Siemens signs up for closer Russian ties

Siemens has strengthened its business ties with Russia, agreeing to participate in the Skolkovo innovation project and signing contracts with RZD, RusHydro and Rostechnology on Thursday.

In the backdrop of a meeting between President Medvedev and German Chancellor Angela Merkel in Ekaterinburg, Skolkovo Foundation President Viktor Vekselberg and Siemens CEO Peter Loescher signed a memorandum of understanding.

According to President Medvedev, Russia supports Siemens's plans to build a center in Skolkovo and Siemens participation in running the Skolkovo hi-tech hub.

Loescher also signed a memorandum of understanding with Russian Railways on the joint modernization of at least 22 sorting stations prior to 2026, with the aim of localizing production 80% within 5 years. This was coupled by another memorandum to set up a joint venture to manufacture, supply and service modern electric trains. According to the agreement, RZD will place an order at the new joint venture for 1200 DESIRO RUS – which are planned for suburban transportation use in big Russian cities.

RZD President, Vladimir Yakunin, was optimistic about the agreement and the link up with Siemens.

“RZD pays special attention to the development of cooperation with German partners in railway transportation. The joint projects being realized are strategic in terms of their depth and scale. This many-sided cooperation includes cargo and passenger transportation, international logistics, joint creation of breakthrough technology in engineering, personnel training and other fields. We are satisfied with the efficient and fruitful cooperation of RZD and its German partners and are ready to promote coordinated activities in terms of opening up the markets of transportation and logistics and engineering products in Europe and Asia.”

The agreements with Rostekhnology and RusHydro include the setting up of a joint venture to produce wind energy installations, according to Rostechnology head, Sergey Chemezov. He said the joint venture will be located in Volgograd, using a local plant which he added would be overhauled.

“We will redesign it, as today it’s in a difficult financial situation. We plan that joint production will start already next year.”

According to President Medvedev, all this comes in the wake of developing economic cooperation, which is strengthening despite the crisis.

“In January to May 2010 trade turnover between Russia and Germany grew by almost 50 %. The economies are recovering, the main trade sectors are recovering. According to our data, German investment in Russia’s economy accounted for around $20 billion. That makes us really happy."