ISA: General Aviation in Russia
TITLE: GENERAL AVIATION
SUBJECT COUNTRY(IES): RUSSIA
POST OF ORIGIN: MOSCOW
SERIES: INDUSTRY SECTOR ANALYSIS (ISA)
ITA INDUSTRY CODE: AIR
AUTHOR: VICTOR POLISHUK
DATE OF REPORT (YYMM): 9512
APPROVING OFFICER: RICHARD STEFFENS
OFFICER'S TITLE: COMMERCIAL OFFICER
NUMBER OF PAGES: 16
SUMMARY
Russia's aircraft fleet is faced with massive obsolescence. More
than 1,000 planes (four-fifths for domestic, the rest
forinternational) must be replaced by the end of this
decade.Russian aviation companies seek U.S.-made engines and
avionics to produce low-cost aircraft for domestic markets.
Dozens of independent regional and private airlines seek to lease
new or used U.S. aircraft to fly both international and domestic
routes. Russia's new rich, and its new private companies, will
want U.S. light aircraft for recreation and business transport.
The most promising subsectors are large passenger aircraft, light
aircraft for general aviation, and jet engines. The estimated size
of the aircraft and aircraft parts market for Russia in 1995 is
USD 805 million, with the U.S. share at ten percent. U.S.
aircraft sales to Russia are expected to grow markedly over the
next three to five years. General aviation was selected as a topic
for market research because this subsector appears poised for a
rapid take-off.
General aviation encompasses private flying, utility operations,
corporate transportation, and recreational aviation. Typical
aircraft used in general aviation are corporate jets, turboprops,
light piston engine aircraft, small helicopters, and experimental
and homebuilt aircraft.
Although the general aviation market is still very small in
Russia today, it appears to have an enormous future for several
reasons. First, aviation in Russia has a proud and proven
history; it is a gem of Russia industrial base, and the
government is expected to make substantial efforts to promote
it. Second, Russia, like Canada and the United States, has a
vast hinterland, where small cities and towns are separated by
enormous distances. As in Canada and the United States, the
light aircraft used in general aviation are often the best way to
quickly bring small cargos and people to remote sites. Third,
many of Russia's new rich are fascinated by flying. These
individuals, long prevented from engaging in private flying,
promise to become avid consumers of general aviation aircraft
during the next decade. These trends indicate new market
opportunities for U.S. companies selling general aviation
products.
At the same time, Russian tariff barriers and certification issues
make market access difficult. U.S. companies interested in this
market can pursue one or more strategies to overcome these
barriers. First, marketing through dealers and local
representatives to the cream of the Russian market that is willing
to pay high prices (including tariffs) for quality U.S. aircraft.
Second, co-producing U.S.-designed aircraft with Russian
aerospace manufacturers. Third, selling U.S. general aviation
engines, avionics, and parts for Russian- designed craft.
STATISTICAL SUMMARY
(USD MILLION)
Years 1994 1995 1996 1997 1998
Import Market 0 0 30 65 70
Local Production 2 2 9 17 30
Exports 0 0 4 5 10
Total Market 22 35 77 90
Imports from U.S. 00 20 50 50
Exchange Rates 1 USD = 4,500 RUBLES (average 1995)
(per dollar)
Source: Statistics based on industry interviews.
A. MARKET HIGHLIGHTS & BEST PROSPECTS
We expect a currently meager market to grow dramatically over
the next two years to USD 77 million. The prestige of U.S.
aviation products, and early joint ventures established by U.S.
aviation firms, make U.S. companies prime candidates to
establish a strong market share in this subsector. Specifically,
we expect U.S. company revenues to grow from almost nil in
1995 to USD 50 million in 1997.
The potential impact of general aviation in Russia can be
predicted by examining economies with an established general
aviation markets. General aviation is firmly established in most
other countries and accounts for the majority of take- offs and
landings in the world. In the United States, general aviation has
been a separate market sector for many years. An FAA study
found the sector contributes USD 45.2 billion annually to the
economy and accounts for 542,000 jobs. 75.6 percent of all
U.S. air traffic and 37 percent of Instrument Flight Rules (IFR)
flying are general aviation.
With Russia's vast distances (a population of 147 million spread
over 11 time zones), general aviation is a logical successor and
supplement to road and rail travel. General aviation aircraft
offer cost-effective solutions to the transport problems of remote
Siberian cities and towns. Smaller, general aviation aircraft offer
users economies of time and place. Small aircraft allow one to
be at a designated place at a certain time, with minimum of time
lost in the process. Other benefits are corporate image, added
esteem for company employees, and good impressions made on
customers. Also, in Russia, the general aviation sector will
provide a promising employment source for retired military
personnel.
The general aviation sector, with its enormous potential for
growth, is a totally new market in Russia. The general aviation
industry, now in its infancy, will require over 8,000 private
aircraft over the next 15 years. Though general aviation aircraft
prices range from USD 100,000 for a small used aircraft to up
to USD 10 million for a corporate jet, a typical price for a
general aviation aircraft is perhaps USD 200,000. Rough
calculation indicates that the total value of this market over the
next 15 years could be at least USD 1.6 billion, and annual sales
could eventually reach USD 100 million.
Specific projections for the next two years are based upon
analysis of expected sales of individual aircraft. A large part of
revenue each year will come from sales of corporate aircraft.
For example, U.S. sales of USD 20 million in 1996 represent
15 corporate aircraft with an average value of USD 1 million,
plus USD 5 million in lower-cost light aircraft plus U.S. engines
and avionics for Russian-built general aviation aircraft.
Several factors will significantly affect the growth of the general
aviation market in Russia.
First, the speed with which the Russian government establishes a
legal framework for general aviation in Russia will have a
dramatic impact on the subsector's development. The U.S.
FAA has been working with the Russian Interstate Aviation
Committee (MAK) and the Russian Department of Air Transport
(DAT) to develop this framework. Aviation laws defining rules
for general and commercial aviation have been submitted to the
Russian parliament for consideration.
Second, an important consideration is the rate of expansion and
the policies of the Russian Air Traffic Control system. Air space
control is currently very restrictive: the military controls all
flying in Russia. In Russia, flight plans must be filed for
approval three days prior to flight. All Instrument Flight Rules
(IFR) and Visual Flight Rules (VFR) flying is subject to this
rule. Currently, only charter companies comply (with difficulty)
with required flight planning regulations, and the current ATC
structure is a strong disincentive to the growth of general
aviation.
Third, continued high Russian tariffs imposed on aircraft and
parts will have a deterring effect on market development.
Finally, the time and expense imposed by Russian certification
requirements could significantly slow market development.
The general aviation subsector includes several categories:
- Utility operations: fire fighting, crop dusting,
helicopter load transport, pipeline patrol, aerial
survey, and law enforcement.
- Corporate transportation: corporate aircraft, government
aircraft, and charter operators.
- Private flying: pilot training, transportation, and
sightseeing by private individuals.
- Recreational aviation: aerobatics, homebuilts, air shows,
and balloons.
Several product lines are promising in this subsector:
- Piston engine aircraft (small single or twin, with fixed
or retractable landing gear, pressurized or non-
pressurized) -- HS 880220: Seating capacity is two to
six passengers and a pilot. These are useful for short
hauls to remote locations. Float plane versions may
become popular for hunting and fishing expeditions in
remote parts of Russia. Price range: USD 100,000 for
used to over USD 200,000. Ilyushin 103 price is USD
110,000; U.S. Cessna 172 or 174 new is priced at USD
200,000.
- Turbo-prop (small single and twin, retractable landing
gear, pressurized cabin) -- HS 880230: These aircraft
may be popular in remote areas for air links to smaller
cities. Price: usually USD 500,000 to USD 2,000,000.
Russian models are usually cheaper.
- Corporate aircraft (usually jet engines, retractable
landing gear, pressured cabin) -- HS 880240:
Corporations around the world recognize the advantages of
quick movement of executives and products. A great
variety of aircraft are now used in corporate fleets;
charter companies make frequent use of these larger
aircraft, renting to corporate customers that lack their
own planes. Examples include the Antonov AN-26, the
Beech King Air series, the Piper Cheyenne, and the Cessna
Citation. Larger aircraft include the Tupolev TU-134,
the Yakovlev YAK-40, and the YAK-42D in VIP
configuration. Passenger load in an executive
configuration is eight to ten. Price: Russian aircraft
prices range USD 1 to 4 million. U.S. aircraft prices
range from USD 1 million to USD 10 million.
- Helicopters: Light helicopters (HS 880211), for
corporate executive transport and utility work, are
invaluable in low-cost missions. A recent survey of the
Russian utility helicopter fleet shows that 61 percent
are helicopters with a take-off weight over 10 tons, and
the remainder are between 2 and 5 tons. Some 50 percent
of the present fleet is expected to reach the end of its
service life by the turn of the century. The greatest
shortage is in light helicopters, which has resulted in a
Russian Department of Air Transport recommendation to
certify Western helicopters. Potential operators of
light helicopters will be Russian oil and gas companies,
the fishing fleet, and law enforcement units. Prices:
depending on size, USD 500,000 to over USD 1,000,000.
U.S. aircraft companies may directly sell to Russian consumers
in this market, and eventually enter co-production agreements
with Russian aerospace firms. Since Russian engine and
avionics technology is behind U.S., U.S manufacturers of
aircraft engines and avionics will find many Russian aircraft
manufacturers ready to cooperate in building Russian general
aviation designs with U.S. engines and avionics. This is another
valuable way for U.S. companies to enter the Russian general
aviation market.
B. COMPETITIVE ANALYSIS
According to information released by the Department of Air
Transport of Russia, the Russian aviation industry is facing
tougher foreign competition. Russian aircraft manufacturers
find it difficult to raise money for new general aviation projects.
Moreover, Russian manufacturers must demand advance, full
payment for new planes, which Russian operators cannot afford.
As a result, Russian end-users may move away from Russian
planes to take advantage of lease offers made by Western
manufacturers. Russian regional carriers are having difficulties
finding replacements for L-410, Yak-40, and An-2 commuters.
(These aircraft will be discarded by the turn of the century.)
Many aircraft operated in a general aviation role, like the
An-28, An-2, L-410, L-610, Mi-2, and V-3 helicopters, are now
manufactured only in Poland and the Czech Republic.
Foreign-made planes make up five percent of Russia's aviation
fleet and their number is growing. According to Russia's
Ministry of Transport, Russian airlines will lease 100
foreign-made aircraft by the end of the century. The Interstate
Aviation Committee (MAK) has already certified Boeing, British
Aerospace, and Airbus Industrie aircraft for operation in Russia.
Certification of the Gulfstream II, III, and IV is in progress.
U.S. firms. U.S. companies have always enjoyed a good
reputation with Russian buyers and end-users. The most
important competitive factors are high quality, competitive
price, availability of service, and active advertising. After sale
support (rarely provided by Russian manufacturers) can be the
foundation for a U.S. firm's export program; special attention
must be paid to maintenance and repair.
Presently, U.S. firms employ two strategies in entering the
Russian general aviation market place. The first, less common
approach, is direct sales. (McDonnell-Douglas, Lockheed-
Martin, and Bell-Textron employ this strategy.) As certification
issues are resolved, export sales by these companies alone could
jump to USD 45 million by 1997.
The more common, longer-term strategy is for U.S. engine and
avionics manufacturers to seek to incorporate their equipment on
Russian general aviation designs. The present lack of financing
for Russian aerospace firms, the long time needed for aircraft
development and testing, and Russian firms' current low
production rates will slow the growth of sales in firms
employing this strategy. We expect sales of engines and
avionics for Russian general aviation designs to reach USD 5
million by 1997 and to climb steadily after that year.
U.S. firms work with Russian partners in a number of ways.
For example, Allied Signal has established two joint ventures to
design and manufacture avionics and landing systems for
Russian-built aircraft. In a bid to extend sales in the Russian
market, a Falcon 20B powered by Garret TFE731-5BR engines
was presented to prospective clients. Boeing established the
Boeing Technical Research Center in Moscow in 1993 to
conduct joint research with Russian institutes on a wide range of
commercial aircraft engineering topics. General Electric
supports GE engines serving on several Russian operator's
aircraft. GE has established joint manufacturing in partnership
with Russian engine manufacturer Rybinsk Motors. GE has
committed to providing engineering support for installation of
GE engines on Kamov Ka-62 helicopters and Sukhoi Su-80
business aircraft. Teledyne is providing engines and engineering
support for Il-103 and Yak-112 general aviation aircraft.
Myasischev Design Bureau has teamed up with Alliance Aircraft
Corporation of the U.S. to manufacture a 7-seat and a 8-19 seat
executive/regional aircraft, a 7-seat single engine turbo prop
executive aircraft Gzhel, and a twin- engine version of Gzhel.
Domestic production. In 1994, Russian aviation industry was
made up of 111 design bureaus and research centers and 134
aviation plants. The industry provides 778,000 jobs. General
aviation programs, however, are only a fraction of the Russian
aerospace industry. Though Russian firms have many
innovative general aviation designs, they are finding it nearly
impossible to raise the money needed to produce and sell
aircraft on the world market. More than 100 design bureaus are
now engaged in the research and development of general
aviation aircraft. 70 aircraft are in the design stage today with
Russian airframe manufacturing firms. Obviously, few of these
aircraft designs will ever enter production. Likely government
credits for the aviation industry (beginning in 1996) should
enable this industry to reach USD 20 million in domestic sales
and USD 10 million in export sales by 1998.
Smolensky aircraft plant manufactures the Yak-18T light four-
seat aircraft. It recently received 30 orders from the U.S., UK,
Switzerland, Turkey, United Arab Emirates, and Philippines.
Russia ordered an additional 20 machines. The aircraft is priced
at USD 65,000. Its range is 600 kilometers at a speed of 300
km/hr.
ROKS-Aero Corporation, a division of Khrunichev State
Research and Production Space Center, is involved in design
and manufacture of general aviation aircraft. Known initially
as ROS-Aeroprogress, this organization was founded in 1990 to
design and manufacture utility, commuter, amphibian, acrobatic,
agricultural, fire fighting, training, and other airborne vehicles.
It is a member of the Business Aviation Association. It has the
following designs currently at various stages of research and
manufacture: T-101, T-106, T- 130, T-201, T-203, T-274,
T-401, T-407, T-411, T-433. T-501, T-501, T-602, T-610,
T-910, T-204, T-422, T-417. Due to financial problems, most
designs are still only full scale mock-ups, and further financing
for the projects is being sought.
Sukhoi Design Bureau has designed a S-80 aircraft powered
with a GE engine. This multi-purpose 23-seater is being
manufactured at Komsomolsk-on-Amur aviation plant. The
Russian Ministry of Health and Ministry of Civil Defense and
Emergencies have ordered 43 aircraft.
Yakovlev Design Bureau is one of the largest designers and
producers of combat, commercial transport, and business
aircraft in Russia. Yakovlev's business aircraft product lines
includes the Yak-112, light, single-engine prop four- seater.
The export version of the Yak-112 will have Teledyne
Continental IO-360ES piston engines and Bendix/King avionics.
Yakovlev foresees a potential domestic market for up to 2,000
Yak-112s, plus 400 for export. Yakovlev is currently seeking
funding to continue development of the Yak-55M, single-seat,
competition acrobatic aircraft, and the Yak-58 six-seater.
On a smaller scale, Tupolev Design Bureau is proposing the Tu-
34 five-seat, high-wing short-take-off-and-landing (STOL) light
transport aircraft, powered by two Allison 250-B17F turbo
props in pusher nacelle installations.
Major Russian general aviation aircraft manufacturers (and
possible joint venture partners) include:
Beriev Design Bureau
Aviatorov Sq.,1
Taganrog, Russia 347923
Tel: 7-86344-499-01
Fax: 7-86344-414-54
Gennady Panatov, President & General Designer
Ilyushin Design Bureau
Leningradskiy Pr. 45G
Moscow, Russia 125190
Tel: 7-095-943-8116
Fax: 7-095-212-2132
Genrikh Novozhilov, General Designer
Kamov Design Bureau
Ul. 8 Marta, 8
Moscow Region,
Lubertsi, Russia 140007
Tel: 7-095-700-3204
Fax: 7-095-700-3071
Sergei Mikheyev, President & General Designer
Mikoyan Design Bureau (MiG)
Leningradskoye Shosse, 6
Moscow, Russia 125299
Tel: 7-095-158-1872
Fax: 7-095-943-0027
Anatoly Belosvet, Deputy General Designer
Mil Moscow Helicopter Plant Joint Stock Company
Sokolnicheskiy Val, 2
Moscow, Russia 107113
Tel: 7-095-264-9083
Fax: 7-095-264-5571
Mark Vineberg, General Designer
Molniya Design Bureau
Svoboda Str., 33
Moscow, Russia 123459
Tel: 7-095-493-5053
Fax: 7-095-492-9371
Alexander Bashilov, General Director
Myasichchev Design Bureau
Zhukovskiy,
Moscow Region, Russia 140160
Tel: 7-095-556-7829
Fax: 7-095-556-5583
Valery Novikov, General Designer
Sukhoi Design Bureau
Polikarpov Str., 23A
Moscow, Russia 124284
Mikhail Pogosyan, Deputy General Designer
Tel: 7-095-945-6525
Fax: 7-095-200-4243
Tupolev Design Bureau
Naberezhnaya, 17
Moscow, Russia 111250
Tel: 7-095-267-2508
Fax: 7-095-261-7141
Valentin Klimov, General Designer
Yakovlev Design Bureau
Leningradskiy Pr., 68
Moscow, Russia 125315
Tel: 7-095-157-1734
Fax: 7-095-157-4726
Alexander Dondukov, General Designer
Aeroprogress/Roks-Aero Joint Stock Company
Volokolamskoye Shosse, 65A
Moscow, Russia 123424
Tel: 7-095-145-8044
Fax: 7-095-145-9477
Third-country competitors. Like U.S. firms, third country
competitors are attempting both the direct sales and joint venture
strategies to penetrate this market. Thus far, however,
third-country sales are limited. Dassault and several other
European aircraft makers are seeking certification for their
business jets to permit sales in the Russian market. Alenia
(Italy) is negotiating a seaplane project with Beriev Design
Bureau. Myasischev Design Bureau and the National Aerospace
Laboratory of India have reached an agreement on joint
development of the M-102 14-seater twin turboprop. Yakovlev
has teamed up with IAI (Israel) to design and manufacture the
Yak-48 Astra-IV twin-turbofan business
jet.
C. END-USER ANALYSIS
The market for general aviation in Russia is unique in its
diversity and potential. An end-user profile could vary from an
extremely capable pilot who is able to afford an extravagant
aircraft to a corporation. Pent-up demand will lead to rapid
sales as Western aircraft are certified. Users will seek strong
after-sales service, ease of repair, aircraft name recognition,
aircraft safety and reliability, and low operating costs. For the
early buyers, cost will be no object, though later buyers will be
more sensitive to price.
Five government and private-sector groups can be identified as
potential end-users.
First, Russian ministries, state agencies, and regional
governments are potential operators of corporate jets and utility
helicopters (for example, the Dassault Hawker 800, the
Gulfstream-IV, or the Bell 209 helicopter). This group should
represent 30 percent of future demand. Russia has 24 Cabinet-
level ministries, 42 central Federal government agencies, 10
Presidential agencies, 11 Council of Ministers agencies, and 16
other federal agencies. Each is a potential corporate jet
consumer, and at least 10 of these agencies (notably the
Ministry of Defense, Ministry of Environment, Ministry of
Transport, and Ministry of Agriculture) will need large numbers
of aircraft and helicopters. Russia has 87 republics, territories,
regions, and autonomous areas. Several (the Republic of
Tatarstan, for example) have corporate jets, and many will be
seeking corporate jets.
Second, large Russian companies (particularly in the timber,
mining, and oil industries) are likely consumers of corporate
jets, light aircraft, and utility helicopters. This group will also
be 30 percent of demand. Of the 2,000 major defense firms that
represented the bulk of the old Soviet economy, at least 200 are
prospering sufficiently to become potential consumers of general
aviation aircraft. In addition, thousands of rapidly growing new
Russian firms could become possible buyers.
Third, charter companies are likely to purchase all types of
general aviation aircraft. These buyers will probably be 20
percent of demand. Charter companies will range in type from
jet passenger aircraft operators based in Moscow to smaller
"bush pilot" operations using small aircraft and seaplanes in the
wilds of Siberia and the Far East. Moscow alone has 12 U.S.
charter operators.
Fourth, law enforcement units are potential consumers of light
aircraft and utility helicopters. This group represents 10 percent
of future demand, though, over the long term, their share could
be higher. The Ministry of Internal Affairs and the Federal
Frontier Service are potential large buyers. In addition, Russia
has 14 cities with populations of over one million, 22 cities with
populations between one million and 500,000, and 117 cities
with populations between 100,000 and 500,000. Their militia
units are potential buyers of traffic and police helicopters and
light aircraft.
A final end-user group includes small companies, farmers, and
individuals who can afford small, private aircraft for both
recreation and local transport. This group represents 10 percent
of the dollar value of future demand, though the group will
probably buy more aircraft than any other. Smaller, less
expensive, aircraft, such as the Antonov An-26, the Beech King
Air series, the Piper Cheyenne, and the Cessna Citation, could
become attractive products. One industry observer predicted
that more than 10,000 Russians will buy Western general
aviation aircraft for private use once they become available in
the Russian market. One Russian aviation analyst predicted that
the most common plane in the Russian general aviation fleet will
eventually become a 4 to 10-seat light aircraft.
D. MARKET ACCESS
Import Climate. Despite current import barriers, general
aviation could quickly develop in Russia. Time after time in
other markets, the product-hungry, cash-rich Russian consumer
has demonstrated the ability to overcome logistical and
regulatory hurdles to obtain Western products. Further
development of trade in Russia will definitely increase general
aviation's role in the transportation infrastructure. The Russian
industry has good technical and manufacturing capabilities, yet
lacks knowledge of how to exploit the market. U.S. firms with
sophisticated marketing organizations could establish a strong
business presence in the country.
Market Impediments. For U.S. firms to capitalize on these
opportunities, two issues require serious attention: customs
duties and operations and aircraft and component certification.
The current 30 percent import duty and 20 percent value-added
tax on imports of aircraft and aircraft equipment hinders the
import of foreign-manufactured aviation products. Frequent
changes in Customs rules and individual interpretation of these
rules also impede trade in Russia. Case-by-case exemptions
could be sought, but they are not a good long-term solution.
The Russian government can be expected to maintain tariff
barriers against import of Western aircraft and to strongly
encourage joint ventures and joint manufacturing with Russian
aircraft manufacturers. The Russian Government provides
financial support to priority industries, including transportation.
Some tariff relief is given to foreign companies ready to supply
technology and equipment, provide services, start joint
production, and invest in industry development and
modernization projects.
Certification problems also hamper U.S. efforts to expand
opportunities. Certification of aircraft and components to an
undefined and inconsistent standard is expensive and time
consuming. Completion of a limited bilateral agreement in 1995
will help restore confidence for investors and partners in an
uncertain environment.
The certificate of conformity can be obtained through the
following organizations:
GOSSTANDARD (Russian State Standards Committee)
9, Leninskiy Prospekt
117049 Moscow, Russia
Tel: 7 (095) 236-4044
Fax: 7 (095) 237-6032
Vladimir Otrokhov, Head of International Department
This is the principal Russian state organization for certification
and standards.
VNIIKI (Russian Research Institute for Comprehensive
Information and Quality)
4, Granatny Pereulok
103001 Moscow, Russia
Tel: 7 (095) 290-5569, 290-2539
Fax: 7 (095) 230-2598
Sergei Papayev, Head of International Department
This Institute provides information on certification and
Russian standards.
European contact:
DIN GOST TUEV
16, Val Strasse
0-1020 Berlin, Germany
Tel: (030) 24-399-992
Fax: (030) 24-399-956
U.S. contact:
INTFO CORP.
Bellaire Str., Ste.1700
Denver, CO 80222-4348
Tel: 7 (095) 498-0004
Fax: 7 (095) 493-1265
Tim McCune, Director
Moscow contact: Elizabeth Houde
Tel/fax: 7 (095) 973-0976
Distribution. U.S. firms selling light aircraft and helicopters
should establish at least three dealers in Russia. One in
Moscow, one in St. Petersburg, and one in the Far East or
Siberia would be a good beginning. Another option is to work
with established luxury car dealers who could then offer sport
aircraft to their wealthy clients.
U.S. firms selling more expensive corporate jets will need to
establish a permanent office in Moscow to face the intricacies of
tariff exemptions, financing, pilot training, and maintenance.
U.S. companies working on joint projects with Russian partners
will need to help their partners in the following areas:
- business and marketing planning;
- setting up a dealer network;
- establishing after-sales service.
Financing. Dealers can expect to receive cash up-front for
recreational aircraft from a surprisingly high number of wealthy
Russian customers. (This has been the experience of many
luxury car dealers in Moscow.) Sales of million dollar aircraft
to charter companies and large corporations, on the other hand,
may require more complex financing strategies and leasing
deals. U.S. firms participating in joint ventures with Russian
manufacturers may seek financing from the Export-Import Bank
and OPIC.
On February 27, 1992, the Export-Import Bank of the United
States (Eximbank) opened programs to support U.S. exports to
the Russian Federation. Specifically, Eximbank supports, under
its short- and medium-term insurance, loan, and guarantee
programs, transactions involving U.S. exports to the Russian
Federation, when the obligor or guarantor will be
Rosvneshtorgbank (The Bank for Foreign Trade of the Russian
Federation), Vnesheconombank (The Bank for Foreign
Economic Affairs) or other official entity acting on behalf of the
Government of the Russian Federation. Before processing
applications for preliminary commitments, Eximbank requires
clearance by Rosvneshtorgbank or Vnesheconombank.
Financing Contacts:
VNESHECONOMBANK
Russian Contact:
Alexander Zhitnik
24 Leningradskiy Prospekt
Moscow, Russia
Tel: 7 (095) 204-6509
Fax: 7 (095) 975-2069
U.S. Contact:
Eugene Ulyanov
527 Madison Avenue, New York, NY 10022
Tel: (202) 421-8666
ROSVNESHTORGBANK
Russian contact:
Valery Telegin, Chairman
16, Kuznetsky Most
103031 Moscow, Russia
Tel: 7 (095) 928-7116
Fax: 7 (095) 973-2096
Telex: 412362 BFTR SU
IMB:
Herbert Marx, General Manager, Trade Finance
5/6 Pushkinskaya Ul.
103009 Moscow, Russia
Tel: 7 (095) 292-8341, 292-3837
Fax: 7 (095) 292-9873
Telex: 412284 IMBAN SU
EXIMBANK:
Russia Loan Officer: Mitchell McCauley
Tel: (202) 566-4779
Insurance Officer: Allen Lubetzky
Tel: (202) 535-9664
In an agreement ratified at the June 1992 Summit, the Overseas
Private Investment Corporation (OPIC) is authorized to provide
loans, guarantees, and investment insurance to American
companies that invest in Russia. OPIC assists U.S. investors
through four basic programs: financing or investment through
direct loans; insuring investments against political risks;
providing a wide range of investor services; and assisting in the
project development. OPIC has set aside up to USD 500
million to support U.S.-Russian joint ventures that involve
former Russian defense plants (which includes the Russian
aerospace industry.)
OPIC, 1100 New York Ave., NW,
Washington, D.C. 20527
Tel: (202) 336-8799
Fax: (202) 408-9859
U.S. government contact:
The Federal Aviation Administration (FAA), which is
responsible for fostering the development of civil aviation
throughout the United States and the world, has a number of
international technical assistance and cooperative programs.
U.S. contact:
Federal Aviation Administration
AIA-200, 800 Independence Avenue, S.W.
Washington, D.C. 20591
Tel: (202) 267-3173
Fax: (202) 267-5306
Moscow contact:
Dennis B. Cooper, Senior FAA Representative
U.S. Embassy
6, Bolshoi Devyatinskiy Per.
121099 Moscow, Russia
Tel: 7 (095) 956-4036
Fax: 7 (095) 956-4293
Key Russian Government Contacts:
Ministry of Transport of the Russian Federation
10, Sadovaya-Samotechnaya Ulitsa
101433 Moscow, Russia
Tel: 7 (095) 200-0803
Fax: 7 (095) 200-1479, 200-2678
Vitaly N. Efimov, Minister
General Direction for ATC Modernization (Ministry of
Transport)
10, Sadovaya-Samotechnaya Ulitsa
101433 Moscow, Russia
Tel: 7 (095) 924-3747
Fax: 7 (095) 200-2678
Anatoly N. Korotonoshko, General Director, Deputy Minister of
Transport
Department of Air Transport (Ministry of Transport)
37, Leningradskiy Prospekt
125167 Moscow, Russia
Tel: 7 (095) 155-5494, 155-5395
Fax: 7 (095) 250-1080
Telex: 411182
Vadim V. Zamotin, Director
Rosaeronavigatsiya
37a, Leningradskiy Prospekt, A-167
125836 Moscow, Russia
Tel: 7 (095) 155-5931, 155-5424
Fax: 7 (095) 155-5917
Valery Shelkovnikov, Chairman
Interstate Aviation Committee
Ul. Krzhyzhanovskogo, 7, korpus 1
117875 Moscow, Russia
Tel: 7 (095) 125-2178
Fax: 7 (095) 129-4177
Tatyana G. Anodina, Chairperson
Aviation Register
Ul. Krzhyzhanovskogo, 7, korpus 1
117875 Moscow, Russia
Tel: 7 (095) 129-4322
Fax: 7 (095) 129-6144
Valentin V. Sushko, Chairman
State Committee of the Russian Federation for Defense
Industries
3, Miusskaya Ploshad
125833 Moscow, Russia
Tel: 7 (095) 251-2812
Fax: 7 (095) 251-7056
Sergei K. Novikov, Deputy Chairman, Conversion
Scientific and Technical Center (under the Committee for
Defense Industries, ATC modernization)
35, Myasnitskaya Ulitsa
Moscow, Russia
Tel: 7 (095) 204-1220
Fax: 7 (095) 207-6091
Igor Ya. Immoreyev, Director
Trade Association Contact:
National Aviation Association of Russia
88, str.1, Volokolamskoye Shosse
Moscow, Russia 123424
Tel: 7-095-491-3711
Fax: 7-095-490-1622
Sergey Maslov, President
Trade Promotion Opportunities.
Moscow Aerospace Exhibition, every August.
(USDOC certified trade event)
During odd years, Moscow Aerospace is a major exhibition.
1997 is the next planned major show. During 1996, Moscow
Aerospace will be a much smaller exhibition about aircraft
engines. For information, contact Victor Polishuk at USFCS
Moscow.
Specialized Publications recommended for advertising products
and services:
Aviation and Cosmonautics (Journal)
12, Petrovsko-Pazumovskaya Alleya
125083 Moscow, Russia
Tel: 7-(095)-155-1464
Fax: 7-(095)-212-2042
Civil Aviation (Journal)
1/5, Staropanskiy Per.
103012 Moscow, Russia
Tel: 7-(095)-925-8506
Problems of Aviation and Space Technology (Journal)
21, Aninskaya Ul.
127521 Moscow, Russia
Tel: 7-(095)-219-8244
Fax: 7-(095)-219-5684
Radioengineering and Electronics (Journal)
11, Mokhovaya Ul.
203907 Moscow,
Tel: 7-(095)-203-4789
Air Transport (Newspaper)
1/5, Staropanskiy Per.
103012 Moscow, Russia
Tel: 7-(095)-924-3355
Fax: 7-(095)-928-5002
**Produced by the Business Information Service for
the Newly Independent States (BISNIS)
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