Siberian cities are becoming more attractive for businesses that need a lot of human resources

18 june 2015 | Kommersant

‘The Kommersant reminds its readers that in March 2014, immediately after the Crimea's integration, a contest on the best strategy for development of Russia’s East was announced. At the time the Russian Government believed that it was in the fast growing Asia-Pacific region that new markets and sources of capital could be found. Moreover, Russia doesn’t need to make any special effort to move east: Russia already plays an important role in Asia-Pacific.’

Vladislav Onischenko
Vladislav Onischenko
First Deputy Director General

Last year Russia and China entered into a series of bilateral memoranda of intentions in agriculture, finance and investment services, transport infrastructure, the paper writes.  Specifically, an agreement was signed to jointly build the Power of Siberia pipeline with a capacity of 38 billion cubic metres and the western section of the Altai pipeline (to be put into operation after 2020). One of the most hotly debated projects was a controlled access highway between Moscow and Kazan worth RUR 1.07 trillion. In addition China suggested building a 7 thousand km high speed rail line between Moscow and Beijing that’s supposed to cross Kazakhstan.

"In addition to China, Russia may develop cooperation with Japan and South Korea, both countries with a lot of economic potential and strong high tech sectors that can give China a run for its money," the First Deputy Head of the Analytical Center Vladislav Onischenko told the Kommersant. The expert believes that in the future India may join this group. According to some projections in the next 10-15 years India has every chance to pull ahead of China economically. Indonesia’s also drawing a lot of attention, it’s a country with a booming economy that Russia doesn’t have well-developed links with yet."

Asian investors currently can make more money by investing in projects in European Russia with its high volume markets and more straightforward and predictable rules for doing business, the paper continues, while the Far East and Siberia are only interesting in terms of natural resources, the Kommersant claims.

"The Far Eastern market is not as large and it doesn’t offer a lot of opportunities for expansion. Sure the flow of goods from Asia is going to increase through the now expanded trading gates," Mr. Onischenko forecasts, "There are good prospects for agricultural development in the Far East and as consumption of groceries goes up in Asia, agricultural companies based in the Russian Far East can meet that rising demand. And we still have pretty good quality human capital and its price is falling, which is bad for the people but is good for our partners. Siberian cities are becoming more attractive for businesses that need to rely on large amount of human resources."