Monday, October 18 2021 21:10

Veronika Nikishina: REC Group is interested in close cooperation  with Armenia in a wide range of integration projects

Veronika Nikishina: REC Group is interested in close cooperation  with Armenia in a wide range of integration projects

ArmInfo.The interregional Armenian-Russian  forum has opened in Armenia yesterday, in the framework of which a  business mission of the Russian Export Center (Russian Export Center)  will also take place on October 19-20, with the participation of  about 150 entrepreneurs.

The REC Group includes the Export Insurance  Agency of Russia (EXIAR JSC) and Eximbank of Russia JSC. The business  mission is represented by Russian manufacturers in the food industry  and agricultural products, mechanical engineering, information  technology and telecommunications, medicine, diagnostics,  pharmaceuticals, building materials, sports goods, and business  services. Attached to the start of the mission, ArmInfo prepared an  interview with CEO of the Russian Export Center JSC Veronika  Nikishina.

- Mrs. Nikishina , what tools does your organization possess to  intensify work with Armenia, do you have experience in working with  Armenia and what is your assessment of the prospects for cooperation?

- We have experience of working with Armenia on some projects and the  most pleasant thing is that we intensively use all our tools in our  trade and economic relations with your country. Our toolkit is  divided into two large groups - financial and non-financial support  measures.

I'll tell about the non-financial ones first. These are usually the  tools that we use to help potential exporters find their potential  partners. These are various business missions, various consultations,  analytics, which first of all allows to determine the target markets  and potential projects, and the ways to implement them. And the  business mission that we will have on October 20 is just the first  very specific point for a more substantive acquaintance of a  potential exporter and a potential buyer.

The business mission is multi-sectoral; companies from various  sectors participate in it and they were selected considering the  specific interests that we receive from Armenia. These are equipment  manufacturers, and manufacturers of scientific and technical  products, companies that participate in various investment  infrastructure projects, have experience in the construction of  roads, junctions, railways and various water-technical structures.   And therefore, having experience and opportunities, we want to find  new potential Armenian partners so that such projects could be  implemented in Armenia. Manufacturers of agricultural products,  pharmaceuticals, IT, navigation aids are very interested in working  with Armenian partners. These are our short-term plans. We hope that  the days allotted to the work of the business mission will be as  productive as possible, including primarily through numerous B2B  meetings.

- What financial instruments do you own, and how can they help  integration projects between Armenia and Russia?

- When companies are already approaching project maturity, they also  need financial support. There are 2 groups of instruments in our  arsenal. These are credit and guarantee support from Eximbank of  Russia and export credit insurance from EXIAR. Sometimes we lend and  insure from above, and sometimes, if the lending is somewhere else,  we simply insure the loans that the buyer takes from other banks.  Sometimes, when structuring the financial part of the project, we  help to choose a bank ourselves, and then we get interbank financing  with our insurance.

- What statistics do you have for Armenia? What has already been   done? 

- I can start with the figures for the last year. 18 exporters  received solid insurance products for Armenia. These were short-term  receivables, but the most demanded financial product is export  insurance. The statistics are interesting: 56% of exporters accounted  for mechanical engineering, 20% for the metallurgical industry, 12%  for the agro-industrial complex.

And this year, for the first 8 months, we already have agreements  with 15 exporters in Armenia. They have already signed insurance  contracts, including for short-term receivables, deferred payment  insurance for SME clients, and insurance for a customer's loan. This  is in quantitative terms, but if we consider the volume of exports  supported by us, these 15 export transactions give a volume three  times exceeding the one for the entire last year. That is the  projects are getting bigger. Therefore, we have a reasonable hope  that the potential that exists will be really in demand.

We already have a so-called flagship project with Armenia - the  supply of 27 passenger cars to the SCR. This is a project funded  purely by us. ROSEKSIMBANK gave a loan to the Eurasian Development  Bank (EDB) for this deal and provided insurance for the supplies.

So, we have some practice of working with Armenia, but we want to  scale this work. Now we really want to offer cars for the Yerevan  metro, since we have experience in structuring and financing such  transactions. We really want to be partners in the construction of  new lines of the Yerevan metro. Now, within the framework of the  tender for their design, we very much hope that one of the Russian  companies with excellent experience in this area will become the  winner, and their work will receive full support from us, including  financial one.

- Are these mainly infrastructure projects?

Yes, they also include projects in the field of energy, especially in  the field of renewable energy. There are serious companies in Russia  that produce high-tech equipment for renewable energy generation.  They are able to implement both EPC (Engineering, Procurement and  Construction) and EPCM (Engineering, Procurement, Construction,  Management) contracts.  Thus, last year we had a project with  Kazakhstan, which in our opinion, is worth replicating. It also  received funding through the Eurasian Development Bank. We are  talking about the supply of solar thermal power plants.  These are  small regional thermal power plants that heat both the population and  provide energy to local producers. It seems to me that in such a  sunny climate as Armenia, it is a sin not to use solar energy  extensively, and the consumers can also be greenhouses in the  construction of which we would also like to participate. Thus, our  experience in implementing both large infrastructural and small  fast-payback projects allows us to offer our Armenian colleagues the  entire range of our tools, designed for the specific needs of the  consumer.  We are successfully implementing such transactions in  various CIS countries. Over the past year and a half, we have  implemented a lot of such projects and the key to success is simply  the interest of a partner both on the part of the state and on the  part of business. And here we see great potential and we need the  will and desire of a partner.

- Have all 18 projects with Armenia been successful? Did you have any  problems with payment or paying capacity?

No, there were no problems. All transactions have been successful. We  are well financially strengthened by the state, so that we, as a  development institution, would be mobile and effective. Therefore, we  are ready to use all our tools very flexibly.

- How many of the 18 "Armenian" projects are exclusively state-owned  and how many are related to public- private partnerships? 

 - You know, almost all of them are actually private-state. And they  are all commercial ones, since the commercial component prevails in  them. But where necessary, they are accompanied by a guarantee from  the state.  But, in principle, since the projects are not very large,  we can afford to finance them without state support. Of course, if  the project is large, for example, the construction of new metro  lines, of course, we will need the state guarantees of the Republic  of Armenia for financial comfort. But these things are absolutely  solvable, and the main thing is that these are some rules of the game  that must be observed in order for the project to be implemented  faster. But the risks we forecast for them are quite moderate and  low.

- Deindustrialization has hit our countries hard. We began to lag  behind technologically, and it is time to catch up within the  framework of integration processes: One of the solutions is the  implementation of specific industrial integration projects based on  modern technologies, up to the widespread use of the artificial  intelligence. It can be instrument making, machine tool building,  radio engineering industry, information technologies. Are we capable  of starting such a catch-up marathon?  Yes, I think it is possible.   And we have such projects, though not with Armenia yet. At the end of  last year we were at the opening of the Tashkent Metallurgical Plant.   This is a factory built from scratch based on the most modern  technologies. The loan was provided by ROSEKSIMBANK, insurance from  EXIAR, Russian equipment was being supplied, although European  equipment was also used there. The plant is already in operation, it  has been launched.

Russian metal goes there as a raw material.  This is a good  cooperation project. Now we work with the leadership of Uzbekistan  and maintain a constant dialogue. You know, when there is a request  for infrastructure, we sit down and discuss with our exporters and  investors from the partner's side for investments, structure the deal  and really achieve success. Likewise, we expect Armenia to show  interest.. We have experience, we seriously rethink all the omissions  that we have had on past projects, in no way repeating them.  Therefore, we are very interested in activating such an industrial  cooperative cooperation with Armenia. 


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