accomplished in the spring of 2019 the goal of having Moscow included as one of the nine pilot cities and regions in the OECD’s large-scale project to assess how cities and regions use the SDGs to formulate and implement their development policies. The Russian capital’s participation in the project not only will help to strengthen cooperation between Russia and the OECD, but also will provide metrics on the attainment of the SDG, enabling qualitatively new indicators to be used to benchmark Moscow against its peers in other countries.
The OECD launched an online tool with more than 60 indicators to measure the distance towards the SDGs in regions and cities of OECD counties. Moscow will also be covered by the OECD tool.
According to the OECD report A Territorial Approach to the Sustainable Development Goals (the first results of this project were published on 10 February 2020), the City Index developed jointly by the Ministry of Economic Development of the Russian Federation, the Federal Service for State Statistics of the Russian Federation and VEB.RF makes it possible to use the OECD’s international indicators to measure how Russian cities work towards a better quality of life and the SDGs.
The Organisation for Economic Co-operation and Development (OECD) is an international economic organisation of developed countries that accept the principles of representative democracy and free-market economy. The OECD works to resolve socio-economic and managerial problems arising out of globalisation and explores the opportunities offered by globalisation.
The UN Sustainable Development Goals (SDGs) are a collection of 17 goals designed for all countries that strive for economic, social and environmental prosperity. The SDGs were adopted by world leaders in 2015 to implement the principles of sustainability, zero poverty and environmental protection.