Newsletter for the South Korea businesses and investors (November, 2013)
Korean and Russian leaders are optimistic after the visit by President Vladimir Putin to the Republic of Korea.
On the 13 November 2013, President of the Russian Federation Vladimir Putin arrived in Seoul, South Korea, for an official visit to demonstrate the support of his government for closer, more productive economic relationships between Russia and the Republic of Korea.
President Putin noted that the development of bilateral trade and economic relations between Russia and the Republic of Korea traditionally is a high priority topic in the dialogue between the two countries. For the last ten years, the volume of the mutual trade turnover has increased by 1300%, having reached the level of 25 billion USD in 2012. For the first nine months of the current year this index has exceeded 18 billion USD.
President Putin underlined that there are opportunities for further mutually beneficial cooperation. Among them he named the necessity of harmonization of the mutual trade structure, the formation of the solid technological and structural alliances, and the realization of the major infrastructure projects of global and regional scales, primarily in the Far East region of Russia.
The Republic of Korea is interested in projects that support a strategy of social and economic development of Far East and Baikal region at least through the year 2025 , as well as other federal target programs of the Russian Federation. In addition, there are possible opportunities in the creation of joint Russian-Korean investment-financing platforms between the Vnesheconombank and KEXIM Bank, as well as the Russian Direct Investment Fund (RDIF) and the Korean Investment Corporation (KIC). South Korea has proposed that the RDIF and the KIC jointly create an investment platform of 1 billion USD.
South Korean President Park Geun-Hye and President Putin noted the necessity to search for new spheres of cooperation in economy, trade, and investment in accordance with the Russian–Korean Joint Plan of Actions in trade and economic cooperation, dated 19 November 2005, and the Joint Program of Partnership for modernization and innovative development dated 3 April 2012. The two presidents agreed to consider the development of an appropriate “road map” for the medium and long-term future The two countries will also explore closer economic integration of rates, direct foreign investments, and the creation of specific conditions for the location of export-import manufacturing facilities.
President Putin also identified the development of the infrastructure for use of the Northern Sea Route for the transportation of hydrocarbons as a possible future initiative.
The South Korean and Russian presidents discussed issues for the successful realization of the pilot project to connect the Trans-Korean Railroad and the TransSiberia Railroad by completion of the reconstruction by OJSC RJD of the Khasan-Radjin railroad yards and modernization of the third dock of the Radjin port.
Fishing was a topic of special attention and importance during the talks. The two presidents agreed about the necessity of continuing the affirmative dialogue and the practical cooperation in the commercial fishing industry between the corresponding competent authorities and organizations of the Russian Federation and the Republic of Korea. The goal is to activate high levels of cooperation among entrepreneurs in the two countries through investment projects in the fishing complex of the Russian Far East and in Korean fishing operations in Russian waters. President Putin specially noted that the South Korea should solve the problem of the illegal control of the Russian fishing companies by Korean entities. Otherwise, starting on 1 January 2014, the Russian Federation will not grant the licenses for nautical biological resources extraction to those Russian fishing companies that are under control of the South Korean companies in violation of Russian law.
High technology industries, particularly those to help small and medium businesses achieve their potential, were also targeted as opportunities for closer cooperation between Russia and South Korea.
The meeting of the two presidents was the occasion to announce the signing of several important bilateral agreements. These included:
- agreements about the mutual cancellation of visa requirements
- agreements about the incorporation and operation of cultural centers
- memorandum of understanding between the Russian Ministry of Transport and the South Korean Ministry of the State Territories and Transport concerning transportation
- memorandum of cooperation among the Russian Federal Tourism Agency and the South Korean Ministry of Culture, Sports, and Tourism to organize Years of Mutual Visits between the two countries in 2014 and 2015
- memorandum of mutual understanding between the state corporation The Bank of Development and External Economic Activity (Vnesheconombank) and the Export-Import Bank of the Republic of Korea
- memorandum of cooperation between the OJSC RJD, the POSCO company, the Railroad Corporation of Korea, and the Hyundai Merchant Marine Co., Ltd.
- memorandum of mutual understanding between the RDIF and the KIC about creation of a joint investment platform
- memorandum of the mutual understanding between OJSC NK Rosneft, OJSC Gasprombank, OJSC Sovcomflot, and the Daewoo Shipbuilding and Marine Engineering Company about cooperation in the development of shipbuilding centers in the Russian Federation.
The the leaders of the two countries came away from these meetings with a high sense of optimism about the dynamic advancement of mutual cooperation between the Russian Federation and the Republic of Korea in the political, economical, scientific, technical, and cultural areas. The also expressed an commitment to use bilateral agreements to continue to develop mutually beneficial, future-oriented relations in a spirit of strategic partnership and cooperation between the two countries.