Roundtable discussion arranged by International Sustainable Energy Development Centre

Dear colleagues,

Association "RusChlor" has participated in the roundtable discussion arranged by International Sustainable Energy Development Centre (ISEDC) in Moscow. The arranger of the event is an NGO operating under the aegis of UNESCO. The aforesaid Roundtable Discussion was held in Moscow on April 24, 2014. The theme for the discussion has been formulated by the arrangers as follows: “Federal Policy for Support and Protection of the National Industry under the conditions of the Russia’s participation in both WTO and Custom Union”. Executive Director of Association “RusChlor” Boris Yagud participated in the discussion.

There also participated in the event the representatives of ISEDC, Ministry of Industry and Trade, Analytical Centre affiliated to the Government, Eurasian Economic Commission, Public Council affiliated to Ministry of Energy of the Russian Federation, and a few other Russian scientists and industry experts.

There were brought to the attention of the participants in the discussion the reports and presentations about formation of a complex of the interconnected measures aimed at protecting and supporting the national industry under the conditions imposed by the Russia’s entering WTO, potential ways of supporting the industrial exports from the Russian Federation subject to the new Codes and Standards imposed by the Russia’s membership in WTO and OECD, equalization of the competitive business conditions at purchasing the products by the natural monopolies as well as the oil and gas companies.

The presentation made by Mr. Yagud at the roundtable discussion considered the contemporary situation of the Russian chlor-alkali industry and compared favorably with all the other reports made there owing to the presentation's focusing on a single acute problem of the industry in the first place and the clear and easily comprehensible formulation of that problem. Mr. Yagud stressed that as of the time of his delivering the presentation the key problem for the Russian producers of chlorine was made up by the tariffs on the electrical energy rather than even modernization. Those tariffs were for the Russian chlor-alkali producers:

are 2.7 times higher than for the American ones;
are 2.4 times higher than for the Chinese ones;
are 1.2 times higher than for the European colleagues and competitors.

It is exactly this outrageous distortion that is currently inflicting the main pain on the Russian chlor-alkali industry. The membership in WTO is supposed to eliminate the uncompetitiveness. When running such an energy intensive facility as the chlor-alkali plant though, one does not stand even a smallest chance of being competitive under the Russian energy tariffs. It is the proper tariff adjustment mechanism or if truth is to be told, the energy price investment that the Russian chlor-alkali industry needs desperately and urgently from the state. Otherwise the industry will not merely survive in to any extent long perspective not even speaking of modernization.

The presentation made by Mr. Yagud has steered a considerable interest among other participants in the roundtable discussion. There were made a few comments on it there. It is worth noticing the following two of them here:

Mr. Kargin, economic growth analyst at Moscow Closed JSC “Flight technologies” has expressed his accord with the Mr. Yagud’s presentation’s main message. Mr. Kargin has also reminded to the participants in the roundtable discussion that the general energy tariff situation of the Russian aluminum industry is pretty close to tariff situation described by the Mr. Yagud’s presentation. Mr. Kargin has suggested that everybody present at the discussion should think of such the possible ways of lowering the tariffs as introduction into the legal and economic practice of the special energy tariffs for the energy intensive industries or putting into practice Article 8 of the WTO Agreement on subsidies;
Ms. Dudykina, head of Office for the WTO issues at Analytical Centre affiliated to the Government has assured the participants in the roundtable discussion that the energy intensive industries’ anxiety for the energy tariffs have been heard by the government and that there is currently going on a search for the adequate efficient ways of regulating the tariffs.