A Russian-Chinese business dialog event was held at the Saint Petersburg International Economic Forum.
On June 7, 2019, a Russian-Chinese business dialog event was held at the Saint Petersburg International Economic Forum. Kseniia Sosnina, Ilim Group CEO, attended the event.
The key topic of the business dialog was the development of trade relations between Russia and the People’s Republic of China. Speakers included leaders of the largest enterprises from both countries, logistics companies and representatives of business associations.
Given a growing interest in China's economy, SPIEF 2019 welcomed more than 1000 Chinese delegates, including representatives of Chinese ministries, provinces, state-owned and private companies, as well as journalists.
Being guided by the target set forth by the president of the Russian Federation regarding an increase in non-commodity and non-energy exports, domestic companies aim to increase their exports of finished products to China while transport companies, in turn, aim to expand the delivery of goods to the consumers in Chinese regions. A special focus was made on the One Belt, One Road project. The speakers suggested that the idea of the Eurasian Economic Union and the One Belt, One Road initiative integration provides significant mutually beneficial opportunities.
Upon completion of the Russian-Chinese business meeting, Kseniia Sosnina, Ilim Group CEO, met with journalists from the Asian mass media, namely from The Renmin Ribao, an official newspaper of the Central Committee of the Chinese Communist Party, and The South China Morning Post, the oldest Hongkong English-language newspaper.
In view of the high relevance of the Russian-Chinese trade relations, Asian journalists asked questions about Ilim’s plans regarding further expansion of its exports to the East. In response to their questions, Kseniia Sosnina emphasized that China is the key partner of Ilim Group.
“Ilim has been working in the Chinese market for more than 23 years. Consistence and reliability are the key concepts for our business. Ilim Group has an excellent reputation and a good pool of partners, traders and consumer plants which appreciate the quality of our products and trust us. Over the years of its presence in the Chinese market, Ilim has delivered more than 20 million tons of products to China. Today the aggregate volume of the Russian exports to China is around USD 100 billion with Ilim's share accounting for more than 1% (Ilim’s revenue from its exports to China is around USD 1.2 billion). In order to improve this indicator and contribute to the Russian non-commodity exports increase, Ilim is investing around USD 3 billion in the upgrade and construction of new capacities at its mills in Siberia. Most of these investments will be spent to increase the board production capacity. By 2023, Ilim’s annual production output will grow by 1 million tons of finished products (700 thousand tons of board and 300 thousand tons of pulp). And in 5 years' time Ilim’s export volumes to China will increase by another 60%. In order to do so, Ilim is actively cooperating with its Chinese partners, both distributors and logistics companies. Since the beginning of 2019 Ilim has already held 6 big conferences attended by more than 600 people, including representatives of about 300 plants from different regions in China. All in all, our products are consumed by more than 500 plants located in 20 Chinese regions,” said Kseniia Sosnina.
The journalists also asked questions about the environmental footprint of Ilim’s production process, since the environment is now one of top priorities in China. As a reminder, starting from January 2018, China enforced a ban on import of unsorted waste paper. There is a ban on fluorescent substances and the laws on food packaging safety have become more stringent.
“Ilim fully supports China's strategic focus on environmentally friendly manufacturing process and helps implement this strategy,” said Kseniia Sosnina. “Our products consist of virgin fiber, which is fully compliant with the requirements of the Chinese companies. Kraftliner produced by Ilim Group has significant competitive advantages: it has superior physical, mechanical and high load bearing capacity, and is suitable for food packaging. In view of e-commerce growth and urbanization, the Chinese market demand for board will continue to grow in the near future.”
While discussing the One Belt, One Road initiative, Kseniia Sosnina emphasized its positive effect. “By 2024 Ilim will increase its exports to China by almost 1 million tons to reach 2.4 million tons of products per year. In order to ensure an optimal supply chain, which will allow to deliver products to all regions on time and without failure, the logistics network needs to be developed. Ilim is investing more than USD 260 million in the logistics services to develop the existing logistics infrastructure and expand the rolling stock. High level of service, including various logistics solutions, has always been Ilim’s advantage. Proximity of its Siberian mills to China gives Ilim additional sales opportunities. Ilim strives to continuously improve its processes.”
