Fundraising

RDIF to boost Far East investments

The Russian fund and its international partners have allocated $1.1bn to potential projects in the region, with a focus on infrastructure, natural resources and energy.

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The Russian Direct Investment Fund (RDIF) is planning an investment push in the easternmost areas of the country, Kirill Dmitriev, chief executive of the state-backed investor, announced at a meeting chaired by Russian premier Dmitry Medvedev last week.

RDIF and its international partners have collectively allocated RUB40 billion (€800 million; $1.1 billion) for investments in Russia’s Far East this year, with a focus on sectors including infrastructure and transport logistics, natural resources, energy efficiency and petrochemicals.

This compares with RUB22.4 billion of investments marshalled by the fund in similar sectors last year, which included RUB16.3 billion from the fund’s international co-investors.

“We are seeing significant interest in these investment projects in the Russian Far East, particularly from our Asia-Pacific partners. RDIF’s investment platforms with China Investment Corporation, Japan Bank for International Cooperation and Korea Investment Corporation are considering a number of promising projects in various industries,” Dmitriev said in a statement.

Large-scale projects to be backed by RDIF include the first bridge to connect Russia and China across the Amur River, which will be funded through the Russia-China Investment Fund, a $2 billion joint-venture between RDIF and the China Investment Corporation (CIC).

The fund is also nearing a deal with Russian operator Rostelecom over a joint project to upgrade digital services and infrastructure in the country’s small and mid-sized towns, with some of the funds provided by the Russian National Wealth Fund. The initiative would be first implemented in Russia’s Far East.

RDIF was founded in 2011 to attract foreign direct investment in Russia's emerging economy. Equipped with $10 billion, it has sealed investment partnerships with a number of sovereign wealth funds from the Middle East, China, Korea, Japan, France and Italy.

The platform has made $3.8 billion worth of investments since inception, comprising more than $900 million of its own funds and $2.8 billion sourced from co-investors.