Russian metallurgical holding Novostal – M intends to become a participant of the AIFC
On October 27, 2021, the management of the largest metallurgical holding of the Russian Federation LLC “Novostal-M” (hereinafter – the Holding), represented by its shareholder and CEO Ivan Demchenko, visited the Astana International Financial Center.
This visit was organized by the AIFC Green Finance Centre and the Eurasian Development Bank (hereinafter – EDB).
During the visit to the AIFC, a tour and presentations of all bodies and organizations were held. The possibilities of the AIFC Court and Arbitration Center, the Expat Centre and the AIX Exchange were presented. TechHub and BCPD presented possible cases of cooperation considering the trends in the development of the metallurgical industry as a whole.
“Novostal-M” is a metallurgical holding company that manages such enterprises as the Abinsk Electrometallurgical Plant located in the Krasnodar Territory and JSC “MP Balakovo” located in the Saratov region. The total volume of steel production is about 3 million tons per year. 80% of the products are exported, including to Kazakhstan.
The main attention of the guests was paid to the issues of cooperation with the Green Finance Centre in the development of ESG policy for the Holding structures, the introduction of green financing tools and the attraction of green technologies.
{img}
Following the visit, a trilateral memorandum of understanding on partnership was signed between Novostal-M LLC, the Eurasian Development Bank and the AIFC Green Finance Centre.
According to the memorandum, the EDB will provide financial support to the Holding’s green projects. Consultations, evaluation and selection of green projects will be carried out by the Green Finance Centre.
Deputy Chairman of the EDB Management Board Amangeldy Isenov stressed: “In carrying out its investment activities, the EDB pays special attention to three aspects: promoting sustainable development, economic integration and compliance with the principles of social and environmental responsibility. Today, the company “Novostal-M” carries out activities aimed at reducing the negative impact on the environment, implements ESG principles both at its enterprises and in the electrometallurgical industry as a whole. The Eurasian Development Bank supports such initiatives and is ready to provide the necessary assistance to the development of the “green” direction of the metallurgical holding”.
In general, following the results of the visit to the AIFC, the Holding together with Business Connect will work out the issue of opening an office in the AIFC, TechHub and BCPD will send their proposals for the Holding’s participation in the C4IR project and educational programs.
In turn, the Head of the Russian holding noted: “I am pleasantly surprised that a comfortable business oasis has been created in the AIFC, in which bold innovative projects can be implemented”. In addition, the head of the Holding, Mr. I. Demchenko, invited the AIFC employees to participate in the Moscow International Congress “Metal EXPO” (November 9-12, 2021) for a wide presentation of the AIFC to the largest metallurgical companies in Russia. In his opinion, all the products and services of the AIFC will arouse great interest among metallurgists.
Reference:
The Astana International Financial Centre was created by the initiative of the First President of the Republic of Kazakhstan, Leader of the Nation, Nur-Sultan Nazarbayev as part of the “100 steps to implement five institutional reforms” national program. The Centre’s development strategy until 2025 was approved by the Management council of the AIFC during the council’s meeting on July 2, 2020. In accordance with the strategy, the vision of AIFC is in becoming the leading financial centre in the region that includes Central Asia, the Caucasus, EAEU countries, western China, Mongolia, and Eastern Europe.
The mission of the AIFC is to assist the sustainable and long term development of the region. As the head of state Tokayev noted, “AIFC, with its unique opportunities, can act as a universal platform that connects the countries in the region.” The strategic directions for sustainable development of the AIFC include the development of a circular economy, financial technologies and a “digital financial centre”.
The AIFC Green Finance Centre is a subsidiary organisation of the AIFC Authority and the Eurasian Development Bank, aimed at introduction and development of sustainable finance instruments and attracting of investments in environmental and social projects in Kazakhstan and Central Asia.
The AIFC Green Finance Centre supported the very first issuance of green bonds and first verified green loan in Kazakhstan. Also, the Centre introduced definitions of green finance and green taxonomy (a classifier of economic activities and projects that meet technical selection criteria) in the national environmental legislation. The new legislation provides incentives for entrepreneurs who use green finance instruments.
The Eurasian Development Bank (EDB) is an international financial organization that carries out investment activities in the Eurasian space. For 15 years, the EDB has been promoting the strengthening and expansion of economic ties and the comprehensive development of the participating countries: Armenia, Belarus, Kazakhstan, Kyrgyzstan, Russia and Tajikistan. The authorized capital of the EDB is US $ 7 billion. The main share in the EDB portfolio is occupied by projects with an integration effect in the areas of transport infrastructure, digital systems, green energy, agriculture, industry and mechanical engineering. In its activities, the Bank is guided by the UN Sustainable Development Goals and the ESG principles.
«Novostal-M» is a metallurgical holding that unites two large industrial enterprises: the city-forming LLC “Abinsky Electrometallurgical Plant” (Krasnodar Territory) and JSC “Balakovo Metallurgical Plant” (Saratov region). The holding produces more than 2.8 million tons of steel per year. The main products are construction rolled products, wire rod, shaped rolled products, wire with various types of coatings.
In total, more than 6,000 people work at the holding’s plants, and the total revenue for 2020 amounted to 82.9 billion rubles. Both companies are implementing promising investment projects, have a significant impact on the metallurgical industry, employment, tax revenues to budgets of all levels and make a significant contribution to socio-economic development.
