Trade doesn't recognize friendship, but in friendship there can be no trade - STRATEGIES FOR BUSINESS - Mos.ru
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S T R A T E G I E S F O R B U S I N E S S I N M O S C O W
Trade doesn't recognize friendship,
but in friendship there can be no trade.
Gotthold Ephraim Lessing
A PROPOS
Imagine there is a premiere in a theatre. Who sits in the terrible shortages are the main reason that the USSR
first row? The most respected people: the store director, ceased to exist after sixty-nine years.
his deputies, the meat salesman… Why them? Because they
In an attempt to alleviate the problem with food
have the power over your groceries. You can’t get anything
shortages, a new food program was introduced in the
without their help!
USSR in 1982. It didn’t help, and the shelves of Soviet
This is the plotline of a comedy that used to be especially stores remained empty.
popular back in the Soviet era, when there were shortages
Young people born after 1985 have trouble imagining that
of just about everything – sausage, cheese, butter… Back
there was a time shelves in grocery stores had almost
then, people could not simply buy things. They had to
nothing aside from expired canned fish.
obtain them by waiting in long lines, often getting into
quarrels and even fist fights. Sometimes deficits resulted in Today the capital has over 56,000 stationary trade
social upheavals, in mass anti-government demonstrations. enterprises, over 11,000 cafes and restaurants, and
From the 1960s on, these demonstrations took place in 22 agricultural markets.
Novocherkassk, Karaganda, Murom, Temirtau ...
There are more and more foreign companies in the trade
Remember the scene from Paul Mazursky’s “Moscow and services sector as well. Almost everybody in Moscow
on the Hudson,” where the main character buys toilet is familiar with brand names like Metro, Auchan, Selgros,
paper after waiting in line for hours just so he can Globus, OBI, IKEA, Media Markt, and Leroy Merlin.
proudly give it to his girlfriend? “I like to fall asleep and
Philippe Roger, Deputy General Director at Leroy Merlin,
wake up among supplies. Food everywhere. Just a little
cited interesting figures during his presentation at the
peace for some time,” popular Soviet writer Mikhail
Confindustria Russia general assembly in November.
Zhvanetsky wrote in one of his stories back in the 1960s,
He reminded the audience that retail is a great reflection of
“Who knew that we would have vinegar, but mustard
would disappear?”. the state of the economy, since it has to do with the general
population’s purchasing power. In 14 years, this major
Of course, when there were food and consumer goods company opened 1,700 stores in Russia and continues to
shortages everywhere, there was no such thing as “service.” open another 16-17 every year. According to him, this was
It did not exist in the USSR. There was no reason to decided back in 2011, and the company is adhering to its
attract people to stores with empty shelves. It’s the same original plan. In 2016, 17 Leroy Merlin stores were opened in
reason there was no advertising in the country. What
Russia. Another 16 were opened in 2017, with the opening
could you possible advertise when the stores were all but
of yet another 15-16 stores scheduled for next year. At the
completely empty?!
end of his presentation, Philippe Roger optimistically said:
Why was the same country that was sending fantastic “The sanctions did not affect us. We invest 400-500 million
ships into space unable to keep stores stocked with things euros here every year. We are confident in the Russian
like toilet paper, sausage, shoes, cars? After all, these market, and in Russia’s stable development.”
Sergo Kukhianidze
Editor in Chief
sergomrk@mail.ru
Moscow official
A new impetus for cooperation
based on an old friendship
Moscow Days in Beijing
CAPITAL IDEAS
Founder: Department for External Economic 6-9
and International Relations of the Government of Moscow
Address: 125009, Moscow, Voznesensky Pereylok, 22
Ph: +7 (495) 633-68-66, Fax: +7 (495) 633-68-65
Partner relations get stronger
E-mail: dvms@mos.ru Moscow and Ulaanbaatar sign cooperation program.
https://www.mos.ru/dvms Mayor of Moscow Sergey Sobyanin and Mayor of Ulaanbaatar
Sunduin Batbold signed a cooperation program for 2018-2020.
Publisher: National Review Ltd The ceremony was also attended by Delgermaa Banzragch,
CEO – Sergei Oposhnyanskiy the Ambassador of Mongolia to Russia.
Phone.: +7 (495) 784-69-71
E-mail: nr@eurasmet.ru 10
CAPITAL IDEAS
S T R A T E G I E S F O R B U S I N E S S I N M O S C O W
Editorial staff: 11
Editor-in-chief – Sergo Kukhianidze
Production crew of the edition: Elena Egorova (deputy editor-in-chief),
Moscow official
Tatyana Akimova, Vladimir Dolmatov, Marina Ogorodnikova, Anastassia Paloni,
Vladimir Smelov, Marina Urshina “Denkmal,
Consulting – Evgeny Khokhlov
Design – Robert Saifulin
Russia — Moscow — 2017”
Photo editor – Victoriya Oposhnyanskaya Gostiny Dvor in Moscow hosted the fourth
Page layout – Alexander Saifulin International Trade Fair of Heritage Preservation,
Assistant – Nadezhda Ratanova Restoration and Museum Technology “Denkmal,
Russia — Moscow ‑ 2017.”
Editorial contacts
web: capitalideas.moscow
e-mail: capital.ideas.editor@gmail.com
12-13
f: capital.ideas.moscow
With assistance of Moscow Center for International Cooperation
Successful cooperation
Address: 105005, 68/8, build.1, Baumanskaya str., Moscow, Russia between Moscow and Vienna
Phone/fax +7 (499) 267-46-56, http://www.mcms.ru/
Distribution – "Trans-Media" Ltd
is the key to friendship
Acknowledgements to: between Russia and Austria
PHOTO – www.mos.ru, www.dvms.mos.ru, www.stroi.mos.ru, ITAR TASS Agency, RIA-
Days of Moscow in Vienna
Novosti, Getty Images Russia, companies and organizations, represented in the issue.
If you wish to get new issues of Capital Ideas, please, apply to: editor@mcms.ru.
The magazine is registered with at the Federal Authority of Legislative Control 14
in Mass Media and Cultural Heritage Protection. Media registration certificate
ФС77-53716, issued April 26, 2013. Moscow and Budapest are
All reproduction permitted only with the Editor’s permission and reference to
‘Capital Ideas’. experiencing a renaissance
Distributed free of charge
Published with support from the Department for External Economic
of bilateral relations
and International Relations of the Government of Moscow
Circulation : 7000
Signed into print 06. 12. 2017
Moscow Global Business Breakfast
Nothing Ventured
Innovation is the How to develop success
foundation of the Hotel Metropol recently hosted an unusual Ernesto Ferlenghi:
capital’s future economy
business breakfast organized by ProChile,
the Trade Office of the Embassy of Chile in There is no reason to
Moscow held the Sixth International Open
Moscow. The event was unusual because the
discussion went far beyond the scope of a
fear Russia
Innovations Forum. The forums broke all partnership between the two countries. Suffice Confidustria Russia, an association of Italian
previous records, bringing together over 18,000 it to say that the main leitmotif of the business companies in the RF, held its annual general
participants from close to 100 countries. 650 breakfast was the following principle: the assembly, which peaked the interest of foreign
speakers gave presentations over the course of people should be at the center of the economy. business community representatives. Suffice it
two days, dedicated to business, the state, and Otherwise, why bother improving trade and to say that over 300 business people attended
society in general. economic relations at all? the assembly.
16-18 36-37 38-39
19
City’s graph
Moscow’s Targeted Investment
Program for 2018-2020
20-25
Face to Face
Alexey Nemeryuk: Deficits are an
archaism that Muscovites have
long forgotten
The trade and service sector is one of the most prominent branches
of the Russian capital’s economy. Just over the past few years,
over 5 million square meters of retail space have been erected in
the capital and half a million jobs have been created in the trade
and service sector. Alexey NEMERYUK, Head of the Moscow
Department of Trade and Services, talked about the development
of this sector in an exclusive interview with Capital Ideas.
26-27
Moscow In Words
28-35
What’s New
January-March 2018 CAPITAL IDEAS 3
Nothing Ventured Our Interview
Nothing Ventured
Jiří Podhola: We’re The three pillars of
Moscow WIKA plant: entering a good time anti-corruption
German quality, for doing business Corruption interferes with the country’s
made in Russia Moscow has a lot of amazing buildings. But there
development as a whole and is bad for business.
Serious investors won’t come to a country that
The German company WIKA Group is one that is never shown to tourists who come to ranks low on international anti-corruption
(Russian subsidiary - WIKA MERA, the Russian capital. It’s located in the very center indices. Anatoly VYBORNY, Deputy Chairman
JSC), a global leader in the manufacture of the city, at 3rd Tverskaya-Yamskaya Street. This of the State Duma’s security and anti-corruption
of process measurement and control building is not unusual in terms of architecture, but committee, talked to Capital Ideas about why not
devices, has localized their production rather because of the purpose it serves. The home’s all indices are reliable, what’s actually happening
within the scope of the import owner, 44-year-old Jiří Podhola, calls the home a in Russia, the value of a businessman’s word, and
substitution program in New Moscow. “unique site” for a reason. the ambiguity of lobbying as concept.
40-44 48-50 54-57
46-47 51 58-60
Nothing Ventured City’s Graph Bookself
PUMA: The era of easy Social and economic Teri Lindberg
money in Russia is development in Moscow: founder and CEO of Staffwell, gives her
advice to foreigners thinking of starting a
over – you have to work facts and forecasts business in Moscow.
harder than before 52-53 62-63
The German company PUMA, which rakes in
an annual turnover of four billion euros and Nothing Ventured People and their work
sells their products in over 120 countries, came
to the Russian market in the early 2000s. Petr Yakubovich: Amiran Revishvili:
Vladimir Gorobets, Area Head of Retail at
Puma Russia, Turkey, Ukraine and CIS, talked We were drawn to the The heart is much
to Capital Ideas about how the company is
doing in Russia. russian market because more than a muscle
we have similar mindsets Since Amiran Revishvili headed up
the A.V. Vishnevsky Institute of
Infobip is a mobile service with over 200,000 Surgery in 2016, he has taken on a lot
clients and 300 mobile operators. The company’s more responsibilities. Today, he is a
mission is to connect users with business. superintendent, an administrator, and
Infobip’s Managing Director talked to Capital a manager all at the same time. But no
Ideas about how the company entered the matter what else Amiran Revishvili does,
Russian market and what it does here. he is first and foremost a cardiac surgeon.
4 CAPITAL IDEAS January-March 2018
Smart money Food&Drink
Between past and future
How to teach children Uwe Lindner: A beer
financial literacy The hunt for hard intermediary between
“The important thing is to have money. We currency or doing Munich and Moscow
can always figure out how to spend it.” The
vast majority of people adhere to this simple
business with foreigners Many people are of the opinion that, while Russia
principle. But finances shouldn’t be taken These days you can change rubles to foreign has a lot of good Chinese, Japanese, Italian,
lightly, judging by the increasing volumes currency just about anywhere in Russia. It’s and French restaurants, an authentic German
of overdue loans, unpaid debts, deceived hard to believe that there was once a time restaurant is hard to come by. This isn’t true. To
depositors, and personal dramas related to when transactions with foreign currency were find a real German restaurant in Moscow, just visit
money. The issue of financial literacy is being punishable by a prison sentence of up to 15 any Paulaner Bräuhaus establishment, which are
discussed at the state level. Moscow bankers years, and even the death penalty. This harsh run by brand-manager Uwe Lindner. The German
were among the first people to start coming law, which was introduced in 1960, wasn’t brewer and restaurateur talked to Capital Ideas
up with practical solutions to the problem. fully eliminated until 1994. about his business in the Russian capital.
66-67 74-77 88-91
68-71 78-79 92-96
Life&Leisure Our interview Food&Drink
Shopping: Moscow style Descendant of the last Tsar: Mircko Zago: Modern
The Russian consumer market is the largest in
Europe, which makes it particularly appealing
I feel the russian soul... Russian cuisine is
for investors. Growing purchasing power and
the Russian appreciation of internationally
Artist, designer and entrepreneur Rotislav
Romanov is one of the youngest heirs of the House
similar to European
popular brands means that more customers of Romanov. He was born in May 1985 in Lake
Forest (Illinois, USA), and currently lives in London.
cuisine in many ways
gravitate toward the best shopping centers in
Mircko Zago is an excellent example of a
the country.
person who brings his talent, energy, and
80-85 enthusiasm to absolutely everything he does,
72-73
not just his job. He started his career early,
Life& Culture
This&That working as a chef in different restaurants in
The supermarket Moscow playbill: Hot ice Italy, Spain, Switzerland, and other countries.
He is originally from Italy, but has been living
challenge and rainbow flames in Moscow for the past 16 years. We talked
to Mircko and found out how he likes living in
From ice shows to the mystical “Queen of Spades” Moscow and where he draws inspiration for
Political analysts, sociologists, and economists opera and the fiery Ritchie Blackmore – that’s the his culinary experiments.
have spent countless hours arguing about what rich cultural kaleidoscope that awaits Moscow
caused the collapse of the Soviet Union. But if guests and residents in the winter and spring of
we had to sum things up in one word, it would 2018.
definitely be “deficit.” This isn’t a reference to
an abstract concept like freedom, but about
empty shelves in the country’s stores and
86-87
warehouses. Moscow Vocabulary
January-March 2018 CAPITAL IDEAS 5
MOSCOW OFFICIAL
A new impetus for cooperation
based on an old friendship
Moscow Days in Beijing
Days of Moscow in Beijing took place on October 31 - November 3 with
support from governments of the two capitals. Beijing residents and guests
got the opportunity to get acquainted with Russian culture, cuisine, and
customs. Businessmen and government representatives held negotiations and
discussions regarding further development of the two biggest megacities of
Europe and Asia, talked about potential projects, and gave presentations.
T
he 2018 cooperation program for Moscow and
Beijing was signed at the Mayor’s Office of the
Chinese capital by the Minister of the Moscow
Government and Head of the Department of
External Economic Affairs and International Rela-
tions Sergey Cheremin and Director of the Foreign
Affairs Office of the People's Government of Beijing
Xiong Jiuling.
There was also a meeting between members of
the Moscow delegation and the Vice Mayor of Bei-
jing Zhang Gong. The two sides agreed on long-
term development of relations based on friendship,
equitable partnership and strategic cooperation.
Moscow and Beijing announced that both sides
are ready to strengthen mutually beneficial co-
operation in spheres like trade and the economy,
research and technology, the energy sector, trans-
portation, education, and healthcare. The capitals
of the two countries also confirmed their intent to
actively combat organized crime, drug trafficking,
and illegal migration, expand contacts between
legislative, executive and judicial bodies, and de- Within the scope of Days of Moscow in Beijing, the
velop tourism. famous Beijing Zoo opened a photo exhibition dedi-
cated to the Moscow Zoo. Representatives from the
At the end of the signing ceremony, during his con- two zoos signed a Memorandum of Cooperation
versation with journalists, Head of the Moscow gov- in the presence of Leonid Pechatnikov and Sergey
ernment delegation and Deputy Mayor of Moscow for Cheremin. Members of the Moscow delegation were
Social Development Leonid Pechatnikov noted that shown giant pandas, which Beijing Zoo experts have
the two sides approved a framework agreement on been working to protect and breed for many years.
continuing business and cultural cooperation for the These animals have been a symbol of China and the
next three years. “Everything depends on relations be- World Wildlife Fund for many years.
tween our two states. And right now, these relations
are improving,” he said. A business lunch with the participation of members
of the Moscow government delegation and China’s
“It’s very important for us that such a landmark event big business representatives took place within the
is taking place with support from the People’s Gov- scope of Days of Moscow in Beijing. Moscow Minis-
ernment of the Chinese capital,” Sergey Cheremin ter and Head of the Moscow Department of External
said, “Because just like China is a strategic partner Economic Affairs and International Relations Sergey
for Russia, Beijing is a strategic partner for Moscow. Cheremin gave a presentation on the investment po-
It is no accident that mutual trade turnover between tential of the Russian capital.
our cities is growing. In just the first six months of
2017, it increased by 20%. We’ve had lasting busi- China has been one of Moscow’s key trade and
ness contacts with Beijing for over 20 years. Chinese economic partners for a long time. there are about
companies regularly take part in the development 200 enterprises with Chinese capital registered in
of the Moscow metro. Chinese specialists are work- Moscow as of today, which puts the PRC in 9th
ing on the construction of the Moscow international place among foreign states in terms of this param-
business center Moscow City, and are helping de- eter. Over the course of the first 9 months in 2017,
velop our communication and telecommunication the volume of Chinese investments in the Mos-
systems,” the Minister said. cow economy amounted to 557 million USD. China
ranks 18th among foreign countries in this respect.
He especially noted that Days of Moscow is the first However, according to the Minister, these numbers
time that special attention is paid not only to official do not correspond to the true potential of Moscow
meetings and negotiations, but also to special busi- and Beijing.
ness conferences, the hotel industry, cooperation be-
tween the zoos of the two capitals, and cooperation “Moscow is a very interesting market and is one of the
in the sphere culture and tourism. largest and most powerful agglomerations in Europe.
January-March 2018 CAPITAL IDEAS 7
MOSCOW OFFICIAL
Leonid Pechatnikov,
Deputy Mayor
of Moscow for
Social Development
and the Vice Mayor
of Beijing
Zhang Gong
In terms of consumer capacity, Moscow is in the top protects investors from non-commercial risks, as
three biggest markets for Western Europe and Asia. well as provides for guaranteed partial sales of new
Even though China is currently a leader in terms of products through Moscow’s government procure-
external economic ties with Moscow, it still ranks 9th ment system. “Right now, doing business in Moscow
in terms of investment volumes into the economy of
the Russian capital. Germany is in first place,” Sergey
Cheremin pointed out.
According to him, Moscow is currently building
metro lines and just recently made the decision
to attract foreign investors on concession terms:
the total investment volume of the contracts will
amount to 3 billion USD. Moreover, Moscow has a
lot of rapidly-developing sectors of the economy
that are of tremendous interest to investors. Ac-
cording to the Minister, these sectors include ad-
vanced technology, transportation, engineering
and tourism. Moscow offers tax breaks, supports
industry investors, industrial developers, as well
as investment funds and companies that finance
transportation and social infrastructure develop-
ment projects, including within the scope of public-
private partnerships.
According to the Head of the Department of Ex-
ternal Economic Affairs and International relations,
one recent major accomplishment of the Moscow
government was the introduction of a new law thatis more profitable than in New York, Paris, London, cow government is also doing everything in its power
and a number of other big cities around the globe. to create comfortable conditions for tourists, includ-
Moscow is becoming more appealing for investors,” ing tourists from China, in our city,” Sergey Cheremin
the Minister said. said, “We agreed with our Chinese partners that tour-
ism will become one of the key areas of our coop-
Beijing also hosted two roundtables: “Moscow-Bei- eration. This is primarily motivated by the fact that
jing: city agglomerations” and “Environmental Protec- Beijing and Moscow are becoming increasingly more
tion.” The two events were particularly interesting to appealing megacities. And even though we run into
Chinese experts and journalists. serious problems every day, we try to share our expe-
rience and solutions.”
Another special event was the “Travel to Moscow”
conference, which was attended by dozens of lead- Statistics show that Moscow government efforts are
ing tourism experts from Russia and China. In 2016, not in vain. Last year, a record number of foreigners
a record number of Chinese tourists visited the Rus- visited Moscow: 17.5 million people. “Of course this
sian capital – over 500,000 people. And over the isn’t our limit,” Sergey Cheremin said, “but we’re al-
course of the first 9 months in 2017, the number of most on par with cities like New York, Paris, and even
tourists from the PRC grew by 30%. Starting in 2012, Rome in terms of popularity. So this trend is very en-
more guests have been coming to the Russian capi- couraging to Moscow and Muscovites.”
tal from China than from Germany, even though
Germans were in first place in terms of tourist vol- Days of Moscow in Beijing were very successful and
umes for a long time. mutually beneficial. In a discussion with journalists,
Sergey Cheremin announced that Days of Beijing will
Sun You, Head of Beijing's Tourism Committee noted be held in Moscow in the summer of 2018. “I am sure
that China is one of the countries where tourism is that our Chinese friends will hold equally impressive
growing more rapidly. According to him, the frame- economic, cultural, and athletic events. The discussion
work agreement on business and cultural coopera- was interesting and incredibly fruitful. Our cities have
tion signed between the two capital, strengthens a lot of potential for cooperation. We can learn a lot
confidence that tourism between Moscow and Bei- from each other,” he said.
jing will continue to develop successfully in the fu-
ture. The final Days of Moscow event was a solemn cer-
emony dedicated to the opening of a Moscow corner
“For us, it’s very important that such a significant in Chaoyang Park in Beijing, where a three-meter tall
meeting is taking place under the patronage of the Russian Matryoshka doll was placed. This was a gift to
People’s Government of the Chinese capital. The Mos- Chinese children from the city of Moscow. ■
January-March 2018 CAPITAL IDEAS 9MOSCOW OFFICIAL
Partner relations
get stronger
Moscow and Ulaanbaatar sign cooperation program
Mayor of Moscow Sergey Sobyanin and Mayor of Ulaanbaatar Sunduin Batbold
signed a cooperation program for 2018-2020. The ceremony was also attended by
Delgermaa Banzragch, the Ambassador of Mongolia to Russia.
T
he new program defines priority spheres of year marks 60 years of friendly ties between the
cooperation for the two capitals over the next capitals of Russia and Mongolia. We will definitely
three years. These spheres include the housing celebrate this date, and signing a cooperation pro-
and utilities sector, education, and the devel- gram will mark the beginning of a new stage of our
opment of small and medium-sized business. The two fruitful cooperation,” he said.
sides will also cooperate in the sphere of urban de-
velopment policy, sharing experience and introducing In turn, Sunduin Batbold thanked Sergey Sobyanin for
each other to regulatory documents and guidelines the warm welcome. He expressed confidence that
in the sphere of spatial planning and creating a social the new bilateral agreement will be significant for
infrastructure. further development of relations between Moscow
and Ulaanbaatar. Friendly ties between Moscow and
Another important field is healthcare, for example Ulaanbaatar were established in 1957. The current pro-
sharing experience in organizing ambulance services tocol on friendly relations and cooperation between
and training and professional development for medi- the two capitals was signed on February 26, 1996.
cal staff. Moreover, Moscow and Ulaanbaatar will
help each other in the development of public trans- Last year, trade turnover between Moscow organiza-
port and road and transport infrastructure. They will tions and their Mongolian partners increased by 70%
share experience in organizing traffic and parking compared to 2015, amounting to 58.7 million USD. In
spaces, creating transport interchanges, and using Q1 2017, it increased by 2.2 times compared to Q1 2016,
intelligent transport systems and computer model- reaching 30.3 million USD.
ing of traffic flows.
Moscow exports electric equipment, detergents and
According to Sergey Sobyanin, partner relations be- hygiene items, candy, grain and flour, as well as other
tween Moscow and Ulaanbaatar are getting stron- food products to Mongolia. The Russian capital imports
ger, and mutual trade turnover is increasing. “This knitwear, carpets and raw materials from Mongolia. ■“Denkmal,
Russia — Moscow — 2017”
On November 8-10, Gostiny Dvor in Moscow
hosted the fourth International Trade Fair
of Heritage Preservation, Restoration and
Museum Technology “Denkmal, Russia —
Moscow — 2017.”
D
enkmal is one of the largest European fo- in the center of the city, where restoration work for
rums on the preservation of architectural the Patriarchal Metochion was carried out at the
heritage. About 5,000 people visit the event same time as the construction of the modern Zarya-
every year. This year, exhibition participants dye Park. “We see historical streets that open up, rid-
included representatives from state heritage preser- ding themselves of cobwebs made out of wires, lurid
vation organizations and leading restoration organi- signs, and closed shop windows to reveal their beauty
zations from Germany, Italy, the Netherlands, Rus- and history to Muscovites,” he said.
sia, France and other countries; science and research
organizations; customers and investors of repair and Over the past few years, almost one thousand architec-
restoration work, as well as students from the capi- tural monuments have been restored in the capital and
tal’s colleges who study restoration. 8,000 buildings have been renovated, complete with
architectural lighting. “These are revolutionary trans-
Mayor of Moscow Sergey Sobyanin gave the opening formation that have made Moscow more comfortable
speech at the event. “I’m happy to welcome you at and beautiful. I want to thank the restoration com-
the exhibition from our colleagues in Germany, Italy, munity, whose activities have essentially been reborn,
France, Austria, and other countries. ‘Denkmal, Russia who put their soul, skills, and heart into the restoration
— Moscow’ has truly become a tradition. We use this of unique Moscow monuments, and to thank the pri-
platform to discuss problems and the historical de- vate companies who invest their funds into restoration
velopment of our cities. I thank everybody who takes projects,” the mayor of the Russian capital said.
part in this movement, who is participating in today’s
exhibition. Welcome to Moscow!”. The fair also hosted a meeting between the Mayor of
Moscow and the Lord Mayor of Leipzig Burkhard Jung,
According to Sergey Sobyanin, the main goal of the who gave Moscow a mosaic panel depicting a frag-
fair is to find harmony between city development and ment of the map of the USSR and the Red Square. The
the preservation of cultural heritage. The combina- Lord Mayor noted that the protection and preserva-
tion of history and modernity in the capital can be ob- tion of monuments should not boil down to fencing
served in the metro, which features architecture from them off and hiding them. “No,” he said, “It means us-
the past century and new technology, on the streets, ing the old, ancient things we have in order to create
where old buildings stand alongside skyscrapers, and something modern in the present.” ■
January-March 2018 CAPITAL IDEAS 11MOSCOW OFFICIAL
Successful cooperation
between Moscow
and Vienna is the key to friendship
between Russia and Austria
Days of Moscow in Vienna took place on November 14-16. Business meetings
and a wreath and flower laying ceremony by the Monument to the Soviet
Soldier at Schwarzenbergplatz marked the beginning of Days of Moscow.
A Moscow delegation headed up by the Moscow Minister and Head of the
Moscow Department of External Economic and International Relations
Sergey Cheremin came to the capital of Austria to participate in the events.
“W
e won’t forget the names of the 17,000 lives for one of the most beautiful cities in Europe,” the
Soviet soldiers who fell in the battle minister said at the end of the ceremony.
for Vienna. They saved many histori-
cal and architectural monuments of The main business program event for Days of Moscow
the Austrian capital from destruction, and gave their in Vienna was a conference on bilateral cooperationin the sphere of economic development, which took sian Infrastructure,” which captured the attention of
place in the Federal Economic Chamber of Austria. a number of European experts, took place within the
The event, which was organized with support from scope of the conference. Members of the Moscow
the Moscow Department of External Economic and delegation visited the Seestadt Aspern district, which
International Affairs, was attended by business and was built using the latest energy conservation meth-
government representatives from both capitals. They ods and smart home technology.
discussed relevant infrastructure development issues,
as well as cooperation in the sphere of restoration of A meeting between Moscow Minister and Head of the
city spaces and the environment. Department of External Economic and International
relations Sergey Cheremin and Mayor of Vienna Mi-
During the plenary meeting, Moscow Minister and chael Häupl took place within the scope of the Days
Head of the Department of External Economic and of Moscow. On behalf of the Mayor of Moscow Sergey
International Relations Sergey Cheremin pointed Sobyanin, the minister invited Michael Häupl to visit
out that Austria is one of the leading countries in the Russian capital.
terms of investments volumes in the Russian capi-
tal. Among European countries, Austria is in 4th Sergey Cheremin and Michael Häupl recalled the Vi-
place: the total volume of Austrian investments into enna Ball recently held in Moscow, during which Mr.
the Moscow economy amounts to over 260 billion Cheremin proposed to hold Days of Vienna in Moscow.
USD, while net investment volumes amount to over Michael Häupl supported this idea. He talked about
3,5 billion USD. the accomplishments of the Russian capital. Talking
about the expansion of Moscow and the development
“This year we’ve seen a positive trend in trade rela- of new territories, he pointed out that there are no
tions with Austria. In the first 6 months of 2017, Aus- comparable projects or solutions in Europe. “The fact
trian exports to Russia grew by more than 40%, while that Moscow has expanded its area like this is amaz-
Russian exports to Austria increased by 25%,” the min- ing,” he said, “Population density in Vienna is growing:
ister said. He pointed out that these are optimistic fig- annual population growth amounts to 25,000 people.
ures that inspire hope for maintaining this trend and But Moscow’s scale of growth is inconceivable for
coming back to the high trade turnover volumes be- Austrians. There is a lot to think about here and a lot
tween the two countries in 2012-2013 within the next to learn from Russians.”
few years. “This is a significant moment for us today,”
Sergey Cheremin said, “Since there are about 1,200 “Today, Moscow can be proud of its stable econo-
Austrian companies working in the Russian capital my,” Sergey Sobyanin said in response, “The city has
right now, including well-known brands like STRA- almost no unemployment, major Western compa-
BAG, Mondi, Magna Steyr, Doppelmayr, and many nies continue to open offices in Moscow, and we’re
others.” According to Mr. Cheremin, leading Austrian developing high-tech industries. Come visit us, and
companies represent some of the most technologi- you won’t recognize Moscow. Those who haven’t
cally advanced industries: instrumentation, process- visited for a while will appreciate the transport in-
ing, electronics, and medical equipment, all of which frastructure developments, new metro stations,
are extremely important for Moscow as a rapidly de- convenient road interchanges, pedestrian spaces,
veloping metropolis. festivals, and fairs.”
Sergey Cheremin gave a number of examples of suc- The Mayor of Vienna noted with satisfaction the
cessful cooperation between Moscow and Europe- growth in trade turnover between Russia and Austria.
an countries – carsharing services, the construction “This is a very important issue for Vienna’s economy. We
of athletic facilities, the development of a transport are glad to host Muscovites who spend time here and
interchange hub system, and the development of bring great impressions back to Moscow with them,”
commercial spaces that amount to about 14 million the mayor said, “Isn’t this where the re-establishment
square meters of real estate. The minister proposed of economic relations to their full capacity starts?”.
that Austrian companies take part in the develop-
ment and implementation of Moscow projects that To conclude the negotiations, Sergey Cheremin and
have a lot of potential. “Overall, European countries Michael Häupl exchanged gifts. Michael Häupl gave
account for over 70% of direct investments into the the minister a sign with the image of the knight that
Moscow and Russian economies. This fact contra- decorates the Vienna City Hall. The Minister of the
dicts the assertions that Russia has shifted toward Moscow Government gave Michael Häupl a wood-
the East,” he said. en barrel with honey. The President of the Moscow
Chamber of Commerce and Industry Vladimir Pla-
The roundtables “The Environment and Innovations tonov presented the Mayor of Austria with old images
in City Management” and “The Development of Rus- of Petrovka Street. ■
January-March 2018 CAPITAL IDEAS 13MOSCOW OFFICIAL
Moscow and Budapest are
experiencing a renaissance
of bilateral relations
Budapest is one of the oldest and most reliable partners for Moscow. According to
Minister of the Moscow Government and Head of the Moscow Department for Exter-
nal Economic and International Relations Sergey Cheremin, the capitals of Hungary
and Russia are currently going through a true renaissance of bilateral relations.
Mr. Cheremin made the statement during a business cooperation forum that took
place within the scope of Days of Moscow in Budapest on November 21-23.
“T
he history of our relations has not al- Within the scope of Days of Moscow in Budapest, the
ways been trouble-free, but today we opening of Moscow Alley took place on the bank of the
have reason to hope that we have a Danube, across the popular Margarita island located
lot of prospects for further cooperation between Buda and Pest. Head of the Moscow govern-
across various spheres,” Sergey Cheremin said. He ment delegation and Deputy Mayor of Moscow for So-
pointed out that there has been a positive trend cial Development Leonid Pechatnikov pointed out that
this year: the growth of trade turnover between the relationship between Russian and Hungarian cul-
Moscow companies and their Hungarian partners tures has been going strong for several hundred years
amounted to 25%. Export volumes from Russia to and regardless of what happened, humanism and san-
Hungary are also on the rise. ity have always taken precedent for the two capitals.
The forum’s plenary session, which brought together Budapest also hosted a meeting between Leonid Pe-
representatives of business communities, directors of chatnikov and Sergey Cheremin and the Vice Mayor
city administrations from both capitals, parliamentar- of the Hungarian capital Gábor Bagdy.
ians, and politicians, was followed by roundtables on
the development of road and transport infrastructure A visit by the delegation of the Prefecture of the North-
and tourist potential for Moscow and Budapest. Rep- Eastern Administrative District of Moscow to the city
resentatives from the Chambers of Commerce and of Debrecen, where the two sides signed an agreement
Industry signed an agreement on expanding bilateral on establishing a sister-city relationship, completed the
cooperation. business program of the Days of Moscow. ■useful info
Department for external economic and international relations of
the Government of Moscow
Address: 13 Tverskaya Street, Moscow, 125032
Ph: +7 (495) 633 68 66
Fax: +7 (495) 633 68 65
E-mail: dvms@mos.ru
www.dvms.mos.ru
Department of Science, Industrial Policy
and Entrepreneurship of the Goverment of Moscow
Address: 22 Voznesensky Pereylok, Moscow, 125009
Ph: +7 (495) 777 77 77
Fax: +7 (495) 957 05 92
E-mail: dnpp@mos.ru
www.dnpp.mos.ru
Department of Economic Policy and Development
of the Government of Moscow
Address: 21 Voznesensky Pereylok, Moscow, 125032
Ph: +7 (495) 777 77 77, +7 (495) 957 72 17
Fax: +7 (495) 629 33 42
E-mail: dprm@mos.ru
www.depir.ru
Department of City Property of the Government of Moscow
Address: 20 Bakhrushina Street, Moscow, 115054
Ph:+7(495) 777 77 77
E-mail: dgi@mos.ru
www.dgi.mos.ru
Moscow Exchange
Address: Office 1: 125009 Moscow, Bolshoy Kislovsky per, 13
Office 2: 125009 Moscow, Vozdvizhenka Str, 4/7, Bldg. 1
Phone: +7 (495) 363 32 32, +7 (495) 232 33 63
Fax: +7 (495) 234-48-40
www.moex.com
January-March 2018 CAPITAL IDEAS 15Innovation is
MOSCOW GLOBAL
Moscow held the Sixth
International Open
of the capital’s
42
Innovations Forum.
The forum broke all previous
agreements, 24 of which entailed the par-
records, bringing together over 18,000 ticipation of the Skolkovo Foundation, were
signed within the scope of the business pro-
participants from close to 100 countries. gram. Some of these agreements concerned
650 speakers gave presentations over the billion-dollar infrastructure projects such as
the construction of a Skolkovo 5G network, while others pro-
course of two days, dedicated to business, vided for direct monetary investments amounting to hundreds
of millions of rubles. A total of 911 business meetings took place
the state, and society in general. at the forum, a 16% increase from last year.
Forum participants included residents of Moscow technoparks.
The city rewards these kinds of scientists with awards and
grants, subsidizing equipment purchases and the development
of innovation infrastructure. It’s no wonder that forum par-
ticipants demonstrated their projects to the Mayor of Moscow
Sergey Sobyanin during one of the forum days.
Comprehensive infrastructure
A comprehensive innovation infrastructure that has become a
driver of the city’s economic growth has developed in the capi-
16 CAPITAL IDEAS January-March 2018the foundation
future economy
tal over the past few years. As of today, Moscow’s innovation There are over 400 production technology development cen-
infrastructure includes about 1,500 sites. A Moscow Govern- ters currently operating in the city. “Entrepreneurs can use
ment Presidium meeting was dedicated to discussing issues high-tech products to implement business development plans,”
related to infrastructure support. said Aleksey Fursin, Head of the Department of Science, Indus-
trial Policy, and Entrepreneurship.
“There are a lot of enterprises and organizations in Moscow,
tens, if not hundreds of thousands of people, from academic Moscow’s innovation infrastructure currently includes about
institutions to startups. 1,500 sites, which house over 3,500 units of modern, high-tech
equipment. This includes:
Industry-specific institutions, private and state tech-
noparks, scientific and industrial clusters that work in • The Moskva Technopolis special economic zone
space, aviation, the nuclear and medical sectors are all en- • 31 Technoparks
gaged in innovative projects,” Sergey Sobyanin said. He em- • “Digital Business Space” - upgraded Central House of the
phasized that innovation is the foundation of the capital’s Entrepreneur
future economy. • 76 coworking space
• five production technologies development centers
Moscow’s improved positions in national and international • two innovation clusters in Zelenograd and Troitsk
competitiveness ratings serve as confirmation of this fact. In • children’s technoparks (quantoriums)
late 2016, Moscow was ranked 43rd in a global rating of inno- • service centers for business and other organizations
vation cities by international rating agency 2Thinknow, rising
from 192nd in 2011. Moscow also placed third on the national Right now, the most important infrastructure sites for inno-
investment climate rating. vation companies are Technopolis Moscow and technoparks,
January-March 2018 CAPITAL IDEAS 17MOSCOW GLOBAL
microelectronics and instrument engineering (190 partici-
pants and over 8,000 employees). The second cluster is in
Troitsk. It specializes in new materials, as well as in laser
and radiation technologies (58 participants and about 6,000
employees). “Regional innovation clusters are cooperations
between science, education, manufacturing, and business,”
Aleksey Fursin said.
In October 2017, Sergey Sobyanin opened the renovated House
of the Entrepreneur. The objective of this multifunctional plat-
form is to become a portal for entering Moscow’s innovation
infrastructure.
The city is granting subsidies for purchasing equipment for in-
novation companies worth up to 200 billion rubles, develop-
ing infrastructure worth up to 300 million rubles, and provides
technology parks and their residents with tax incentives that
the number of which has increased by five times over the past have reduced taxes by up to 25 percent. The city also supports
four years (there were six in 2014, and there are 31 now). The startups. The Moscow Foundation for Support of Industry and
number of resident companies in technoparks also increased Entrepreneurship provides affordable loans for research and
by almost four times (from 450 to 1748) and the number of development and engineering projects (up to 50 million rubles
jobs increased by 6.5 times (from 6,800 to 44,100). Tech- with 5 percent interest rates for five years). The Venture Invest-
nopark residents can rent space at attractive prices, get access ment Promotion Foundation issues venture loans to startups
to high-tech equipment and services such as clean rooms and (up to 30 million rubles). Young scientists receive bonuses and
labs for experiments. grants for expanding their projects (33 bonuses worth one mil-
lion rubles each).
Sharing experience
Innovative purchases
Another aspect of innovation companies is sharing experience
with international partners. The International Association of The city’s departments of construction, healthcare, informa-
Science Parks and Areas of Innovation (IASP) includes 374 tech- tion technology, transport, housing and utilities lead the way in
noparks from all over the world and 142,000 resident companies. terms of innovative purchases among executive agencies. Open
Inquiries and Manufacturers’ Sessions are important tools for
After the 33rd IASP conference, which took place in Moscow in boosting demand for innovative goods.
the fall of 2016, it was decided to create a Eurasian IASP division.
The division includes 31 technoparks from Russia, Azerbaijan, Open Inquiries allow executive agencies to seek innovative so-
Armenia, Belarus, Georgia, Kazakhstan, Kyrgyzstan, Mongo- lutions for topical utility infrastructure requirements. The city
lia, Tajikistan, Turkmenistan, and Uzbekistan. 18 of these tech- implements the best solutions. In turn, Manufacturers’ Sessions
noparks are located in Moscow. The Moscow Export Center is allow manufacturers of goods and technologies to show them
the coordinator of the project. to potential clients and to receive feedback.
There are a total of 76 coworking spaces operating in the city. Forty open inquiries have been made to date, with 859 compa-
Each one is equipped with 100 work spaces. People rent spaces, nies suggesting 1,051 solutions. The city has organized 80 events
business services, and much more. All of this speaks to the de- for manufacturers of innovation goods, with 340 manufactur-
mand for coworking spaces among young companies. ers presenting 444 promising goods or technologies.
There are five production technology development centers op- The city has also developed the iMoscow online navigator for
erating in Moscow. They support small and medium-sized tech using the innovation infrastructure. This navigator helps en-
companies. Any entrepreneur can work out the technological trepreneurs receive information and use various services. The
process in detail, learn about the different functions of manu- website has an interactive map of infrastructure facilities. Its
factured product samples, and get new products certified. In users can learn more about various services and opportunities
2017, 354 high-tech companies used services provided by these in innovation business support, book facilities at technology
centers. Enterprises were provided with over 2,600 services re- parks and co-working spaces using their account, and learn the
lated to technological development, trials, and product stan- latest news from the innovation sector.
dardization.
This approach towards developing the innovation ecosystem
There are two regional innovation clusters developing in the allows Moscow to attract talent, projects and high-tech in-
city. The first one is located in Zelenograd. It specializes in vestment. ■
18 CAPITAL IDEAS January-March 2018CITY’S GRAPH
Moscow’s Targeted Investment Program
for 2018-2020
Transportation system development continues to be a priority
for the city government
METRO
81,7 km of metro lines
6 electric engine houses
35 metro stations
55 transport interchange hubs
ROADS
300 km of roads
80 engineering structures
40 pedestrian crossings
In New Moscow:
110 km of roads
13 pedestrian crossings
21 engineering structures
Source: Moscow Complex of Urban Development Policy and Construction
January-March 2018 CAPITAL IDEAS 19FACE TO FACE
Alexey Nemeryuk
Deficits are
an archaism that
Muscovites have
long forgotten
The trade and service sector is one of the most prominent branches of the
Russian capital’s economy. Just over the past few years, over 5 million square
meters of retail space have been erected in the capital and half a million jobs
have been created in the trade and service sector. Alexey NEMERYUK, Head of
the Moscow Department of Trade and Services, talked about the development
of this sector in an exclusive interview with Capital Ideas.
Mr. Nemeryuk, how did import substitution initia- tries, we started to work with the regions in the
tives impact the capital? Have there been food def- food sector. This cooperation takes places within
icits? What does the current ratio of domestic ver- the scope of intergovernmental agreements that
sus imported products in Moscow stores look like? Moscow currently has with just about all federal
subjects of the Russian Federation. The point of
I’ll say right off the bat that there are no food deficits these agreements is as follows. First, to create the
in the capital, and there won’t be any in the foresee- conditions for the stable development of regional
able future. This popular word borrowed from the So- agricultural producers. Second, to sell these prod-
viet era has been forgotten by Muscovites completely. ucts in Moscow.
(Smiles) As a major city, Moscow consumes over 12
million tons of food products annually. Today, food products in the capital come from over
50 regions in Russia. Thus, domestic producers cover
Right after the introduction of bans on the import almost all of the city’s grain, wheat, buckwheat, and
of food products from a number of foreign coun- egg needs. They also account for 90% of potato, 88%
January-March 2018 CAPITAL IDEAS 21FACE TO FACE
different Russian regions. There are 13 shopping
centers from different regions featuring a wide
range of products, including live fish, which has its
own separate section. It has over 250 kinds of live,
chilled, smoked, and frozen fish, as well as seafood
from Murmansk, the Far East, Dagestan, Astrakhan,
Belgorod, and the Crimea.
Food products in Moscow are sold not only in over
56,000 stationary enterprises, but also in agricultur-
al markets (there are a total of 21 in the city). Not to
mention the fact that the capital has a great tradition
of holding all sorts of food markets, including week-
end markets. Last year, 109,000 Russian producers
took part in weekend markets and over 25,000 tons
of agricultural products were sold. 2,974 weekend
markets have already been held in 2017.
All of these events aimed at providing Moscow resi-
dents with domestic food products have helped us
keep the city’s food product market stable, avoiding
price fluctuations and deficits.
Moscow has a lot of major foreign chains: Metro,
of sugar, and 85% of vegetable oil volumes (and all IKEA, Leroy Merlin… what is their share of the mar-
sunflower oil is produced domestically). We do import ket in general?
some fruits and vegetables. But this trend is wan-
ing, along with the share of imported meat and meat In terms of foreign supermarket chains like Billa, Metro,
products on the Moscow market. Auchan, Selgros, and Globus on the Moscow market,
their share is not very high. It amounts to about 4.5%.
The agro-logistics infrastructure that is being de-
veloped in the city plays an important role when it The share of foreign chains outside of the food sector
comes to increasing supplies from domestic pro- is significantly higher, about 47%. It’s worth point-
ducers in the capital as well. In 2014, the first ag- ing out that these are primarily major players that
ricultural cluster called “Food City” opened in the focus on construction materials (OBI, Leroy Merlin,
Russian capital. The food sold here comes from 63 Castorama), household appliances and electronics
22 CAPITAL IDEAS January-March 2018(Media Markt), home and interior design products
(Ikea), as well as clothing and footwear from inter-
national brands.
Interestingly, the latest business trend has been shift-
ing toward smaller spaces. Even major retail chains
are gravitating toward this. Grocery stores have start-
ed to opt for areas about 150-200 square meters in
size. The French chain Auchan, for example, is starting
to create smaller stores under the brand name “My
Auchan.” In August of this year, one of these stores
opened its doors on Tverskaya after the street under-
went reconstruction within the scope of the “My City”
program. In terms of chains outside the food sector,
an H&M opened on Tverskaya in 2017 and a NIKE and
a Massimo Dutti popped up on Kuznetsky Most.
Russian grocery chains are also adjusting to custom-
er behavior, and customers have started to shop at
stores located closer to their homes more frequently.
It’s convenient to drop by after work, spending as little
time on shopping as possible. For example, Azbuka
Vkusa and Perekrestok have bigger supermarkets
along with smaller options (AB Daily and Perekre-
stok-Express). The expansion of pedestrian spaces in You know, it’s probably a combination of all of these
the center of Moscow is also a factor. There are more things. There are over 10,000 cafes and restaurants
pedestrians here, according to expert assessments, currently operating in Moscow. And this figure is
which means the number of people shopping has also more or less stable. I say “more or less” because, for
gone up. Of course, chain owners are expecting this a number of reasons, these establishments open
kind of behavior, instead of shopping trips where fam- and close frequently. For example, last year 1,279
ilies buy groceries for the whole week, which is what new cafes and restaurants opened while 726 closed.
happens in stores located near MKAD.
But the number of summer cafes in the capital has
Street food is, to put it mildly, not one of Moscow’s doubled over the past five years. There were about
strong points compared to foreign cities. Why? Is 1,200 of them, and now there are 2,400. According
this about climate, the economy, or maybe culture? to polls, 70% of Moscow residents and guests would
January-March 2018 CAPITAL IDEAS 23FACE TO FACE
prefer to sit outside as opposed to indoors. Thus, the dedicated to City Day, had street food stands op-
improvements that are currently taking place in Mos- erating across 40 platforms. There was all kinds of
cow are giving a very clear signal to business: yes, street food: delicious pies with different fillings, ke-
summer terraces will be in demand in the near future. bab skewers, tender kulebyaka, the air-light “Bird's
Milk” cake, and so much more. No wonder that over
City festival spaces within the scope of “Moscow ten million people visited the festival events. Both
Seasons” events definitely have a lot of street food the comfortable city atmosphere throughout most
options. The festival that took place in September, of Moscow and great service, of course, had a lot to
do with this.
In 2018, Moscow will be hosting the FIFA World
Cup. The impressions foreign fans will have will
depend not only on how well their team does, but
also on how comfortable they are in the capital.
That is, on the trade and services sector. Is the
city preparing something special in this regard?
I am confident that not a single tourist who comes
to visit us for the World Cup will be left hungry.
There will be a wide range of food services, includ-
ing dishes for all price ranges. There will be haute
cuisine, affordable business lunches, family estab-
lishments with game rooms for kids, and more. It
all depends on personal preferences of the visitors
(location, prices, taste). There will be ways to find
restaurants, book tables, or order delivery on spe-
cial websites like Afisha and Menu.ru, as well as on
search engines like Yandex, 2GIS, and others. ■
24 CAPITAL IDEAS January-March 2018January-March 2018 CAPITAL IDEAS 25
MOSCOW IN WORDS
“Cold frost and sunshine: day of wonder! “The forest is entranced
But you, my friend, are still in slumber - by Winter the Magician.
Wake up, my beauty, time belies: Under velvet snow
You dormant eyes, I beg you, broaden it's mute, immobile, glistening
Toward the northerly Aurora, wondrously with life,
As though a northern star arise!..” standing enchanted,
Alexander Pushkin, neither dead nor alive,
the greatest Russian poet, entranced by a magic dream,
“Winter Morning” entirely covered, fettered
by light links of snow…”
Fyodor Tyutchev, Russian
poet, “The forest is entranced
by Winter the Magician…”
“All going to the whiteness, earthly,
As an unmoving immense wall,
There pours a snow, becoming denser,
And shields us from daylight at all.
Not giving to its move attention,
How slow is its heavy stream –
It seems, the force of gravitation
Directs it to the earthly realm…”
Konstanin Vanshenkin, Soviet poet
and lyricist., “Snow”
26 CAPITAL IDEAS January-March 2018You can also read
