News / Europe

Vladivostok Aspires to be Hot Pacific Rim City

James Brooke
The world spotlight shone on Vladivostok in early September when 20 Asia-Pacific heads of government gathered for a business conference in Russia’s main Pacific port.

Looking ahead, regional officials and investors are working to turn Vladivostok into Russia’s first hot Pacific Rim city.

The region’s new governor, Vladimir Miklushevsky, says a key will be to attract investment from China - and to cut red tape. He is lining up investors for 19 development projects totaling $95 billion over the next decade.

 “We are going to reduce the administrative barriers for business projects,” he said.

Near the new $200 million airport, construction starts next year on a “Northern Macao” - Russia’s largest casino and resort complex

 “We are planning to develop it has an integrated resort, with gambling used as an anchor, and we’re planning to receive 10-12 million tourists a year,”  said Miklushvesky, governor of Russia’s Primorye region. “Why is tourism possible in Vladivostok?  First, it’s the unique location of Primorye.  There is a population from 200 to 300 million people within a one- to two-hour flight from us.  Of course, I mean citizens of China, Korea, and Japan.  And we are waiting for, and anticipating, their arrival.”

Salavat Rezbaev says another key to the region’s development will be investment from China. He is brokering Chinese investment for a $4 billion new port, and $30 billion new town.

 “Seven to 10 years ago, it would be unimaginable to offer a serious level of Chinese investment in certain areas of the economy, certain sectors,” said Rezbaev, who is chairman of New Age Capital Partners. “Right now, we’re witnessing it.  Not only are we witnessing it, we’re doing it, and we’re getting support from the regulators, from the government.”

Top-level backing was clear in early September when President Vladimir Putin inaugurated a plant to assemble Japanese Mazda cars in Vladivostok. Elizaveta Badalova represents Sollers, the Russian side of the joint venture.  Sollers also assembles SsangYong cars from South Korea in Vladivostok.

“Customers in Vladivostok used to buy used vehicles and the vehicles from Japan,” Badalova said.  “But now when they see their own plants and their own territory working, I think the impression is better.”

Foreign investors praise Vladivostok’s central location.

Clive Bowen, from Britain, plans to build a $200 million motor sports center near the new airport. 

“We are within an hour to an hour-and-a-half from all of the key markets for motor sports in Asia - so you have Japan, South Korea, and China,” he said, joined by the Russian Project President Vitaly Verkeenko.

By embracing Asia, Russia may finally create its own hot city on the Pacific Rim.

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by: Gennady from: Russia, Volga region
September 27, 2012 11:27 AM
For 12 years the regime was unable to eradicate sharp difference in Russia’s regional development. Why will Vladivostok be an exception? Mr Putin in his May’s Decree wanted the government to address the problem but nothing happened as some ministers opposed to the Decree. http://www.kremlin.ru/news/16493, http://www.kremlin.ru/news/16503. In an interview to Vedomosti.ru a high ranking bureaucrat said “Its easy (for the President) to throw money (billions $) and promises than to build new roads in the Far East as they are being destroyed by rains”. It sounds as if no other country in the South-East Asia has any road.
In Response

by: Charlie from: UK
October 01, 2012 4:34 PM
The ways things work are the same in Russia and China.If you want the contracts,you come up with some bankhand money,and you can forget about all the nitty gritty.For years the Russians have been worried about large Chinese immigrant population in Vladivostok.With more investments from China that would open the floodgate to more Chinese which could pose a threat to Russian sovereignty in the near future when the Chinese immigrants decide to break away from Russia and join up with Mother China as it has happened in former Yugoslavia.

What's the point in having foreign investment when it doesn't create jobs or improve the way of life for the local population? Would China have got to where it is today if the West and Japan have invested in the same way as them? Just get the resources,make the money and forget about polution,exploitation and sufferings
In Response

by: Jonathan Huang from: canada
September 28, 2012 10:10 PM
worry01fromus, you are wrong, China's investment focus on natural resources, so there is no such thing as investment return, as long as we have the accesses to those resources, we will keep invest. Another main investment is market, the main problem in Russia is the consistence of policies, if you dont have a fix rule how can we play a fair game? And for sure Russia is worried about too much China influence.
In Response

by: Worry01 from: U.S.
September 28, 2012 4:19 AM
I would be a bit wary. If China is only offering short-term investment, the residents could be left holding the bag for projects that Chinese companies decide to abandon. Some African countries have had that experience in recent years with some Chinese firms. The Chinese failed to take into account the poor infrastructure and skill level of the workforce, and lost patience when their capital investment did not yield rapid returns.

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