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"Support and development of non-primary exports is our mission"
Alexei Tupanov, Executive Director of the Russian Export Center, talks about the trends and dynamics of development and changes in the structure of Russian exports
- Alexey Alexandrovich, how does the situation with Russian exports look like in the first half of this year, in general, compared to the same period last year? How does the dynamics and ratio of exported commodities of raw materials and non-primary, non-energy sectors change? Which industries now and in the future could increase non-primary exports?
- The situation this year is a logical continuation of the trend of the past few years. We are observing a serious change in the structure of domestic exports - the volume of non-primary exports in general and non-primary non-energy exports in particular is growing, which is important, since it is the increase in the turnover of products with a high degree of redistribution that is the driver for the entire economy of the country. Russian exports in January-June 2017, according to preliminary data from the Federal Customs Service of Russia, amounted to $ 167,6 billion. Non-resource non-energy exports, according to REC estimates, amounted to $ 57,2 billion, or about 35% of the total. During this period, the growth of non-resource non-energy exports amounted to 19% (+ $ 9 billion), if compared in the first half of 2016. The sectors of non-resource non-energy exports, which demonstrated significant growth, are metallurgy, agro-industrial complex - and here we are talking, first of all, about wheat (Russia is still among the world leaders in this indicator), as well as various fertilizers. The volume of supplies of food products, mechanical engineering, and good dynamics in the woodworking industry are increasing.
I also want to note that the export of services is developing - this is an important indicator, since it is not just about exporting finished products (for example, aircraft or cars), but also about the development of service centers for servicing with the involvement of Russian specialists. Recently, more attention has been paid to the topic of export of education, tourism - here we have many opportunities that must be used.
- Does the REC participate in the work that promotes the opening of separate markets for our producers? For example, the market of meat and dairy products in China? Perhaps other, yet closed markets for Russia? What is the situation with the export to the countries of the APR neighbors? How fast is export growth to China and at the expense of what?
- Even when we created the insurance agency EXAR, which is now part of the REC group, we set ourselves the task not only to strengthen our positions in well-known foreign markets, but also to help Russian entrepreneurs to enter new ones. The ATR market has a huge potential for Russia - there is a very high purchasing power and a serious interest in products from Russia.
The growth of non-primary non-energy exports to the Asia-Pacific countries for the first half of 2017, compared to the same period of 2016, was about 30 percent. The key partner of Russia in the region is China, but it is impossible not to note the positive dynamics in the supply of domestic products to India, the Republic of Korea, Japan, Taiwan, Vietnam, Indonesia.
State support measures, developed taking into account the country's peculiarities of the region, have become a real driver of export growth. REC takes an active part in this work. We conduct road shows of Russian goods in these countries, help companies find partners, provide consulting support.
Of the last interesting examples that contribute to the increase in the supply to the APR countries, I will launch the launch of a new export railway route to China, implemented by the REC in partnership with the companies RZD, RZD Logistics, PJSC Transcontainer and Freight Village RU . Eliminating logistic barriers is one of the important measures to support the supply of goods abroad. The key advantage of the new route is the shortening of the delivery time of cargoes up to 14 days with significant cost savings. For the first three months of the route operation, 53 containers were sent, the departures are sent every two weeks. Of the main goods can be allocated the following: flour, metal, household chemicals, cars, plastic pipes, fiberglass. The total value of the cargo shipped for export to the PRC was about 7 million US dollars.
- Not so long ago, the Government of the Russian Federation approved the REC development strategy until 2019. What are its main goals and parameters to be achieved? How is the interaction between Roseximbank and EXIAR currently being organized at REC?
- Quite right, and this is a very unusual case, when the strategy of the joint-stock company is approved at such a high level. For us it is, above all, a higher level of responsibility. In 2016, the functional and organizational integration of the REC, EXAAR and REB took place. The goal of the integration was to improve the quality of services, scale up and expand the coverage area, as well as the growth rate of the merged organization. As part of the integration process, the key effect of optimization and reorganization has been increasing customer satisfaction through the development of a single business process of interaction with counterparties and transparency of this process for exporters and foreign partners. The idea of creating a "single window" was reflected in the formation of a common front office, the unification of the processing of customer appeals, the deployment of a single information system and a risk assessment model, as well as the integration of back office functions (strategy, IT, PR, HR, etc.) . As a result, a unified structure was established to support exporters, an integrated business process of interaction with Russian companies entering international markets and their foreign counterparts was built. In fact, functional integration has made it possible to form a single institution for export support, preserving the current corporate outline of the companies of the REC group.
Following the results of the integration and expansion of the functional of the REC, a new development strategy was developed for the future up to the year 2019, setting ambitious goals and a wide range of tasks for the united structure. On their basis, the following roles are defined in the system of state support and export development: fulfilling the role of a single institution for supporting exports through its own portfolio of financial and non-financial support instruments; coordination of state export policy; the role of an agent of the Government in certain functions, services and subsidies.
Speaking about specific kpis, by the end of 2017 on the basis of the REC there should be formed a single center for coordination and support of exports, with the participation of which support will be provided in the amount of at least 20,3 billion US dollars. At the same time, not only the indicator of the total volume, but also the growth of the number of exporters themselves is important - we say that at least 6600 enterprises should help. By the end of 2019, the volume of exports supported by the REC will be at least 34,7 billion US dollars, coverage of support - at least 7 700 exporting companies.
- What mechanisms of financial support are currently most in demand among REC clients? Has the EXIAR export insurance model changed?
- Our mission is to support and develop non-raw exports through participation in public policy and the creation of a single effective development institution. One of the outcomes of the integration of the REC group of companies was the formation of a single block of export financing, which included EXAR and Roseximbank. Such synergy allowed to improve business processes, make credit-insurance products more affordable and significantly increase the speed of decision-making on financing transactions. At the same time, the financial block of the REC group does not compete with other players of the financial market (for example, commercial banks), but cooperates with them in support of domestic companies entering foreign markets. Insurance coverage of EXAR is available both to the largest banks of the country, and to a small regional bank. One of the most popular products of the financial block is still the insurance of short-term receivables. This service is designed to protect Russian companies (as well as banks that provide them financing) from the risk of non-payments for commercial and political reasons from foreign buyers. Coverage extends to the regular supply of homogeneous goods, carried out on a deferred payment basis to regular customers abroad. As a rule, the insurance period for this product is 1 year.
In July, a new specialized program was launched, designed to motivate banks to finance export deliveries. A measure of financial support for exporters is implemented through the REC Group.
Under the new program, Russian exporters and foreign buyers will be able to receive financing at low rates by compensating part of the interest rate to commercial banks by the state.
The new specialized program will be compensated for a significant part of the interest rates on loans received in commercial banks by Russian exporters of non-primary goods, as well as by foreign buyers (and their banks). The program involves only reliable banks that have passed a special selection. Thus, Russian financial organizations operating in the market for at least five years, having a capital of at least 25 billion rubles, which do not have overdue debts on taxes, fees and other obligatory payments, as well as restrictions on banking activities, can support exporters.
At the same time, we believe that the approach to financial support of exporters by the state should be flexible and adaptive and depend on the stage of the economic cycle. When the situation in the banking market is characterized by the availability of financing and high liquidity, then the tool of insurance support is more effective, given the limited resources of the state. During the economic downturn and the lack of financing on the commercial market, the state's participation in the provision of loan financing is also relevant.
At the same time, our key function is to create competitive conditions on international markets for financing contracts with the participation of Russian entrepreneurs. This will be realized through the development of financial products and the creation of an export support infrastructure (the development and implementation of new tools, formats, products and services, and the development of support channels).
We continue to work on the development and adaptation of the product line for solving a wide range of tasks of Russian business, providing the opportunity to obtain financing on the most comfortable terms. Serious attention is paid not only to the support of existing exporters, but also to financing export-oriented production.
In our work we, among other things, introduce the best world practices of government measures to support the escort, in particular, we are assessing the potential for expanding the REC's toolkit with project and share financing of domestic exporters.