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"Business needs the inviolability of rules and cheap loans"

Chairman of the Board of Directors of the Far Eastern Transport Group Raisa Parshin about why even the negative experience is priceless, and in the future plans the main thing is realism and perseverance

"Business needs the inviolability of rules and cheap loans"
- Raisa Nikolaevna, the transport component is also very important in the development of the Far East, primarily the delivery of goods by rail. Judging by the statistics, the volume of such cargo transportation for the first months of the year 2018 increased compared to last year by 16,9%. Does the Far Eastern Transport Group feel better? 

- I will clarify: you have provided data that relate to container transportation. DVTG now almost does not deal with them, they do not have a significant impact on our business (although they used to be one of the main directions). We provide services for container transportation directly at the terminals - storage, loading and unloading from cars to wagons, forming trains, and so on. In addition, we have 300-400 own platforms on which we carry out these transportation. However, the crisis forced many companies to reconsider their development strategies and focus on the most promising areas, abandoning not very profitable ones. We are no exception. In the past, we also had 14 wagons and a large fleet of our own containers, which we leased. Now we are betting on a number of new projects. Today we have two long-term tasks - the reconstruction of the Nakhodka Sea Fishing Port (NMRP) and the technical re-equipment of the car repair depots. Negotiations with potential investors, including foreign ones, are already underway. But, as you know, the path from protocols of intent to real agreements and investments is quite long. 

- Reconstruction of the port - the project is more than large-scale. How much investment is it planned for and what stages does it provide? 

- Investments will amount to 3,9 billion rubles, of which we have already invested 700 million of our own funds in the reconstruction of the northern part of the port. The reconstruction project provides for the creation of terminals for containers, as well as for universal and other cargo. Naturally, the fishing port needs facilities for processing and shipping perishable products, refrigeration units, and so on. At the stage of searching for investors, the project experienced a not very pleasant situation: the bank that issued the first tranche to us lost its license. Naturally, we had to rebuild on the go and look for new partners. As you can see, we have held out and continue to work. Last year, we purchased three units of loading and unloading equipment, signed an agreement with the Agency for the Far East to Attract Investments and Export Support, and are negotiating cooperation. The Far East Development Corporation is actively helping us in this. There are a lot of offers - for example, from the Chinese port of Dalian. But we must understand the specifics of the PRC. Even if the memorandums are signed and the partners are satisfied with everything, the process is periodically delayed for inexplicable reasons. And we ourselves are now very cautious in choosing strategic investors, since we have a rather difficult experience of cooperation with various foreign companies and with our domestic banks. 

- Experience was extremely negative? With what do you connect, except for the "common for all" crisis?

- No, there is never a pure negative and nowhere, but from any troubles you just have to take lessons and look at everything philosophically. As for the work experience, for example, with the Korean logistics company, we are very happy with it. Together with Koreans DVTG in 2007 year built and launched a modern technological container terminal in the Moscow region. The project was made by Finnish specialists in accordance with the European standards of technical and software production process. Finns carried out architectural supervision, construction works were conducted by the Yugoslav construction company. The terminal with the area of ​​10 ha was put into operation at the originally agreed time, without delays. Pay off the project was for 7 years, and it was done much earlier - for five and a half.

In 2005-2007, the DVTG group of companies, together with Chinese builders, launched a railway terminal in Zabaikalsk at the China-Russia border crossing. Its area was 10 hectares, and there is everything - narrow and wide track, monolithic pavement, German equipment for reloading, warehouse, temporary storage area, modern software for automating work processes. In 2004 DVTG together with Uzzheldorcontainer (a subsidiary of the Uzbek Railways) put into operation the container terminal "Asia Trans Terminal" located in the city of Tashkent. Processing capacity 40 000-foot containers (TEU) per year. The project became extremely profitable and paid off in 20 years. Unfortunately, it had to be sold in order to pay off loans to banks after the 2,5 crisis.

- On working with banks as lenders, as far as I know, your memories are not at all rosy ...

- Unfortunately yes. In 2007, we received a loan from VTB Bank at 14% per annum for the development of the means of production - more precisely, for placing orders for the construction of wagons by Russian plants. However, during the crisis of 2008-2009, the bank raised the rate to 36% and demanded a loan to be returned - despite all the exhortations of the Ministry of Transport and the Ministry of Economic Development, which explained that DVTG is included in the approved list of structuring enterprises requiring assistance. As a result, we were not able to fully repay the loan, especially as due to the growth of the dollar, container shipments of imports and transit cargoes sharply decreased, to which we focused our main business. The increased interest and imposed fines caused the bankruptcy of some of the enterprises that were part of our group of companies. So we are familiar with the "bestial grin of capitalism". Therefore, we are very cautious and we consider carefully any offers of investors. Especially taking into account the fact that in the projects for the development of objects of transport infrastructure, the minimum payback period in this period is 7-8 years. There is no other way with transport infrastructure projects, it would be a mistake to hope for something else. I am confident that we will find a reliable strategic partner in the foreseeable future.

- "Reliable" in your understanding is what?

“This is an investor who would be primarily interested in the development of the Nakhodka sea fishing port for the export of food supplies, rather than coal, so that Nakhodka could finally dilute the depressing black coastline of many small ports that transship coal. NMRP is the only port in Primorye, which, in contrast to them, purposefully transships products with higher added value, receives, stores and dispatches coastal cargo of the "northern delivery" to the regions of Magadan and Kamchatka. Equipment, containers, food goes through it. NMRP has very profitable logistics - it is located within the city of Nakhodka, has 34 hectares of area and a quay wall length of 1200 m. Our project provides for the development of this port for the export of grain, oil, perishable goods (primarily fish and fish products). It is planned to build a refrigeration complex and reconstruct all port facilities. This will allow maintaining the ecological balance in Nakhodka and creating new jobs. Taking into account the history of the port's life and its location, we consider the given vector of development to be consistent with the interests of the city's residents and, in general, the development strategy of the economy of the Russian Far East. That is why I believe that investors will definitely come here as soon as possible. Moreover, the state introduces a system of benefits and preferences for this in the form of TORs and other forms.

- Does DVTG have any advantages as a resident of a free port?

- Tax benefits - in themselves a big plus. In addition, immediately there is a "status increase" in negotiations with potential partners: when we are assisted by an official structure represented by the Far East Development Corporation, the level of any agreements is much more solid. We really hope that this will allow us to start serious, long-term investment projects. Naturally, we rely on both external and domestic, domestic partners, work with them is parallel. We do not provide a door-to-door cargo delivery service (for example, when we completely accompany the cargo from the moment it was shipped from the factory somewhere in China through all customs offices, port terminals, by rail and further to the final destination warehouse ). But we take on ourselves quite a significant part of the way of the goods from the producer to the consumer. Perhaps in time we will regain our high positions, which occupied before the mid-2000 crisis. This is not easy, the market has its own barriers, and monopolists sometimes dictate their own conditions. With many companies, we do not compete in principle, because we have different weight categories. That absolutely does not prevent us from building our own plans and achieving their successful implementation.
- And what are the prospects for the second of your long-term projects - the reconstruction of Dalvagonremont?

- It provides for the technical re-equipment of three car-repair depots. This project is less expensive than the reconstruction of the port, investments should pay back for 3-4 years. The total amount of necessary investments is about 200-250 million rubles. The network of railways is increasing the fleet of innovative cars for maintenance repair which requires the use of new technologies and diagnostic equipment. We started the project several months ago and expect to implement it during the 2018 year - also, of course, we are looking for partners and investors.

- Another problem in our country, especially in its remote regions, is personnel. How do you deal with the shortage of good techies, how do you attract them?

- In the staff we need. This has always been, there is, and will be, the main question: in the final analysis, everything depends on people and their professionalism, from the worker to the financier, who "did not count" at the time of the crisis - or, on the contrary, managed to reduce losses to a minimum. It is especially difficult now with qualified technical staff. There is no good locksmith - and he must be taught, there are no inspectors, no engineers and mechanics in the amount required by modern production. How do we attract them? Learn by yourself. We try to keep those who arrived - we rent an employee an apartment, then, if a person we work long enough and successfully, we get housing for him. We have an individual approach not only to executives, chief engineers or engineers for production, but also to average technical personnel. In the past two or three years, we have been keeping wages at the market average, and in some, especially important cases, much higher than the standard. But we "lure" people to us (this is my personal impression) not only by salary and apartment, although this is very important. We are attracted by the fact that we are doing an interesting and promising business that will help the specialist to work with full efficiency and realize his professional potential. Our HR staff constantly monitor the market, we place applications in all colleges and profile universities. If there is a technical school next to the depot, then the chief of this depot will necessarily come there as often as possible and prospective students to know in person.

- And with what you primarily connect the prospects of DVTG itself?

- With the fact that for Russian business, at last, the rules of the game and guarantees by the state will be clearly and clearly defined. Now the laws are changing so often that business for them sometimes just does not have time and is afraid to make plans for the long term. For example, you have become a resident of the TOP. In two years someone will decide that the benefits have been given incorrectly, and will require you to return those, relatively speaking, 2 million, which you saved on taxes during this time. Can this happen? I do not have complete certainty for a solid "no". For us, the main thing is that even the most difficult rules remain unshakable, and the laws have no retroactive effect.

In addition, still as there were no cheap loans for business, and no. So, there is no money for development, infrastructure construction. Therefore, no matter how much you advertise the notorious Far Eastern hectare, what will you do with it if you are not able to bring electricity, water or access to it? And there is not enough one hectare for someone who really wants to develop. It is necessary at least five or ten hectares - and not to touch the entrepreneur for ten years. We will not go anywhere without credits for a zero or 2-interest rate for 10 or 20 years, as is the case in other countries. It does not even need to reinvent the wheel, everything was invented long ago and before us.

It is clear that for any company that starts a battle for a place in the sun under the conditions of today's competition, the path will be difficult. And no TOR will help - or rather, give you a head start in the first stage, and then, be nice, move yourself, no one in your arms will not wear you. We - like many Russian companies - passed the period of illusions at the beginning of the 2000, they got themselves a lot of cones and learned to play by the rules that really exist. Even if they are not too humane to us. Therefore, we count on success, regardless of any crises.
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