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Maxim Oreshkin: It's Time for the Eight-Area Russian-Japanese Cooperation to Be Reviewed

07.09.17

Maxim Oreshkin, Russian Minister of Economic Development, opened up the Russia-Japan business dialogue held during the Eastern Economic Forum.

A year after the joint work on the eight-item economic cooperation roadmap proposed by Japan’s Prime Minister Shinzo Abe was launched; it is now possible to talk of a significant expansion in the interaction between the two countries’ business communities.

The discussion of joint investment projects in oil & gas, agriculture, health care and infrastructure has reached the practical stage.

A lot of them are related to the Russian Far East region. Russian and Japanese companies are actively holding talks on the gas trunk line and sea energy bridge construction to supply electricity to Japan. The advance in the renewable energy sources cooperation is of particular interest.

The business dialogue participants were talking through the projects by Japanese companies that are already being implemented in the Far East region and what is the key to their success, the doubts that prevent Japanese companies from investing in the Far East region, and the sectors that hold the most promise.

Transcript of the talk by MaximOreshkin, Minister of Economic Development of the Russian Federation

Good morning, ladies and gentlemen, our Japanese guests! A very warm welcome to the 3rd edition of the Eastern Economic Forum in Vladivostok which is the region’s largest event.

Alexey Evgenievich has told about the huge work and, in fact, it was done by all of us together. There is a big forward movement both at the governmental and at the business levels. However, we should not stop there.

And once again I am happy to welcome everyone in Vladivostok. Historically, Vladivostok is known as Russia’s gateway to the Pacific. A lot of partners from the Asia-Pacific region can be seen there. And it is very gratifying that the Japanese delegation is always one of the broadest. Therefore, once again I wish to express my gratitude to our Japanese colleagues for their participation in the Forum.

This is its special edition in terms of the Russian-Japanese cooperation. It's time now to review the work done in the eight areas of the Russian-Japanese cooperation that were proposed by Prime Minister Abe in May 2016.

Take a look at our economic relationships. They show a positive trend. There is a 15% increase in trade turnover for the first six months. This is a big growth spurt as compared to 2016 when we could hardly boast of increasing turnover. Unfortunately, these are indicators that lag behind those of trade turnover between Russia and a number of other countries.

The past year saw signing of about 100 commercial and interagency agreements.

Approximately 40 more agreements will be signed on the margins of the Forum.

It is of importance that some of them bring our economic relationships to a new level. For example, the Convention on the Elimination of Double Taxation that is due for signing today meets all modern international standards and will significantly facilitate the activities of our companies. It will be easier for Japanese companies to work on the Russian market and for Russian companies to operate on the Japanese one.

Consultations on trade in services and investments are actively held with a focus on international best practices.

I’d like to note also a large number of commercial agreements in areas such as energy, finance, health care, and high tech.

Past months saw landmark transactions such as the acquisition of a stake of R-Pharm Russian pharmaceutical company by Japanese Mitsui. It has acquired a 10% stake. Eidos-Medicine and RIKEN research institute are developing a unique portable test system for diagnosing a wide range of diseases.

The Unified Institute for Housing Development and Japanese Nikken Secca architectural bureau have designed the concept of development of the Vladivostok agglomeration. And I recommend to all the Forum participants to visit the dedicated booth of the project. I think it has a high importance for the development of the Far East region as, once it is launched, we will be able to take a big step forward in terms of the quality of the Vladivostok urban environment. This means improving life for the Far East residents, which will allow more active developing of joint business projects.

In July, Japan became a partner state to the Innoprom 2017 International Industrial Trade Fare. The program for technological audit of twelve Russian enterprises by Japanese experts is in progress. Employees from 26 Russian enterprises visit the advanced Japanese production sites, under the personnel training program. We have also agreed with our Japanese friends to work actively in two new areas for the programs that have been approved in last months. These are programs in labor productivity growth and in digital economy development.

I’d like to mention the launch of Japanese Bridgestone’s tire plant, in May 2017, in Ulyanovsk.

The mutual trust between our countries is also evidenced in the steps that are aimed at lifting trade restrictions. In this regard, it’s worth noting the opening access to the Japanese heat treated meat market for Russian producers. The first supplies of the Russian sausages produced by Ratimir, LLC to Japan were delivered in June.

We also advance our financial cooperation. Russian Direct Investment Fund and Japanese Bank for International Cooperation have established a venture capital fund of $ 1 billion. The parties are already engaged in estimation of Russia based priority projects. A loan agreement was signed between Alfa-Bank, the State Export-Credit Agency of Japan and Sumitomo Mitsui Banking.

It’s worth noting that negotiations are under way for many projects; however, it is essential for them to achieve results. Negotiations are currently in progress on the Khabarovsk airport modernization project, creation of the innovation center for automation of Gazprom Neft processes in St Petersburg, and implementation of Abby's AI technologies in Japan.

I’d like to emphasize once again that today all conditions have been created to intensify trade and investment cooperation between our countries. And the dialogue between business associations, Japanese and Russian businessmen must be the key component there, which is proven by the examples I have given.

Therefore, I wish the participants of today's Forum fruitful work, explicit agreements and projects that will ensure the further expansion of Russian-Japanese economic relationships.

And Mr. Saeko and I will try to give them a comprehensive aid.

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