OREANDA-NEWS. November 02, 2011. Transcript of the meeting’s beginning:

V.V. Putin: Mr Dmitriev, let’s start with the Direct Investment Fund. I’d also like to know how your bank provides support for our exports in various ways.

Your bank is working towards this end. Here I mean providing support for export contracts and other lines of activity, such as, for example, insurance. Go ahead, please.

V.A. Dmitriev: It is safe to say that the Russian Direct Investment Fund has got off to a good start. On May 18, 2011 you met with leaders of the international investment market, leaders of the largest investment companies, sovereign investment funds. A little more than half a year has passed since then and now we can say that the fund is operating. Most importantly, it is working on specific projects. Now we plan to carry out about 20 projects, that is, potential investment transactions worth about USD 5 billion.

It is important that all the investors who met you have confirmed their readiness to participate in the projects we are offering them. Moreover, apart from these projects, they are launching their own initiatives as well.

An agreement on setting up a joint investment fund signed with the China Investment Corporation during your visit to China is also very important to us. This is one of the largest existing funds responsible for managing assets worth about USD 450 billion. Regrettably, it was not present in Russia before. This agreement is a major breakthrough in Russian-Chinese investment relations. Now, we are completing work on the memo of understanding that we signed to be able to enter into specific agreements on establishing this fund. The readiness of our Chinese partners to move forward at such a pace is a pleasant surprise. We hope to complete at least two transactions before this year’s end and conduct most transactions next year.

Foreign investors are ready to invest their money together with the fund in sectors that are in line with the modernization program and generate good profits for them. It is good that small- and medium-sized enterprises are interested in operating in these sectors – agriculture, mass consumer goods, retail chains, medicine and healthcare. Strange as it may seem but in healthcare, apart from pharmaceuticals, they are considering the formation of private clinics throughout the country on the principles of public-private partnership. There are funds specializing in this area. They can share their most advanced experience in corporate governance and technologies themselves.

V.V. Putin: And what can you say about cooperation with other investment funds besides the Chinese partners?

V.A. Dmitriev: We have good relations with funds in the Persian Gulf area primarily Kuwait and Abu Dhabi. Naturally, we are also cooperating with US and British direct investment funds, such as TPG and Blackstone and others on specific projects.

V.V. Putin: Good. Let’s now move to exports. Providing support for…

V.A. Dmitriev: I’m glad to say that the Export Credit and Investment Insurance Agency (ECIA) has started operating. Under the decision taken by the Supervisory Board, we have not only established a management team headed by a director general but also held the first meeting of the Supervisory Board. Apart from the Board, we have also set up working committees that include both the Supervisory Board’s members as well as independent experts. These are committees on auditing, strategic management and personnel that fit in into a normal practice of a serious agency's corporate governance.

Now I’d like to say a few words about specific transactions. Our team has just returned from Indonesia where we discussed specific deals – albeit not the first ones – in which the fund will take part. This includes promoting our medium haul Sukhoi Superjet on the Indonesian market. Importantly, the formation of the ECIA will allow us to promote this aircraft under tripartite agreements with such leading insurance agencies as Coface in France and SACE in Italy. These insurance agencies did not want to deal with any companies that were not state-owned. This is why the ELIIA will help us promote our airliner in third markets in this tripartite format.

V.V. Putin: It is a good thing that you are focusing on such a high-tech product. These instruments were created to this end.