Creon Capital’s Chairman Dr. Fares Kilzie encourages Chinese private investors to increase their engagement in the Russian petrochemical industry. While Chinese state-owned companies and state Funds were by now invested with almost 67 bn. $ in oil and gas upstream projects in Russia, Kilzie argued, the influx of investments from Chinese private companies remains low. Kilzie’s advise to the numerous businessmen, who took part in the conference “Russia and China: Taking on a New Quality of Bilateral Relations”: Instead of being focused on upstream-projects and mere crude imports from Russia, China should diversify its FDI-flows to Russia and consider to invest in oil refining and gas processing projects. Otherwise China will suffer from low commodity prices just as the Russian economy is suffering.
Generally Kilzie decided to be very honest in his assessments: Funds, banks and big corporate from the People’s republic invest in projects with Russia’s oil-giant Rosneft or LNG-producer Novatek, because these projects are politically supported. “Private companies simply don’t know who they should contact in case of trouble. That’s why they are afraid to invest in Russia, though the prospects would be much more attractive than in countries like Pakistan.” Creon Capital is keen to help both European and Chinese investors to understand the Russian market.
Xin Yongzi, Vice president of China Gezhouba Group (CGGC) admitted: We have to study properly how Chinese enterprises can do business in Russia.” His company belongs to Chinas Top-Five-companies investing abroad. “Russia is a broad market, which is strategically important for us”, Xin Zongyi underlined, “but Russia is very different from China, there are several risks and challenges remaining.”
Creon is General Partner of the conference on the relationship between Russia and China, which takes place in Moscow from May 29th until May 30th. The Russian International Affairs Council hosts this event for the third time, many high-ranked politicians and businessmen followed the invitation – beyond them Valentina Matvienko, Chairman of the Federation Council of the Russian Federation. More than 50 representatives from China flew to Moscow, among them top-managers of companies such as CNPC, Sinopec and CGGC.
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Creon Capital-Chairman Fares Kilzie (r.) evaluates the Chinese investment activities in Russia. The panel discussion on investment prospects in the world’s largest country was part of a conference on Russian-Chinese relations. Creon sponsored this event in Moscow, which has been visited by more than 200 entrepreneurs, scientists and politicians from China, Russia, EU and the US.