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Situation with Siemens undermines Russia’s trust in European business — lawmaker

July 25, 2017, 18:46 UTC+3 MOSCOW

The refusal of Siemens to supply energy equipment to Russian firms forces Russia to seek alternative suppliers, the lawmaker said

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MOSCOW, July 25. /TASS/. The refusal of Germany’s Siemens to supply energy equipment to Russian firms undermines the credibility of European companies and forces Russia to seek alternative suppliers both on domestic market and abroad, Vladimir Gutenev, First Deputy Chairman of the State Duma Committee on Economic Policy and Industry, told TASS.

First of all the Russian enterprises, which are part of the United Engine-Building Corporation (under Rostec corporation) are the main alternative as supplies of the energy equipment, Gutenev who is also First Vice-President of SoyuzMash Russia, said.

"They can fully implement such ambitious projects," the first deputy head of the profile committee assured. Also, the Asian markets could be promising in this direction, he added.

"We can look for other suppliers. In China they have very good and quite competitive products. We can also carry out a full import substitution, which is much more promising in terms of creating jobs," Gutenev said.

Speaking about the consequences of the scandal with Siemens, Gutenev said that some Russian companies are quitre capable of producing heavy turbines from 35-40 megawatts and higher.

"Power Machines has very good competence and a number of joint subsidiaries. So the whole situation will not be a big tragedy for us, although it will, of course, cause inconvenience," he said.

On July 21, Siemens announced that all four gas turbines produced by the German company for a project in southern Russia have been delivered to Crimea, in breach of the agreements.

Siemens stressed that it has no plans to wrap up operations in Russia but will toughen the rules of operation in the country. From now on it will implement new projects for development of gas turbine power generation equipment in Russia only through a joint venture with Power Machines - Siemens Gas Turbine Technologies (STGT), and its wholly-owned subsidiary, OOO Siemens, Moscow. All new engagements would be subject to the new, permanent control mechanism, the company said.

Energy Minister Alexander Novak said earlier that the situation with Siemens does not pose any risk to Russian companies.

"Our domestic market is absolutely competitive, everything that Siemens delivers can be supplied by other companies, including those in electric power industry. In many respects, as part of the import substitution policy, we learned how to produce the appropriate equipment. I do not think that leaving our market will be an effective step for them. For us it does not carry any risks," Novak said.

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