Magazines — RZD-Partner International — 2 (18) april - september 2009
2 (18) april - september 2009
Contents
Editorial
EDITORIAL
Recently, I was looking through the Western transport and logistics press and found that companies in the field are, surprisingly, not bringing their plans to a halt. Maybe the plans for 2009 are not as great as they were when they were created in 2008, but we still see players relying on future growth. More importantly, they are building strategies lasting several years, not just the construction of one terminal or improvement of a management system.INVESTMENT IN RUSSIAN LOGISTICS: PROS AND CONS
THEME / logistics in russia: new solutions to fight the crisis
In early September 2008, marketing analysts forecasted an increase in the supply of class A warehouses
in Russia’s regions and the further rise of demand for warehouses in both capitals (St. Petersburg and Moscow). Nobody expected the crisis. Nowadays many developers have had to freeze the construction of warehouses.
At the same time, European companies are announcing they are going to expand into the RF market.
RUSSIAN LOGISTICS: THE CRISIS WILL BALANCE THE MARKET
THEME / logistics in russia: new solutions to fight the crisis
“By the beginning of the crisis, the Russian market had become overheated. Many developers built warehouses on a speculative basis, that is, before they had tenants. I don’t think that we will see the same situation in the near future. Nowadays, there is not much investment capital available in the market. Investors are demanding much higher returns for the investments and lower risk, so they want to be sure that there are tenants there and that the rents are sufficiently high to provide acceptable returns. Unfortunately, warehouse rents today are too low to provide these returns. This means little or no new investment will happen in the warehouse sector in the near future.” - Miles Jones, partner, Griffin Partners, explains that the financial crisis will ultimately balance the supply/demand equation in the Russian warehousing market.
Alliances: a Lifejacket for Logistics Management
THEME / logistics in russia: new solutions to fight the crisis
The large Russian logistic companies have suspended plans for further development and are reconsidering their forecasts. The logistics sector is on the threshold of large-scale changes. The latest tendency – the merger and absorption of companies – has already begun, with the association of “Russian Logistic Service” and “STS Logistics”.
Panorama. Economics
ECONOMICS / Panorama
Under the agreement signed on 31 March in Paris in the presence of Russian Railways President Vladimir Yakunin, the French company has acquired 25% plus 1 share in Transmashholding’s parent company.Interest in the Arctic heats up
ECONOMICS / state policy
At the end of last year, the RF Government’s Marine Board published a draft of the Marine Activity Development Strategy to 2020 (further - Strategy) on its website. A wide discussion was initiated by this step. Discussions are to be held in the first half of 2009 and, after they are finished, all recommendations to complete the Strategy will be sent [by July 1st] to the developer of the project - The Russian Defence Ministry, until July 1st. It is planned that the modified draft will be presented to the Government by September 1st.Money is Finished. But Interest is Staying
ECONOMICS / Projects and Investments
How is the investment situation in the transport sector developing in the uneasy conditions of the world financial crisis? Where can the means be found to finance new infrastructure projects? What measures can be used to keep the sector financially attractive? These are the topics touched on in conversation with the Eurasian Development Bank experts – Evgeny Vinokurov, Chief of Analytical Management’s Economic Analysis Department, and Murat Dzhadraliev, a Senior Expert in the same department.A Step Towards Competition, or Away From It?
ECONOMICS / Reform
The development of Second Cargo Company’s Creation Concept is planned to be completed by summer 2009. If there is a positive decision, there will be no public park left to work to state-regulated tariffs in Russia.
The CIS: The Decline Has Started
ECONOMICS / CIS and Baltic States
In the recent years, until Q3 of 2008, there was a trend of increasing freight transportation volumes on the CIS railway network. But from October 2008, the dynamics started to slow down. According to the directorate of the CIS Railway Transport Council, last year total loading volume amounted to 2.159 billion tons, 1.8% down year-on-year.rosmorrechflot
ECONOMICS / who is who
In this issue we present the structure of the main railway government body in Russia: the Federal Agency for Sea and River Transport.A Year of Strategic Decisions
ECONOMICS / top five events in russian transport in 2008
Last year was really a period of new strategic undertakings for Russian transporters: the constant attention of the Government to their problems and to the future of Russian transport has brought three major sector policy program documents to final approval at the same time (two Strategies and The Federal Target Program).On The Right Track To The Stock Exchange
ECONOMICS / top five events in russian transport in 2008
The initial public offering (IPO) of Globaltrans Investment PLC that took place in spring 2008 was in fact the first attempt by the Russian railway industry to get funds for development through global financial markets. The attempt was very successful, which provided the clearest signal that foreign investors consider the railway business in Russia an attractive field.Wagon Repair - a Game of Patience
ECONOMICS / top five events in russian transport in 2008
Last year’s separation of wagon-repair enterprises from OAO RZD was a unique and long-expected event. RZD management’s 2006 decision to sell these shares was in line with railway transport reform. And the fact that this plan was only partially implemented doesn’t diminish the significance of this first step down a long road.
First Toll Road In Russia: PPP Turned Into Public Partnership
ECONOMICS / top five events in russian transport in 2008
In 2008, the first toll road building project based on the Public-Private-Partnership (PPP) principle was launched. The road, called the Western High Speed Diameter (WHSD), is to link the Great Port of St. Petersburg with the Ring road around the city enabling trucks to avoid getting onto the city’s overcrowded streets.
Customs Getting Closer to Borders
ECONOMICS / top five events in russian transport in 2008
The concept of redeployment of customs clearance procedures to the offices located along the national border which was made public last year is going to become a milestone in an attempt by Russia’s government to improve customs’ performance. Observers say that the possible benefits of the initiative may at the same time destroy the existing working practices of companies in the field.Panorama. Transportation
TRANSPORTATION / Panorama
A pilot container train operated by Russian Railways covered the 9,244 km of the Trans-Siberian route between Vladivostok and Bekasovo station near Moscow in less than seven days, taking just six days, 20 hours and 35 minutes. The normal transit time for fast container trains on this route is 12 days.Posture Towards New Circumstances
TRANSPORTATION / Auto Transport
Six months ago Russian road hauliers had nothing to complain about – the problems of their competitors in the Ukraine and Byelorussia as well as the crisis in Europe allowed them to hope for the best. Today, however, the volume of freight to be carried is falling and a lot of Russian companies have to reduce expenses by selling their vehicle fleet and reducing staff numbers.Russian Airports: Hoping for the Best
TRANSPORTATION / Air Transport
It seems a paradox but it is a fact that in spite of the economic crisis, many Russian airports have not given up their development plans, or at least their declarations of what is to be realised over the next few years have remained the same. The fact that these plans not only exist but also are being implemented, is a positive factor – even if some of the plans only look one year ahead.
Oil Products: Stable Growth Instead of Logical Decline
TRANSPORTATION / Port
The throughput of most Russian sea terminals has reduced. Only one cargo has escaped the crisis – oil bulk. According to experts’ forecasts, the demand for oil products exported from Russia will either be the same as in 2008 or even increase. The ports of Russia’s North-West will play a special role in this process.
Panorama. Company
COMPANY / Panorama
On March 19, 2009, OAO RZD and Ulan-Batorskaya Railway (Mongolia) concluded a cooperation agreement. The document was signed by Vadim Morozov, the First Vice-President of OAO RZD, and Vanchigdorzh Otgondambrel, Head of Ulan-Batorskaya Railway.Local Improvement
COMPANY / OAO RZD
In the first two months of 2009, the loading volume of OAO RZD was 154.4 million tons, a 30% decrease compared to the same period the previous year. The decline goes on but specialists at Russian Railways are paying more attention to the fact that the loading volume in February grew by 17.9% month-on-month.Working in the Construction Industry in Russia: New Legislation
COMPANY / OAO RZD
According to updated Russian legislation, State construction licences havestopped being issued since January 1st, 2009, and from the beginning
of 2010 any licences that had been given before will become invalid. Instead,
companies (including foreign ones) working in the Russian building market
(including in railway construction) should show their new quality assurance,
that is an Admission Certificate of a Self-Regulated Organisation.
To Outlive the Crisis
COMPANY / Doing Business in Russia
Sergey Mytarev, senior investment officer at the International Finance Corporation tells the readers of The RZD-Partner International which transport projects are worth investing in, what opportunities for private investors exist today and considers a global infrastructure fund.
What We Calculated And How We Did It
PRODUCTION AND SERVICES / rating of rolling stock manufacturers
Every self-respecting branch of the economy has a way of rating itself. Usually, such a rating is done by media specialising in the sector, which guarantees the reliability of the data and independence from all the ranked companies. That is why The RZD-Partner magazine decided to form a rating of the largest rolling stock producers in the CIS, the Baltic States and Georgia.Mechanical Engineering: Two More Years to Wait for Growth
PRODUCTION AND SERVICES / rating of rolling stock manufacturers
The effects of economic stagnation were felt first of all in those branches of mechanical engineering which directly depended on metallurgy and bank credit. Among the main victims were wagon-building enterprises whose orders in the current year have dropped by 30- 50%. As a result, some factories are now on the verge of closure.
