Export of Czech companies to Russia for the first 9 months of 2013 amounted to 85 billion crowns (approx. 3 billion EUR).
Export to Russia provides 60% of this amount for the sale of means of transport and production of engineering companies.
According to the representative of the Chamber for relations with CIS countries in 2012, exports to Russia amounted to around 120 billion crowns. So it is possible that 2013 will be even more successful. He further states that the chamber also organizes business missions to Russia, as a result of which exports to Russia reach such high indicators. Among the most successful exporters to Russia is the company Alta, as well as, for example, the engineering companies PSJ and PSG. In the future, a project to build a railway in the Urals should be implemented. The contract for this project was signed during D. Medvedev’s visit to the Czech Republic in 2011. However, according to available information, it is still being postponed, so it is not certain when it will begin to be implemented.
In addition, the Winter Olympic Games in Sochi are also an opportunity for Czech exporters to find new business partners in Russia.
Export to Russia is growing despite the fact that its share insured by the state export insurance company EGAP is decreasing. According to the director of the insurance company, exports to Russia needed to be encouraged in 2008 and 2009, which EGAP succeeded in doing. He clearly doesn’t need that kind of support now. Export to Russia for 2013 will not represent the largest part of the value of newly insured business. Azerbaijan should take the lead. According to EGAP statistics, in 2009 it insured exports to Russia worth 24.1 billion crowns, which is 48% of the value of exports, in 2012 this amount was less than two billion crowns. However, transactions insured in this way accounted for 18% of the total export. By September 2013, the share of state-insured exports had fallen to 10%. At the same time, Czech exports to Russia have more than doubled since 2009.
Czech companies can apply themselves in Russia by supplying large investment units. However, to finance these deals, they would need the banks to cooperate more in financing. A representative of the company Alta, for whom exporting to Russia is key, states that the pressure on turnkey projects is growing. However, Czech banks are often not professionally prepared to help with the preparation of project financing exports to Russia.
The main risk for exports to Russia is that customers repay the loan only after the start of the new investment unit. Projects are often delayed and equipment is commissioned later. According to information from the Czech Export Bank, which provides loans to Russian importers of Czech production, the loan repayment problem has reached dire proportions. Currently, banks owe more than tens of billions of crowns for loans, while some Russian borrowers have not yet paid a single crown.
Despite this problem, the future of exports to Russia remains optimistic. The biggest opportunities for cooperation for the Czech Republic continue to be in the fields of construction, engineering and healthcare.
Sources:
http://www.egap.cz/o-spolenosti/egap-v-mediich/zpravy/egap-v-mediich.php?zpravy_id=43
http://www.radio.cz/ru/rubrika/radiogazeta/cheshskij-eksport-v-rossiyu-byut-rekordy
