Торгпред РФ: Нидерланды не хотят терять российский рынок из-за санкций

Relations between Russia and the Netherlands are going through hard times. Nevertheless, despite the fact that the Netherlands, as part of the European Union, has also imposed sanctions against Russia, the entrepreneurs of the two countries do not intend to surrender their positions to competitors. In an interview with RIA Novosti, Alexander Cherevko, the Russian Trade Representative in the Netherlands, talked about how they will be able to do this.

- Alexander Nikolaevich, please tell us, how did the Russian Trade Mission fare during the first six months of the sanctions? Has there been a cooling of interest shown by Dutch business towards Russia, have there been any cancellations of joint projects?

- Of course, the sanctions imposed by the US and the EU have had an impact on the dynamics of trade and investments. At the same time, the Dutch companies still view Russia as a large promising market for the development of their businesses.

The Netherlands are second in the world, in terms of agricultural product exports, and the leading Dutch agricultural companies are interested in selling their knowledge and technology in Russia. This strategy of Dutch businesses objectively coincides with the interests of the Russian economy, and so the trade mission is actively assisting enterprises in the Netherlands in establishing contacts with interested Russian partners.

This year, with the support of our office, more than 30 business missions were organized for Russian companies in the Netherlands and for Dutch companies in the Russian regions. More than 20 agreements and contracts were signed.

A limiting factor for collaboration is the lack of financing. Whereas previously, many Russian and Dutch companies relied on access to cheap European financial resources, now in the majority of cases, these opportunities have been closed.

For example, the Dutch company Farm Frites, working on a joint-project with the Belaya Dacha Company in the Lipetsk Oblast, was refused financing for this project by the EBRD.

In this regard, we need to strengthen the coordinating role of the federal government in funding projects that have been reviewed in the regions and have received support from regional authorities and the Ministry of Economic Development.

The Vnesheconombank (VEB), Rosximbank, and the International Investment Bank have already decided they will be participating in financing projects that involve the exporting of Russian products, and implementation of investment projects in Russia. It is important that these decisions become actually implemented.

- Were the Dutch able to find markets for their agricultural products, those that Russia has banned from being imported, in response to Western sanctions?

- The retaliatory measures undertaken by Russia have had a strong impact on the agricultural business of the Netherlands. According to the ministry of the economy of this country, Dutch farmers were not able to sell products to Russia worth about 600 million euros. An additional complication lies in in the fact that the products, intended for export to Russia, cannot always be sold on the EU market. For example, tomatoes that were grown for subsequent sale in Russia, have a longer ripening period, and the cucumbers destined for Russia – are of a different size.

Moreover, the Netherlands market was flooded with products from Poland, Spain, and France. As a result, prices for some products have fallen two or three times. To support their farmers, the Dutch government purchased part of the production of farmers and returned to the practice of providing free lunches in schools.

According to Dutch experts, the total damage suffered by Dutch farmers, due to lower prices and the loss of the Russian market amounts to about 1.5 billion euros – this is a very painful blow to the agricultural sector of the Netherlands.

We should also not forget that the Netherlands are a major trading country in the European Union, and many Dutch logistics companies were involved in the transportation of products to Russia from other countries as well, so these have also fallen on hard times.

Today, Dutch business is firmly pursuing this issue with its government and that of the European Union, demanding compensation for their losses. Moreover, leading Dutch companies are increasingly blaming the authorities, saying that by supporting the EU sanctions, they are helping competitors of Dutch business in the Russian market.

Many Dutch companies actively support the normalization of relations with Russia for the development of their businesses.

- You mentioned the free breakfasts, what other steps has the Netherlands taken to sell the products that were intended for the Russian market? Finland, for example, was selling goods for nothing, some threw products away, and others organized special promotions.

- Dutch businesses are very highly organized and use a variety of methods to market and sell their surplus agricultural products and foodstuffs. Indeed, a variety of fairs are being held, where the products are sold almost at cost.

As for the support measures, the Dutch government is helping to promote the products of its farmers, small and medium-sized businesses to new markets. There were hopes regarding deliveries to Ukraine, but these proved to be groundless. Nevertheless, some Dutch products, due to their high quality, managed to find markets in other countries.

- Are Dutch companies turning to the Russian trade mission for assistance?

- We support the projects of Russian businesses in the Netherlands and Dutch businesses in Russia – this is a fundamental point. For us, the Dutch companies operating in Russia, we consider as being our own, just as the Russian companies that work in the Netherlands.

Dutch companies come to Russia not only with the desire to make money, but also with their knowledge, technology, management – and our task is to assist them in the successful implementation of their projects, so that their Russian partners receive knowledge, technology and know-how from the Dutch, in order to further develop their own businesses.

The issues that concern Dutch entrepreneurs are phytosanitary control, customs regulations, and the financing of projects in the Russian regions.

You know, the Dutch business community is considering this crisis in the political sphere as a new challenge, as a new opportunity for them. For them, this is just a “little storm”, and the Dutch are used to many such “little storms” in business – since the days of their East India and West India Companies, so one way or another, they will find opportunities to work in Russia.

I will say one more thing: there are even companies that have been advised not to be particularly active in working with Russia, yet nevertheless, they are seeking opportunities for cooperation. For example, recently Shell has signed an agreement with Gazprom on the construction of the third phase of a lignified natural gas plant on Sakhalin Island.

- There are many registered representative offices of Russian subsidiaries in the Netherlands, including Gazprom International, South Stream, and Vimpelkom. Has the attitude of the Dutch authorities towards them changed in any way? Have the working conditions deteriorated; is there increased pressure from the EU?

- The Dutch government in 2011 set itself a target – that by 2020, 10% of the top 500 companies in the world would be paying taxes in the Netherlands. Why does this goal have realistic prospects of being achieved? Because the tax legislation of the Netherlands is one of the best in the world. Therefore, of course, the government is interested that Russian companies be registered and pay taxes in the Netherlands.

However, against the background of geopolitical tensions, which intensified after the downing of the Malaysian airline, which killed nearly 200 citizens of the Netherlands, a number of absolutely inappropriate measures have been taken.

For example, a Russian company registers a subsidiary in the Netherlands, and appoints a director who is a Russian citizen – this company is then denied the right to open an account in a Dutch bank. Who is the winner in this situation? This environment is, of course, very unfriendly, and the political situation is quite complicated.

However, we use the platform of the trade mission to discuss the current situation and to identify ways to address difficult issues.

- The Russian Summa Group, which is building an oil terminal in the Port of Rotterdam, encountered difficulties in the implementation of this project, due to the sanctions. Is there any likelihood that this terminal will still be built?

- The Summa Group is implementing a project involving the construction of a new terminal in the port of Rotterdam, which will be used to trade oil and petroleum products.

Investments into this project were forecasted at one billion euros, of which 800 million would come from the company Shtandart TT B.V. (100% owned by the Summa Group – ed. note), and 200 million euros would be supplied by the Port Authority of Rotterdam.

It was assumed that the terminal construction would start in mid-2014, but for various reasons these deadlines were postponed. For example, there were difficulties with obtaining permits for the start of work and getting approvals from the fire inspection service. Then the public hearings took a lot longer than was planned. In addition, they discovered ammunition from the Second World War at the future construction site, and it took time to clarify that – if this could affect the construction work. Thus, the timing for the start of construction was shifted to 2015.

Despite the difficult period in relations between Russia and the European Union, this project has a lot of support both in Rotterdam and in the Netherlands as a whole. The Dutch are very interested in the emergence of a major new oil hub, including supplies from Russia, since this project will increase the cargo turnover of the port. There were statements made by several members of the city council that this project should be cancelled, but they did not find support. We, in turn, are working very hard with the Summa Group, and are ready, if necessary, to assist it in this project.

- Now, many companies, such as the VEB and VTB, are trying to challenge the sanctions in the courts of Europe. What do you think are the chances, from the legal point of view, of winning these lawsuits?

- If we approach this with an open mind, the chances are high, but we should also understand that this is a politicized process. And so, let us call a spade a spade: the crisis that has now emerged in relations between Russia and the EU, has shown that European leaders, unfortunately, are ready to make political decisions that are detrimental to their national businesses. The sanctions against VEB and VTB clearly confirm this.

- We talked about Dutch companies, and how much do Russian businesses, excluding the fuel and energy complex, want to export their products to Holland, and will there be a demand for them?

- As an example, I will name the non-profit partnership Russoft, uniting software development companies in Russia, which last year opened an office in The Hague. A number of Russian IT-companies are now actively working with Dutch customers. Many of the products developed by Russian programmers for Dutch enterprises have also found demand in other European companies.

The Dutch government has decided to increase the share of “green energy” usage to 14% by 2020, and that is why the deliveries of Russian pellets and other biomass materials are increasing.

The Dutch are also interested in cooperation in the field of environmentally friendly products and supplies of agricultural raw materials from Russia. Despite the decline in total turnover, exports of food and agricultural raw materials, from Russia to the Netherlands, increased by 45% in the first half of this year. This is true, but for now, this is only a small amount – $265 million. Therefore, the possibilities do exist, and Russian entrepreneurs are looking for ways to promote their products.

- Under the sanctions, the EU has banned the export to Russia of equipment used in the oil and gas sector. Has this part of the sanctions affected any Dutch companies?

- To cite a recent example, our trade mission was approached for assistance by the company HLP Group, which manufactures pumps for oil and gas pipelines – 95% of this company’s business involves exports to Russia. This company’s products are not prohibited for export and they do not fall under the category of “dual-use”.

HLP Group signed a contract in March 2014 with a Russian company based in the Primorsky Krai. This contract is worth about 200,000 euros. The equipment was manufactured ​​within the period stipulated in the contract, and should have been delivered to Vladivostok in mid-November.

However, the Dutch customs authorities required a special export license to ship this equipment out of the country. To issue such a license required a wait of up to eight weeks – which actually meant the failure to fulfill obligations under the contract.

At the same time, in the energy sphere there are also sectors in which mutually beneficial Russian-Dutch cooperation continues. In particular, I am talking here about the technologies for the production of fuel systems by Dutch companies for using natural gas as a motor fuel in Russia.

- Are Dutch companies prepared to implement projects in Crimea?

- Many Dutch companies, operating in the Crimea when it was still a part of Ukraine, would like to continue their business operations on the peninsula. A number of Dutch companies would like to participate in the implementation of infrastructure projects in Crimea.

In November of this year, a Dutch business delegation met with the Russian Minister of Crimean Affairs Oleg Saveliev, regional authorities, enterprises and organizations working in Crimea. Following the meeting, agreements were reached on the participation of Dutch companies in projects involving the construction of roads, water treatment and waste treatment plants, as well as the reconstruction of health resorts on the peninsula.

The main difficulty now lies in the fact that in Crimea and Sevastopol they have not yet solved many systemic issues, for example, there is no general scheme of water supply, and a number of other issues need to be resolved.

Along with this, Dutch companies are ready to participate in projects in the agricultural, medicine and health spheres, as well as in the creation of industrial parks in Sevastopol and Yevpatoria.

- Are Dutch companies interested in participating in the tender for the construction of the Kerch Bridge?

- This is a much-politicized question, but I can say that some Dutch companies are exploring the possibility of their participation in this project. For now, I will not tell you the names of these companies.

- A few years ago, there was talk about the possibility the world famous Dutch flower auction – the Flora Holland – coming to Russia. Have there been any developments on this theme?

- This year, our partnership with the Flora Holland flower auction became more active. In many ways, this was made possible by the arrival of a new team of specialists that now manage the auction – who have realized the value, and most importantly, the prospects offered by the Russian consumer market for the Dutch flower business.

The annual turnover of this auction, the largest commodity auction in the world – Flora Holland, is 5.5 billion euros, and exports to Russia account for 350 million euros of this sum. Unfortunately, most of Russia’s imports from the Netherlands are cut flowers – only about 15 traditional varieties.

Serving as another incentive, to some extent, were the Russian retaliatory measures against EU sanctions, which resulted in an increase of exports of other Dutch products, not covered by the ban.

In this regard, the leaders of the auction have proposed developing cooperation in several areas. Among these being the logistics systems for flowers delivery, growing in Russia of frost-resistant varieties, cooperation among research centers and laboratories in the selection of seeds, cultivation of flowers, seedlings and ornamental trees/shrubs, and finally the construction of “turnkey” greenhouses with Dutch specialists providing scientific support for the processes.

As for the coming of the Flora Holland to Russia, with the level of current technologies, the physical presence in Russia of a branch of the auction is not so urgent. We have already started negotiations on organizing the participation of Russian companies in this auction in the online mode. The leadership of Flora Holland plans to present this project in the coming months, with a view of launching it in late 2015 - early 2016.