More projects needed to boost Russia-China investment

China Economic Net, Industry Updates, 15.04.2013

Russia and China need to carry out more demonstration projects to boost bilateral investment cooperation, says a fund director.
"The two countries have been devoted to investment cooperation in recent years, yet we have not seen enough successful projects," Kirill Dmitriev, CEO of the Russian Direct Investment Fund (RDIF), said in an interview with media on April 11.

The RDIF and China Investment Corporation (CIC) established the $2-billion Russia-China Investment Fund (RCIF) when President Vladimir Putin visited China last June.

The RCIF is a "pioneer and paragon" not only for Russia and China, but for the Asia-Pacific region, Dmitriev said.

"The fund has concluded its maiden project, investing 200 million dollars in Russia Forest Products, the second largest forestry enterprise in Russia ... This is a fairly solid start," Dmitriev said, adding that several forestry projects were under way and open to Chinese partners.

Dmitriev is a member of the delegation led by First Deputy Prime Minister Igor Shuvalov to visit China next week. He said he would consult with CIC representatives, major Chinese banks and security trusts.

"The main goal is to introduce to our Chinese friends prospects and potential of investing in Russia. We are likely to hold detailed consultations on possible cooperation projects," he said.
Meanwhile, the director acknowledged that many elements had been restraining the two big neighbors from broadening cooperation.

"First and foremost, investors from both sides are not familiar with each other's national realities and potential, thus breeding stereotypes," he said.

Successful joint projects, as Dmitriev put it, were far from enough. "Thus, we (RCIF) need to set a good example that Russian and Chinese enterprises are able to conduct cooperation for mutual benefit."

With the Russian government recently launching a development scheme for the Far East and Baikal region till 2020, China was welcome to set a foot in this area, Dmitriev said.

"We have signed a handful of agreements with CIC in terms of investing and equipping infrastructure in the Far East. With hardware facilities of high quality, the two countries can move on to more investment projects," he said.

Dmitriev said the Russian government had implemented dozens of measures to improve the environment for investment. "Preferential tax policy is one of them. We are also working on a roadmap to facilitate customs clearance and improve logistics," he said.

With Russia-China relations entering a new stage, bilateral investment cooperation had every chance of reaching a new high, Dmitriev said. "Moreover, successful cooperation contributes to an intimate strategic partnership and neighborhood," he said.