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N°95 - Troisième trimestre 2011

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El Salvador
Sri Lanka
  France-Russie : un partenariat tourné vers l’avenir
  Le groupe d’amitié France-Russie du Sénat : la diplomatie parlementaire en action
  Vers un renouveau du partenariat stratégique Russie-UE
  La Russie, un partenaire actif du Conseil de l’Europe
  La complémentarité, maître-mot du partenariat économique entre la Russie et la France
  « Les entreprises de France jouent la carte de la modernisation de l’économie russe »
  La CCIFR une plateforme incontournable pour comprendre les spécificités du marché russe
  Les enjeux de l’évolution des relations russo-européennes
  Les entreprises françaises passent à la vitesse supérieure en Russie
  « Notre objectif est de briser la barrière entre la science et le commerce »
  Le lancement de Soyouz à Kourou : un tournant historique pour la coopération spatiale russo-européenne
  La Russie, un marché stratégique pour les maisons du luxe français
  La Maison de la Russie à Nice : une initiative pionnière de la dynamique culturelle franco-russe
  France-Russie: le dialogue continue
  La science au cœur du resserrement des liens entre la Lorraine et la Russie
Enjeux Économiques
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  Russian Standard Vodka
Potel et Chabot
Crédit agricole
BMW paris
Caisse des Dépots
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Hôtel de Crillon Paris
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  S.E.M. / H.E. Alexandre Orlov

The French-Russian Tandem at the Heart of Greater Europe

Spurred forward by the France-Russia Year of Cultural Exchange in 2010, relations between Moscow and Paris have never been stronger. As Russia prepares to take over the presidency of the G20 in 2013, the two countries share similar views on a myriad of international political issues. They have bolstered their ties spectacularly in the economic arena, underscoring the complementary nature of their economies in a wide variety of areas. H.E. Alexander Orlov, the Ambassador of Russia to France, discusses the bilateral partnership in the wider context of the construction of Russia-Europe “common spaces,” and assesses the impact of these unprecedented advances.

The Diplomatic Letter: Mister Ambassador, you were at the 16th French-Russian Intergovernmental Seminar in Moscow on 17 and 18 November 2011. What, in your view, did they achieve?

H.E. Alexandre Orlov:
The 16th French-Russian seminar in Moscow in November this year gathered a large number of French and Russian ministers working on the main issues hovering around our bilateral cooperation. I was fortunate to attend all the meetings and can tell you that I saw the same depth and earnestness that I can see in all relations between Russia and France today. These relations are built on genuine trust and friendship, and stem from a real strategic partnership between two countries that value and respect each other. This seminar was also an opportunity to look back at what the teams in both governments had achieved over the past four years, in the light of the milestone elections – presidential elections included – in Russia and France in 2012.
Both countries agree that this seminar has achieved something extraordinary. We have managed to substantially increase exchanges in spite of the crisis. Our exchanges grew 34% over the first nine months of 2011 and should hit the US$ 30 billion mark – an all-time-high figure in French-Russian relations – by the end of the year.
This seminar has also pulled off a series of ‘emblematic’ projects, over and above the breadth and wealth of the exchanges. I would like to mention one example: the first Soyuz rocket launch from the Kourou Centre in Guiana on 21 October 2011. Both countries had been working very hard on that launch for a decade.  But, more importantly in my view, this achievement is opening up new horizons for French-Russian cooperation and for Europe. Soyuz rockets have joined the European family. And France and Europe didn’t just try out this new project with any old satellite: they used Soyuz to launch the first two Galileo constellation satellites. That is a strategic programme for Europe – and a statement about the level of mutual trust we share today.
The second milestone project that materialised in 2011 was Russia’s acquisition of two Mistral-class projection and command ships. That was the first time that Russia, which is also a leading armament manufacturer and exporter, had bought modern navy ships with the latest technology from another country – and a competitor on several markets.
And, last but not least, the third project I would like to mention is the Nord Stream gas pipeline. The opening ceremony took place on 8 November 2011, and President Dmitri Medvedev, Prime Minister François Fillon, Dutch Prime Minister Mark Rutte and German Chancellor Angela Merkel attended. Russian gas will be supplying the European Union directly for the first time ever. This is a big step to bolster Europe’s energy security and drive cooperation on this front, which we see as vital.

T.D.L.: The previous intergovernmental seminar, in December 2010, kicked off a cooperation programme in the farming sector and a French-Russian centre for energy efficiency. In which other areas would you like to see strategic partnerships between France and Russia deepen?

There are several new prospects opening up for French-Russian relations. Nuclear energy was on the latest intergovernmental seminar agenda. After the incident in Fukushima and Germany’s decision to pull out of the nuclear energy sector, Russia and France are the only two European powers that still believe in this option. As I see it, nuclear power is the power of the future: it is clean and nothing will be able to replace it, with gas, for decades to come. It is obviously necessary to develop alternative energies but experts agree that alternative sources will only ever play a supplementary role.
As Russia sees it, France has the best civilian nuclear technology today. In Moscow, we spoke about the possibility of building new nuclear power plants in Russia and other countries. We have also decided to double our capacity in this area over the next decade, adding 16 or 18 new reactors. We are actually building a plant in Kaliningrad. Alstom, a French company, has expressed interest in this project and is backed by the French State. Civilian nuclear power will account for a significant portion of our bilateral cooperation over the next few years.
Another important issue we broached was the fact that Russia is not investing enough in France. We only invested US$ 160 million, which pales in comparison to the total US$ 9 billion that France has invested in the Russian market! Prime Minister Vladimir Putin has invited his French counterpart to analyse the causes and work together to interest Russian investors in the French market. The French-Russian Council on Economic, Financial, Industrial and Commercial Issues, (or CEFIC for Conseil Économique, Financier, Industriel et Commercial) will be appointing a mixed task force to look into that. I believe France will be keen on cooperation in this particular area because, in the midst of a financial crisis, Russian investors can only be good news for the French economy and jobs.
More broadly speaking, we can see the scope of French-Russian cooperation expanding at every intergovernmental meeting. Farming was the big issue in 2010 and legal cooperation was in the spotlight this year. We established a commission – which was much needed given the growing number of marriages between citizens from both our countries – to protect children’s rights should their parents divorce. We have also signed a very important treaty on adoptions. As far as I know, French families have already adopted more than 2,000 Russian children. We hope this treaty will regulate this delicate issue and maybe also facilitate adoption procedures.
The other area where we might find opportunities to cooperate – or at least exchange thoughts – involves projects to build Greater Paris and Greater Moscow. Our two countries have actually started thinking about a programme to enlarge their respective capitals beyond their present boundaries. French Minister for Urban Affairs Mr Maurice Leroy is already in touch with his Russian opposite number to try to look at the possibilities in this area.
So, as you can see, French-Russian cooperation is growing further and further
beyond primary commercial exchanges. We are really talking about integrating our two economies, which will actually lay the foundation to build that large economic, human and security area spanning Russia and Europe that General De Gaulle had once envisaged and President Sarkozy and President Medvedev recently discussed. 

T.D.L.: Alongside state-of-the-art technology, buttressing infrastructure ranks high on President Dmitri Medvedev’s list of priorities to modernise Russia’s economy. How can French expertise help, especially in the railway sector?

As Russia is so immense, we unsurprisingly rank transport infrastructure high on our list of priorities. And we are also working towards several key milestone events that our country is due to host, including the 2014 Winter Olympics in Sochi and the 2018 Football World Cup. Before that, Russky Island will be hosting the 2012 APEC Summit off Vladivostok. And we are delighted that a subsidiary of French Group Vinci was selected to build the bridge connecting that island to the mainland. That group is also building the first stretch of the Moscow-Saint-Petersburg motorway.
Besides the Sochi motorway project, which is already well underway, French companies should be bidding on the toll highway skirting the Don River. Several plans to build rivers are also likely to interest French contractors (Gustave Eiffel incidentally built several railway bridges in Russia in his day).
As you asked about the railway sector, we are indeed building new railway lines, but the main goal is to modernise our existing network. A consortium including Alstom and other French groups is bidding to build the high-speed-train line between Moscow and Saint-Petersburg. I don’t want to get ahead of myself here but I think it has a good chance of winning it. We are also talking about other high-speed lines to Nizhny Novgorod and eventually Yekaterinburg.
All that infrastructure also ties in with the Football World Cup, which we will be hosting in a dozen cities in 2018. So we are also planning to modernise roads, build new stadiums and hotels, and so on. Building sites are mushrooming in Russia and we are counting on our French friends to take part in the various RFPs that we will be running soon.

T.D.L.: The Superjet-100 developed by Sukhoi, an aircraft manufacturer, and France’s plans to buy Beriev-type fire-fighter aircraft, are two examples. What other opportunities, in your view, can open up for Russian technology on the French market?

H.E.A.O.: France is indeed thinking about renewing its Canadair fleet and has expressed interest in Russian Beriev aircraft. We actually flew that aircraft to Le Bourget to display it and for a few demonstration flights at the June 2011 Air Show. But, most importantly, it spent the summer in the French Midi. Even though, fortunately for France, there were not many forest fires this year, we heard a lot of very positive feedback. It is now up to the French State to make a decision, which could happen by 2015.
As regards the Superjet 100, you mustn’t underestimate France’s contribution in general and the Safran Group’s contribution in particular to its design. One-third of its that aircraft’s selling price goes to the French side. This aircraft’s quality is amazing and it was recently tested between Moscow and Le Bourget. 170 have been ordered to date, in Russia and other countries. We are hoping several French airlines, regional airlines included, decide to buy this plane – especially as France has a stake in it.

T.D.L.: The Nord Stream gas pipeline’s inauguration on 8 November 2011 was a big step for cooperation between Russia and the EU in the energy industry. In that light, what is your view on the difficulties that the South Stream gas pipeline project is facing? Do you think they are connected to the European Commission’s stated preference for the rival Nabucco project?

The South Stream gas pipeline is a very big project. Before starting construction work, which needless to say requires very heavy investment, we concluded negotiations with the countries that this gas pipeline is supposed to travel through. Our European partners, especially Southern European countries, confirmed that they were interested in the project because they needed the gas and wanted to diversify their sourcing options. We also put together a consortium of companies to build and operate that pipeline (and are delighted that French Group EDF is involved). So we had prepared all the ground to start construction work.
The European Commission’s decision to adopt the third Energy Package, however, raised a serious problem – which we discussed extensively at the French-Russian intergovernmental seminar. This Directive has reshaped the conditions that apply to energy distribution in the EU.
The gas supply agreements that Russia has signed with several countries (including France) are long-term contracts – through 2025 – and pre-date that Directive. The European Commission has changed the rules of the game and made them retroactive, which is something that never happens in international law. We have made it clear that this Directive has made our energy relations with Europe much more difficult. So we have to reach an arrangement.
I would like to point out that Russia has never opposed the Nabucco project. But can this project replace Russia’s gas supply capacity? We have to be realistic and look at all the projects with the same yardstick. It is also important to put energy cooperation between Russia and Europe in historical perspective. For example, we signed our first contract with French company GDF 40 years ago. That is 40 years of true and tried services. As an aside, most of our European contacts had positive views on this project.
I would like to talk about another issue that comes up when we talk about energy in Europe: gas price increases. Aside of the fact that gas prices are correlated to oil prices, we can save European consumers’ money by delivering our gas directly to our local distribution company. As Prime Minister Mr Vladimir Putin has told his French counterpart Mr François Fillon, the intermediaries between producers and consumers are the ones that push gas prices up. If you cut them out, we estimate that consumer gas prices could drop 25 to 30%. We are negotiating a contract like that with a German company to deliver our gas directly. Then we will be able to see the actual effect on prices.

T.D.L.: In view of the EU-Russia Summit on 15 December 2011, Russian diplomacy was hoping to make progress towards a visa waiver for Russian citizens. In the long term, what are you expecting to achieve?

Our goal is to remove circulation visas between Russia and the EU as soon as possible. We have already done all the groundwork. We have signed agreements to readmit Russian citizens who are in European territory illegally. We have also started issuing biometric passports. But we have to meet new requirements in spite of all we have done. The new European Commission is slowing down the process. France is in favour, as are Italy and Spain. There are still a few issues to iron out with Germany but we are working on them together.
We hope to start negotiations to sign a visa waiver agreement as soon as we meet the conditions to do so on the roadmap.  That will be our stance in Brussels at the EU-Russia Summit.
I think that, if we want to push ahead and build this great Europe – which we have to build to counterbalance the big emerging hubs in China, India and Brazil, as well as the United States (which is still a key player) – Europe has to focus on thinking big and aiming high. And we have to waive visas to build this economic and human area. We are aiming to create a vast market, where capital, people and ideas can circulate freely, which is what the 1957 Treaty of Rome principles prescribed – and what could provide the basis for this common area spanning Europe and Russia.

T.D.L.: Your country hosted the first emerging country (BRIC) summit in June 2009 and has made it clear that it wants to weight on the international governance system’s reform. How do you feel about the Cannes Summit and the G20’s difficulties coming up with down-to-earth proposals to do that? What is your view on the difficulties in the Euro zone and their possible repercussions on Russia-EU relations?

Russia is actively involved in the G20’s efforts. We believe that it provides a very good structure for cooperation, especially to address the economic issues that concern us the most. The G8 of course has to keep on working because it has its own agenda but the G20 is much more representative and mirrors the multi-polar world that is surfacing today.
We will be able to show how dedicated we really are to the G20 in 2013, when Russia serves as its President (the Cannes Summit backed our bid). We will be taking over from Mexico. I believe Russia will be embracing most of the causes that the French Presidency championed. The two Heads of State see eye to eye on them. We will be pushing ahead with the efforts underway to reform global governance and the international monetary system. But you are obviously aware that those reforms won’t happen overnight. The French Presidency deserves a lot of credit for putting them on the G20’s agenda. That is a very important step: it has paved the way for the countries that take over to look for and find new solutions.
The crisis that Europe is undergoing today of course concerns us directly, because our economy is more and more intertwined with Europe’s economy. We feel the Euro exchange-rate fluctuations all the more so as half our gold and currency reserves are in Euro. So it is in our best interest to see Europe weather this storm as swiftly as possible. We are willing to invest in Europe if the conditions and projects are worthwhile, as I said earlier when I spoke about Russian investments in France. We are completely willing to help our European friends.
The French and Russian prime ministers have met to discuss the European Central Bank’s (ECB’s) role. We also see eye to eye with our French friends here: the ECB has to be able to play a key role resolving Europe’s crisis because the biggest threat for the EU today is not inflation but recession – which would be simply disastrous.
We are also willing to provide financial support for countries in difficulty via the International Monetary Fund (IMF). This institution was created to deal with this type of problem. Its procedures to do so have been tried and tested, so it can inter alia keep tabs on the funds it provides and on how the countries it bails out use them. We know what we’re talking about because we went through a rough patch in the early 1990s when Russia was in serious debt. Back then, we cooperated with the IMF and paid off our loans, to such an extent that the Russian State’s public debt is only 10% of our GDP today. So we know how much the IMF can effectively resolve the debt-related problems that certain European countries are facing today.

T.D.L.: The international economic downturn has also hit China, where growth has slowed down this year. Do you think that will last? And, more generally, what is your view on the way Russian-Chinese cooperation is evolving?

No, I don’t think China will be slowing down for very long, and much less that there is a risk of recession. We have to look at the wider trends – even if, for various reasons, we can sometimes see some sogginess in economic development in China, and in India, Brazil and even Russia. China is a huge country and should be emerging as the world’s leading power over the coming years.
China is also a major partner for us. If Russia is a European country from geographic, historical, cultural and economic-policy perspectives, a lot of our territory is in Asia. From that perspective, China is our biggest neighbour. Our trading tradition goes back a long way. I think Russia is quite fortunate to border a partner country that is developing so buoyantly. China needs energy to fuel its expansion. We are building an oil pipeline to provide it. But Russia mustn’t settle for supplying raw materials. We are hoping to develop industrial cooperation, for instance, to spur growth in the east of our country. Our political leaders meet several times a year, besides the fact that both our countries are part of new international cooperation forums such as BRIC and the Shanghai Cooperation Organization (SCO). This new reality also reflects the fact that a multi-polar world is emerging.

T.D.L.: The differences between your country’s and France’s views on Syria were the only ‘false note’ at the latest intergovernmental seminar. Can you tell us about Russia’s stance on the Syrian crisis? And, more generally, how do you feel about the “Arab Spring” and geopolitical shift in the Middle East?

We indeed have different views on the the events in Syria and see them from different angles. The French and Russian heads of government had a very open exchange on that issue. The point is that Russia is not one of Syria’s allies. We do not want to be Mr Bashar al-Assad’s advocates. To the contrary: we are working on every level with our Syrian partners to encourage them to accelerate reform, especially on the social front. The Syrian people have high hopes when it comes to modernising their country. They need answers, but using force is not one of them.
If we take a step back and look at the bigger picture, the “Arab Spring” as a whole, we can see that there are also many questions waiting for answers. These popular movements are needless to say perfectly legitimate and we acknowledge that they are objectively justified. They reflect the fact that these regimes need to modernise, and that the youth is aiming for better living conditions, more freedom, and a more open society. The fact that the leaders in those countries have often been in power for three or four decades has led to a form of political stagnation, maybe even sclerosis.
But our question is “where next?” Do France or any other western countries know? Should we be stepping in on one side or the other side of these civil – sometimes tribal – wars? We don’t think so. From that perspective, the international community should stand back. Somebody of course has to stop the violence. And we have the political and economic leverage to do that. But we can’t intervene militarily, which is what happened in Libya. Mr Vladimir Putin mentioned Iraq and Afghanistan as two examples. The United States is going to pull out of Afghanistan but what will happen next?
We have history in Afghanistan. And, precisely, what happened next? We have seen Wahhabism exported to Russia (especially Chechnya), the September 11, 2001, attacks, and now heroin traffic in Russia and on through to Europe. There is a great deal of border instability in that region. We paid the heavy price to put an end to the rebellion in Chechnya fuelled by Islamist extremists who came from other parts of the world – from Jordan, Saudi Arabia or Algeria – to fight Russia. Today, we don’t want the instability in the Arab world to spill over into our country as a fresh burst of Islamism. So we are trying to look at the long-term historical perspective. Unfortunately, European leaders are often tempted to make rash decisions, often dictated by popularity polls. That explains the difference in our approaches to Syria. It’s easy to destabilise the Arab world but it will be much more difficult to get to a point of equilibrium.

T.D.L.: The International Atomic Energy Agency (IAEA) recently published a report that made a serious case about the military agenda behind Iran’s nuclear programme. As Russia has established close cooperation ties with Iran, what role can your country play to rekindle dialogue between Teheran and the international community?

Iran is one of Russia’s neighbours. And not an easy partner. We are working with Western countries and China in the Group of Six to adopt a more constructive approach and resume dialogue with the IAEA and UN. But it’s a tough job.
Our goal here is also to avert the use of military force, which would lead to nothing – or, worse, possibly destabilise our borders even more. We are talking a lot with France about this, on and off the record. So we are working together, even if we sometimes disagree on a few points. We have noticed that our French friends are itching to move faster. But it is also true that patience has its limits and we sometimes feel very let down. You will see that, every time there is an important decision to make, Russia lines up with the Group of Six. We are each trying to work different angles with Iran to try to deliver results. We are really trying to deliver the same result: we don’t want our country to have a next-door neighbour with a nuclear weapon that could fall into terrorist hands. We are concerned about the same security issues as France. And I think cooperation between our two countries on the Iranian issue has been quite good so far.    

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