Russia moves to protect shipbuilding business

A representative of the governmental press service confirmed comments made by Dmitry Rogozin, first deputy prime minister of Russia, that all the orders for new Russian ships should be executed in Russia, instead of German, South Korean and other foreign shipyards.

Rogozin said: “We plan to form a single state order for all types of shipbuilding and marine equipment that will be calculated for the next several years. It would be better to suspend the development of offshore fields, instead of giving shipbuilding orders to foreign countries. The funds must remain Russia.”

An official spokesman of the German Ministry of Transport said that the loss of Russian orders would be a significant loss for German shipbuilding businesses, which count Russian shipping companies among their major customers.

Meanwhile the Russian government hopes to attract foreign shipbuilders to establish production within the country, in the form of joint ventures with local shipbuilding companies. Ministers from Russia and Germany have recently discussed establishing ventures at Russian shipbuilding plants in St Petersburg.

According to sources close to the St Petersburg government, such joint ventures would allow Russia to benefit from German shipbuilding and marine technologies on conditions that will comply with sanctions against Russia, as future ventures will be registered in Russia.

The Russian government has also started talks with South Korean shipbuilders on the supply of technologies and equipment for Russian shipyards. Daewoo Shipbuilding & Marine Engineering Co is among South Korean companies already participating in Russian projects, although the company declined to comment on future developments.