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02 december, 2014

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Civic Chamber advises state-owned companies to buy Russian

Civic Chamber advises state-owned companies to buy Russian

Vice President of the Russian Union of Entrepreneurs of Textile and Light Industry Eugenie Titov suggested that natural monopolies and state-owned companies should be prohibited to purchase foreign light industry products unless there are no Russian analogues on the market. He announced this in the Civic Chamber during a round table on optimization of the public procurement system.

“As time passes by, the issue of import substitution is getting more and more urgent. As yet, we have no clear pattern of how state-owned companies should cooperate with domestic manufacturers; what we have is reciprocal claims, so we need to look for ways of bridging the differences. We will not reach an agreement without efforts from both sides”, Andrey Razbrodin, round table moderator and member of the Civic Chamber Commission on Development of the Real Sector of the Economy, outlined the problem.

According to Eugenie Titov, the market of special workwear and footwear for natural monopolies and state-owned companies is estimated at ₽35 million. “This is a significant sum for Russia’s light industry enterprises, with production of many of them being competitive against foreign substitutes”, Titiov argued.

Deputy Director Roszheldorsnab, the branch of OJSC "Russian Railways", Maxim Karagiannis expressed fears that in the case of the introduction of restrictive measures, domestic producers will not be able to provide the necessary quality of materials: "Technical standards for materials have been introduced not on a whim of state-owned companies, but with respect to safety and comfort of workers. We just can’t abandon them in favor of import substitution policy”.

Member of the Civic Chamber Andrey Razbrodin admitted that fears of state-owned companies are reasonable, as there is no unified database of Russia’s light industry enterprises containing complete and accurate information about all industry players. “Volume of production, materials, logistics, lead time – all this information should be available in a unified register if we are to minimize risks in the public procurement process”.

Ministry of Industry and Trade, in cooperation with Russian Union of Entrepreneurs of Textile and Light Industry, has already started working on a unified register that would contain reliable information on industry players.

“We support a push for substitution of import, but this transition should be gradual. Now we are working on a register and are going to follow it up with a plan of development of the industry in accordance with government’s demand”, said Irina Ivanova, Head of the Light Industry and National Handicrafts Department, Ministry of Industry and Trade of the Russian Federation.

RF Civic Chamber Media–Office

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