Market Intelligence
RUSSIA
Natalia Shibanova
Russia puts environmental issues at the top of the agenda
As Russia looks to improve its ecological credentials, more opportunities are arising for UK environmental goods and services companies to enter the market Ecological problems in Russia remain among the most
serious and unresolved issues. Russia inherited lots of ecological problems caused by industrial development during Soviet times and some of the new and emerging issues of the last decade have grown at a faster rate than measures have been taken to combat them. The report
Ecological situation and politics in Russia at the turn of
the centuries, published in 2009 by the Russian Regional Ecological Centre, highlights fi ve key environmental problems for Russia: water and air pollution; climate change; reduction of croplands and degradation of soil quality; deforestation; and accumulation of wastes.
Environmental issues and policy in Russia
The period from 2008-2009 (especially the second half of 2009) showed important trends in the development of the Russian Federation’s (RF) environmental politics. The Russian Government produced a report called Conception of the long-term social and economic development of the RF by 2020. That document emphasised the importance of a reduction in emissions and waste of 20 per cent; a 40 per cent increase in energy effi ciency; a reduction in the number of ‘ecological hot points’ and cities with a high level of air pollution; and the expansion of protected natural areas and national parks.
Opportunities in the water sector
The Russian water industry is at a critical point in its evolution, as it began to embrace the private sector six years ago, with local fi nance initiatives. There is also
an urgent need to improve the water and wastewater infrastructure and standards of service. The Government has shown strong commitment to improving the sector by providing funding through the Federal Targeted Programme Clean Water and a World Bank loan, by amending existing legislation to make it more applicable to the specifi cs of the water sector and by supporting PPP initiatives. Existing business opportunities for UK companies in
the Russian water market include BOT (build operate transfer) and BOOT (build own operate transfer) projects, Public Private Partnerships (PPP), engineering/consultancy opportunities. There are also opportunities for specialist equipment producers, pipeline rehabilitation and wastewater treatment technologies. UK water sector companies can capitalise on these
developments and play an increasingly important part in the sector. However to do this, companies need to be in, and not merely visit, this market. Having a local presence is crucial for success. Local knowledge and contacts are needed to follow up developments and react quickly and effi ciently to business opportunities. The current Government policy encourages the establishment of local production and assembly. The Russian Government has developed special industrial economic zones to attract foreign direct investment in the country. UK companies interested in working in the Russian water and wastewater sector can develop an industrial base in Russia. In July 2009 UKTI led a water sector seminar mission to
Perm and Moscow. One of the companies that participated in the visit was Analytical Technology (ATI) and the company has since reported that its Russian distributor has completed its fi rst installation at a major Russian customer’s site. Other installations are also planned.
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