- Financing totalling 59 million US dollars
- First integration deal for the benefit of companies in three countries
VEB.RF is to provide Almalyk MMC with financing to pay for BelAZ haul trucks to be used for the modernisation of the company’s mining and smelting facilities in Uzbekistan.
Financing is estimated at 59 million US dollars for a term of five years. Russia’s content of the cost of supplied products should be over 30%. This is a prerequisite for VEB.RF’s involvement in project financing.
“This is the first transaction in a new format of cooperation between Russia and Belarus. The haul trucks will go to one of the largest producers of copper, gold and silver in Central Asia. VEB.RF provides the buyer with a long-term loan, and its interest rate will be subsidised by the Belarusian Government. The project was made possible by effective cooperation between the governments of the two countries and financial institutions. Our mutually beneficial partnership not only contributes to closer trade ties between the countries, but also provides support for our businesses by increasing their utilisation rates,” VEB.RF Deputy Chairman Daniil Algulyan said.
Bank BelVEB (part of the VEB.RF Group) acts as the agent for the Belarusian Government to subsidise VEB.RF’s interest rate. The Belarusian Government and VEB.RF operate under an agreement for financial support for products resulting from industrial cooperation between Belarusian and Russian manufacturers and exported to third countries.
VEB.RF and Bank BelVEB have provided financing for several years to pay for Russian high-technology equipment, feedstock and materials supplied to BelAZ for the manufacture of haul trucks.
“This project lets us show the successful start of cooperation to support the export of Russo-Belarusian products to third countries in a new format. The project is a logical continuation of long-lasting cooperation between the banks in financing and proves that the governments have a wide range of mechanisms to support the promotion of jointly made products,” Bank BelVEB’s Chairman of the Board Vasily Matyushevsky said. “We can see the growing demand for our export support services intend in the near time to carry out similar projects for other Belarusian companies.”
“We are glad our cooperation with VEB.RF and Bank BelVEB allowed us to complete such a large project, which will help to scale up mining and smelting operations in Uzbekistan and will promote cooperation among our countries,” said Anatoly Trambitsky, Acting Deputy General Director for Marketing and Export Policy and Marketing Centre Director, BelAZ. “The first shipments of 200-tonne haul trucks took place in October and November 2020.”
VEB.RF approved a five-year credit line for 1.8 billion roubles in November 2020, allowing Almalyk MMC to pay for Russian high-technology equipment to be used for the company’s modernisation.
Maxim Reshetnikov Presides at Inaugural Meeting of Investment Committee of VEB.RF’s Supervisory Board
The Investment Committee of VEB.RF’s Supervisory Board held the first meeting chaired by Maxim Reshetnikov, Russian Minister of Economic Development.
The Investment Committee approved VEB.RF bylaws speeding up decision-making related to VEB.RF property transactions, reviewed strategies to deal with VEB.RF assets and considered new limits on financing for existing investment projects.
The committee recommended that these issues should be further submitted to VEB.RF’s Supervisory Board.
Additionally, the Investment Committee took note of information concerning VEB.RF’s ongoing and potential gas-to-chemicals and chemical projects and information about the impact of these projects on attaining the national goals of Russia’s development until 2030. It was also reported on the current status of examining VEB.RF’s involvement in financing the investment project to build and operate a Kingisepp-based ammonia and carbamide production facility (EuroChem Northwest-2, a special purpose entity of the Project Financing Factory).
The Investment Committee of VEB.RF’s Supervisory Board was formed in 2020 following amendments to Federal Law No. 82-FZ on State Development Corporation VEB.RF. The enacted law was the first step towards the reform of the development institutions.
“The Investment Committee considers issues on VEB.RF’s broad agenda: investment, foreign trade, export support and projects of national importance. Each project under review has great significance to the country’s economy and higher standards of living,” VEB.RF Chairman Igor Shuvalov said.
“Due to the reform of the development institutions, the VEB.RF Investment Committee will take decisions on key investment projects. Our task is to align them with the national development goals outlined by the President. It’s necessary to focus on increasing the share of private capital in projects,” Russian Economic Development Minister Maxim Reshetnikov said.
As instructed by the Government, the Ministry of Economic Development is working with the Ministry of Finance, VEB.RF and other agencies and departments on road maps for reforming the development institutions.
Following the reform, the development institutions will use KPIs that will make it possible to monitor their performance in real time. The Ministry of Economic Development is forming a working group chaired by Deputy Minister Ilya Torosov to release the KPIs.
As a reminder, Mikhail Mishustin announced the reform of the development institutions on 23 November. The activities of the reorganised institutions are to be consistent with the national development goals set by the President and with national projects.