English documents https://ngo-broc.com ru BIKIN INTACT TAIGA: 30 YEARS OF CONSERVATION BATTLE https://ngo-broc.com/tpost/6y1ft8te51-bikin-intact-taiga-30-years-of-conservat https://ngo-broc.com/tpost/6y1ft8te51-bikin-intact-taiga-30-years-of-conservat?amp=true Thu, 10 Dec 2020 04:11:00 +0300 Лебедев А.В. Articles Russian environmental movement, currently presenting hundreds of green and indigenous groups from Pacific coast through Baltic and Black sea, was actually born 30 years ago...

BIKIN INTACT TAIGA: 30 YEARS OF CONSERVATION BATTLE


Russian environmental movement, currently presenting hundreds of green and indigenous groups from Pacific coast through Baltic and Black sea, was actually born 30 years ago as the first direct contacts with global environmental activism, strong and ripen by the end of 1980-s. In Russia the process of self-identification of movement as civil society, started with 2 basically separate hearths – European and Far Eastern. Geographically, they were based upon rapidly growing contacts with European NGOs in European Russia, and with neighboring ones in USA at Pacific Russia. Although first national NGO, Socio-ecological Union, was established in Moscow by sponsorship of Washington based NGO around 1989, some equal and independent activities occurred at the Far East even earlier with support and advocacy of NGOs in California state, often more active on the global context.
Our NGO BROC was born then as informal grassroot group of support Greenpeace. Representatives of this famous NGO from UK and USA came to the only open port of Nakhodka to take part in Soviet Pacific political Civil Forum in 1989, together with human rights activists from Latin Americas and Asia-Pacific countries. Our meeting there with Greenpeace colleagues and their yacht “Vega”, arrested in Nakhodka, became start of the whole green movement for Russian Far East. By that just year, I was democratically elected to the regional legislature and led it’s environmental Commission, so that was my official duty to deal with Greenpeace colleagues and pump in all their great experience in global conservation efforts and problems. 

That’s significant, that at the first sessions of our regional Parliament I’ve met municipal deputy from Bikin area, young teacher Pavel Sulyandziga. Since that beginning of our careers in new Russia, thanks to our foreign colleagues, we deeply understood the importance of cynergetic collaboration between global conservation concerns and local, community based and indigenous interests and their resilience. A bit later, when famous environmental activists John Seed and Patrick Anderson came to Vladivostok and Bikin area, they formulated the point very clear, which I remember forever. If you come to any area with your great global conservation ideas, just look around first, find local community leaders and ask them – what their cultural, subsistence and resilience priorities are, and what kind of support they need from you, if any. That approach, very obvious and simple by the first glance, as I can estimate now, 30 years later, is really hard to achieve in practice. And the whole history of Bikin battle for conservation and indigenous rights, which I thus decided to write and publish, demonstrates that perfectly. 

The key point of this history is the number of different group interests, crossed in Bikin taiga – last big pristine temperate forest in Pacific Russia, home for Siberian tiger and indigenous udege community. They are interests of unique ecosystem itself, with a set of rare species of flora and fauna, udege community, dependent on local rich wildlife and fishing, timber business, numerous sport and trophy hunting and fishing community of the whole Far East, and interests of municipal, regional and national administrations, having their own plans of economic development on Bikin, often hardly contradicting to the interests of listed groups. 

For us with Pavel Sulyandziga it was a first goal to use incredible interest of global environmental movement to this territory, after political opening of Vladivostok and Primorye for any foreigners in 1991. We immediately started working on any special legal regime for Bikin, granting protection from at least mass commercial logging and poaching there with simultaneous guarantee of resilience for udege community, deeply dependent on wildlife use and fishing. Legally middle part of watershed was protected from logging as pine nut protected zone since 1970-s, so the core trouble we felt regarding the least accessible, wild upper part, about 700 000 ha, remained highly attractive for timber companies and regional officials. We created working group to draft that special regime of resource use limitations, but succeeded to adopt it by our legislature in 1993 only, after famous and unforgettable battle between Korean logging giant Hyunday and Greenpeace action with sail ship “Rainbow Warrior”. 

The point was that our first regional governor, foreign affairs politician, succeeded to attract Hyunday to enter upper Bikin with logging joint venture, created by local timber companies, run rapid privatization in 1990 under total governmental strategy. New JV was established in other municipality, neighbor to Bikin, at the sea coast just when our working group started to draft protection regime for the territory. So, hard conflict was unavoidable, and our small group of activists succeeded to attract Greenpeace high level action in 1992. That was possible, despite the absence of Internet and computers in Russia, thanks to great foreign support and opportunity to combine forest concerned and indigenous interests with our visit to the site of nuclear submarine disaster, occurred in 1985 (1 year before Chernobyl) not far from Vladivostok and kept deeply secret from public.                      
  
Since that Greenpeace action public and political attention to udege and Bikin’s destiny turn sustainable at all levels. Hyundai created it’s logging JV, but our efforts, combined with udege block-post at the watershed and protest near Primorye administration created enough problems to loggers. In 5 years JV failed to bankruptcy and gone. And our first model of balance environmental, indigenous and logging interests at the area became a positive model of distribution over the other Russian regions. That was possible in the short period of new democratic Russia, when all regions received real governance and resource use rights from Moscow. And we all were full of hopes to protect and balance environment and human rights of remote intact forests.

Anti-democratic Coup of 1993, when most democratic Soviets were dissolved, opening the door to power for new oligarchs, turned the process back to total centralization of all power and resource management. During some time we, together with indigenous and green leaders, tried to develop our movement, relying on available and highly helpful funding from our colleagues in USA. Thanks to that, strong and brave system of regional environmental NGOs and indigenous Associations over the whole RFE. Bikin
town Krasny Yar became a center of attraction for many scientists and activists from all over the world. They brought lot of new global initiatives, including idea to bring World Heritage status to Bikin valley, as it was already adopted for Baikal lake. We all began to travel globally to learn conservation and human rights experience. But, we were too and dangerously ignorant to the process in Russian power and economics, which rapidly run to gangsters’ style of oligarchy in governance and resource use. 

We until 2000 succeeded to adopt good set of legislation, target to protect environment, human and indigenous rights, but did not pay enough attention, that those laws and rules remain on paper only and in our hearts. Wherever new resource business raised it’s head in our totally resource RFE economy, any environmental and humanitarian limitations meant nothing and were ignored. New Russian power, reasonably trying to take country off the economic chaos of 1990-s, started to reduce and cut that limitations in favor of businesses, creating thus unique soil for top level corruption and junction between power and business.

Our history tells that story in mane details, describing legal and civil efforts and fails around Bikin territory, local, regional and national conflicts between different groups of interests. They sometimes used to collaborate, sometimes contradict or act in parallel, leading to obviously zero result, unfortunately.

]]> Brief review On RFE-Siberian BRI and forestry initiatives – 2019 https://ngo-broc.com/tpost/ukz2rm5ro1-brief-review-on-rfe-siberian-bri-and-for https://ngo-broc.com/tpost/ukz2rm5ro1-brief-review-on-rfe-siberian-bri-and-for?amp=true Thu, 10 Dec 2020 04:12:00 +0300 Лебедев А.В. Articles Last several years of the Russian Far East (RFE) and Siberian reality had been focused upon increasing ignorance of regional interests and indigenous peoples subsistence from federal empire,with concentration of all national-regional...

Brief review On RFE-Siberian BRI and forestry initiatives – 2019

Last several years of the Russian Far East (RFE) and Siberian reality had been focused upon increasing ignorance of  regional interests and indigenous peoples subsistence from federal empire,with concentration of  all national-regional governance on the need of Chinese-BRI investments into broad destruction of the last intact environment in favor of feeding Chinese industry with natural resources, remaining still pretty rich. Brief analysis of priority investment projects over RFE Federal district, enriched recently with Zabaikalsky Krai and Buryat Republic, legally promoted under models of Territories of Advanced Development (TAD) and Vladivostok Free Port (VFP) demonstrates continued invasion of Chinese BRI investments into big scale forestry, coal andgold mine enterprises over the region. Culturally and traditionally, that high scale investment model, focused by the government and president, target to destroy traditional family and community resilience and household on the region, controlled and supported by the women. Privilege for officially licensed businesses on fisheries and destructive logging enforces local males to become gold miners and loggers by the slavery mode with low salary, and leave the only choice for women to run traditional hunting and fishing at the last rivers and intact forests, left still alive.

Broad scope of projects under TAD and VFP demonstrates quite positive involvement of city based women into adopted investment projects under BRI, including businesses on hotels, tourism, food and agro-processing services. But, main profits from them still remain concentrated on the municipal level of middle and big cities, keeping rural communities and families out of general profits from those projects. While males in small settlements keep dying as victims of industrial disasters on the gold mines, floods and forest fiкes, and keep working hard together with CIS migrants on the logging sites, their women try to maintain their kids and great traditional Siberian culture of environmental harmony, keeping still great intact forests alive as their core livelihoods.

If to extract resource based projects with Chinese investment from hundreds of them in the lists of TAD and VFP,which is covering main part of the Asian Russia, we can find not many forest concerned projects. The reason is clear, as itis turned obvious from the recent federal investigation in Irkutsk Oblast: biggest logging activities in Siberia are based upon “grey” schemes of legal logging leases, labelled as “sanitary” or other “maintenance” operations. They used to be highly popular at the southern Far East about 20 years ago, and now successfully moved to Siberia. Underlying cause of that shift and sustainability are identified by WWF-Amur and other NGOs, including GFC (Global Forest Coalition) members. We succeeded to use satellite control data to activate governmental agencies for control legality of forest use, and found lot of violations, paid over by Chinese consumers of Siberian raw logs from intact forests, leased for “sanitary” or “maintenance” operations. That operations left Siberian families and women without their only source of subsistence. Siberian actors of logging successfully used  former experience of their colleagues from the RFE and found new models of violations. Result of Chinese “green BRI” strategy, target to move environmentally destructive logging and mining  practices to the intact forests of Siberia, turned disastrous for rural culture and ecosystems in Asian Russia – millions ha of burnt intact forests and rivers, died by corrupt gold mining.

We can give bunch of examples of that from Khabarovsk too. It became already “mauvais tone’ to remind super scandalous pulp mill project of 100 % Chinese company “Polaris” in Amazar of Zabaikalye Krai, launched and invested by China more than 17 years ago, and turned absolutely absurd by the lack of forest resources and underlying hidden goals of Chinese partners to create a new bridge over Amur to get raw logs to China. Despite hard efforts of Siberian environmental community to stop this project, it was adopted by the federal government as “priority national one” (but it lost such status in April 2019), relying on created processing infrastructure, Chinese companies continue to try use it for some new fantastic purposes. The same fake story, occurred with Amursky pulp mill at the low Amur river city Amursk in Khabarovski krai. After signing promising agreement with regional governor by the end of 2018, Chinese investors simply had gone, leaving territory with a set of questions on the awaited investments and local taxes. 

Hundreds of small and big logging and mining businesses keep operating over the vast region on the traditional lands of indigenous families, supplying timber, gold and coal to Chinese “green BRI” consumers and leaving local communities without real rights to survive. And none court or prosecutor is able so protect that constitutional right. Recent disaster on the river gold mine illegal dam in Krasnoyarsk region with real victims demonstrated all the cynical level of ignorance to the human rights and environment from national and regional officials, interested in getting profit only by any cost, including human lives. Under pressure of “Entire Russia” party they keep resource concerned legislation targeted not upon territorial and social development, but upon extracting extreme profit from Siberia in favor of Russian national and Chinese oligarchs, hidden behind fake motto of “Green Silk Road” or Green BRI. So, our key problem, during last 20 years, remain the same – to change governance and legislation in favor of local community and municipalities, versus timber and mining oligarchs, in favor of local families and their resource rent, granted by the Russian Constitution.      

]]> BROC – 2012 REVIEW https://ngo-broc.com/tpost/1gty554xk1-broc-2012-review https://ngo-broc.com/tpost/1gty554xk1-broc-2012-review?amp=true Thu, 10 Dec 2020 04:13:00 +0300 Лебедев А.В. Articles NGO BROC under the leadership of Anatoly Lebedev was registered as legal entity in the early 1997, but was acting as journalistic and experts' network since early 1990-th.

BROC – 2012 REVIEW


NGO BROC under the leadership of Anatoly Lebedev was registered as legal entity in the early 1997, but was acting as journalistic and experts' network since early 1990-th. We then organized (1992) globally famous Greenpeace action against Russian - Hyunday JV "Svetlaya", illegally tried to enter with destructive commercial logging to the remote intact temperate forests and indigenous people land on the  Sikhote-Alin watershed, later adopted by UNESCO as World Heritage Site "Central Sikhote-Alin". Since 1995 BROC during 9 years produced special regular biweekly TV show "Preserved" ("Zapovedano") on the governmental channel of Primorye Region, which constantly presented analysis, review, interviews and stories on the destiny of the forest communities under destroying governance of Russia, on environmental and community problems, suggested alternatives, choices and experiences from another regions of Russian and Globe. 

Although this forest concern was not the only issue for our TV show, it was always our priority in accordance to the basic grantmakers strategy and interests. Since 1995 we were involved as grantee and sub-grantee into the forest concerned projects of IUCN, World Bank, USAID, private funds WAJ, McArthur Foundation, TMU, IKEA, Eurasia, Hewlett Foundation, Ford Foundation, NGOs Forest Trends, Forests Monitor (UK), Global Forest Coalition, DFID (UK), ITTO, CIFOR etc. We also used to closely collaborated with US Yale and Vermont Universities on the issue of sustainable forestry.

We conducted all the logistics and ideology of famous Greenpeace action in 2000 against illegal timber from Russian Far East, when "Rainbow Warrior" attacked Russian timber ship "Biisk" in Toyamashinka, Japan, carrying justified illegal timber from Primorye, and then submitted official statement on the issue to G-8 at Okinawa, Japan. Since that the problem of illegal timber from Russian Far east to Japan and China began officially recognized in Russia, Japan and China, and many governmental and inter-governmental initiatives started, as FLEG etc. 

Since 1996 BROC, in collaboration with Pacific Environment (USA), Friends of the Earth - Japan, national and local Russian NGOs, conducts regular analysis of forestry practices and illegal logging at the Russian Far East and timber market dynamics of the East Asia with specific focus on the forest community benefits and livelihoods. We had published a set of analytic reports via websites of our partners PE, FOE-J, Forests Monitor, Forest Trends and Taiga Rescue Network, produced a series of video documentary - ourselves and in  collaboration with UK University of Wolverhampton. A bunch of analysis was produced to evaluate environmental and social impacts of the new Forest Code in Russia. 

In the close collaboration with Amur Branch of WWF-Russia and timber company in Primorye "Terneylesstroy" BROC succeeded to involve a set of timber companies of the South Far East to FSC certification, created a group of environmentally and socially responsible companies. All the positive experiences in the forest management and community involvement had been broadly distributed over the Far East and Siberia since 2001 via our quarterly magazine "Ecology and Business". It is distributed by the own efforts of BROC over all the resource concerned officials, universities, key mass media, supervising and monitoring agencies, some municipal administrations and key resource users, Russian and regional NGOs and libraries.

As a result of our activities inside forest communities we challenged a high interest to the efforts to find balance between biodiversity conservation, environmental, social and economic sustainability on the community level, which is completely ignorant on the state power level. 

And the most efficient and unique result of our activities during 15 or more years in the high conservation value forests of the South Far East we consider rehabilitation of community members, determined officially as illegal loggers. We discovered, that the real and dangerous destruction to the forest and forest communities in Russia comes from the criminal state itself, which ignore Constitution, Budget and any other laws and regulations in the run for profit. And, if any company pays officially designated obligatory payments to the budget, it only helps to strengthen corruption at the upper level in Moscow and lower in the regions. To the other side, if people go by the illegal mode of forest use and timber trade, they succeed to keep much more forest profits on the territory via bribes. 

Criminality of Russian governance - not in the forest only - is many times confirmed by the lot of media. And one simple system of "otkat" - private payment to official for the right to get legal right for the resource use - use to equal 60 % of the whole obligatory payment. In such conditions and strategy, target to murder small local business totally, local bribery is the only chance to keep forest communities live and thus save the forests from unlimited legal destruction in favor of national oligarkhy. 

It is very important to understand, that in such our approach we meet almost full support and understanding amongst local illegal loggers, which are ready to accept most of environmental limitations and to accuse corrupted state officials, seeking for bribes and happy to put into jail anyone, who is not paying it. Some the most progressive illegal loggers succeeded with our media support to develop local infrastructure for the villages, which was ignored by officials constantly.

We also succeeded to turn the mind of some key forest inspectors to differ real forest thieves, supported by the criminal corrupted officials, and poor community members, enforced by the wrong legislation to get some illegal timber for their family survival and poverty reduction. And we finally broadly distributed our understanding of that by our own magazine "Ecology and Business" and mass media contacts. 

Additionally to all that, BROC during about 20 years present comprehensive vision and necessary contacts for the foreign journalists, interested in the forest use and community problems. In 2010 only we already conducted journalistic rides for French, Spanish and Japanese colleagues, interested in Chinese invasion into our forestry complex and it's social and environmental impact. Formerly we used to help our colleagues from USA, China, Japan, CNN, France, Germany, UK, Italy, Finland, Sweden etc. This all gives a lot to the better global understanding of the whole processes in our forest communities and forest governance.      

]]> Forest management rights review - 2012 https://ngo-broc.com/tpost/soxf5dvxr1-forest-management-rights-review-2012 https://ngo-broc.com/tpost/soxf5dvxr1-forest-management-rights-review-2012?amp=true Thu, 10 Dec 2020 04:19:00 +0300 Лебедев А.В. Articles Does the FME have evidence of tenure rights? Are there any disputes by stakeholders regarding how land tenure was obtained? Is there a due process underway or completed to resolving the dispute?

Forest management rights review - 2012


Does the FME have evidence of tenure rights? Are there any disputes by stakeholders regarding how land tenure was obtained? Is there a due process underway or completed to resolving the dispute?

Any FME get  forest land lease by the bidding (auction) procedure, designated by the Forest Code and described in details by appropriate regulations. Forest service prepare forest plots for lease and announce auction by official publication on it’s website and in mass media usually a month before. Announcement is based upon key legal document of certain forest division – lesnichestvo and it’s reglament, which includes detailed maps, comprehensive description of forests in it’s borders, their quality, species, status, restrictions and permitted forms of use. Companies submit their applications with required documents and paid advance fee, and come to auction to compete by money. Initial price of the plot is usually stated by the forest service, using basic governmental costs, methodology and forest inventory data. If FME lose, advance is returning back, if win – they pay the difference, appeared as a result of bidding. The key cause for any dispute usually is now that this bidding model is the only way to get both forest lease for long term or right to get short term contract for maintenance (intermediate) logging, although former Code provided also another model – contest with social and municipal priorities. Currently, the stronger competition is, the more company pay for lease, and the less is able to spend for local social needs, which is actually voluntary.      

Does the FME have valid permits for harvesting, road infrastructure, maps of its operating boundaries etc? Are they abiding by the regulations and their approved harvesting plans? 

As soon as FME win auction, it signs the contract with forest service, usually for 49 years, which is a subject for state registration in special governmental service. On the base of this contract and existing inventory data company sign another contract with specialized project agency, which  prepares legally required project of resource use on the lease for 10 years. It is a big basic document with maps, prescribing strategy of moving logging activities over the area, infrastructure (storages, roads, temporary camps, equipment, processing facilities, species to be logged, timetable etc.). This project then should be the subject for environmental expertise and adopted by regional government. Then FME create annual Declaration, which becomes a key permit for logging operations with specific volume of timber, designated species and parts of lease, technology, seasonal and infrastructural details. Unfortunately, declaration is not public document, and is not the permit itself, which may be checked and inspected by any special law enforcement agency or by public any time. FME simply report to forest service division each quarter about implementation of operations, designated by Declaration, and that’s it. None can check how realistic that reports are: inspection may come to check logging site only by any signal about violation.     

Are there any reports of illegal logging or conversion inside the concession?

There is a set of reporting tables and forms for annual report on Declaration, which FME submit to the forest service. They include all the cases of registered cases of illegal logging on the leased area. No conversion of forest land status is possible on the lease until it is cancelled by the court or arbitration, since the lease is strongly protected by the status of state registered contract. If there was illegal logging occurred in the lease, it is not possible practically to reduce annual allowable cut volume, since it should require revision of the whole project, which is too serious and costly work. NGOs try to insert this requirement into basic legislation – to revise AAC in accordance to the loss of timber on the lease, occurred by illegal operations or fires, but not succeed. That bring even more lie and unreality into any reporting and give FME opportunities to log more than it is possible and available really on the lease – outside their lease, getting dozen of shady income for bribes and own commercial flexibility.

Is there any evidence of tree species being harvested that are CITES species and should be protected? 

It is constantly happening everywhere by different hidden models, that restricted CITES Korean pine use to be logged and sold. Loggers know that any inspection is extremely weak, rare (once in 3 year official inspection of any company is prescribed by Forest Code), low financed and thus corrupt. They know also that it is very easy to get Korean pine in the process of official logging on their lease, and sell it immediately to any Chinese sawmill, which exist in almost every forest town of the South Far East, or timber yard, where it may easy be loaded to the train for China with documents of larch or spruce. After sawmill Korean pine turns as regular boards, whish species does not of any interest for anyone more. Customs officers are either not enough educated to fix all species, or also corrupt and may be bought by some hundreds bucks. Actually, restricted Korean pine might be checked and stopped by police on the road between logging site and timber yard or sawmill, if there is any honest and sustainable checkpoint or patrol of police. But, in the forest area police is the most corrupt system, often involved into organizing illegal logging itself, so there is no hope on police at all. Even if any truck with Korean pine is stopped, owner may easy explain that it was some trees only, which had to be logged unavoidably in the process of creation local trailing path, road or on-site timber storage. If not, and eventually court case is occurred on the ground of appeared document of legal violation, they may pay penalty easy, which will be compensated immediately by the sales of another illegal consignments.   ]]> ILLEGAL LOGGING, CHINESE LUMBER AND EU TIMBER MARKET https://ngo-broc.com/tpost/mkc04ryjs1-illegal-logging-chinese-lumber-and-eu-ti https://ngo-broc.com/tpost/mkc04ryjs1-illegal-logging-chinese-lumber-and-eu-ti?amp=true Thu, 10 Dec 2020 04:22:00 +0300 Лебедев А.В. Articles China, remaining during last 10 years the first consumer of Russian round wood from Far East and Siberia, simultaneously is the key global supplier of hardwood flooring and furniture, produced from illegal...

ILLEGAL LOGGING, CHINESE LUMBER AND EU TIMBER MARKET

China, remaining during last 10 years the first consumer of Russian round wood from Far East and Siberia, simultaneously is the key global supplier of hardwood flooring and furniture, produced from illegal and suspicious oak and ash from the last intact temperate forests at the south Far East Russia, habitat of famous endangered Siberian tiger. During decades local and international environmental NGOs investigate practices of illegal logging at the region and Russian-Chinese chains of custody, delivering high value timber products to EU markets. By Amur branch of WWF, export volume of oak and ash from region to China overcome permitted logging volume by 6-8 times constantly during last years, and no governmental measures to stop this broadly known crime got success.  

By Chatam House evaluation, the percentage of imported timber from illegal sources is 20% for China, and this figure is considered to be conservative estimates. To the other hand, Chinese manufacturers exported totally $ 20 billion worth of hardwood products and flooring in 2012, and EU got, by estimate of EIA (Environmental Investigation Agency) 17 %of this huge market volume. Including significant quantity of stolen wood from Russian Far East. 

Since March 2013 EU Regulation # 995/2010 on timber import to EU markets got valid and obliged European importers of timber products to conduct special measures to get a documented proof of legal origin for any consignment. This requirement may be not very hard to follow for short chains of custody, which brings timber products to Europe directly from logging company or from processing facility, located in the same region and country of logging operation. But, for China, being the main consumer and processor of Russian timber, it is far not the case by several reasons. 

First is high level of legal ignorance and low level of logging control in Russia itself. Second – high level of trans-boundary corruption in Russian-Chinese timbertrade, which was perfectly analyzed and highlighted in RFE investigative research of EIA, published in 2013. Third is incredible attention in China to their own forests, being broadly restored and protected, while the need of country in timber products is easy satisfied by Russian intact forests. Fourth reason is well known Chinese initiative OBOR (One Belt, One Road), currently inserted into mentality of governments and businesses of all giant Eurasia. OBOR means development and increasing of all Chinese business and trade activities, including consuming Russian forests and sales of final wood products to EU. And finally, China remains for Russia and EU deeply unknown culture, highly patriotic and devoted to their mainland and ignorant to the problems of others. So, they don’t care of legality in the countries of their suppliers and their buyers – they simply care of their economic success only.

That means that there is the only efficient way to make Europeans sure that they act as civilized market subjects while purchase flooring and furniture from China. We plan to conduct serious public scrutiny and research of logging operations and timber market from Russian side with a goal to identify suspicious lumber facility in China, and then to follow it’s product until exporter to EU. Simultaneously our partners in EU have to conduct scrutiny of final wholesalers and retailers in EU and bring them our data about illegal Russian timber, used in certain Chinese products, beong sold in Europe. As a result, EU lawyers may raise lawsuits against that wholesalers, if they continue to deal with their suspicious Chinese suppliers and thus violate EU Regulation # 995. 

This will be a hard work for NGOs, but it already brought result once in USA after EIA project, relied on USA Lacey Act on timber products legality, similar to EU Regulation # 995. And we in EU-Russia Civil Forum can now develop this practice in Eurasia.Itwill help Russian forest communities protect their intact forests as the only source of their livelihood from barbarian destruction and assure Europeans that their consumption practice does not hurt any communities and environment in remote Russian territories. This project is practically concerned to the interests of several working groups of EU-Russia CF – on Legal dialogue, Combat transborder corruption and Environment. 

Content of this project includes investigation, customs data collection and exchange between, from one side, activists of NGO BROC at the Far East, FSF in Siberia, monitoring illegal timber flows to Chinese companies, and analysis of further lumber trade chains inside China until export points like Dalyan or possibly new train based export flows in framework of OBOR initiative from China to EU. From the European side, it includes activity to analyse sources of flooring and furniture from Chinese suppliers, also mainly by customs data with a target to discover coinciding suspicious company names between data from RFE-China and EU-China. Since such coincidence got found, EU based activists get a proof and reason to start pressing buyer by media campaign or by lawsuit using EU Regulation # 995.

NGO BROC, having 20 years experience in management of international projects with EU, Japanese and USA based partners, is ready to submit proposal and be a core grant managerin this project, in collaboration and partnership with FSF, ClientEarth, Terra-1530 and any other member European NGO in EU-Russia Civil Forum, interested to be involved into such significant Eurasian activity. 

We plan to start working as soon as possible, applying for about 30000 – 40000 Euro for one year activity in framework of current grant program. We are sure we can bring unique and impressing results to the next meeting of EU-Russia CF in 2019 and thus get a chance to continue further.

Waiting for additional EU partners from WG on Corruption and Legal Dialogue before May 25.
--
Initiative message to EU-Russia grant partners from NGO BROC
Vladivostok
swan0741@gmail.com
]]> LEGAL AND CIVIC RESPONSIBILITY FOR HIGH CONSERVATION VALUE FOREST RESTORATION ON THE RUSSIAN FAR EAST AFTER NEW FOREST REFORM https://ngo-broc.com/tpost/be65kcgcs1-legal-and-civic-responsibility-for-high https://ngo-broc.com/tpost/be65kcgcs1-legal-and-civic-responsibility-for-high?amp=true Thu, 10 Dec 2020 04:24:00 +0300 Лебедев А.В. Articles Russian Far East includes boreal \ coniferous (on the north – 195 mln ha or 70 % of forest cover) and temperate \ mixed (on the south) forest zones. Amongst coniferous 60 % are larch forests...

LEGAL AND CIVIC RESPONSIBILITY FOR HIGH CONSERVATION VALUE FOREST RESTORATION ON THE RUSSIAN FAR EAST AFTER NEW FOREST REFORM

INTRODUCTION
Russian Far East includes boreal \ coniferous (on the north – 195 mln ha or 70 % of forest cover) and temperate \ mixed (on the south) forest zones. Amongst coniferous 60 % are larch forests, 7,8 % - birch and 5.4 % - fir-spruce forests. Most valuable complex temperate ecosystem with dominating Korean pine and up to 20 other species is located at the most south, Primorye and part of Khabarovski region. It occupies 1.2 % of the whole RFE forest cover and presents the highest capacity of the natural restoration – 1.5 cu m per ha. These cedar-broadleaf forests are rich with Korean pine, fir, spruce, different birches, linden, oak, ash, poplar, aspen, elm, maples, Manchurian endemic species like nut tree, velvet tree, set of wines etc. To the other hand, about 3/4 of the whole RFE forests grow on the permafrost lands with very low capacity for both natural restoration (about 0.5 cu m per ha) and silviculture. Therefore silviculture here, as more expensive practice, is generally much less popular than activities to maintain natural restoration (enlightening, rejuvenation, passage, salvage logging, fire and pests protection etc.). To compare, in Primorye silviculture was conducted on 4300 ha in 2003 whilst natural restoration maintained on 63000 ha; accordingly, in Khabarovsk region it was 9200 and 181000 hectars. 

But, during last 20 years activities to maintain natural restoration changed initial target from improvement forest quality to making more money for poorly financed foresters. And it was not primitive commercialization of the forest maintenance – motivation to prefer maintenance of natural restoration as the key model versus active silviculture was scientifically reasonable. It was based upon specifics of regional ecosystems, their capacity of natural restoration on the south, problems with catastrophic fires and permafrost on the north. But practically, maintenance of natural restoration as a way to get commercial timber turned to large scale destructive logging, legalized with this tricky game of “restoration” logo. In the maritime monsoon type of climate with regular catastrophic floods and typhoons in summer it creates a huge problem for both forest environment, local economy and traditionally sustainable lifestyle in the forest communities.  

SOCIO-ECONOMIC BACKGROUND 

Sikhote-Alin mountains, administratively including part of Primorye and south of Khabarovsk region, is the most populated and economically developed area of the whole Far East, having some settlements of concentrated inhabitance of indigenous people udege and nanai. Since 1991 when total economic failure of Soviet economy started, population only on Primorye reduced from 2.4 million officially to less than 2 million. With failure of the group of huge shipyards, machine-constructing, fish processing, agricultural factories and lumber plants as well as highly developed system of harvesting and marketing of non timber forest products, army of unemployed members of forest dependent communities began logging in favor of army of Chinese timber entrepreneurs. They moved to Russia in framework of Chinese state strategy of economic occupation of south RFE, and helped forest communities to survive by presenting the only market for local timber. It has happened on the background of total ignorance in Russian government to the destiny of RFE. To the other hand, Asian guests fed their Chinese North-East with a flood of cheep timber, initiated unprecedented timber processing and economic boom there. Significant, that since 2000 when labour import from China had been organized and controlled by governmental quotas by the special appeals, many Chinese workers, who came for agricultural activity on the empty fields of Primorye, were found on primitive sawmills in remote forest towns very soon

Since 2009 when Russian government blocked raw logs export by high taxes simultaneously with the same blockade of the other self-developed business of the RFE – second hand Japanese cars trade and service – size of unemployment in the region increased further and began politically dangerous. Not many timber businesses succeeded to develop processing, and even for them global market of timber products became closed by the global sales crisis. Thus the major traditional incentives to develop logging, timber trade and lumber activities met a set of problems. Despite that deep reform of the forest sector reduced volume of operations and production, companies continue trying to get forests leased for the complex use including NTFP, which was forgotten during last 15 years. But, with regards to the total market crisis and continued growing of “maintenance” logging it seems highly problematic to wait for any serious activities target on reforestation or even real maintenance of natural restoration of forests. There is also a deep crisis of forest inspection, control, fire monitoring and prevention, which makes any talks on restoration senseless for quite long time.

MODELS AND RESPONSIBILITIES

Currently there are two main responsible players in the process of restoration. On the leased forest area it is company-leaser, which creates a basic project of long term forest use on the area. The project is an object of state expertise and provides all the restoration activities as a strict rule to be inspected regularly. Second player is specialized, usually municipal forest maintenance enterprise, which almost unavoidably win the bidding of getting rights to conduct forest maintenance operations upon non-leased forest areas, including restricted, protected, reserved and other forests. This is the most dangerous model of “maintenance”, which is obviously under very symbolic control and clearly is a target of making profit from restricted, high conservation value forests. Most specialists of these enterprises, created in 2007, came from the local stations of former state forest service. Theoretically they were always legally responsible for protection HCVF, but always, up to now are doing their best to make profit from them by timber sales    

Forest restoration on Sikhote-Alin is based upon traditional scientific knowledge, collected by generations of foresters of Russian Academy and RFE Forestry institutions, and also upon knowledge of practical forest users. Since 2009 all basic operations target forest restoration are determined by regional Forest Plans of Primorye and Khabarovsk regions, as well as forest reglaments – basic inventory and strategic documents  of municipal forest service offices, named lesnichestva. Both documents are adopted by governors and accorded with State Forest Service. But, these documents are huge and too complex for public scrutiny, they were created very fast in 2008 by compilation of different sources and databases, from old and inappropriate forest inventory to some economic dreams. Therefore, there are many contradicting announcements and visions inside them: declaring verbally conservation and sustainable complex use strategy, documents designate intensely increasing logging operations, including so called “maintenance’.

INCENTIVES AND CAPACITY FOR RESTORATION

Now, as soon as leaser became fully responsible for restoration legally, he should select – either to keep company live and survive by ignorance to any efforts on restoration, or to be honest and attentive to the valuable forests as climate regulator and biodiversity storage, but to run bankruptcy and give forest lease up to more barbarian colleagues. Those who have capacity and will to make restoration efficient, have no interest and incentive, besides still quite rare cases when companies plan to run FSC certification to enter new environmentally sensitive markets of EU and USA. Green purchasing policies, being developed under FLEG initiative since 2006 in Japan, EU and now in USA in framework of updated Lacey Act, together with rapid growing of COC (Chain for Custody) certification in the rest of Russia, still is a very exotic case for timber suppliers from RFE – the region with total resource concerned corruption and very low level of stakeholders’ activity. As IUCN based ENPI-FLEG project demonstrated recently, local companies prefer to keep status quo, supplying raw logs or primitive boards to Chinese middlemen and deep processing facilities. Finally, green purchasing policy in the global furniture, pulp and paper trade becomes less significant than low prices for the final wood products from China with foggy and suspicious source of raw timber. Even few FSC certified companies on the RFE, affiliated to bigger regional and international holdings like Dallesprom-EurAs or Terneyles-Sumitomo, can not warrantee and demonstrate clearly honest and environmentally responsible origin of all their timber. And regular capitalistic greed is not the only reason for that: another one is growing level of corruptive payments to all the vertical of power in Russia.          

FOREST PEOPLE AND TRADITIONAL CULTURE
Forest people, which spiritually have incentives for that, have no capacity and opportunity for conservation and protection, since they are hardly enforced to take care of their livelihoods by themselves – they can rely on zero support from any municipal or governmental agency for that. There is also no hope for different communities, separated from each other by hundreds kilometres of dirty roads, to unite and collaborate  – this is a key result in Russia of so called “perestroika”, which was really capitalistic revolution of a gangsters’ type. Former Soviet and Communist leaders, which were anyhow obliged by the Party to take care of territorial social and economic development, since 1990 immediately turned they ideology to self enrichment, and under Putin’s governance to now this new “culture” and lifestyle became totally dominating. This became a perfect ground for corruption in all the models of  community based forest use – either for firewood, for private construction needs or for small business. You may easy get all you need in the forest, from documents and rights to lease and access to reserved area, if you share your profit with appropriate officials. And you are determined as illegal logger immediately if you refuse to share – your illegal timber will be anyhow confiscated in favour of the same officials, and your destiny may be quite doubtful on the border of  court case – jail, or penalty, or full freedom. All is dependent on the price which you pay to determined officials.  

We have one perfect illustration of such paradox kind of local forest economy. One brave local hunter in remote poor village on the middle Sikhote-Alin in 1990-s created good organized professional logging brigade and applied to local forest service office to get forest lease. But they suggested him to share future profits by shady mode to feed governor’s vertical of power. As soon as this guy rudely refused, he lost a chance for legal logging and began to log illegally. And he succeeded to defend his illegal business from local inspectors and militia, demonstrating his investments into infrastructure of his poor village, completely forgotten by municipal officials. He upgraded diesel power station, roads and bridges around, repaired library and school, cleaned up the whole village, opened public shop and bakery there. Inspectors usually understood that he is more right than those who get legal logging permits and get timber profits out of this area, or enrich themselves. Thus he remained legalized illegal logger, demonstrating craziness of regular practice. Now his brigade entered big timber company and is working outside of his village, which is getting back more and more poverty without his support. Primorye and municipal officials located  Chinese sawmill there, which is fed with timber from surrounding forests, where loggers from outside make profits for outside capitalists. The nowadays destiny of this community is sorrow – alcohol, drugs and total unemployment, as everywhere in Russia outside of big cities.   

PRICE FOR SUSTAINABILITY

As we can see, although paradox and crazy, existing corruptive system is extremely sustainable and thus should be considered as the most perfect one in the forest management practice. One may like it or hate, participate or fight, but each player of timber business area clearly understand how strong it is. And a key essence of the system is deeply cultural approach: people in the forest never trust thievish managers. And people always understand that there is enough forest around for any local use, and that officials will always present privilege for that to outside users, including Chinese sawmill workers, which are closer to and more dependent on the upper level officials. That’s why, by my perception, there is absolutely no sense to fight corruption: we should learn from it’s system and try to organize legal management by the same model, simultaneously conducting our educational and enlightening activities amongst criminal management, logging and market community. With this approach we should keep in mind that in corrupted country anything legal means done in favour of  gangsters. And, vice versa, anything illegal MAY and often happens in favour of local community, and MAY be turned in favour of the forest environment. Local people, working for themselves, not for Moscow or Vladivostok based mafia, more often are sensitive to environmental needs as their families’ future, than official loggers, giving most of their profits up to corrupted vertical.             

SOLUTIONS AND EFFORTS

The only opportunity to change this situation at least locally at the South Far East and entire Russia is to make situation broadly known by strengthening local NGOs and communities, supporting their efforts on public monitoring of forest use practices, forest certification and media campaigning on the issue. The key point in this process is getting equal trust amongst forest community members, which are traditionally afraid of being publicly identified as illegal loggers-users-traders and accused anyhow. This is very delicate and  long process, target to insert into public consciousness real understanding that you, journalist of NGO activist, are not their enemy, but first ally, trying to help adapt to complex situation and overcome real enemies and opponents of community and forest, which are located in official agencies, including law enforcement ones. This approach will help slowly overcome very deep traditional slavery and fear in Russian spirit and begin feel more personal responsibility for what person is doing in the forest. This will also help reduce regular hatred of poor community members to official thieves and softly forgive them as weak people, located into hard position without any choice.      

This also becomes hard in contemporary totalitarian Russia, where NGOs meet problems in attracting foreign support and in criticizing destructive state forest policy. So, it is once more a very hot agenda for global environmental community if it needs to keep the rest of vast Siberian forests live and rich of biodiversity. It is significant, that in 1990-th there was quite active and fruitful set of local NGO groups, conducted public control and monitoring of logging activities and presented all the violations to the regional and municipal media. Since then we lost most of them as well as the most municipal papers lost opportunity to publish any critics on local authorities and significant businessmen. We lost “Taiga Ranger” in Komsomolsk, group “Taiga” in Krasnoarmeiski municipality, “Eco-patrol” in Vladivostok, “Noosphere” in Shkotovski municipality, groups of public rangers in Pozharski, Chuguevski, Dalnerechenski municipalities. Their activists are still there, but they have almost zero chance to get financial support from anywhere, and thus are losing hope and incentives to do anything against corruptive system of forestry. So, if we dream to conduct any form of the forest restoration and protection, we first have to think about restoration of our public civic energy and environmental consciousness.         
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Non-government organization BROC, 63 Pologaya street, Vladivostok, 690600 Russia,  
email: swan1@vladivostok.ru, http://ngo-broc.org]]> SIBERIA GOLD, TIMBER AND TOURISM – WHERE IS MORE PROFIT - 2020 https://ngo-broc.com/tpost/k1mtegflc1-siberia-gold-timber-and-tourism-where-is https://ngo-broc.com/tpost/k1mtegflc1-siberia-gold-timber-and-tourism-where-is?amp=true Sat, 03 Oct 2020 04:27:00 +0300 Лебедев А.В. Articles There are very few people in the vast Russia, which are aware that Siberia is a territory of many indigenous forest and tundra tribes, colonized by brave Slavic сossacks 3-4 centuries ago, just in time of American colonization by Europeans.

SIBERIA GOLD, TIMBER AND TOURISM – WHERE IS MORE PROFIT - 2020


There are very few people in the vast Russia, which are aware that Siberia is a territory of many indigenous forest and tundra tribes, colonized by brave Slavic сossacks 3-4 centuries ago, just in time of American colonization by Europeans. Basically this Siberian colonization was far not that aggressive and bloody as in Americas, since Cossacks were runaway former peasant serfs and understood the cost of freedom. Nonetheless, as soon as indigenous tribes used to be turned to orthodox Christian church, recognized by emperor as fur taxpayers, and since emperor’s staff recognized unlimited volume of timber, coal and gold on Siberian lands, colonial behavior of emperor’s viceroys turned more aggressive. 

Different emperors, including Stalin in 20 century, demonstrated more or less respectable policy regarding indigenous cultures, resources and religions in Siberia. But Russia never even tried to recognize traditional land and resource rights of indigenous tribes and communities on their territories – they always were centralized and owned by businesses, close to Russian emperor. New capitalist revolution of 1990-1993 did not change anything essentially for indigenous Siberians, besides tragic loss of Soviet attention to their cultures and traditional resource use, which were always supported by Communist party. Revolution of 1993 opened the free gate for new Russian and Chinese oligarchs to the key mineral resources of Siberia – oil-gas, gold and timber as a core economic groundof national budget and personal enrichment.

Intense extraction of those resources began to seriously grow particularly since Putin’s era of 2000-th, coinciding with step-by-step reduction and weakening of strong environmental legislation, created during 1990-s with an active help of global environmental community. The key legal point in the new mode of resource use since 2000 is that gold, oil and gas deposits lease right has a top priority over traditional fish, game, forest and tundra grazing lease rights, essential for indigenous communities. Underlying cause of such model of tenure is that gold and oil-gas as key budget feeders remain under federal property and management, while forest, fish and game are managed regionally. And federal interests in Russian empire are always a first priority and let such resource users to easy ignore any local interests, if there is a conflict between forest, fish and game use from one side and extraction of mineral deposits from another side.

As a result of existing resource hierarchy, gold or coal miners, getting their federal license, can easy take valuable and even protected forest plot off from logging company or from local community.They are doing that broadly everywhere in Siberia, causing destructive forest fires, contamination of clean salmon rivers and destroying traditional reindeer grazing areas. And logging monopolies, from their side, have a legal right to log intact forests, being the only source of traditional livelihood for indigenous tribes, dependent on fish, game and reindeer herding. The same happens with salmon on the Far East coastal rivers, primarily distributed officially between regional or national fishing monopolies, which local communities financially can not compete with in the bidding process.

Separate set of problems for the forest dependent Siberian communities came with the last Forest code of 2008, which, despite all extreme efforts of environmental community, saved wrong and dangerous paradigm of forestry, which consider forest not as ecosystem and essential environment for local communities, but as timber deposit for feeding federal budget. The more, during decades Russian government continued to successfully feed border concerned Chinese lumber industry with Siberian raw logs, constantly declaring inadmissibility of such national model of such extensive forest use. By our expert in BROC, such business desertifies vast Siberian taiga, brings nothing to budgets and local communities. It develops only Chinese lumber industry and enrich few Russian oligarchs. Recent Putin’s hard statement on the need to urgently stop export of raw logs in one year was accepted by environmental community as a brutal joke: president himself and his government tried to do it several times during last 20 years by different ways, and never got success. The only they succeeded was the loss of some external markets for our timber, which were immediately replaced by the equal timber species from other countries. 

Nonetheless, our forest community and NGOs are ready to use this new presidential statement as much as possible to insert the most positive global experience of our colleagues in GFC to try change and improve our forestry legislation and regulations In favor of environment and local communities. With regards to forest concerned tourism in favor of local communities we shall continue our work in Expert group under Ministry of nature resources to mare tourism concerned regulations for protected forests more environmentally friendly and community focused.


]]> Terneyles-priority project - 2014 https://ngo-broc.com/tpost/4t9rintd51-terneyles-priority-project-2014 https://ngo-broc.com/tpost/4t9rintd51-terneyles-priority-project-2014?amp=true Thu, 10 Dec 2020 04:29:00 +0300 Лебедев А.В. Articles Around March 2008 “Terneyles” applied to regional Forest Service in Primorye for the forest lease of 685000 cu meters annual capacity to feed it’s prioritized national project.

Terneyles-priority project - 2014

Around March 2008 “Terneyles” applied to regional Forest Service in Primorye for the forest lease of 685000 cu meters annual capacity to feed it’s prioritized national project. According to governmental decree of 2007, such projects, as soon as adopted by the Ministry of Economy, had to be granted with forest lease without bidding procedure and by 50 % of regular resource fee. Remarkable, that to this time FSC certified company already had leased forest lands with annual capacity 1 235 000 cu meters, and used only half – 634 000. Obviously, “Terneyles” did not need new forests to feed it’s new lumber facility, the more that there is a strong deficit of free forests for logging in Primorye. 

Also, trying to get the project adopted on the national level, “Terneyles” holding officials pointed out in their Concept note that they can actually feed their future new facilities with appropriate volume of raw logs, produced by it’s 3 “daughter’s”, also certified – “Amgu”, “Melnichnoye” and “Roschinski”. Currently they mainly export that logs and pay to the budget for their use full price. Nonetheless, Forest Service formally followed legislation and presented requested forest lease to “Terneyles”. And, during last 3 years company continued requesting and received more and more forest areas, justifying them by the priority project, already more than twice fed with raw timber. Company simply used temporary absence of clear governmental regulation of this procedure, adopted only in 2010, and actually had stolen millions from the budget, paying half of the obligatory fee for that new leases.        

Obviously swindler style trick was demonstrated by “Terneyles’ in June, 2011. Company entered next auction to get more 10380 cu meters, and artificially sharply raised the price, target to get all competitors off the process. “Terneyles” certainly won, but refused to sign lease agreement. Thus it simply disrupted auction and brought serious loss to the budget. This case could not be ignored by SGS auditors and should lead to stop-over of FSC certificate validity. But, it did not happen. By the Russian anti-monopoly law, “Terneyles” had to be allocated after that into special list of irresponsible companies, and illegally taken leases to be cancelled.          

Actually, vice versa, being unpunished and remaining still certified, company newly applied for the same forest plot which it won before, but now once more for the priority project, which meant getting it without any auction and for 50 % fee. Fortunately, strict order of this procedure was already adopted, and Forest Service rejected that appeal. 
Simultaneously, foresters reminded to “Terneyles” officials, that this just forest plot is already designated for another priority national project, being implemented by another company, “Biotop-wood”. Nonetheless, stubborn “Terneyles” applied to arbitration to take other’s forest off.  

We consider such behavior of certified company outrageous and absolutely not acceptable regarding FSC standards. We also reminded to ASI officials, that we and WWF many times reported about irresponsible audit of this company, conducted by SGS-East, which led to such rude violation of national legislation and FSC principles under FSC logo. Now it is a time to stop this certificate of “Terneyles” and accreditation of SGS-East.    
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UN Forest Hero - 2011]]> A series of short analytic reviews of the investment and business activity of Chinese companies and provinces in the Asian part of Russia https://ngo-broc.com/tpost/95k351u0t1-a-series-of-short-analytic-reviews-of-th https://ngo-broc.com/tpost/95k351u0t1-a-series-of-short-analytic-reviews-of-th?amp=true Tue, 26 Mar 2024 12:23:00 +0300 Articles NGO BROC hereby launches a series of short analytic reviews of the investment and business activity of Chinese companies and provinces in the Asian part of Russia.

A series of short analytic reviews of the investment and business activity of Chinese companies and provinces in the Asian part of Russia

NGO BROC hereby launches a series of short analytic reviews of the investment and business activity of Chinese companies and provinces in the Asian part of Russia

In this times of the current great change in the global distribution of capitals, resources and economic interests under growing pressure of sanctions and birth of new economic blocks, relations between the global core production center in China and neighboring core resource storage in Siberia demonstrate extraordinary importance and cause top interest among political and business circles of the whole Eastern Asia.

Our reviews, based upon regular analysis of international, national (Russia, China, USA) and regional sources will present comprehensive and detailed perspective of reality and trends in the area of investments, trade, environment and culture, including results of ongoing compelled "Eastern turn" of some industries from European Russia to Chinese markets.


ОО "БРОК" начинает публикацию англоязычных кратких обзоров инвестиционной и деловой активности компаний и провинций Китая на территории Азиатской России - ДФО и СФО

В условиях глубинных и драматических перемен в системе распределения мировых капиталов, ресурсов и экономических интересов, при реализации каскадов экономических и политических санкций и формировании новых значимых экономических блоков, взаимодействие крупнейшего в мире китайского центра производств и пограничного с ним богатейшего источника ресурсов Сибири-ДВ обретает глобальную значимость и вызывает высокий интерес в политических, экономических и деловых кругах стран Восточной Азии.

Наши обзоры, основанные на регулярном анализе общедоступных источников международного, национального (Россия, КНР и США) и регионального уровня формируют своеобразную мозаичную картину, отображающую сложную динамику отношений между компаниями и регионами КНР и ДВ-Сибири в сфере инвестиций, торговли, политики и культуры, в том числе и в части теперь уже вынужденного разворота российского европейского экспорта на Восток, прежде всего на Китай.
]]> Chinese North-East and Russian high speed trains https://ngo-broc.com/tpost/vvojfkjk11-chinese-north-east-and-russian-high-spee https://ngo-broc.com/tpost/vvojfkjk11-chinese-north-east-and-russian-high-spee?amp=true Tue, 26 Mar 2024 12:44:00 +0300 Articles How Russia and China develop their own high-speed train lines, and some ideas on the cooperation

Chinese North-East and Russian high speed trains

Centrally administered State-owned enterprises (SOE) in China's northeastern region will build a modern industrial ecosystem to compete with rivals at home and abroad, corporate executives and market watchers said, as the country seeks to intensify and advance the reform of such companies. The government has put in place a series of policy measures aimed at supporting SOEs to foster innovation and enhance their self-reliance and technological prowess. The State-owned Assets Supervision and Administration Commission (SASAC) of the State Council said in July that the government would strengthen policy support to address the pressing concerns of SOEs and sharpen their competitive edge. During a visit to Qiqihar, Heilongjiang province, in September, Zhang Yuzhuo, chairman of SASAC, called on SOEs in Northeast China to deepen collaboration with industrial and supply chains, rejuvenate the old industrial base in the region with renewed vitality.

CRRC Changchun Railway Vehicles Co Ltd, a Jilin province-based subsidiary of Beijing-headquartered CRRC Corp Ltd, China's largest rolling stock manufacturer by sales revenue, unveiled the world's first hydrogen-powered urban train in Shanghai in May. The company manufactures various types of trains, from light rail to electric multiple units, for foreign clients in countries including Colombia, Brazil and Saudi Arabia. Its latest four-carriage train is designed for a maximum speed of 160 kilometers per hour and achieves a driving range of 600 kilometers through a hydrogen-powered system. The integration of 5G vehicle-to-ground communication technology and big data analytics ensures that the train is safe to operate.

"We will continue to make breakthroughs in cutting-edge products, such as a new generation of unmanned subway trains, low-floor light rail trains and locomotives that use a combination of hydrogen fuel and lithium batteries to win in the emerging markets and signatory economies of the Regional Economic Partnership agreement," said Jiang Baiyang, the company's chief designer. New trains will play a key role in the comprehensive revitalization, new economic growth drivers in Northeast China. It is important to develop strategic emerging industries, the digital economy and foster green economic growth in the region, industry officials point out. Basically, China is rapidly becoming a global leader in high-speed train technologies. Recently the new engineering miracle was presented there – magnet-pendant “maglev” train with speed capacity 600 km/hour and lowest level of noise.

In the meantime, neighboring Russian Far East during several last years is full of plans to rich Chinese railroad and trains industry in its speed and technologic level. There were broadly promoted ideas of Sakha-Yakutia president Nikolaev to create high-speed 3000 km railway from Yakutsk to Vladivostok, more realistic idea of high-speed train Vladivostok-Khabarovsk of the same distance as between Moscow and St Petersburg. Primorye-Jiling regional officials seriously discussed 70 km project of high-speed railroad Hunchung-Zarubino. The most recent suggestion was stated by president Putin on the high-speed train Komsomolsk-Khabarovsk.

Earlier, in 2015, Russian government announced and discussed with Chinese colleagues more giant project of 7000 km speed train Moscow-Beijing as a part of BRI, part of which, 3200 km in China was already constructed. China South Locomotive & Rolling Stock Corporation Limited (CSR) presented then renders of those trains, designed with Australian studio Fordyno with detailed interior design for several classes. That railroad was designated for both passenger and cargo trains, planning to reduce way time from Moscow to Beijing from 5 days to 32 hours. The first part of it in Russia should be created between Ekaterinburg and Chelyabinsk at Ural region, basic Agreement on general 500 billion rubles with participation of German Siemens and Russian Fund of Direct Investments was signed in 2019.

But, launching Ukrainian war, Russia seemed to finally bury all those plans and ideas in favor of highways. Even the destiny of the eldest Russian high speed railroad project Moscow-St Petersburg is now unclear, being passed from one operator to another. Russian railroad officials continue suggesting Chinese partners to activate all those projects, but, as usual, Russian vision of the costs and investment system seriously differ Chinese one. By the last statement of deputy Minister of transport Ivanov, first Russian high-speed railroad Moscow-St Pepersburg will cost 1,7 trillion rubles, and need almost no budget donation. Meanwhile, none such road used to be created in the world without budget support. And Russian business cannot afford more than 20 % of that cost.

By the President of Russian research center “Transfers and infrastructure” Ivankin, there is no real need to speed-up that way between Moscow and St Pepersburg now, the more by that costs. Increasing transport speed is much more crucial for the region between Vladivostok and Irkutsk, where Chinese participation may be much more realistic.
]]> News on transboundary trade https://ngo-broc.com/tpost/b4bof1enl1-news-on-transboundary-trade https://ngo-broc.com/tpost/b4bof1enl1-news-on-transboundary-trade?amp=true Sun, 31 Mar 2024 03:49:00 +0300 Articles News from the International investment forum in Vladivostok, which occurred in December, 2024.

News on transboundary trade

International investment forum on the field of Far East Federal University occurred by the late December with participation of Chinese delegations from Heilongjiang and Liaoning provinces, and Chinese Consul General in Vladivostok Piao Yangfan. From the Russian side this significant event was coordinated by deputy Chairman of Primorye government Nikolai Stetzko. Problems of logistics in developing transboundary inter-regional exchange were mainly discussed on the meetings.

As it was stated by the First Secretary of Communist Party in Suifenhe Lo Haitao, development of economic collaboration between neighboring Primorye and Heilongjiang require deep modernization of border gates at Pogranichny and Poltavka. In December track based transboudary trade was equal to $ 150 million, but, since the whole modernization will occur including electronic customs declaring, multiple magnification of this level is forecasted. Many experts state that insistent promotion of such modernization from Chinese side is caused by the need of more import of natural resources and agro products to develop economy of the northern provinces. They play outstanding role in the national plans of economics and infrastructural stabilization under ongoing global crisis. For Russia this region is also strategically crucial to deeply enter giant domestic market of China.

During consultations with deputy Chair of the Commerce Department in Liaoning Government Tiang Hung parties agreed to create Representative office of Primorye government in Dalyan to attract into Primorye more investments and more companies into existed joint agricultural projects with privileged economic regime in the Advanced Development Territories.

By the same time of late December equal questions were discussed at the national Russian level in framework of the Russian-Chinese Committee of friendship, peace and development and company “Sinorus”. It was stated there, that in 2023 Chinese producers of hi-tech electronics and cars actively developed their presence at the Russian markets, which was stimulated by establishing new ruble based export taxes since October and full electronic mode of customs procedure designated to the end of 2024. Experts also pointed out, that official weight and size limits for transboundary trade were increased in 2023 by 5 times, and some ex-im taxes reduced, which cancel a set of problems for serious traders. Giant trans-Amur bridge Blagoveschensk-Heihe, launched in 2023, with its customs-logistics terminal “Kanikurgan” should play extreme role in transboundary trade development in 2024 thanks to recently activated electronic line for “green corridor” procedure.

By Chinese customs, Russian import from China in 2023 increased by 50 % to achieve $ 100,33 billion, while Russia exported goods in the amount of $ 117,84 billion, which is by 11,8 % more than in previous year.
]]> Segezha Group turn To China https://ngo-broc.com/tpost/pizf2fpvd1-segezha-group-turn-to-china https://ngo-broc.com/tpost/pizf2fpvd1-segezha-group-turn-to-china?amp=true Fri, 05 Apr 2024 18:00:00 +0300 Articles In the early January Russian timber holding Segezha Group, active both in Karelia and Siberia, signed agreement with Russian corporate giant AFK “System”.

Segezha Group turn To China

In the early January Russian timber holding Segezha Group, active both in Karelia and Siberia, signed agreement with Russian corporate giant AFK “System” with a target to develop lumber industry, transportation and logistics. Agreement includes creation of special Siberian division of Segezha and study opportunities of creation special Siberian plant on production heavy logging equipment and machinery.

Segezha is broadly known as a biggest logging and lumber Russian enterprise, supplying Karelian and Siberian timber, producing paper, veneer, CLT-panels and paperboard. Initially Segezha was Europe oriented, since 2016 entered for that to CEPI Eurokraft Association and started production of highly demanded in EU CLT-panels and fuel pellets in 2021. In Siberia Segezha purchased for that regional logging giant Lesosibirski LDK-1, famous since 1990-s as deeply criminalized China oriented enterprise. A bit later Segezha included into its assets another, export oriented Novoeniseiski lumber-chemical complex, and finally added to the holding one more timber company InterForestRus, active in the vast Krasnoyarsk and Irkutsk taiga. To increase its capital from 10K to 1,5 billion rubles, management of InterForestRus passed its assets to the foreign Interforest AG.

As a result of such tricks, Segezha consolidated almost all timber industry of the whole East Siberia – legal, grey and illegal. But, despite giant market income, profit of the Group remain low and not stable, keeping company next to bankruptcy with about 24 billion rubles of official debts. Besides catastrophic failure of European markets in early 2022, by experts, it means that management of the Group continue hiding serious incomes somewhere outside of Russia. Now Segezha is trying to insert CLT-panels into Russian market, since neither they, nor fuel pellets are demanded in China. But, it is obvious that CLT panels are absolutely non marketable both in Siberia and in China as construction material.

Nonetheless, Segezha still can supply paper, paperboard and veneer, which remain unlimitedly demanded in China. That means, that plans to move main timber processing industries to Siberia, next to the key logging areas, will be obviously implemented. That also means that wide scale Siberian logging by Moscow based Segezha management will grow further, the more that governmental and non governmental forest control is reduced down to almost zero since March 2022. Regarding that, Russian Expert Council on Nature Conservation have sent yesterday special warning letter to the top management of AFK “System”, pointing out total illegality and impossibility to develop designated logging operations upon territories, which were preliminarily reserved for creation new protected areas in Karelia and Siberia.
]]> Sakhalin resort investment https://ngo-broc.com/tpost/e8t83orlf1-sakhalin-resort-investment https://ngo-broc.com/tpost/e8t83orlf1-sakhalin-resort-investment?amp=true Wed, 10 Apr 2024 19:15:00 +0300 Articles “Gorny Vozdukh” resort in Yuzhno-Sakhalinsk, receives significant investments from China

Sakhalin resort investment

By the official report from “Far East–Arctic Development Corporation” (FEDC), Sakhalim based construction Russian-Chinese company “Stroydomkomfort” will invest 250 million rubles to purchase wide range of construction machinery and equipment for the Territory of Advanced Development (TAD) “Gorny Vozdukh” (Mountain Air). While registered 4 months ago only, the company immediately received official status of this TAD resident with all set of privileges, despite long public tail of complaints from clients which the same named company of the same owner Jin Cheng Yen brought to the Far East from St Petersburg. Significant, that there is no official public data on this company with that location – only on Sakhalin. Currently company stated its plans to start creation here in 2024 blocks of living apartments and industrial buildings, two 4-star hotels and gulf course with creation of at least 30 jobs.

Jin Cheng Yen informed FEDC, that he will soon purchase all basic equipment – track cranes, excavator, forklift track, install concrete-mortar and foam-block units. Then company will be ready to start just constructing of any commercial estate on Sakhalin, which actually means to enter the most safe and profitable business in Russia now. By such successful renovation of his company, which became highly problematic around St Petersburg, Chinese businessman promised to present a wide set of jobs for carpenters, welders, electricians, concreters and other workers. Modestly hiding his doubtful experience at the Russian Nord-West, Cheng Yen points out officially that his company has a broad experience in living and industrial construction and already participated in several projects on Sakhalin – supermarket, skating stadium etc.

Regarding this extremely rapid Chinese business invasion to Sakhalin TAD, officials of FEDC repeatedly stated that attraction of the foreign investments is their key goal and listed all accompanying privileges for TAD residents – administrative, concerned to taxes, custom fees, migrants labor and consulting services. “Stroydomkomfort” specifically will also receive discount in insurance fees and zero profit tax which will help Cheng Yen to implement his plans.

TAD “Gorny Vozdukh” is located at the resort area around Yuzhno-Sakhalinsk and implement now 31 investment projects with total 17,2 billion rubles and 1132 new jobs. It includes already active restaurant complex at the mountain, apart-hotel of alp-style, trade-entertainment complex, set of hotels and air terminal. Mountain skiing complex here is highly popular winter resort for the whole Far East and attract thousands of people for at least 4 months since December through March. Experts consider, that such rapid involvement of such doubtful foreign investor from European Russia into Far East Advanced development territory demonstrates serious reduction of interest and trust to foreign investments in European Russia and deep lack of them at the Far East.
]]> Chinese strategy - 2024 https://ngo-broc.com/tpost/x6kbg669v1-chinese-strategy-2024 https://ngo-broc.com/tpost/x6kbg669v1-chinese-strategy-2024?amp=true Mon, 15 Apr 2024 21:04:00 +0300 Articles Are Chinese investments into Russian Far East focused upon local resource based projects instead of systematic infrastructure development?

Chinese strategy - 2024

While anyone try to analyze current Chinese investments into Russian Far East, it turns obvious that their trend is focused upon local resource based projects instead of systematic infrastructure development. Such strategy has several targets, and development of Chinese North-East by the use of Russian resource rent is one of them. In 2023 first serious capital run from China equal to $ 68,7 billion was registered in the long time. It’s not too much, but creates a big trouble for Chinese authorities. Another reason for capital run from China is, by some experts, the effort of business elites to localize overseas investments and thus hide their capitals outside from domestic scrutiny.

As a result, growing activity of Chinese investors is registered on the stock markets of Tokyo and Seoul, although government is trying to block that trend. One of the officially acceptable option for this trend is offshore zone at the Russkii Island in framework of Territory of Advanced Development (TAD). In framework of the officially stated investments here Chinese companies can hide their profits by the special legal privileges, and use them however they want. Experts forecast also that any developer models for Chinese capital run may be used in framework of designated Vladivostok satellite city, which should attract about $ 3 billion.

One more perspective point for Chinese investments here is Big Ussuriiski Island development in Khabarovsk, whose plans could not be synchronized by parties during many years. As Russian government stated, now mutual understanding is finally achieved and intergovernmental agreement is in the process of preparation. Resulting, cargo-passenger border gate, flood protected road and logistic-touristic centers will appear here soon and make the island one of the key regional center of collaboration.

Parties plan to start full size designing during 2024 and begin construction in 2025. 1,4 million people and 1,3 million tons of cargoes should cross this border gate in 2030. Regional government already prepared all documents for the island road by its own and plan to start construction this spring. Since opening this road it will pass annually 700K tourists and 700K tons of cargo.

During 2024 Russia will present to Chinese partners a concept of the island development. Recently Russian Vostok Development Ministry, Khabarovsk government and local company “Orion” signed agreement on creation transport-logistic complex with private investment of 14 billion rubles. They will create Russian-Chinese center of duty free trade of 30 billion rubles with hotels, recreational and museum zones, cable car road to Khabarovsk and flood protecting dams. As Heilongjiang provincial governor Liang Huiling stated, Big Ussuriiski island will become soon the key zone of regional mutually profitable and cultural collaboration.

Chinese investments began to come also to the real estate construction in Primorye. Recently created company “Vostok-Stroy”, new resident of Vladivostok Free Port, with 49% of Chinese share will create cottage settlement in Peretino town near Partizansk (Golden Valley town) on 10 hectares with 673 million rubles investment. It will start construction this year with Chinese technologies and supplies to complete up to 2028.

While Russian director of “Vostok-Story” owns 51 % share, Chinese entrepreneur Mao Weihong has 33%, and Wang Changfu — 16%.
]]> Elga Coal: out of joint venture https://ngo-broc.com/tpost/5aeh623y81-elga-coal-out-of-joint-venture https://ngo-broc.com/tpost/5aeh623y81-elga-coal-out-of-joint-venture?amp=true Sun, 21 Apr 2024 19:00:00 +0300 Articles Elga port is continuation of Russian-Chinese project of completely private Pacific Railroad, target to join extremely rich Yakutian coal deposits with the sea coast for export to China and Asia-Pacific.

Elga Coal: out of joint venture

New deep water sea port Elga, which is under construction on Manorski Cape of Khabarovsk Krai, has increased its designated capacity on ship size to be ready accept Panamax class ships. Initially port was designated to moor bulkers of not more 85K tons deadweight, but now Elga raises the stakes. Panamax type ships have deadweight 120K tons and draft about 18 meters, and are able to go through Panama Channel. By the end of January Vanino terminal of Daltransugol company in Khabarovski Krai accepted such bulker Cape QUINGDAO of deadweight 170 K tons and filled it with Yakutian coal during 60 hours.

Elga port is continuation of Russian-Chinese project of completely private Pacific Railroad, target to join extremely rich Yakutian coal deposits with the sea coast for export to China and Asia-Pacific. Investor is planning in 2024 to test the road of total 531 km, which has now 350 km already completed. Reportedly, construction is running with extraordinary speed, and the road, since completed, will be able to transfer annually 50 million tons of Yakutian coal.

Last May Yakutian Head Nikolaev stated, that Republic could export 36 million tons in 2023, but received a limit from Russian Railways monopoly 26 million only by the limited capacity of the East polygon. In the meantime, in 2024 Yakutia may export 52 million, and to 2030 – 70 million tons. But, now “ElgaUgol” of “Rostech” as a key manager of Yakutian coal has lost its key Chinese partner Guahong Ocean Shipping (GH Shipping), which panned to increase export volume by times. Joint venture, announced by the end of 2020 with this partner, suggested by Chinese ambassador in Russia Zhang Hanhui, was not created. Resulting, company’s supply of coal in 2021 achieved 8,5 million tons only instead of planned 18 million. Chinese company could not help ElgaUgol to enter domestic Chinese market, since was not equally influential to overcome some regulations and customs barriers concerned to Covid-19.

In the meantime, Chinese coal market turn highly attractive for Russian suppliers in 2021 thanks to the unofficial import ban on Australian coal, being then obvious leader on coking coal supplies. Using that, Russian companies increased their supplies up to 52 million tons. But, for ElgaUgol ambiguous plans of increasing supplies were not easy – Chinese consumers had to evaluate parameters of coal and insert it into local industrial market. That takes a time and local partner, despite that quality of Elga coal is fully comparable with leading Australian sources like Gunilla, Gordston, and even overcome them.

Its significant, that Yakutia has a set of successful projects with China – 2 mining and coal processing joint plants in Neryungri district of Russian Colmar and Chinese air construction company AVIC, and brick factory in Namski district. So, considering growing capacity of the coal export from Yakutia to China, limited capacity of existing railroads and timetable of construction railroad to Elga port, Yakutia President Nikolaev met by 5 February with Chairman of Russian Railroad Company. They accorded possible volume of Yakutian coal export to China and India in 2024, which will be equal to last year – 26,3 million tons, and include possible supplies via new Elga port and new cross Amur rail bridge Jalinda – Mohe. Nonetheless, both parries hope that new Pacific railroad to Elga will help overcome it.
]]> Chinese invasion to Baikal: new wave https://ngo-broc.com/tpost/d38ous4341-chinese-invasion-to-baikal-new-wave https://ngo-broc.com/tpost/d38ous4341-chinese-invasion-to-baikal-new-wave?amp=true Sat, 27 Apr 2024 15:11:00 +0300 Articles New post-COVID wave of Chinese economic and touristic invasion to Baikal is registered and raised in the whole Siberian media during current winter.

Chinese invasion to Baikal: new wave

New post-COVID wave of Chinese economic and touristic invasion to Baikal is registered and raised in the whole Siberian media during current winter. It was the key topic here during 2017-2020, when active civil protesting campaign of local citizens enforced officials to stop illegal delivery of some land plots around lake for Chinese hotels and even start demolishing some ones. Significant project of Baikal water pipeline from Kultuk to the thirsty northern Chinese provinces, started with construction around 2017, was also stopped, although water deficit there is estimated as 70 billion cu meters. Municipal Head of Listvyanka settlement, the top attraction for Chinese tourists 60 km far from Irkutsk, was then arrested under criminal investigation for illegal lease of 1400 square meters of land target to construct Chinese hotel. The same sentence was presented to him again in 2019.

Chinese entrepreneur Qu Fei planned to create brothel and SPA-complex in Listvyanka, near historic cemetery, but was stopped by prosecutor, leaving semi-constructed building forever. Nonetheless, covid had gone and Chinese tourists flow to this tight place between steep hills and lake continue grow rapidly with several big buses coming here every day. Two times a day buses are replaced by sewage disposal trucks, although many small hostels continue dropping sewage waters straight to Angara river and sacred Baikal. Russian-Chinese family, owning “Mandarin” hotel, drilled illegal well to get fresh water, which caused dramatic loss of water from neighboring public well. According to many Chinese tourists been interviewed by the local media, Chinese consider themselves as historical owners of Baikal zone, that’s why their behavior is so brave and impudent here.

By the same reason, new post-covid stage of discussions around Baikal water supply to China had raised in media this winter. According to reports from officials in Lanzhou, the capital of Gansu province, they still intend to build the fresh water pipeline through Mongolia to China, although the feasibility of such three- lateral plan is highly questionable. It is pointed out that distribution of water resources in China is deeply disbalanced, leaving Beijing, Shanghai, Xinjiang-Uygur, Shangji, Hebei, Ningxia and Hunan provinces with high deficit. It creates huge problems for agriculture and food supply at the North.

But, reportedly, the result of new negotiations stage on the water topic turned highly unexpected for China. Russian officials closed discussions without any doubts and recommended Chinese colleagues to better analyze and manage their own resources more efficiently. After the first emotional reaction from Chinese media, Siberian journalists reminded the global value of Baikal as a World Heritage Site, which all 3 neighboring countries have to take care of altogether not to turn it to dump, as it occurred with many water reservoirs over the South Asia. By UN data, fresh water supply in the Central Asia had reduced during last half century by 3,5 times, and personal water deficit up to the end of this year may become crucial – 1,7 m3 a year.

Therefore, Russian government invests 22 billion rubles in 2023-2025 to Baikal protection measures. Nonetheless, experts forecast that Chinese will not stop rely on Baikal water, trying to suggest more investments into region for it, as well as they will continue sending more and more tourists to their “historical heritage” and develop own local infrastructure.
]]> Kamchatka coal for China https://ngo-broc.com/tpost/4gl59xoul1-kamchatka-coal-for-china https://ngo-broc.com/tpost/4gl59xoul1-kamchatka-coal-for-china?amp=true Fri, 03 May 2024 09:04:00 +0300 Articles Perspectives on the development of Krutogorovskoye coal deposit

Kamchatka coal for China

Significant coal deposit at Kamchatka west coast, Krutogorovskoye, has a long 10 years history of investment for mining project, but no practical activity up to now. Since 2014 Indian Tata Power were interested to invest here more 400 million rubles and created for that daughter company with official support of regional government. Company planned to start coal mining by the end of 2023 for Indian needs and to supply 200K tons annually for local needs as well. During all 10 years Tata Power tried to conduct geologic research and create mining project, based reportedly upon environmentally worse technology of the open mining quarry.

The problem was concerned to the awaited coal dust, dangerous for number of salmon spawning rivers at the area of 1,4 square km, distanced 70 km from marine coast and 90 km from Sobolevo town. Local branch of World Wildlife Foundation also warned publicly that coal dust is not acceptable for marine shelf, crucial for reproduction of the big set of economically valuable bioresources, endangered birds and animals. Kamchatka scientists even planned to establish here special environmental conservation legal status with strictly limited commercial activity. Lastly, global coal prices has dropped during last years, which caused closing of the whole project by Tata Power, also reportedly by the “revision of strategy in favor of increasing investments into renewable energy sources”.

So, initially designated start of coal mining on Krutogorovskoye in 2023 not occurred, even though WWF, the key opponent of the project, got banned in Russia just this year.

Nonetheless, suddenly on the early 2024 Chinese entrepreneur Sun Fengsheng established new Group on Global Food and Agro Development on Kamchatka with initial stock of 1 million rubles. By his official statement, besides food and agro product supplies Sun Fengsheng is basically planning to develop coal mining on Krutogorovskoye deposit. He clearly understand all the problems concerned to the area of West Kamchatka, having no roads and deep sea ports, but officials in Far East Development Ministry stated their readiness to help create needed transport infrastructure for the coal shipping. This deposit keeps about 945 million tons of high quality coal, interesting not only for Chinese energy, but for chemical industry as well.

Sun Fengsheng evaluates investment capacity of the project as $ 1 billion creating more than 1000 jobs. Together with Chinese marine shipping company he plans to organize coal supplies to consumers in China, transit navigation through Polar Marine Way and even ready to invest in master-plan of Petropavlovsk city development. All these plans were announced in time of recent meeting Sun with the first deputy director of Kamchatka Development Corporation and chairman of Far-East – China Friendship Society. Russians were really impressed with Sun’s plans and evaluated his high attention to specifics of environmental safety at the territory. In framework of this negotiations parties agreed to prepare more detailed Protocol of Intentions concerned to Krutogorovskoye coal mine development. Additionally, Sun Fengsheng expressed his will to create sister city relations between Petropavlovsk and Sanya on Hainan province, where his company’s headquarter is located.

The project on Krutogorovskoye includes creation of new port with full infrastructure, terminals and roads to Sobolevo. This part of project will cost about $ 60 million. But, by reliable experts only sea port here, where the sea is iced most of time, will cost $ 1 billion, regarding constant need of ice-breakers for shipping. Railroad from mine to port will cost $ 100 million more. That will increase whole project cost up to 110 billion rubles. All those parameters are now under active discussions on both sides.
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