Constant Dropping Wears Away the Stone

Home , Alexander Spendiaryan, Alexandrov Ensemble, Dinamo Stadium (Minsk), Government of Moscow, Kashirskoye highway, Nadezhda Babkina

STRATEGIES FOR BUSINESS IN MOSCOW

Constant dropping wears away the stone

A PROPOS

Moscow wasn’t built in a day. This saying has been excellent impression. I want to come to Moscow again!”. popular in Russia for centuries, but doesn’t look relevant Here is what another celebrity, Hugh Jackman, had to today. It would be a challenge to find a city that is say about the Moscow metro: “We went into the metro developing as quickly as the Russian capital. Previously and truly saw something amazing. Around us, hundreds unused spaces are quickly being replaced with modern of people were rushing to get to work and not paying business centers, abandoned buildings are converted attention to their surroundings, and we stood there with into technoparks, and barely paved streets have turned our jaws dropped open.” into elegant pedestrian areas. Even the foreigners who It’s important that the Moscow government is making come back to Moscow after being gone for a year changes in a way that strikes a balance between the are surprised by how much the city has changed, not interests of investors and city residents. The authori- to mention the people who remember what Moscow ties adjusted their ideology, making the city’s develop- looked like during the Soviet era. For them, the appear- ment more comprehensive and gentle. For example, the ance of multiple cafes and restaurants, cosy hotels, development of depressed industrial areas prioritizes different shops and phenomenal parks is akin to living improvements to transport infrastructure and communi- on a different planet! cations, as well as improvements to surrounding areas. Yes, Moscow is improving by the hour, becoming more Among the most large-scale and ambitious projects that comfortable for both living and working. This is con- ensure better standards of living, it is important to point stantly confirmed by the heads of foreign companies in out improvements to the embankments of the Moscow Moscow, as well as foreign businessmen and investors River. This is a truly grandiose project. Suffice it to say who travel here for work. Across the pages of Capital that the length of the river within the city amounts Ideas, all of them say that they don’t miss home nearly to 80 kilometers. Up until now, only 7 percent of the as much as foreigners used to during the Soviet era, for river’s embankments were accessible to pedestrians. In example, when everything about the city seemed difficult London, on the other hand, 76 percent of Thames River and unfriendly. Now, expats are free to enjoy their favor- embankments are accessible. 52 percent of the Seine ite food and live the kinds of lifestyles they’re accustomed River embankments are available to pedestrians. The to. These days, Moscow has absolutely everything that main objective of the Moscow project is to finally make one would expect a modern city to offer. The famous the Moscow River a comfortable space for people. In actor Pierce Brosnan, who came to Moscow for the first fact, this is the objective of any project that is currently time two years ago, wanted to get a real feel for the city underway in the city. so desperately that he ran away from his bodyguards early one morning. After walking around by himself for sometime, Piers said, during a press-conference: “I got an Sergo Kukhianidze Editor in Chief

[email protected] CAPITAL IDEAS Founder: Department for External Economic Moscow Official and International Relations of the Government of Moscow Address: Tverskaya, 13, Moscow, 125032. For the benefit of Ph: +7 (495) 633-68-66, Fax: +7 (495) 633-68-65 E-mail: [email protected] residents from www.dvms.mos.ru two capitals Editorial staff: Editor-in-chief – Sergo Kukhianidze In October, the Mayor of Moscow Sergey Production crew of the edition: Elena Egorova (deputy editor-in-chief), Sobyanin and the Mayor of Budapest Tatyana Akimova, Gennady Charodeev, Vladimir Dolmatov, Marina Ershova, István Tarlós signed a cooperation program between the capitals of Russia and Hungary Evgeny Khokhlov, Sergei Levin, Pavel Lukyanov, Marina Ogorodnikova, for 2016-2019. Anastassia Paloni, Vladimir Smelov, Anna Tomkins, Marina Urshina 6 CAPITAL IDEAS STRATEGIES FOR BUSINESS IN MOSCOW

Publisher: Moscow Center for International Cooperation CEO: Sergei Anikanov Address: 105005, 68/8, build.1, Baumanskaya str., Moscow, Russia 7 – 9 Phone: +7 (499) 267-46-56 E-mail: [email protected] Moscow Official General Partner: National Review Ltd CEO – Sergei Oposhnyanskiy Big opportunities Phone.: +7 (495) 784-69-71 for cooperation E-mail: [email protected] For the first time in history, Moscow and Consulting – Gennagy Charodeev, Evgeny Khokhlov Singapore signed a cooperation program Design – Robert Saifulin for 2017-2019 during the first Days of Photo editor – Victoriya Oposhnyanskaya Moscow in Singapore Page layout – Alexander Saifulin Assistant – Nadezhda Ratanova Distribution – "Trans-Media" Ltd Acknowledgements to: PHOTO – www.mos.ru, www.dvms.mos.ru, ITAR TASS Agency, RIA-Novosti, Getty Images Russia, companies and organizations, represented in the issue. If you wish to get new issues of Capital Ideas, please, apply to: [email protected] The magazine is registered with at the Federal Authority of Legislative Control in Mass Media and Cultural Heritage Protection. Media registration certificate ФС77-53716, issued April 26, 2013. All reproduction permitted only with the Editor’s permission and reference to ‘Capital Ideas’. Distributed free of charge Published with support from the Department for External Economic and International Relations of the Government of Moscow Circulation : 7000 Signed into print 30. 11. 2016 Moscow Official Cover Story A friendship that dates back New Urban Projects — The New Face centuries of Moscow It will be impossible to enhance the status and competitiveness of Moscow Days of Moscow in Yerevan among major cities, and to fulfill its mission as a world city, without improving the quality of its urban environment. On the level of global Strengthening ties between cities competition, this factor proves decisive for the influx of investment and Within the scope of Days of Moscow in Belgrade, which took place the augmentation of human potential. In our survey we have placed an in the beginning of October, a number of important documents were accent on the most far-reaching and ambitious projects, which offer new signed regarding the development of ties between the capitals of standards for the quality of life in the city. How will Moscow change in the Russia and Serbia. near future, and which projects will become the face of the capital? 10 – 12 14 – 31

32 – 33 City’s Graph

34 – 38 What’s new

January-March 2017 CAPITAL IDEAS 3 Face to Face Nothing Ventured Alexis Rodzianko: It's Time to implement a very good time to Nothing Ventured a green tariff Moscow is becoming a do business in Russia “Currently, Russia has all the conditions “American business in the last 25 years necessary to start resolving the problem great place for developing has grown quite a bit in Russia. I always of MSW management via the construction like to say, you can’t spend a day in Russia of additional disposal sites as well as via industrial manufacturing without being touched by an American MSW processing and therefore shift to The establishment of technoparks is becoming company’s product or service”- said Alexis fundamentally new business models,” said one of the key trends when it comes to Moscow’s Rodzianko, President of the American Alexey Volostnov, Director of Business development. The appearance of yet another space Chamber of Commerce in Russia, in an Development at Frost & Sullivan in Russia, in begs the logical question: how is the Technopolis exclusive interview with Capital Ideas. an interview with Capital Ideas. METMASH project different from the rest? 40 – 46 56 – 58 68 – 71

48 – 49 60 – 63 72 – 73 Nothing Ventured Expert tips Moscow in words 50 – 54 We believe in developing our The regulations Face to Face business in Russia for business Heidelberg Cement has over 3,000 representative offices in success Ernesto Ferlenghi: over 60 countries all over the world. We sat down to talk Pour your heart into with Mihail Polendakov, General Manager of Heidelberg How foreigners can avoid Cement in Russia, about the company’s activities. additional costs and fines when supplying their products to Russia doing business in 64 – 67 Russia Nothing Ventured “Our objective is to convince Italians that, in spite of the sanctions, the drop in oil prices Massimiliano Perri: and ruble devaluation, you can and should continue to work in Russia. You have to We are going to expand our learn to adapt to the new conditions, study presence in Russia the market and analyze it,” said Ernesto Ferlenghi, President of Confindustria Russia, The Italian company Iveco is quite unique for the Russia an association of Italian companies operating (now belongs to the multinational CNH Industrial). It entered in Russia, in an interview with Capital Ideas. the Russian market almost 40 years ago, and continues to successfully develop today. Back on the 1970s, Iveco started supplying its powerful trucks for what was referred to as “the construction project of the century” - the Baikal-Amur Mainline. Now, the company carries out a much wider range of activities in Russia. We sat down to talk about the company with Massimiliano Perri, General Director of Iveco in Russia

4 CAPITAL IDEAS January-March 2017 Life&leisure Don’t be bored this Life& Culture winter, get your skates Travel and head out! Art as food for thought The New Year is finally here. Every single person is Moscow Review of the most popular ice rinks in Moscow waiting in anticipation for the new things that lie is among Ice skating is a favorite pastime for Muscovites ahead - something interesting, bright, original that in the winter. People used to attach blades to we can talk about with our friends or our significant top cities their snow boots, but now anybody can rent other over a cup of hot tea, warm apple pie or a Moscow has been named one of skates at the ice rink. This pastime, which ginger cookie during the winter evenings. A trip to the world’s best cities, according is both a sport and a leisure activity, is truly the theatre, a concert or an exhibition can provide to Lonely Planet’s Best inTravel enjoyable, helps you stay healthy and gives your you with this kind of food for thought for your 2017 list. mood a big boost. conversations. 74 – 75 80 – 83 86 – 91

76 – 77 84 – 85 92 – 96 Travel This and That Food&Drink To Russia with cash Tea with sugar! Simple Things The number of Chinese tourists visiting Most people believe that Russians like It seems there isn’t a word out there that Russia rose significantly in the first five vodka, but this isn’t necessarily the case. The has as many different meanings as the word months of this year, according to the head beverage Russians truly enjoy is tea. At least “simple.” Even dictionaries can’t convey the of Russia’s Federal Tourism Agency according to a popular opinion survey, over many different connotations of this word. 94 percent of Russians drink tea regularly. After all, “simple” can mean “natural,” “easy 78 – 79 to understand,” “close,” or “without cheating.” Moscow Vocabulary In any case, the patrons of the cafe “Simple Things” intended for all of these meanings to be a part of the establishment’s name.

January-March 2017 CAPITAL IDEAS 5 MOSCOW OFFICIAL

For the benefit of residents from two capitals In October, the Mayor of Moscow Sergey Sobyanin and the Mayor of Budapest István Tarlós signed a cooperation program between the capitals of Russia and Hungary for 2016-2019.

The document provides for the development going to sign today will be beneficial for residents of of cooperation in the sphere of urban both Budapest and Moscow,” Sergey Sobyanin said.

planning, construction and reconstruction, “For our country’s government, it is extremely impor- transport and the development of the road tant to establish good relations between our cities. Hungary is a country that fought hard for its sover- and transport infrastructure, healthcare and eignty and we highly appreciate our good relations medicine, education and tourism. with our Russian colleagues,” István Tarlós noted.

n spite of the challenges we are all aware István Tarlós also recalled that an alley on the bank of of, our cooperation continues to develop. I the river in Budapest has been named after the Russian would like to thank you and your colleagues capital. “The entire world will know about this, because for working with us to prepare a cooperation we are hosting a swimming championship and those program“I between our cities for the next three years. who come to visit the city will be going for walks along I am confident that it will take our cooperation to a the alley,” the Mayor of Budapest said and invited Ser- new level in sectors such as urban planning, design, gey Sobyanin to visit the championship. István Tarlós transportation policy, traffic flow management, intel- also invited the Moscow government to take part in ligent transportation systems, healthcare, education, the autumn festival CAFE Budapest 2017, as well as in culture and tourism. I hope that the document we are the spring and summer festivals in 2018. ■ Big opportunities for cooperation Singapore hosted the first Days of Moscow

For the first time in history, Moscow and Singapore signed a cooperation program for 2017-2019. The announcement was made during the opening ceremony for Days of Moscow in the Lion City by Head of the Department for External Economic Affairs and International Relations (DVMS) Sergey Cheremin. The documents points out that priority areas of cooperation include the development of public transportation, urban planning, environmental protection, as well as housing and communal services, IT and innovations.

ingapore is one of the most comfortable document, “The local administration have interest- places to live and do business with phe- ing urban solutions, a well-functioning transportation nomenal technologies that have been system, and phenomenal healthcare and education successfully implemented in the urban systems. But we also have a lot to be proud of. “Seconomy,” the Head of the Department for External Economic Affairs and International Relations (DVMS) According to the minister, the ambitious task set by Sergey Cheremin told journalists after signing the Moscow’s mayor Sergey Sobyanin - to make Russia

January-March 2017 CAPITAL IDEAS 7 MOSCOW OFFICIAL

the best city in the world to live in - is very similar to The central Days of Moscow event in Singapore was what the Singapore authorities did for their citizens. the business forum that addressed issues of bilateral cooperation. the forum was attended by more than It is important that the Russian capital, with its new 200 big business representatives, as well as experts in developed transport infrastructure, high quality the spheres of urban planning, information technol- health care, education and cultural systems, is of in- ogy and finance. terest to the Singaporeans. One piece of evidence is the fact that there has been an increase of enterprises During his address, Sergey Cheremin talked about with Singaporean capital in Moscow: there were 25 of the investment potential of the Russian capital and them in 2015, which is a two-fold increase from 2014. the measures to attract foreign investment to state infrastructure projects with the use of public-private As of January 1, 2016, Singapore was in 24th place partnerships. among Moscow’s foreign partners in terms of total investment volumes. Both Moscow and Singapore In 2016, the enterprises and organizations registered authorities, however, think that the level of economic in Moscow carried out trade operations with over 200 cooperation does not live up to the potential of the countries all over the world. Foreign trade turnover two capitals and can be increased several fold. with foreign partners in the first half of 2016 amounted to $86 billion: $32.8 billion in imports and $53.2 bil- During the discussion between Mr. Cheremin and the lion in exports. State Minister of National Development, Trade and Industry of Singapore Koh Poh Koon, the two sides The Minister also said that Moscow is interested in talked about switching to settlements in rubles and working with Singaporean investors who are focus- Singapore dollars in the near future. Right now, all of ing on advanced technology, research and science. the settlements between Moscow and Singapore are “I think that this can be one of the main elements of done in US currency. This results in huge operational our cooperation,” he said, “The Russian capital is also expenses in terms of currency conversion, which, ac- interested in Singapore’s experience in the establish- cording to Sergey Cheremin and Koh Poh Koon, does ment of a technopark system, the establishment of an not stimulate cooperation. Negotiations on this issue international financial center, the development of the will continue. transportation system and many other areas.” The Singapore Ambassador to Russia Lim Kheng Hua, ern metropolis. The head of the Moscow delegation who spoke at the forum, said that Moscow is becom- Sergey Cheremin took part in the Russia-Singapore ing more comfortable and appealing to work in for Business Council meeting. foreign companies every year, including companies from Southeast Asia. There was quite a stir at the Singapore Science Cen- tre, where hundreds of people waited in line for hours “I see a lot of opportunities for companies who want in order to get an autograph from a living legend - to do business in Moscow today. the city is go- the Russian cosmonaut Anton Shkaplerov. He came ing through a cycle of active development. Over the to the Lion City as part of the official delegation of past few years of being in Russia, I have seen a lot of the Moscow government in order to take part in the changes for the better. Moscow is becoming one of Days of Moscow in Singapore, specifically in opening the most beautiful cities in Europe,” she said. the “Russian Space” exhibition.

According to Lim Kheng Hua, Singaporean companies Shkaplerov not only signed postcards, photos and should focus on Russia and Moscow as a convenient books about cosmonauts, but also answered ques- market. tions from the general public. Surprisingly, a lot of Singaporeans still remember Yuri Gagarin well. This is Andrey Tatarinov, the Russian Ambassador to Singa- why the Russian cosmonaut, whose lecture also went pore, recalled that relations between the two coun- viral on social media, talked a lot about the first hu- tries have been developing for over half a century, and man in space. partner relations between Moscow and Singapore were established in the 2000s. “I was in space twice, and one of those times I spent 200 days there,” Anton Shkaplerov said, “I circled “I think that Moscow and Singapore can and should the Earth a thousand times. But I’ll never forget work together in order to create a more comfortable how Singapore looks at night, because you can’t environment for mutual development,” Tatarinov said. mistake it for any other city in the world. I hope that a citizen of Singapore will go into space with Within the scope of Days of Moscow in Singapore, Russian cosmonauts soon. Especially considering there was also a round table to address urban plan- that Russians have taken representatives of eight ning issues, as well as a conference dedicated to the countries into space with them, including from the implementation of information technology in a mod- neighboring Malaysia.” ■

January-March 2017 CAPITAL IDEAS 9 MOSCOW OFFICIAL www.yerevan.am A friendship that dates back centuries Days of Moscow in Yerevan

At the end of October 2016, the capital of Armenia, Yerevan, hosted Days of Moscow. The objective of these events was to create a comfortable setting for the development of cooperation between Moscow and Yerevan in spheres such as trade, the economy, road and transport infrastructure and urban planning.

he Days of Moscow business program began two sides talked about the cooperation program for with a meeting between the Mayor of Ye- 2017-2019, which Moscow and Yerevan plan to sign revan Taron Margaryan and the Minister of in the near future. Mr. Cheremin and Mr. Margaryan the Moscow Government and Head of the noted that the two capitals have been proactive in TDepartment for External Economic Affairs and In- terms of working together. The head of the DVMS ternational Relations (DVMS) Sergey Cheremin. The said that he hopes the cooperation program will www.yerevan.am serve as impetus in the development of trade, eco- cow Chamber of Commerce and Industry platform nomic and investment ties between capitals. He also hosted consultations, meetings, and councils with invited the Mayor of Yerevan to come to Moscow participation from hundreds of different entrepre- with an official visit. neurs. Thanks to constructive cooperation between business and government, the capital’s laws are ad- “The friendship between Armenian and Russian peo- justed to suit the requirements of the changing eco- ple dates back centuries,” the Minister said, “I am con- nomic climate,” he added. fident that business relations between the two capitals will continue to develop and become stronger. I “Moscow and Yerevan have been friends for several have the highlight the special significance of holding decades,” Russian Ambassador to Armenia Ivan Vo- Days of Moscow in Yerevan and Days of Yerevan in linkin said, “Cooperation between the two capitals is Moscow: this initiative has truly become a favorite now starting to take place at a high level of integra- and welcome event for the residents of both capitals.” tion, especially considering the fact that Russia and Armenia have become full-fledged members of the A central and important event of Days of Moscow in Eurasian Economic Union.” the capital of Armenia was the business cooperation forum “Cities Striving Toward the Future.” Participants Round tables were also active during the business of the forum included Sergey Cheremin, Chief Adviser forum.The expert community was particularly inter- to the Mayor of Yerevan Vano Vardanyan, Russian ested in the section titled “Smart City Management Ambassador to Armenia Ivan Volinkin, prominent Solutions: cooperation between capitals and major public figures, businessmen and cultural experts. cities of EAEC countries.” Expert reports focused on projects for creating an e-government, systems for When opening the forum, Sergey Cheremin recalled providing remote services, and energy conservation that the last time Days of Moscow were held in Yere- issues. Armenian participants shared their experience van was in 2012. The heads of the two capitals agreed and effective solutions that have been implemented to regularly hold similar large-scale events in the fu- in the city with their Moscow colleagues. A separate ture. “Especially since this is one of the ways to actively section was dedicated to the subject of tourism, its cooperate with business partners,” the Minister said. potential and perspectives for growth. “Taking bilateral agreements, historical ties and mutual interest in close cooperation as a starting point, Within the scope of the Days of Moscow cultural residents of Moscow and Yerevan witness dozens of program in Yerevan, the Moscow House hosted the events related to our cooperation every year: exhibi- opening of a book exhibition about Moscow, “My tions, concerts, forums and fairs. Days of Moscow in Moscow” photo exhibition and exhibitions dedicated Yerevan is the pinnacle of our friendship and mutual to the Great Patriotic War (1941 - 1945). The Arme- understanding,” the head of DVMS pointed out. nian National Academic Theatre of Opera and Bal- let named after Alexander Spendiaryan hosted a gala Trade turnover between Russia and Armenia increased concert featuring the Turetsky Choir ensemble and from $800 million to $1.2 billion from 2010-2016. Russia the Gzhel Moscow State Academic Theatre of Dance. is Armenia’s main trade and economic partner. “Mos- cow makes a significant contribution to the Russian- The Dinamo stadium in Yerevan held freestyle wres- Armenian inter-regional cooperation, which encom- tling and judo matches as part of the Moscow-Yere- passes all aspects of life in the two capitals - trade van Youth Athletic Games. ■ and economic ties, investment, cooperation across the social, cultural and humanitarian spheres, as well as youth exchange programs,” Sergey Cheremin said.

There are a number of investment projects being implemented in Moscow with the participation of Armenian business: the establishment of a Yerevan guest house, an Armenian trade and distribution center, and a hotel complex.

“In the current challenging economic climate, our Armenian friends will undoubtedly be interested in learning about how Moscow is implementing the anti-crisis plan developed by city authorities with active participation of the Moscow Chamber of Com- merce and Industry,” said President of the Moscow Chamber of Commerce and Industry Vladimir Pla- tonov, “We are ready to share our experience in field of legislation aimed at business support. The Mos-

January-March 2017 CAPITAL IDEAS 11 MOSCOW OFFICIAL

Strengthening ties between cities

Within the scope of Days of Moscow in the two countries to become acquainted with each Belgrade, which took place in the beginning other’s cultures and investment opportunities.

of October, a number of important Sergey Cheremin thanked Siniša Mali for organizing documents were signed regarding the Days of Moscow in Belgrade. He noted the importance of the historic three-year cooperation program signed development of ties between the capitals of by the two cities a year ago. The document entails co- Russia and Serbia. operation between the capitals across all sectors that determine the stable, safe and favorable development he protocol on the development of coopera- of the capitals in terms of urban development, hous- tion in the sphere of tourism was signed by the ing, creating a comfortable environment for business, Minister of the Moscow Government and Head renovation of industrial zones, development of public of the Department for External Economic Af- spaces, the creation of technology parks, and coop- fairsT and International Relations (DVMS) Sergey Cher- eration in the field of culture and sports. emin and the head of the Belgrade Tourism Organi- zation Miodrag Popovic. President of the Belgrade There was also a plenary conference to address the Chamber of Commerce Milivoje Miletic and President issues of developing business cooperation between of the Moscow Chamber of Commerce Vladimir Pla- Moscow and Belgrade. Participants of the event gave tonov signed a bilateral cooperation agreement. Af- presentations and discussed the investment potential terward, the Mayor of Belgrade Siniša Mali and head of the Russian and Serbian capitals. The head of the of the DVMS Sergey Cheremin signed the agreement DVMS invited the Serbian colleagues and investors to on holding Days of Belgrade in Moscow in 2017. exchange experience and take part in Moscow projects for the development of the transport infrastruc- The Mayor of Belgrade noted that all of the signed ture and railway traffic, as well as to implement their documents were aimed at bringing the capitals of own projects in Moscow’s technoparks, which are ac- Russia and Serbia closer and will allow people from tively developing. ■ useful info

Department for external economic and international relations of the Government of Moscow Address: 13 Tverskaya Street, Moscow, 125032 Ph: +7 (495) 633 68 66 Fax: +7 (495) 633 68 65 E-mail: [email protected] www.dvms.mos.ru Department of Science, Industrial Policy and Entrepreneurship of the Goverment of Moscow Address: 22 Voznesensky Pereylok, Moscow, 125009 Ph: +7 (495) 777 77 77 Fax: +7 (495) 957 05 92 E-mail: [email protected] www.dnpp.mos.ru Department of Economic Policy and Development of the Government of Moscow Address: 21 Voznesensky Pereylok, Moscow, 125032 Ph: +7 (495) 777 77 77, +7 (495) 957 72 17 Fax: +7 (495) 629 33 42 E-mail: [email protected] www.depir.ru Department of City Property of the Government of Moscow Address: 20 Bakhrushina Street, Moscow, 115054 Ph:+7(495) 777 77 77 E-mail: [email protected] www.dgi.mos.ru Moscow Exchange Address: Office 1: 125009 Moscow, Bolshoy Kislovsky per, 13 Office 2: 125009 Moscow, Vozdvizhenka Str, 4/7, Bldg. 1 Phone: +7 (495) 363 32 32, +7 (495) 232 33 63 Fax: +7 (495) 705 96 22 www.moex.com

January-March 2017 CAPITAL IDEAS 13 COVER STORY

New urban projects – the new face of Moscow

the cost of real estate with access to a Developing the embankment river has risen substantially. In addition, a river accords a certain VIP status to those territories of the Moscow river properties located on it. For instance, in Moscow, such properties include the Kremlin, the White House (where the he development of the Russian built up the lower embankments of the Government of the Russian Federation capital was always closely tied to Seine in Paris in the middle of the eight- convenes), the Moscow International its location on the banks of the eenth century. In the Russian capital, the Business Center, and various monaster- Moscow River, which was a very city’s first move in the direction of the ies and temple complexes. important passage for transpor- river was the construction of Gorky Park, tation.T At all times this river has consist- with its slopes down to the water. After The navigable channel of the Moscow ently maintained its significance to the this, the embankments were developed River, between opposite points of the city, while also changing its function. in accordance with the General Plan of city’s Ring Road, is approximately 80 1935 – they were lined with granite in the kilometers long, and the entire length European city planning relatively recently central part of the city. Londoners began of the bank, including inlets and docks, discovered rivers as a resource for devel- paying attention to their city’s river even stretches longer than 200 kilometers. opment. Up until this point rivers were later – in the 1950s and 1960s. For a long time, the areas around the viewed only as technical devices. The first banks were not developed, and in a step toward elevating the status of rivers Now the situation looks more or less the number of places they are not at all ac- in Europe was made by the French, who same in any city of world significance: cessible to citizens. In the evaluation

14 CAPITAL IDEAS January-March 2017 It will be impossible to enhance the status and competitiveness of Moscow among major cities, and to fulfill its mission as a world city, without improving the quality of its urban environment. On the level of global competition, this factor proves decisive for the influx of investment and the augmentation of human potential. For this reason the authorities in Moscow are paying great attention to innovations and projects aimed at creating a comfortable urban environment that will ensure a comfortable lifestyle for Muscovites and guests of the capital, up-to-date conditions for initiating and running businesses, and effective communication in urban and informational spaces. In our survey we have placed an accent on the most far-reaching and ambitious projects, which offer new standards for the quality of life in the city. How will Moscow change in the near future, and which projects will become the face of the capital? New urban projects – the new face of Moscow

of specialists from the Body for Urban Development Policies and Construc- tion, 16% of territories along the major aquatic passageway of Moscow (32.4 Chief Architect of the Scientific hectares) have no access to the river, Research and Design Institute “General and another 44% (87 hectares) are poor- Plan for Moscow,” Andrei Gnezdilov: ly designed or abandoned. “The city has turned its attention to the river and begun to study it. The As the Deputy Mayor of Moscow in river is a whole country within the city, which many people know only charge of construction and urban de- vaguely. I believe that it is a treasure, which we must put to proper use.” velopment policies, Marat Khusnullin, has repeatedly observed, efforts to re- fashion the Moscow River should result be improved upon, access roads would There will be three stages to realizing in the construction of an integrated sys- be constructed, and a developed system this concept for developing the em- tem of interconnected territories along of aquatic transport would be organized. bankment territories of the Moscow the banks, as well as in ensuring they The river’s renewal ought to improve the River: The first stage proposes to real- are used more effectively. According to visual profile of the historical ensembles, ize some of the ideas for improving ar- plans, another 10.4 thousand hectares bring about a logical reorganization of eas along the banks, and it is planned to of land reaching down to the river’s wa- the industrial parks abutting the river, be finished by 2017; the second encom- ters would also be reorganized. It is also and result in a change in the function of passes more important urban develop- planned that the embankments would these parks. ment tasks, and is planned be finished

January-March 2017 CAPITAL IDEAS 15 This project proposes, above all, to develop the infrastructure of mass transit: Deputy Mayor of Moscow in the metro, new bus and tram routes and charge of construction and aquatic transit; to develop the pedestrian urban development policies, and bicycle infrastructure above the river Marat Khusnullin: and en route to the river; to transform the “The experience of other large cities demonstrates that the area around river’s embankments into public spaces; to create ports which will become agents a river should be dedicated, first and foremost, to pedestrians. It should of the urban environment and will serve be accessible for strolls and leisure. But in Moscow we have become ac- for transmissions on the river. customed to automobiles running along the embankments, and there’s A large quantity of landmark properties is little access to the river. In actual fact, only 7% of the Moscow River’s located within the zone of pedestrian ac- banks are accessible to pedestrians. This situation is not at all compara- cessibility from the Moscow River. Con- ble to other world centers. Let’s take London for example: there, 76% of necting the territories along the banks of the three rivers – the Setun, Moscow, the bank of the Thames is accessible to people, and everyone can walk and Yauza – holds great potential for the up to the water and touch it. In Paris, 52% of the bank of the Seine is development of major programs in the accessible. Therefore, the main purpose of this project is to make the em- city, for consolidating the urban fabric, and for creating new areas of attrac- bankments accessible to people. In order to ‘liberate’ the river, we need to tion. The plan for making the river cor- partially redirect the highway from it.” ridor more ecologically friendly involves the construction of a certain lively space for interaction, creativity, enlightenment, by 2025; all work is planned to be fin- identity in the form of gateways for the and cultural activity. ished in 2035. regions located nearby. The port and its dense system of city spaces will create The primary direction for developing the The winner in the contest to develop the a new axis of development for Moscow. territories adjoining the Moscow River embankments of the Moscow River was The system of riverside parks provides is elevating their role in urban develop- the Russian architectural agency “Project a future structure for Greater Moscow. ment and the formation of new areas of Meganom.” The framework for realizing this concept urban activity: includes three strategic courses: The guiding idea for their concept was ●● developing a system of new city- a generalized image of the “port.” Such ●● a selective process for construct- wide centers: Rublevo-Arkhan- a “port” includes attractive cultural and ing new river portals; gelskoe, Tushino-Spartak, Mn- recreational spaces on the water – mag- eviki, City, ZiL, Negatinskaya nets and “trailheads” built into a care- ●● the strengthening of connec- Poyma; fully thought-out system of pedestrian tions: a human scale for systemic and transport connections, supporting development; ●● actively implementing a residen- features, leading ecological technolo- tial facility: Tushino, Simonovs- gies, and programs in urban partnership. ●● a healthy ecosystem and intelli- kaya Embankment, ZiL, River Each of these ports has its own unique gent sanitation. Park (a former dockyard);

16 CAPITAL IDEAS January-March 2017 ●● forming a multifunctional environment: a new “combined municipal and residential” type of real estate development with a Russian Architect and Director of distinct interrelation of residen- the Architectural Agency “Project tial and municipal development; Meganom,” Iurii Grigorian: “Our project is called ‘Future Ports.’ We wanted to present a kind of urban ●● increasing the proportion of municipal and residential develop- space that is quite new but also traditional, like St. Mark’s Square. This is a ment by almost double in com- space that is directly joined to the river, just as the Venetian square inter- parison to the current situation; acts with the lagoon. The result is new urban centers: 11 centers of citywide ●● activating recreational use: creat- significance, and 28 of regional standing. We have called these ports “Plac- ing new parks, such as Zaryadye, es where the city meets the river.” We believe that there are transportation parks in Mnevnikovskaya Poyma; lines, the embankments along which you travel, but there are also certain a more active recreational usage; the development of a recreation- places where you can find yourself on the river. In addition to ‘Future Ports’ al infrastructure for the existing there are some other more minor facilities in our project, but the 39 portals parks and recreational territories, are, in essence, the main elements of the structure.” such as Marinksy Park and the park on Gurianov street;

●● reorganizing industrial territo- It is planned that improvements to the partment of Culture, the Department of ries while reducing them pro- connections between the banks will be Housing, Public Utilities, and Develop- portionally and forming com- realized through the construction of ment, and others among our colleagues,” bined business-industrial parks; 12 pedestrian bridges, the reconstruction explained Kuznetsov. of the pedestrian parts of two vehicular ●● developing municipal, residen- bridges, and the organization of a ferry Moreover, there are plans to construct tial, and recreational facilities on crossing. 24 bridges over the Moscow River in the undeveloped and underdevel- coming years. A number of them will be oped territories; It will be possible to evaluate the results for automobiles, and others for pedestri- of the improvements along the embank- an traffic. In the words of Khusnullin, one ●● reducing the area of the “im- ments of the Moscow River at the end of of the first to appear will be a bridge in penetrable territories” by almost 2017 or beginning of 2018. “At present the Maryino. It will unite Shosseynaya Street 1000 hectares. work along the Moscow River has fallen and the Kashirskoye Highway. Plans for in individual categories: the identification constructing new bridges in the south The most important lines for develop- of territory on which further urban-de- of Moscow are tied to the realization of ment in these territories are: entering velopment documentation can be done, major projects: the reorganization of the the embankments into public circulation, work with lots that already have existing industrial park ZiL and the creation of an ensuring that the regions located along land users and investors, and work with amusement park in Nagatinskaya Poy- the banks of the river will be connected, territories that enter into various urban ma, which will be dedicated to Russian and solving ecological problems. programs under the auspices of the De- and international cartoon characters.

January-March 2017 CAPITAL IDEAS 17 COVER STORY

ganized existing municipal spaces, such as Zaryadye park Gorky Park, the Krymskaya embankment, Solkoniki, and historic streets. The open- aryadye will become the first ma- the Bolshoy Moskvoretsky Bridge to the ing of the new park is planned for City Day jor park built in the capital in the Sparrow Hills. A unique landscape will be in September 2017, the year of Moscow’s past 50 years. It will unite all pe- created here, as well as a philharmonic 870-year jubilee. Entrance to the grounds destrian and tourist routes in the hall, viewing platforms, museums, and will be free, and visitors will only have to Z center, from Varvarka Street to cafes. The city had previously only reor- buy tickets for exhibitions and concerts. The winner of the contest for planning the park in Zaryadye was an international consortium headed by the architectural agency Diller Scofidio + Renfro (New Chief Architect of Moscow, York). The American agency is known for Sergei Kuznetzov: its unusual natural-architectural properties, such as a building made from fog “Zaryadye will be an entirely open space. We have made the decision created for a Swiss exhibition in 2002. to forego any type of enclosure, and the Mayor of Moscow, Sergey So- But of course, their most famous project byanin, has supported this idea. We plan to integrate the park maxi- is a park built from abandoned railways in New York. mally into the urban environment, from all sides. People will be able to stop in from Red Square or the Great Moscow-River Bridge without any The park will feature the full variety of problem. Convenient entrances from the embankment – from direction nature in Russia: forest, steppe, northern landscapes, and river meadows. These sec- of the aforementioned bridge, as well as from that of the Peter the Great tions will descend from the upper portion Academy – will be preserved. From the academy it will be possible to of the park to its lower areas by means of pass along to the Church of the Conception of Anna, and to the park. terraces in the northeast and southwest. Visitors coming from Red Square will find Pedestrians will also reach Zaryadye from Varvarka street, as well as themselves in a birch grove, beyond which from other places: there is a plan to organize a promenade between the low and rambling plants from the north- churches. From the Kitay-gorod passage one will need to enter through ern landscapes will extend along Varvar- ka Street. This will preserve the view of the arch in the wall of Kitay-gorod; the main entrance to the philhar- the street’s historic monuments. Below, monic hall is there as well.” a temperate forest will spread out, as well as a large meadow that will seamlessly

18 CAPITAL IDEAS January-March 2017 transition into the roof of the philharmonic hall. And in the southwest there will appear ponds with a network of wooden scaffolding for pedestrian. Diller Scofidio + Renfro on the idea Visitors will encounter the coldest region behind the Zaryadye park project: of Russia, Yakutya, in the form of an ice cave. This structure will maintain a neg- “The design is based on the principle of Wild Urbanism, a hybrid land- ative temperature even on the hottest scape where the natural and the built cohabit to create a new type of days. Here it will be possible to view an public space. Characteristic elements of the historic district of Kitay- exhibition of ice sculptures and to learn about famous arctic expeditions and the Gorod and the cobblestone paving of Red Square are combined with the lives of northern peoples. lush gardens of the Kremlin to create a new park that is both urban and green. The Park incorporates four Russian landscape typologies: tundra, The philharmonic hall in Zaryadye will become one of the best musical ven- steppe, forest, and wetland. Interior spaces are folded into the landscape ues in the country due to its uncommon within a series of terraces – architecture and landscape are a synthet- acoustics, architecture, and technical ic whole. A unique paver system that seamlessly knits landscape with capabilities. On account of its naturally sloping contours, a part of the building walking surfaces makes the park ‘pathless’, allowing people the freedom will be “buried” in a hill. Only one side will to move about in entirely unscripted ways.” remain open, and this side will be made entirely of glass, from floor to ceiling. An open amphitheater will be built for from the summit of the hill. From here park cafes, or from the embankment of large-scale events. Performances will be one can see a beautiful view of the Krem- the Moscow River by taking a transpar- broadcast on a gigantic screen. lin, which has never stood before a spec- ent elevator. Interactive guardrails will tator at such an angle. be installed along the perimeter of the Visitors will be protected from inclement bridge. They will exhibit the develop- weather by “glass bark” – a translucent One more viewing platform in the park mental history of Zaryadya from ancient cupola with wooden braces that will cov- will be a “hovering” bridge 140 meters times until the present day. For safety’s er the entire hill above the philharmonic. high, which will hang above the water sake, they will be reinforced with a firm Beneath the “bark” the temperature will without supports. This openwork con- frame, and the ground covering will be remain above freezing even in the win- struction resembles the letter “V.” made resistant to heat and cold. ter, and green grass and flowers will grow there. In all kinds of weather, visitors will One can get to the viewing platform One will also be able to get to the lower be able to gaze upon the urban landscape from the philharmonic building and the embankment through an underground walkway with an area of 2.3 thousand square meters. This passageway will be a one-of-a-kind museum dedicated to the architecture of the capital: the builders will open up to visitors a piece of the Kitay-gorod wall.

Alongside the future Zaryadye park, a passenger pier will be built on the Moscow River. “We decided not to build the pier near the ‘hovering’ bridge, since that would have overfilled the space and prevented it from maintaining the function of a embankment promenade. The pier will be opened 200-300 meters from the park,” explained the chief architect of the capital, Sergei Kuznetsov. The pier will be built downstream, at the location of the old pier. The landing is being reconstructed and refurbished in order to receive passengers.

Every element of the park will be literally built into its contours and nothing like traditional structures. This will make it possible to hide the managerial quarters,

January-March 2017 CAPITAL IDEAS 19 COVER STORY Anyone who is curious can view what is now being done on the grounds of Zary- adye. Information about the project is available at the information pavilion that opened on the grounds of Zaryadye in spring of 2014. The pavilion looks like a The Mayor of Moscow, glass cupola from without, and within Sergei Sobianin: its walls are covered with signs featuring Quick Response Codes. One can access “Among our plans for 2017 is the completion of construction on the text and pictures via these codes by us- philharmonic hall in the park ‘Zaryadye.’ On the whole, the new ing a tablet available at the entrance or recreational area is one of the unique parks of the world, being located by using one’s own gadget with a special application. within immediate proximity to the Kremlin. Just recently the massive structure of the hotel “Russia” stood here, and a large office center was “As concerns the quality of the design for being projected. the Zaryadye park, there truly exists no similar park anywhere. And this is not In accordance with the mandate of the President of the Russian only my opinion, but the opinion of my Federation, Vladimir Putin, the decision was made to construct a unique colleagues in architecture and even of the representatives of UNECO, with whom landscape park, which includes a philharmonic hall, a ‘hovering’ bridge, we have been in intensive contact regard- an embankment, a media center, and whole array of other interesting ing the coordination of this design; after facilities. The construction of this park is called upon to resolve uncommon all, it is located in the protected zone of the Moscow Kremlin,” observed the chief challenges. The overall volume of visits is up to 12 million persons per year, architect of Moscow, Sergei Kuznetsov. taking into account the modest area of this park. It is a serious task.” In his words, Zaryadye is not simply a park but a multifunctional space with a to reduce visually the size of the new there will be not only passenger cars but complex engineering achievement on buildings, and to maintain an open view also tour buses. Technical rooms and the inside. “This is an unprecedented pro- of the historic center. loading zones will also be set up under- ject, and I hope that the quality of its re- ground. This will allow the personnel of alization will correspond to the declared Under the park’s grounds will be locat- the park to avoid crossing paths with the demands of the design,” underscored the ed a parking lot with 430 spaces, where visitors. chief architect of the city.

20 CAPITAL IDEAS January-March 2017 CITY’S GRAPH Moscow River – the guiding principle of urban planning in Moscow

Area of 1940 ha of which are the consideration 10 400 ha surface of the river

Length of the within the city’s borders Moscow River 83 km

Length of the on both shores coastline 201 km Residential mln Total area construction 4,8sq.m of existing mln developed area sq.m Nonresidential mln 22 construction 17,2 sq.m

Current Utilization of the Area

14 % Adjacent territories 25 % 18 %

10 % 10 % 11 % 12 %

Residential Public Manufacturing Natural and landscaped Streets and roads Water surface Undeveloped

January-March 2017 CAPITAL IDEAS 21 COVER STORY

gle. Thus, fans will be treated to an ex- Sports facilities for the World cellent view of the field from any point in the stands, including the upper and football championship lower rows. On the northern and south- ern stands, two media screens will be set n 2018, for the first time in the history of football, Russia will host the world cham- up, which will also be highly visible from pionship. The central venue for the competition will be the legendary Luzhniki everywhere. And thanks to a new French stadium, which will be the location of the opening ceremony, first match, one audio system, fans will be able to hear semi-final match, and the final. clear, well-defined sound even from the farthest seats. I “Fans do not need to worry: in Moscow we will build every thing on time,” as- sured the mayor of Moscow, Sergey Sobyanin. In his words, the central venue for the The renovated stadium will be able to competition will be the Luzhniki stadium, which is now actively being reconstructed. hold 81 thousand spectators, which The Spartak stadium has also been built with 40 thousand seats. “Construction is be- was three thousand more than before. ing completed on the Dynamo stadium, which is a beautiful facility. In addition to the 300 seats are being set up for people football stadium, there will also be an ice arena for hockey at this location. The CSKA with limited mobility. For VIP spectators, football stadium sits empty. So Moscow is becoming one of the most football-friendly there will be 2 thousand seats on the cities in the world,” observed the mayor. main stands, 4.5 thousand seats in the guest service area, and around 2.5 thousand seats for the press. In the stands Luzhniki an additional balcony will be made out of 100 corporate boxes with enhanced The main sports arena in the Luzhniki sta- arrived for an inspection and accorded comfort (skyboxes). Here, visitors will be dium will maintain its historic character Luzhniki green status. That means that served according to a heightened stand- after reconstruction. The overall area of there is not risk that the stadium will not ard, including hot food. the reconstructed stadium, including the be prepared for the world championship. stands, comprises 221 thousand square The color of the stands at Luzhniki – bur- meters. This is more than half the terri- One of the main tasks for the reconstruc- gundy with gold accents – was selected tory of the Vatican. This massive size not tion is to create comfortable conditions by Muscovites themselves. More than withstanding, the reconstruction is pro- for fans. The quantity of main entrances 137 thousand citizens participated in the gressing ahead of schedule. Work should to the arena will rise from 13 to 16. Before vote on the “Active Citizen” portal in Au- be finished in the second quarter of 2017, work was begun, around 10 percent of gust 2014. but the fundamental work on building spectator seats were in an area of poor and installation is planned for comple- visibility. Now the stands are located on The roof on the stadium has already been tion this year. In September 2016 FIFA two platforms at a more pronounced an- replaced. The new covering is 30 millim-

22 CAPITAL IDEAS January-March 2017 ramic view of the football field. A campus for guest services will also appear here.

Deputy Mayor of Moscow in charge of In developing the security system for construction and urban development Luzhniki, specialists studied previous policies, Marat Khusnullin: experience in Russia and abroad, including the experience of holding the “This facility is our priority, and it is receiving special attention and over- Olympics in Sochi in 2014. Here they will sight. First of all, I would like to say that we have left unchanged the build six transit and five pedestrian secu- historic appearance of our legendary stadium. This is important inasmuch rity checkpoints and install 1.5 thousand cameras for external observation plus a as Luzhniki is a recognizable visiting card not only for Moscow athletics, thousand cameras in the arenas, as well but also for athletics across Russia. And we have already succeeded in as radiation monitors, detectors for ex- the primary task of conducting the reconstruction in such away that our plosive substances and dangerous liq- uids, X-ray introscopes, and scanners for legendary stadium maintains its historic appearance. I am certain that the bottoms of automobiles. Luzhniki – with its unique rooftop media display, “goal control” record- ing system, ultra-contemporary natural grass field, and two international Video cameras cover the entire stadium: the stands, the inner building, entrances broadcasting center – will be transformed into one of the most up-to- and exits, and also the parking lot. In line date and beautiful structures on a world-wide level – and incidentally, with FIFA demands, the entire complex much of it will have no analogue elsewhere in the world.” will be divided into 10 zones according to levels of security. These will be areas for general access, the press, hospitality, VIP eters thick and made of impact-resistant The goals at Luzhniki are equipped with guests, transit zones, a technical zone, polycarbonate. This material allows sun- the “goal control” system. Several cam- and others. light to pass through and is an excellent eras will watch after them, and they will fit for stadiums with natural grass, as be linked to the referee with the help of a More than 62 thousand persons will be Luzhniki will have. To protect fans from special bracelet. able to pass through the new security precipitation, the roof of the stadium checkpoints in one hour; more than a above the stands has received an addi- The area of the rooms below the stands thousand automobiles and 60 buses will tional tarp, 11-meters long. will increase. In this space will be located be able to pass through in this time. This two warm-up areas, a dressing room for will prevent traffic jams at the entrance, Sports lighting will be installed under the the athletes, a hall for press conferenc- even on days of major events. roof. It will ensure a quality picture on es, an express-interview area, television television screens. The roof itself will be a studios, office spaces, restaurants and The reconstruction of Luzhniki involves special kind of media screen. To this end, toilets. not only work on the sports arena, but a great quantity of LED will be installed in also renovating the whole grounds of the it. It will be possible to see the broadcast In the main sports arena building there will sports complex. It will be transformed of a match from the Sparrow Hills, the be a hall for press conferences, an express- into a modern park with running and Third Transit Ring, and even from Kom- interview area, several television studios, biking paths, as well as a separate path somolsky Prospect. and a presentation studio with a pano- for roller-skating. At the same time, the

January-March 2017 CAPITAL IDEAS 23 stadium will maintain its historic appear- sightseeing center built on the north vived, and new sections will be construct- ance: the walls of the building have been section of the stadium. One will be able ed upon the children’s sports center. cleaned and renovated, but the façade to get there either by walking or by remains the bright sandy color that is air – on a funicular from the Sparrow The area around the pool will be divid- familiar to Muscovites. It has been dec- Hills. And for thrill-seekers there will be ed into pedestrian alleys, pathways for orated with a frieze depicting football a pathway on the roof of the stadium. running and cycling, automobile pas- players, hockey players, track runners, They will have the opportunity to drop sages, and parking. In front of the main and other athletes. They are frozen in onto the Luzhnetskaya embankment entrance there will be a square with motion, like the ancient Olympians on with the help of a zip-line system, that a fountain, lawns, stone benches, and Greek vases. is, along a steel cable. street lamps. In the evenings the walls of the building with openwork installa- The entire grounds and system of navi- A pathway of cable 737 meters long will tions will be illuminated within, while the gation for the stadium are being deco- connect Luzhniki with the other bank of blank walls will be lighted with yellow rated in a unified style. At its base lay the the Moscow River, where the Sparrow spotlights from below. symbol for Luzhniki: a picture of a ring Hills, the Neskuchny Garden, and Gorky made of five swallows. Dark blue, violet, Park are located. This funicular will si- After reconstruction the Luzhnetskaya yellow, and crimson representations of multaneously solve sightseeing, athletic, embankment will be more convenient these feathered creatures will be drawn and transit problems. In the winter ath- for pedestrians. The highway section has on the sidewalk on the side of the main letes will use it to travel up to the ski been reduced to two lanes, and in the entrance from the “Sportivnaya” met- jump on Sparrow Hills, which will be re- newly freed space has become an area ro station. They will also appear on the constructed by 2018. There is a plan to for going on strolls, running, cycling, and Prestizhny alley near the western stands, build an athletic school nearby for chil- roller-skating. and in the winter one will be able to see dren and youths. In actuality, this will these birds on the ice rink. This rink will restore a sports zone that historically A professional running path with a special be located on the area between the are- arose here. rubberized surface extends for 3 kilome- na and the embankment. In the summer ters. Six workout stations, altogether cov- dry fountains will run in Luzhniki, and ca- After reconstruction, the pool at Luzh- ering 400 square meters, were installed in fes with terraces will be constructed on niki will become in modern swimming the shade of trees along the embankment. either side of the arena. center, with an athletic pool that has The following have been placed along the 10 lanes and two training areas for adults embankment for the comfort of athletes A viewing platform will be made on the and children (with three lanes each). Be- and pedestrians: 170 new benches, 118 lit- upper level of the main sports arena. It sides the athletic infrastructure there will ter bins, 50 bicycle stands, 300 street will be open to visitors on days when no be an aqua park and a spa zone. Luzh- lamps, and 30 navigation stands. events are scheduled in the stadium. Visi- niki will feature a wave pool, a salt bath tors can gaze upon a beautiful view of the and a river pool, a bath with an area of A new municipal space by the water city center, the Novodevichy monastery, 270 “squares,” a thermo-pool, hydromas- has also appeared on the Luzhnetskaya the “Moscow City” skyscrapers, and the sage and spa baths. embankment. Instead of a granite slope Lomonosov Moscow State University. down to the river, now there is a wooden Training halls and a fitness center will lead stairway. On these steps one can exer- The departure point for all visitor routes into the complex. The boxing club and cise, tan, read, meet friends, or simply on the grounds of Luzhniki will be a children’s gymnastics center will be re- gaze at the Moscow River.

Informational Point CI – Luzhniki

On 23 December 1954, the Soviet govern- the sports complex for three main types of first European club tournament final to be ment made the decision to construct in activity: as an arena for major international played in Russia. Luzhniki a “major Moscow stadium.” At and domestic competitions, as a training On 21 May 2008 the Luzhniki stadium was first this stadium, along with the entire base for team preparation, and as a base the venue for the first UEFA Champion’s sports complex, carried Lenin’s name. (The for the establishment of mass sports. Con- League final to be held in Russia, as well as “V.I. Lenin Central Stadium” was the name siderable success was achieved in all three the farthest eastern final in the tourna- not of the stadium as a large sports arena, directions. ment’s history. The English clubs Chelsea but of the whole sports complex.) In 1980 the stadium became the main and Manchester United played. On 22 May On 31 July 1956 the ceremonial opening of arena for the Olympics, one of the most UEFA accorded to the Luzhniki stadium the the Central Stadium took place, after it important locations for holding the sum- status of an “elite” stadium. was built in record time – in the span of mer Olympic games. Luzhniki is also the largest concert venue only 450 days. Then the Central Moscow In 1998 UEFA included the stadium on its in Russia. At various times Luzhniki has Station at Luzhniki was comprised of a list of 5-star European football stadiums. hosted concerts for the Rolling Stone, great sports arena, a minor sports arena, (Since 2006 they have used a system of Rammstein, the Pet Shop Boys, Moby, a palace of sports, a swimming pool, and a four categories.) DDT, Spleen, and many others. number of open-air sports venues. These structures were sufficient for competi- On 12 May 1999 this stadium hosted the In 2018 Luzhniki will receive 7 matches in world tions and training in 18-20 types of sport, final of the UEFA Cup, in which the Italian football championship (four matches at the from track and field to hockey. From the club Parma played against the French group stage, a match in the quarter final, one very beginning there were plans to use Marseille. This football match was the of the semifinal matches, and the final match).

24 CAPITAL IDEAS January-March 2017 Dynamo

The Dynamo central stadium has histori- velopment of a complex on the grounds young architectural studio (founded in cally been considered one of the centers of “VTB Arena Park.” The international 2007) has made a name for itself in the for the development of athletic culture and architectural agency Manica Architec- past several years as a major interna- sports in Moscow. Today it is undergoing ture was brought in to work on the tional agency specializing in bold and the most major reconstruction in its history. concept of the new stadium; this agen- effective public projects, especially sta- cy, based in Kansas with affiliates in diums. Work on the renovation of the stadium London and Shanghai, is headed by the is provided for in the design for the de- American architect David Manica. This From the beginning, it was proposed that the renovated stadium would be among those applying to host matches for the World Football Championship in 2018. But then the decision was made to hold the Moscow matches in the Luzhniki and Spartak (or Otkritie Arena) stadiums, and The Mayor of Moscow, the capacity of Dynamo was reduced Sergey Sobyanin: from the plan of 45 thousand spectators to 26 thousand. “The reconstruction of Dynamo is proceeding according to schedule. I hope that the stadium will be complete in 2017. This is a unique sports Those developing the project arrived at facility. Not only will a new sports compound by built, but the historic some revolutionary ideas in the sphere of constructing sports facilities. The western stands will be preserved and the bas-relies will be restored, so uniqueness of the renovated stadium that the history of the unique Dynamo stadium will be preserved. In es- will consist in the fact that a small multi- sence, a new sports compound is being born in Moscow. Besides the purpose arena and a larger sports arena will be housed simultaneously beneath stadium, a sports academy will be built and a first-class sports park will its roof. The Museum of the Dynamo appear, so that this complex will be a unique and, I hope, favorite place club will also be housed here, as well as for Muscovites to engage in athletic activities.” a recreational complex and underground parking.

January-March 2017 CAPITAL IDEAS 25 In the future, Dynamo will be trans- dome to be used as a media surface ball match, which is planned to occur on formed into a multifunctional complex, when it is dark out. The western wall, 22 October 2017 – on the birthday of the in which there will be both sports com- facing Leningrad Prospect, will feature famous goalkeeper Lev Yashin. petitions and concert and entertainment a gigantic screen. events. The design for the development of a The major task for the builder was main- complex on the grounds of VTB Arena The minor arena can hold from 11.5 thou- tain and restoring the historic western Park also provides for the construction of sand to 14 thousand spectators and host wall of the stadium, which has held the a sports-recreation complex, the Dyna- hockey and basketball matches, but it status of an architectural monument mo Sports Academy, the erection of the will also be a scene for artistic perfor- since 1987. Thus, special attention will Urban Park city block, and the establish- mances. The configuration of the hall be paid to restoring the bas-reliefs made ment of the Dynamo sports park. will be adjusted depending on the spe- by the outstanding Soviet sculptor Ser- cific event. gei Merkurov, which have decorated the The Dynamo Sports Academy is a porticoes to the north and south of the sports training complex with an area of The roof will be made out of spe- stands. 62.8 thousand square meters. It includes cial materials that allow light to get 2 hockey venues, a gymnastics hall, through. Moreover, LED ribbons will The opening of the renovated Dynamo rooms for boxing, squash courts, a fenc- be built into it, and these will allow the stadium will be marked by its first foot- ing area, and a rehabilitation center.

Informational Point CI – Dynamo

The Dynamo central stadium was built here, after which Dynamo was closed for As the reconstruction progresses, the historic in 1928 according to the design of archi- reconstruction. The project was named western stands opening out onto Leningrad tects A. Ya. Langman and L. Z. Cherikover. “VTB Arena Park.” Prospect will be preserved and restored. In the beginning, it was in the form of a After the reconstruction “VTB Arena – horseshow with an opening toward Petro- At present work has been completed on Dynamo Central Stadium” is complete, it vsky Park. In 1936, after work had been reinforcing the preserved western stands. will unite under a single roof a football completed on the eastern stands, which In-situ concrete molding is being per- arena with 26,319 seats and a multipur- closed off the stadium, it was able to hold formed to construct the stadium’s frame, pose sports hall for 11,488-14,000 specta- 54 thousand spectators, and until Luzhniki to structure the walls and columns on tors. Hockey and basketball games can opened it was the main sports arena in the fourth and eighth floors, and to install be held here, as well as concerts. The Moscow. precast elements on the first and second overall area of the stadium is 206 thou- levels of the stands. The stadium was partially reconstructed sand square meters. It will have eight for the 1980 Olympics and on the even of stories above the ground, and one story Reconstruction of the Dynamo stadium is the World Youth Games in 1998. On 22 No- below, which will contain 719 parking planned to be complete in 2017. It will be vember 2008, the final match was played spaces. named after Lev Yashin.

26 CAPITAL IDEAS January-March 2017 CSKA

The professional football club CSKA own cars, 1400 parking spaces will be 400 thousand square meters (4 Khodyn- (PFC CSKA) has awaited a sports are- provided. The underground parking lot sky Boulevard). na of their own for nearly 10 years. will provide 600 spaces, and another 750 Over the past several years the Army will be in a separate building, plus 50 on At present, construction is being con- has conducted matches and practice the street. ducted on two hotel and office complex- at other clubs’ stadiums. Now CSKA es, featuring apartments, with an area of has its own bastion. This stadium fully A 38-floor office tower has been built 166.6 thousand square meters. Moreover, complies with all standards set by FIFA in the southwest sector of the stadium. there are plans to construct in the Kho- and UEFA. During the World Football It resembles the UEFA football trophy, dynsky field a State Center of Contem- Championship in 2018 teams participat- which the Army claimed in 2005. porary Art (area: 46.5 thousand square ing in the World Cup will train in this meters), a 825-student school, a temple stadium. The new arena of the “red and Located in the Khodynsky field, the sta- in honor of the Saint Sergii Radonezhsky blue” is planned to hold 30 thousand dium for the CSKA club became one of (capacity: 800 persons), and other public spectator seats. the main properties in the complex con- and business facilities. struction of that region. In addition to Fans will be provided with special metal residential buildings, the largest sales On the undeveloped grounds, a new ur- chairs, and there will be plastic ones on and entertainment complex in Moscow ban park will be created with an area of the central stands. This stadium has also was built here: “Aviapark” with an area of 24 hectares. been outfitted with 125 skyboxes, built with VIP sections and a panoramic view Information Point CI – CSKA of the field. The first stadium for the CSKA (Central match could have been a distraction for Sports Club of the Army) was opened in planes as they took off and taxied. What The playing surface has the peculiarity Moscow in 1961 a part of the universal is more, this stadium was not very com- of being woven with threads of artificial sports location “Pesachnoe” and named fortable for spectators, as it had wooden grass. This stabilizes the surface and re- after Grigory Fedotov, a famous football benches instead of comfortable seats. player who scored 100 goals in the USSR inforces the root system. In 1997 this sports facility was recon- championship. structed. The capacity of the stadium The corpus of this complex will also in- The arena could hold 11 thousand specta- was increased, and the wooden benches clude a sports school for children and tors. The stadium was built without over- were replaced with plastic seats. But in youths, a museum, a hotel for visiting head lighting, and the matches could only 2000 the CSKA stadium was closed and be held in the day. The issues was that torn down so that a new, comfortable teams, restaurants and cafes, an official the football field was located right next stadium could be constructed. Today the merchandise store, and a medical center. to an airfield that operated at the time in CSKA stadium has risen like a phoenix For those who would like to drive in their the Khodynsky field, and lighting for the from the ashes.

January-March 2017 CAPITAL IDEAS 27 COVER STORY

The ZiL Grounds

n the spring of 2013 a design was ac- 20 hectares, a pedestrian boulevard, a de- cow Hermitage” museum center (an af- cepted for planning the industrial park veloped embankment, and also theaters, filiate of the world-renowned Hermitage ZiL. These grounds were divided into concert halls, art galleries, and art centers Museum). nine functional sections, which will in- for exhibitions and installations. clude residential micro-regions, a busi- The museum will be designed by Ameri- Iness center, parks, a sports compound, The first section of the boulevard will can Architect Hani Rashid. Combined and an automobile factory. As a result, on feature a large fountain and the “Mos- with a 150-meter residential tower de- the site of the abandoned industrial park there will be a “City within the city” with an accessible transportation infrastructure, workplaces, and social facilities.

The builders have already begun construc- Chief Architect of Moscow, tion on an art-class residential complex Sergei Kuznetsov: ZiLART. Ten leading architectural agencies in Russia and worldwide have come for- “This is the most important, model design of multifaceted development ward to design buildings of the first order for large portion of the city, which mayor Sergey Sobyanin has called one for the ZiLART residential complex within of the major world capitals. For us the cornerstone was finding continui- the framework of a unified design code. Each building, designed by a single archi- ty, showing that the plan for these grounds, the streets that the residents tect, is a true masterpiece, thought out of the new region will walk upon, was not accidental. The history of this to the smallest detail and having its own place will appear not only through place names, or through the preserved concept and individual face. The builders took into account specificities of the loca- exteriors of the workshops, but in the very structure of the design. ZiL tion where each building was construct- will be an outstanding project from an urban development point of view, ed, the direction of the facades, and how as well as the architecture of individual buildings. Without a doubt, there the building looks from different angles. will be public spaces with an actively putting forward various functions, The grounds of this massive residential the park will be broken up, and of course, there will be interesting ar- complex will become a new center for chitecture. Moreover, in ZiL a serious investment will be made in public Moscow, where not only the local residents, but also other citizens and tourists transportation, which in the context of Mayor Sergey Sobyanin’s policies will enjoy spending their time. For instance, plays a role for the city as a whole.” there will be parks with a combined area of

28 CAPITAL IDEAS January-March 2017 signed by Hani Rashid on the neighboring plot, these facilities will become new sites to see in Moscow. Landscape Designer and Urbanist, This will all bring a large influx of Musco- Head of the New York Agency !melk, vites and tourists to the new region. Thus, Jerry van Eyck: more than 25 thousand persons will be- “Moscow is a good example of a city with an important history of public come residents of the residential structure, approximately another 20 thousand spaces, many of which have historical significance and have an influence will work in the commercial properties, on how people across with world think of such areas. As I see it, the sys- and tens of thousand of people will come tem of parks and green municipal zones called ZiLART could become a to this region daily for leisure, shopping, and visiting the public attractions. symbol of Moscow in the 21st century. I imagine the design of a park that is unlike those that already exist. I believe that the ZiLART park could be The main virtue of the project’s design, as come the leading park, and its image should be ahistorical, with materials it has been developed, lies in the fact that a qualitatively new urban environment put to proper use; it should be full of innovative elements and fantastic will take the place of the out-of-date public art. I imagine a park with a social infrastructure – it will suit all factory and abandoned structures. ZiL types of visitors. The park is stable not only ecologically, but also cultur- will be come a city within a city, where one can live, work, and relax. ally and economically. The ZiLART park will become part of the Moscow brand. It is a great honor for me to take part in this fantastic project.” In addition, those who worked on the design promise to preserve the historic appearance of the industrial park. The most the ZiLART park will become a symbol will be named in honor of Marc Chagall interesting properties in ZiL, in a historic- of Moscow for the 21st century, part of in this section. The overall length of the architectural sense, will be preserved and the city’s brand. This park, which com- ZiL river peninsula is approximately 4 kil- reconstructed. From these buildings they bines natural and architectural elements, ometers. will “excise” the production facilities, and is like a show; it’s a place for leisure, art, the remaining administrative offices will and entertainment. It will be of interest The overall area of construction in the ZiL be refurbished as offices. not only to residents of the ZiLART re- industrial park comprises approximately gion, but also to other citizens and tour- 6.2 million square meters, out of which In addition to all this, there is a plan to ists. It will correspond to the principles of 3.5 million “squares” will be residential build a contemporary yacht club on one sustained development in the economic of the embankments at ZiL. and cultural sense. The ZiLART park will There are plans to build comfortable con- be for the 21st century what the Parisian temporary apartments for 38 thousand There are plans to create a large, Parc de La Villete was for the 20th. persons and to create approximately 14.5-hectare city park in the former in- 43 thousand jobs. This approach has long dustrial park, and a world-renowned Sports and game venues will be built, as been typical of developed European cities, specialist has been brought for this task: well as places for recreation and cycling. and since recently it has been the norm the well-known Dutch American land- The first 10 hectares of this Moscow park in Moscow. It is anticipated that this will scape designer and urbanist, head of the will appear in the summer of 2017. And make it possible to reduce commuting New York agency !melk (a deign studio in the following year the first pedestrians and unburden the street infrastructure. of landscape architecture and urbanism), will already be walking along the em- Being such a massive project, it will be re- Jerry van Eyck. He has promised that bankment of the Moscow River, which alized in two stages, lasting until 2022.

January-March 2017 CAPITAL IDEAS 29 COVER STORY

Skolkovo

n less than five years a new city tion should be low-rise and high-density, cal, energy-conservation, atomic, and will appear near Moscow. On the while also devoting a significant portion cosmic technologies. The staff of the IT 400 hectares that were transferred to public spaces. They will ultimately de- compound is developing strategic aims in to Skolkovo six years ago, around termine the quality of life and create the information technologies – from search 2.5 million square meters of real es- necessary “climate” and interaction be- systems to cloud computing. The “Ef- Itate are planned for construction: one tween citizens. fective Technologies” compound sup- third will be office and research sites, an- ports innovations and groundbreaking other third will be a residential section, The chief architect of Moscow, Sergei technologies aimed at reducing the en- and the last third will go to transit, event Kuznetsov, believes that despite the dif- ergy consumption of industrial facilities, infrastructure, and so forth. Two million ficulty and short deadlines for realizing public utilities, and the municipal infra- square meters of this space will go to the the Skolkovo mega-project, it can be structure. The experts in the “Biomedical projects of investors, who will build – and considered paradigmatic, and its exam- Technologies” compound are supporting are already building – within the frame- ple can be studied. and developing innovations in the field work of worked-out master plan, while of biomedical technologies. The goal of observing its fundamental principles: res- As part of the Skolkovo project, five com- Atomic Technologies compound is to idences, public spaces, service infrastruc- pounds have been created to develop in- support the non-energy applications of ture, and workplaces should be located novative projects. These are compounds atomic technologies and realizing the within walking distance; the construc- dedicated to informational, biomedi- potential of the division for transferring technologies that have been created in the process of developing atomic science and atomic power to other industries. The workers in the “Cosmic Technologies and Telecommunications” compound President and CEO of Sberbank, occupy themselves with cosmic projects German Gref: and the development of telecommunica- “For us this is more than a building, it is a place where the future of major tions technologies. This group also ad- Russian and international bank will unfold. We want to use this building dresses many other spheres of activity, from cosmic tourism to systems of satel- to emphasize the necessity of ongoing improvement. The new Technical lite navigation. Park should create an environment that will continually push us forward, to set a high bar that cannot be lowered.” In the near future, an IT park for Sberbank will appear on the grounds of Skolkovo.

30 CAPITAL IDEAS January-March 2017 Construction on the Sberbank technical park in Skolkovo is expected to begin in 2017, and construction will be complete in 2020. Project Manager for the Company Zaha In April of this year, the winner of the Hadid Architects, Christos Passas: closed international contest for a functional and architectural concept for the “Our concept is to reexamine and perfect a principally modern approach Sberbank technical park in Skolkovo was to the creation of working spaces, which have been standardized un- the design proposed by the architectural agency Zaha Hadid Architects. “Zaha til now. We see now possibilities for the allocation and transformation Hadid Architects developed a unique of modular components with simplified geometry, with a renovated and concept for the building complex in the perfected means of accessing light and areas that maximally induct fresh Sberbank technical park, which will be brought together in a unified architec- air into the work environment.” tural ensemble and harmoniously in- scribed on the architectural environment alongside the Skolkovo innovation cent- white, which will help to highlight the technologies, and medical equipment er, and will respond to all demand of the differing functional zones of the com- will work at the base of the compound, as present day,” said the chief architect of pound. will educational organizations concerned Moscow, Sergei Kuznetsov. with raising the qualifications of Russian On 15 August, the Mayor of Moscow, doctors and other medical works, as well The area of the technical park will ex- Sergey Sobyanin, buried a time capsule as attracting international experts in the ceed 130 thousand square meters. The in the foundation of the Skolkovo medi- field of medicine. “Sbertech” company and other techno- cal compound. Before construction a logical subdivisions of the credit organi- plot of land was chosen with an area of The diagnostic clinic will specialize in deep zation will be located here. 10-12 thou- 57.6 hectares. In 10-15 years this land is investigations of patients’ overall health sand persons will work in the technical planned to contain up to 15 clinics spe- (Check-Up). 133 specialists will work here. park. According to the information of cializing in the treatment of the most se- Moskomarkhitektura, the technical park rious and widespread disease: oncology, The two pilot corpuses are planned to be will be essentially a building-sculpture, cardiology, orthopedics, traumatology, realized over the period 2017-2020. ■ forming a nonlinear terminal arc over the and neurology. main boulevard. The bipartite “central This document was prepared using information from the following sites: mos.ru (official hub” will emerge as the connecting mod- The Skolkovo medical compound will site of the Mayor of Moscow), stroi.mos.ru ule of the complex and will operate as unite world-class clinics that will be able (Body for Urban Development Policies and an exhibition and ceremonial block. This to attract foreign doctors and to use for- Construction), mka.mos.ru (Moskomarkh- project presupposes the usage of leading eign medical equipment and medications. itektura), archsovet.msk.ru (Architectural technologies and innovative elements in Committee of Moscow), archi.ru (Russian its architectural and planning solutions, Scientific organizations specializing in architectural web-portal), www.dsrny.com as well as in construction and engineer- the development of medicines, medical (architectural agency diller scofidio + renfro). ing solutions – in particular, panoramic glass paneling and light shelves, as well as innovative technologies for heating and energy supply.

Plans have also been finalized for a diagnostic corpus on the Skolkov grounds, which will be the flagship building for the Skolkovo international medical compound. The area of this facility will be approximately 13 thousand cubic meters. Two other corpuses will enter into this medical compound: a therapeutic corpus and an interdisciplinary one with a clini- cal block.

All three buildings are planned to be four stories high, and they will be distin- guished by heterogeneous types of fa- çade, featuring vertical aluminum plates painted to resemble bronze, wood, or

January-March 2017 CAPITAL IDEAS 31 CITY’S GRAPH Conditions for Doing CITYLAB: the 25 most economically Business powerful cities in the world World Bank’s Doing Business Rankings CITYLAB: 25 Most Economically Powerful Cities of the World

Russia’s ranking, which reflects primarily the Moscow’s 25 conditions for doing position: cities/regions business in Moscow included in the 23 ratings Moscow’s position: Was previously absent from the list 189 cities/ regions Rankings: 1 – New York 22 – Geneva 62+ 62 positions included in – London – Washington, the ratings 2 23 compared to 2011 Moscow, (124th place) 3 – Tokyo 4 – Hong Kong San Francisco 5 – Paris

Innovation Cities Global Index 2thinknow Innovation Cities Global Index Reflects the potential for innovation concentrated in the city

– San Francisco / Moscow’s 445 1 position: cities/regions San Jose (Silicon Valley) included in the Rankings: 63 ratings 61 – Kobe, Japan +129 positions compared to 2012 66 – Edinburgh (192nd place) United Kingdom

32 CAPITAL IDEAS January-March 2017 Global Cities Index A.T. Kearney Global Cities Index Reflects the extent to which a city is “global,” that is an international center

Moscow’s 125 Rankings: 1 – New York 13 – Toronto position: cities/ 2 – London 14 – Moscow regions – Paris – Sydney 14 included in 3 15 +11 positions the ratings compared to 2010 (25th place)

Entrepreneurial Climate in Russian Cities

А++ — highest score on the RA Expert scale

Moscow’s 100 position: cities/regions included in the Hasn’tA++ changed ratings 2010 – 2014

Investment Appeal of Russian Regions RA Expert

In the group of regions with the highest potential and lowest risks

Moscow’s 85 position: cities/regions included in the 1A ratings Has not changed

January-March 2017 CAPITAL IDEAS 33 Smart City IT Center

about the city’s accomplishments in the sphere of Big Data. An interactive map of Moscow can tell visitors about the infrastructure of any district and pulls up information which is stored in different information systems on every building in the city.

A unique project is planned for Smart City - a point of public access to the city’s video surveillance system. Anybody will be able to come in and select from one of the city’s 145,000 cameras to look at their street, building or parked car in real time. Visitors will also be able to use the image archive.

It is planned that the new IT center will be a platform for scientific and practical conferences. Companies and startups will be provided with facilities for lectures, hack-a-thons and other he Smart City IT Center has opened at VDNKh. The new activities related to new technologies. pavilion has linked the exhibition of Moscow’s achievements in the sphere of IT with business and educational Moreover, a crowdfunding platform will be established. Teams spaces. The IT is close to the main entrance, next to pa- of developers will be able to use it to present prototypes of their Tvilion No. 69. The total area of the pavilion is 1,600 sq.m. and the devices or programs to potential investors and users. ■ building is 6 meters tall.

At Smart City, visitors can use a 3D printer, try out a virtual reality helmet and test the opportunities machine learning offers. The center’s guests will learn what cloud computing and Big Data are and how these things are used in everyday life, education and medicine.

The project not only brings together the best IT practices on a single platform, but also creates the conditions necessary to develop new ones. The pavilion is made up of business, educational and exhibition spaces. On opening day, guests could see 50exhibits, models and systems, such as the development map for the city’s free Wi-Fi network. Muscovites will also find out

Rink with artificial ice in Skazka park kazka park in Krylatskoye has opened a skating rink with artificial ice near the Zhivopisny Bridge. The new rink is 1,500 square meters in area.

SThere will be comfortable conditions for winter sports for both professional athletes and amateurs.

Starting in December, the traditional Russian Grandfather Frost sled with three horses will be touring the park. And the sur- prises don’t end there! In the winter, visitors will be able to go for a ride on a camel and the rope park for children will be converted into a land of tall, icy mountains.

The project is a unique family park project. The design is based on the need for children to spend as much time outdoors as possible, regardless of the weather. The organizers say that the types of activity in the park will alternate and change depending on the time of year. ■

34 CAPITAL IDEAS January-March 2017 Open-air ice rink at Park of Legends

workshops for children and parents with the opportunity to go skating in full hockey gear, figure skating lessons, meetings with legendary athletes, performances by celebrities and lotteries.

The open air ice rink at Park of Legends meets all the technical requirements necessary of professional hockey arenas.

The area of the rink is 30 by 60 meters. This adheres to the regulations of the Continental Hockey League, which means the arena can be used to host matches with professional athletes. The rink is equipped with lighting and spectator stands. Their standard capacity is 2,200 audience members. The capacity can be increased to 5,500 people.

This is the first open-air rink to use the innovative technique of implementing concrete slabs with built-in pipes for cooling the water. Prior to this, this method was only used for closed n open-air ice rink will start operating at Park of rinks. Legends in December. The ice rink will host hockey matches as well as public ice skating events for Mus- The cold supply line runs from the refrigeration unit of the ice covites. palace and the cooling settings are adjusted by experts. This A allows the ice to retain its properties and withstand different Visitors will be able to skate across the rink for professional temperatures. hockey players starting on the first day of operations. There will be special hours for those who enjoy playing hockey in their The quality of ice on the open rink at the Park of Legends spare time. is also ensured by advanced equipment: an ice resurfacer and a water treatment installation system. As a result, the Visitors have a varied entertainment program in store for ice can withstand even the harshest ice skate hits during them: parties with live music from the best DJs in Moscow, matches. ■

Oceania Shopping Center on Kutuzovsky Prospect

new multifunctional shopping center center that has been erected in Moscow recently is Oceania, Oceania has opened on Kutuzovsky Pros- an interesting center,” Sergey Sobyanin said during the open- pect. The unique shopping center is a cyl- ing ceremony. ■ inder-shaped aquarium with a 10 meter diameter.A It is 23 meters in height and has a capacity of more than one million liters. Inside there is a panoramic elevator where visitors can look over the 250 shops and service enterprises in the center. “Over the past few years, we introduced over 10 million square meters of commercial and mixed-use complexes. And in spite of the seem- ingly challenging economic climate, the construction of commercial real estate in Moscow continues. This year, we introduced 1.3 million square meters of commercial real estate in the span of 7-8 months. This includes office spaces and shopping centers. Judging by the market, the market is picking up again, there are less empty spaces and more real estate deals. One such

January-March 2017 CAPITAL IDEAS 35 Bridge on Karamishevskaya Embankment

“The construction of a new bridge near Karamishevskaya Em- bankment is part of a bigger development concept for the development of the areas around the Moscow River, which was prepared at the order of Sergey Sobyanin,” said Sergey Kuznet- sov, Chief Architect of Moscow.

According to him, one of the goals of the concept is to al- leviate transportation issues and make the districts more accessible. “The bridge will have an elegant cable structure with a support structure in the center in the shape of the letter Y,” he explained.

The new bridge will have six lanes (three in each direction). The total length of the bridge will be 528 meters, and will amount to 650 meters with the overpass across the embankment.

According to the Stroicomplex press service, the main span of the bridge will be around 300 meters in length.

The new bridge will be located 400 meters from the old Kara- mishevsky bridge, which was erected in 1937. The capacity of the new bridge will be significantly higher.

he Moscow City Architecture Committee has approved After the bridge opens to traffic, the old Karamishevsky bridge the project for the tallest cable-stayed bridge across the will be used primarily for public transportation. Moscow River in the city, the construction of which will begin in 2017. The bridge will connect Ulitsya Narodnovo Moscow currently only has one cable-stayed bridge in the west TOpolcheniya with Ulitsya Nizhniye Mnevniki. A 137-meter high of the capital, the Zhivopisny bridge. Up until now, it was con- mast in the form of an inverted letter Y will support the bridge sidered the tallest bridge in the city (the height of the bridge’s with metal cables. arches is 105 meters). ■

Hockey rink with a sports bar at VDNKh

24-hour hockey rink has opened at VDNKh in Novem- ber. Visitors can rent skates, hockey sticks and protective gear, change in comfortable changing rooms with showers and relax in the sports bar afterward. The area behindA pavilions No.8 and No.93 isn’t just another field, but a real athletic ice complex.

The rink’s area will be 30 by 60 meters. Visitors will have access to two warm changing rooms for 20 people each. The changing rooms will have comfortable showers, individual lockers and compartments to keep documents safe. There will also be a rental point for skates, hockey sticks and protective equipment. Guests will also be able to sharpen their skates here. Moreover, the hockey rink will be used for figure skating classes as well.

The rink will be open around the clock. Visitors will even be able to rent the space for a big group. The rink’s artificial surface will be updated before each game and will be able to keep retain its properties with temperatures of up to +15 degrees. ■

36 CAPITAL IDEAS January-March 2017 Hotel complex next to Kievsky Railway Station

under one roof: Novotel Moscow Kievskaya (202 rooms), Ada- gio Moscow Kievskaya (149 rooms) and ibis Moscow Kievskaya (350 rooms). There are a total of over 700 rooms of different categories. The complex includes a bar, two restaurants, a conference center and a health center with a swimming pool, which is available to guests of all hotels in the complex. The interiors of all three hotels were designed by a German architectural bureau. The complex has a single, joint entrance. The hotel lobbies are located on the 5th floor of the Kievsky hotel complex. Each lobby boasts a unique style that reflects the character of each brand.

“The opening was the most significant event for AccorHo- tels in Russia over the past few years, as well as the most large-scale hotel project in Moscow since the 1980 Olym- pic Games. The new complex is not only over 700 new hotel rooms in Russia, but also 3 new hotels on the map. Thanks to the opening of the new complex, the number of AccorHo- tels Group hotels in Russia increased to a total of 42, which serves as testimony to the fact that we want to develop on the Russian and Moscow markets and also promote the de- ccorHotels Group announced the official opening of velopment of domestic, international and business tourism. their biggest hotel complex in Russia. The Kievsky I am confident that the new complex will become a signifi- complex, which includes hotels from brands with as cant contribution to Moscow’s hotel infrastructure and will Novotel, ibis and Adagio, opened in the center of the be appreciated by both tourists all over the world and resi- Acapital next to Kievsky Railway Station. The new complex gives dents of the capital,” said Alexis Delaroff, Chief Operating Of- guests the opportunity from one of three hotel brands housed ficer of AccorHotels Russia. ■

First Encore Fitness Club his is a new generation of premium clubs. The main idea behind the project is to reshape the way people are used to thinking about fitness clubs. Aside from ideal programs and equipment, special attention is T paid to the club’s interior design, relaxation areas and pool. New technology will also be integrated into the infrastructure and the training process.

Every club in the network is a unique project that is adapted to the needs of club members. There are smart exercise machines and entry system, the option to choose your own locker, bracelets that can be used as electronic wallets, a personal MYZONE dashboard that contains information executed in art-deco style, and the thermal complex 1,200 about training sessions, a big aqua and relaxa- square meters in area. There are 8 fitness areas on the club’s tion area, as well as convenient logistics and lo- territory, a balance studio, a pilates studio and a 25 meter cation. swimming pool.

The chain’s first location with an area of 3,900 The second Encore club will open in the beginning of 2017, in the square meters opened in 2016 in the OKO sky- premium Novoyasenevsky residential complex in the south- scraper and became the biggest fitness club in west of Moscow. An area of 2,200 square meters will include Moscow City. Aside from scale, the project stands 7 fitness areas, including a modern club for kids and a unique, out due to a meticulously thought out design, teardrop-shaped pool. ■

January-March 2017 CAPITAL IDEAS 37 New food stops

Cofix (Manezhnaya square 1, bldg. 2, Okhotny Ryad Shop- ping Center) – an Israeli coffeehouse chain that at one point revolutionized the marker with a new approach to the restaurant business: every item on the menu was priced at 5 shekels. Everything in the Moscow cafe costs 50 rubles (about 2.5 shekels if you go with the current exchange rate) and it really is great food for breakfast, a light lunch of a snack in between meals. There are sandwiches, pastries and decent coffee.

Losbandidos Bar (Maroseyka 2/15, bldg. 1) – a craft bar from the creators of Bad.Bro.Bar, Parka and Varki. The designers drew inspiration from American gangster movies: even the bar stand looks like a bank vault. There are 36 types of beer and cider on tap and over 100 varieties of bottled beer. In terms of food, there are sausages, goulash, burgers and chicken wings in chili sauce.

Erwin.Река – Alexander Rappoport’s seafood restaurant Erwin.Reka.More.Okean now has a place on one of the Radisson Royal Moscow ice class yachts, which is focked at the Taras Shevchenko embankment, near Ukraina Hotel. The menu is a shorter version of the one featured in the original project. The restaurant is open from noon until 1am, but goes on a scheduled journey on the Moscow River three times a day.

Kotomania (Ulitsya Pokrovka 20/1, bldg. 1) – a club with a yoga studio and a cafe where people can get coffee and cheesecake, as well as pet cats and feed them treats from a special cat menu. The cost of a visit is calculated by minutes, 5 rub/minute for adults and 10 rub/minute for children. There are also jazz concerts on Fridays. ■

Restoran 354 – located inside one of the skyscrapers in Moscow City, on the 86th floor. According to the owners, the restaurant is the highest open terrace in Europe. There is a unique convertible canopy that protects guests from ad- verse weather.

O’Donoghue’s (Pytnitskaya Ulitsya 29) – another Irish pub from the owners of Lionʼs Head, Punch & Judy Pub, Tap & Barrel and The Tipsy, which is modeled after a Dub- lin establishment with the same name. The Dublin pub has been around since 1789 and the facade had to be completely redone in order to resemble the original.

Shikari (1-ya Tverskaya-Yamskaya Ulitsya 2, bldg. 1) – a chain of Pan-Asian restaurants that specializes in Seoul cuisine and used to operate only outside of the city finally has a restaurant in the center. Low prices, a colorful interior and dishes adapted for the Russian palette.

38 CAPITAL IDEAS January-March 2017 He labor market CITY’S GRAPH in Moscow

Labor force in Moscow - over 7 million people 815 out or 1,000 residents of working age have a professional education Moscow is 8th in the world among the world’s big cities in terms of the percentage of adults with higher education Moscow has a low unemployment rate (1.8% as of 2015), which is lower than the vast majority of big cities in the world The average monthly salary in Moscow according to data from 2015 amounted to 64,300 rubles ($1,049) The average hourly wage in March of 2016 amounted to $5.3

Moscow central circle (MCC) – a part of the capital’s transportation system of the future

Total length of the circle – 54 km Total number of stations – 39 17 stations will have parking lots with total capacity 2,000 cars MCC runs through 26 city districts which house about 2 million people The total area of influence for the circle makes up about 12% of Moscow’s territory 34.5 million people will transfer from the metro to the MCC every year There will be less traffic in the metro (traffic on the ring line will go down by 20%) The MCC Lastochka trains can travel at speeds of up to 160 km/hour Every Lastochka train can hold up to 1,200 people The waiting time for a train during rush hour is 6 minutes. Otherwise, the average waiting time is 11-15 minutes

January-March 2017 CAPITAL IDEAS 39 FACE TO FACE

Alexis Rodzianko: It's a very good time to do business in Russia

“American business in the last 25 years has grown quite a bit in Russia. I always like to say, you can’t spend a day in Russia without being touched by an American company’s product or service”- said Alexis RODZIANKO, President of the American Chamber of Commerce in Russia, in an exclusive interview with Capital Ideas.

Relations between Russia and the US is Mr. Rodzianko, relations between Moscow and Washington now are very bad. Some politicians are even talking about a a gloomy subject these days. Thankfully, return to the Cold War period. Of course it’s not a Cold War. President of the American Chamber of But, in this sense, how can you value current economic relations between the two countries? Commerce in Russia Alexis Rodzianko Well, first off, it’s far from the Cold War. The Cold War is a com- has an outlet - horses and his favorite parison because relations are bad at the government level. But, a sport, polo. Perhaps this is why he is lot of things are different from the Cold War times. And probably, for me the most important thing is certain freedoms that Rus- optimistic about so many things… sians have today that they didn’t have back then. Primarily, the freedom to travel. The freedom to choose between more than just Pepsi and Coke.(Smiles)

40 CAPITAL IDEAS January-March 2017 Right. That’s a good point! (Smiles) The goods and the jeans that are available that used to be a big prize and were smuggled in. Now, they are clearly here – well, The economy is a market economy. There is competition, there they are made in China for both the US and Russia: the same is choice, there is private enterprise, there is the opportunity for jeans, from the same place, the same brands. So, just in terms Russians to open their own businesses and it’s being done. So, it’s of everyday presence it is a very big presence, a noticeable pres- a very different country, a very different time and a very different ence. McDonald’s, Subway, Procter & Gamble, just to name a few, Cold War – if it is a Cold War. Now, the second part of your ques- Pepsi, Coca Cola, I have already spoken about, and all the other tion: How do I evaluate the economic relationship between Rus- products that come with them,they are all here. And what we sia and the United States? American business in the last 25 years found is when the relationship deteriorated… Well, first of all, it’s has grown quite a bit in Russia. I always like to say, you can’t perceived to be a largely US-driven deterioration where Europe spend a day in Russia without being touched by an American is the passenger pulled by the US locomotive. Whether that is, or company’s product or service. We can start with the large ac- is not, actually the case doesn’t matter – that is the way it is per- counting firms, the Big Four, the Mars bars that are everywhere. ceived. I have often had to face the criticism that the US is forcing

January-March 2017 CAPITAL IDEAS 41 FACE TO FACE www.procterandgamble.ru

42 CAPITAL IDEAS January-March 2017 sanctions on Russia at no expense to itself. All of it is at Europe’s What do you mean? expense. Because look at the figures for US business involvement in Russia. They are very trivial. It doesn’t cost the US anything. The public discourse. The propaganda in the US is very much anti- And that is based on official trade statistics and official invest- Russian, and in Russia - very much anti-American. And so the fact ment statistics. But those official trade and investment statistics that companies are continuing to invest in growth doesn’t fit the don’t reflect the actual visible presence of US business here. So, propaganda. It doesn’t match. It means, you know, somebody is we had the question: How could it be that there is so much busi- wrong. ness here, and yet the official statistics are so insignificant? And so, we did a survey and we posed a question to companies that Okay, I got it. we identified as US-based multinational companies. We took the largest 140 companies in our list of companies and asked them Companies would prefer the saying, “money likes quiet”, “busi- to answer some questions such as:How much have you invested ness likes quiet”. Business would rather brag about its bottom in Russia? How much do you trade with Russia, and how much line and its dividends and its stock price than about, “hey, we of your trade with Russia goes from the US as opposed to third grew our business in Russia by 20 percent”. countries? 59 companies responded, and just those 59 companies have invested 50 billion USD. Hmm, that’s really a good point. Let’s imagine how will the results of the coming elections in the United States influ- 50 billion? ence relations between Moscow and Washington? What will happen if Mr. Trump wins and if Mrs. Clinton wins. (The 50 billion. Now, the official statistics say something like 14 or 15 interview was conducted before the US elections) billion USD total investments by all US companies since the Sovi- et Union collapsed, or since the Russian Federation was formed, Let’s start with Mrs. Clinton. to put it more constructively. And what that says is that the official statistics is missing a lot of investment. It’s clear that mul- Why? tinational US companies keep their money in lots of subsidiar- ies in different countries and don’t have to invest from the US. Because it’s easier to predict. If you read the newspapers and you So, actually, American investment in Russia is much larger than read the surveys it looks like her chances look better. I’m not an cross-border US-to-Russia measured investment is - number expert on it. But the experts say her chances are better. one. Number two, on trade, almost three quarters of all trade by American companies is done through third countries. So, if you When I asked an expert what he thought the probability was look at the official statistics, the peak of trade between the US he thought 60 percent Clinton, 40 percent Trump. Which is still and Russia in 2013 was at 40 billion USD. And then figure that a pretty healthy uncertainty, right? But with Clinton it’s much three quarters of that was done outside. If you multiply that clearer because she’s been a part of the establishment. She’s by four, you might get something more in the lower end of the been an acting politician. She has been the Secretary of State. range of European trade. So, what that says is that the actual Now, what do I expect from her? Nothing much constructive presence is quite a bit larger than the official statistics would tell compared to where we are today. If anything, perhaps initially you. And that is consistent with just living in Russia and observ- a harder line. More demands on Russia. More threats of sanc- ing the presence. Now, the politics clearly don’t add enthusiasm, tions. That said, I think there’s a limit on how much the US can that’s for sure. And even companies that continue to invest and get the world to impose sanctions and how long they can con- continue to grow, don’t put it in the front pages of the news- tinue. And particularly, in a place like Russia, which is a bigger papers. And they do - our companies are continuing to invest. economy than any of the other countries that in the past recent We asked that question as well. And the investment volumes last history have been subject to sanctions. We always say to the US year and this year are bigger than they were two years ago. And government, and the US government acknowledges the point, in a very different direction. If you look at the 50 billion number, is that it’s not our business to tell you whether or not sanctions half of it was in oil and gas energy. If you look the plans for 2016, should be done. That’s your business. Our business is to tell you half of it is in manufacturing and a very small percentage in oil don’t do them unilaterally. If you’re going to do sanctions, do and gas. Now, that’s not a complete figure, that’s just an indica- them as a coordinated matter and don’t try to get ahead of your tion. We know that there are more investments done in oil and soldiers. Don’t leave us as the only players in the field and the gas that we don’t know about, or that we didn’t hear about in only damage will be to our business interests if the US imposes our survey. But the point is that there is movement toward lo- a unilateral sanctions regime. And the response in Washington calization. There is movement and investment by our American is that they understand that it’s very important that it’s a coor- companies into Russia, into developing their market share, into dinated action and not a single unilateral action. So far, that’s expanding their business presence. And there’s very little enthu- been the theory and the practice. With Hillary Clinton, prob- siasm to go and write about it in The New York Times. ably, that will continue. But there’s at least a chance, with her, that has signaled a harder line, that she might even be willing Why? to do something without participation by others. I’m not sure. That’s the risk. I wouldn’t imagine much difference between the Because it’s not fashionable. policy then and now. And realistically, there’s still a few months

January-March 2017 CAPITAL IDEAS 43 FACE TO FACE

before the change of power, and the situation that she inherits, Could you give me some examples? Just a few. when she inherits it if she’s the winner, will also have a lot to do with determining what actions she might or might not take. I won’t give you names, but I’ll give you examples. The automo- Specifically, the situation where there’s more chance of flux, like tive industry and the second level of supplier – the people who the Syrian situation, which is the one that’s now being spoken make the brakes, the people who make the bearings, the peo- about more as the reason for imposing stricter measures and ple who make the wheels. They’re coming, they’re here. So, and stricter sanctions on Russia. Although I’ve heard the theory that again, multinational companies are multinational. Ford is as big that’s just a tactic in order to get the old sanctions extended at probably in Europe as it is in the US so they have suppliers all the same level. over the world and they’ll bring the ones that are closer to them, or easier to convince. And by the way, General Motors, when it And what about Mr. Trump? said that it was stopping its assembly of Opels and Chevroletsin Russia, and closing those facilities and closing that business, had Mr. Trump is much more difficult to predict. Mr. Trump has said a much bigger effect on German trade than on US trade because a lot of different things. Initially he said… he makes this point most of that was made in Germany. And, by the way, that actu- which is different from the consensus on foreign policy of the ally was less related to Russia and more related to General Mo- US foreign policy elite, which is, “We’ve got to stop spending our tors’ business in Europe overall. money in 80 different countries where we have military. We can’t police the whole world. We can’t afford it.” That’s actually What kind of advice could you offer to an American investor a very real statement. But the way he delivers it, he goes, “Let or businessman who is thinking of coming and doing busi- the Japanese fight for themselves and let the allies who don’t ness in Moscow and Russia? pay their way, leave them in the dirt”. That’s the colorful side of him coming out. The real message is, of course, true. How long Well, I would say one thing. First, it’s a very good time to be can the US continue to try to be the policeman for the world thinking about it because… with its budget problems? That’s the real message, on one side. On the other side, he says, “You know, hey the Russians are It’s a very good time? bombing ISIS. Great! Good for them. Let’s let them do it. We need that done.” This is a different view of the foreign policy of A very good time. Because things are cheaper and more acces- the US in the Middle East from the current view. Now, why is it sible and if you buy when it’s cheap you have a chance to sell different? I don’t even know because I can’t begin to understand when it’s dear. If you come in when the market’s at the bottom what it is. So, there’s that issue. Then the issue of, “I’ll speak to then you’ll have a chance to grow as the market recovers and President Putin. I think we can get along. Let’s try to be friends that pattern is what we expect to see happen. That pattern in instead of enemies.” That sounds encouraging. That sounds re- Russia repeats with quite a bit of regularity. So, I would say, first ally good. I’d love to see that happen. And then the next week of all, in that sense it’s a good time. In the sense of, what are he says, “And if they fly close to our ships we’ll blow their planes business conditions like, what it’s like to operate a business in out of the air.” So, you know, the range of possibilities is very, Russia? If you are a foreign businessman and you have more than very wide. So, the bottom line is much more difficult to predict. an individual, if you have a decent-sized business with enough And there’s no real basis on which to judge how he will actu- administrative support, yes the rules here are more difficult here ally behave as president because he hasn’t been in a position of than they are in the US, but they are rules, and it’s possible to elected office ever before, which is part of his attractiveness. follow them, and it’s possible to operate here. And no one will, The mood in the US is – get rid of the politicians, they messed well, no one is a strong word, - your chances of being harassed up. That’s his main assent. are quite low. Russia is not a bad place to do business relative to lots of other places in the world. Yes. You already mentioned some American businessmen that are doing business here, but all of these are big names. Are you sure? What about small and medium-sized businesses? In the World Bank’s Doing Business ranking, Russia moved to There are much less American small and medium-sized busi- 40th place this year, outperforming countries like Belgium, Italy, nesses in Russia compared to SMEs from places like Germa- and Israel. ny. This is because, to be multinational, and to go so far from home, it’s just easier for the Germans where Russia is a neigh- In your opinion, what does Moscow have to do to attract bor. And from the US it’s, God knows where... But if they are more businessmen, and to attract more tourists? suppliers to the large companies, then they’re quite often invited by the big companies to supply them in Russia. And they To attract more tourists, I think there are some simple things. do. They do first by exporting to Russia. And then if the vol- Some of them are being considered for the time when the umes weren’t, they can come and look at producing here and World Cup will be held here. And those are things such as some of them have done that. So I would say that’s more a coming into Russia for a week without needing a visa. Rus- statement on medium-sized companies that have come here sia is very, very reciprocity-centric. And I would recommend and will continue to come to Russia. Russia to think of itself first, and of reciprocity second. So

44 CAPITAL IDEAS January-March 2017 if it makes sense for you to have tourists come here and spend money, make it easy for them to come here and spend money. Don’t try to make it hard for them to come here and spend money.

Like what? What should they do?

Like visa-free travel. And don’t make the other country recip- rocate before you do that. So, if a US tourist wants to come here for a week or a month, give them the visa-free travel. And, advertise. There are all these tourist bureaus. Russia doesn’t advertise very much, it doesn’t talk about itself very much. It assumes that people know that it’s a great place to come. Well, that’s a strong assumption. Especially with the level of propaganda. I mean, people ask, I have heard this many times, I get asked it myself, “Is it safe there?”, “Is it okay?”, “Are you okay in Russia?” Well, I’m at least as safe in Russia as I am in London or in New York, and maybe safer. So, yes, I think Rus- sia can take advantage of that or get that message out better than it does today.

So, to cut a long story short, what are the main obstacles that Moscow has to overcome?

Well, I think distance is one. Image is another. Global warming is It wasn’t me who introduced it to them, but I was part of bring- a good thing, if it actually ever happens. It’s a little cold here. No, I ing the very first horses that came here to the club. And within mean, coming here in May to September is okay. Any other time, two years I became the owner of that club. So yes, in the last it’s pretty cold. 13 years, I suppose about 11 of them I’ve been the owner of the Moscow Polo Club. Let me ask you just some personal questions. Who and what inspires you in everyday life in Moscow? And also head of the Russian Polo Players’ Federation.

I think just the average Russian person. The spirit of the average The Russian Polo Players’ Federation is a member of the Federa- Russian in what has been a tough, tough two years is just not tion of International Polo (FIP) and we have been for the last 12 broken. That’s impressive. That people say, hey, it’s tough, but it’s years. And yes, I represent Russia. But Russia’s participation is been tougher. I think that impresses me the most. very small. I really look forward to the day when it becomes a sport that somebody really cares about. And tell me please just a few words about your passion. I mean, the Moscow Polo Club. You mean an Olympic sport?

Well, I love the horses and I love the sport and the sport is prob- Well, it was an Olympic sport, and it is an Olympic sport on the ably the most adrenaline-inducing sport that I’ve ever, ever long list but it hasn’t been played since 1936. The last Olympic played. And the other one, it’s a little bit like golf in that, you gold medal was won by Argentina in 1936 in Berlin. And then know, I’m 65 and I can still play polo because the horse’s legs after the war, the first Olympic games after the war were in are 5 years old and I don’t have to run on my own legs, I can let England, which is the home of modern polo, but all the polo the horse run. fields were turned into air strips and most of the players were shot down on airplanes during the war. So, there weren’t that And how often do you train? many, there wasn’t an ability to do it. Now, FIP, the federation, is about 30 years old and its objective is to make polo an Well, it’s three times a week from May through September and Olympic sportagain. And they’re trying. And I think eventually then it’s three times a week from mid January to mid March. And it should happen. The leaders in the sport today are Argentina, then, of course, riding horses is something you can do pretty the United States, Great Britain, Brazil, France, Spain, Italy, Ger- much all year long. But playing, we organize the playing practices many and India. in those two blocks. In the cold winter, at holiday times, I’ll go to Florida and play there. It’s quite nice. And where’s Russia?

As I understand it was you who introduced Russians to the Russia is very new in the sport. Russia hasn’t developed that sport. much. We would be, probably, somewhere near the level of the

January-March 2017 CAPITAL IDEAS 45 FACE TO FACE

central European countries, like Hungary, Poland, may- Let me ask you one last question: What are your be a bit below, behind them, but close. main achievements?

So as I understand your aim as the head of the Rus- My main achievements? sian Polo Federation is to put Russia among the leaders. Yes.

Well, that would be great. Of course that’s my aim, but In what? it’s unrealistic. That’s the aim for my children and for their children. In everything. In polo, in business…

And what’s your aim as a head of the American In polo, in business and in life. Well, I’m pleased I got Chamber of Commerce. to 65 years old and I have a family and I have grand- children. And that’s probably the best achievement. Well, to help our member companies, and those are It’s a great, great pleasure to see them grow up, to American companies and international companies see them develop, to see them do well. I think in and Russian companies, to some extent, to have a terms of my career in Russia, I’m very pleased I had better business environment. Anything we can do the chance and opportunity to live and work here to advice, to assist, to encourage the creation of a for almost 20 years. And I’m very pleased to have the better investment and better business environment chance to actually try to, in the American Chamber, in Russia is our objective. Of course we’re not alone. to serve both my companies and the country of my We work with RSPP, with Delovaya Rossiya, with ancestors. ASI, with the European associations, AEB – Asso- ciation of European Business, with the Canadians, Thank you very much. Good luck. German and the French clubs and the Japanese. We have similar positions on many issues. Every coun- Thank you. try group has its specifics but I think in many, many cases we work together and that’s our objective as Nice talking to you. well – to work well together, to make this a better place to do business. Thank you very much. ■

46 CAPITAL IDEAS January-March 2017 useful info

Chamber of commerce and industry of the Russian Federation Address: 109012 Moscow, St. Ilyinka, 6/1, bldg. 1 Ph: +7 (495) 620 00 09 Fax: +7 (495) 620 03 60 E-mail: [email protected] http://www.tpprf.ru/en/

Department for Work with Foreign Legal Entities and their Representative Offices Address: 109012 Moscow, St. Ilyinka, 6/1, bldg. 1 Ph: +7 (495) 620 02 14, 620 02 22 Fax: +7 (495) 620 01 70 E-mail: [email protected] http://www.tpprf.ru

Moscow Chamber of commerce and industry Address: 107031, Moscow, St. Petrovka, 15, bldg. 1. Ph: +7 (499) 940 33 16, +7 (499) 940 33 25, +7 (495) 276 12 19 E-mail: [email protected] http://www.mostpp.ru

Main Administration for Service to the Diplomatic Corps (GlavUpDK) Address: 20 Prechistinka Street, Moscow, 119034 Ph: +7 (495) 637 23 26 Fax: +7 (495) 637 31 71 E-mail: [email protected] http://www.updk.ru

January-March 2017 CAPITAL IDEAS 47 MOSCOW IN WORDS

If you want to be happy, be. Leo Tolstoy, Russian writer and philosopher

The greatest happiness is to know the source of unhappiness. Fyodor Dostoevsky, Russian writer and philosopher

Happiness always looks small while you hold it in your hands, but let it go, and you learn at once how big and precious it is. Maxim Gorky, Russian dramatist, novelist, and short story writer

How unbearable at times are people who are happy, people for whom everything works out. Anton Chekhov, Russian playwright and short story writer

48 CAPITAL IDEAS January-March 2017 If a man has not lost his ability to wait for happiness – then he is happy. That is happiness. Ivan Bunin, Russian writer

Happiness will come from materialism, not from meaning. Andrei Platonov, Russian writer, playwright, and poet

When a small child, I thought that success spelled happiness. I was wrong, happiness is like a butterfly which appears and delights us for one brief moment, but soon flits away. Anna Pavlova, Russian prima ballerina

Some people, and I am one of them, hate happy ends. We feel cheated. Harm is the norm. Vladimir Nabokov, Russian-American novelist

January-March 2017 CAPITAL IDEAS 49 FACE TO FACE Ernesto Ferlenghi: Pour your heart into doing business in Russia

“Our objective is to convince Italians that, in spite of the sanctions, the drop in oil prices and ruble devaluation, you can and should continue to work in Russia. You have to learn to adapt to the new conditions, study the market and analyze it,” said Ernesto FERLENGHI, President of Confindustria Russia, an association of Italian companies operating in Russia, in an interview with Capital Ideas.

Mr. Ferlenghi, what is the state of trade and economic re- mantly refuse to understand that Russia is a European country, lations between Italy and Russia? much like all the other states on the continent. And it is a country with tremendous intellectual potential. I have a degree in You know, I’ll put it this way: our relations have always been physics, so for me this is an axiom. I have always regarded your good, which isn’t surprising considering that they were estab- scientists and engineers, who were on the front lines of space lished over half a century ago. The first long-term agreement exploration, as gods. between Italy and the former USSR was signed back in the late 1950s. It was an energy agreement. At the time, Moscow start- Yes, it seems that Europe never really understood Russia ed to supply us with gas from Siberia, and then we built the that well. Right now relations between Russia and Europe famous Fiat factory in Togliatti. There are so many examples of aren’t so great. I am talking about the economic sanctions our strong trade and economic ties! against Moscow...

What is the reason behind these good relations? I’ll confess, I always think to myself: I hope they get rid of these sanctions soon, which would be best for both Russia and Eu- The national character of both peoples. We have a lot more rope. However, in some ways they’ve been a blessing in dis- in common than might appear at first glance. We are similar guise. The sanctions helped Russia to wake up, so to speak. Af- in terms of how we think, as well as in terms of our attitudes ter they were introduced, the country started to think: “Why do toward work. Much like Russians, Italians tend to not make we always have to depend on others - on foreign technology, straightforward decisions that only benefit one side. In my for example? Let’s develop our own, joint technologies.” That opinion, the problem with most Europeans is that they ada- is, clever people in Russia and in Europe understood that, since

50 CAPITAL IDEAS January-March 2017 January-March 2017 CAPITAL IDEAS 51 FACE TO FACE

one door closed, it was time to open another one. It wasn’t so aren’t all that culturally aware can’t tell what’s true and what long ago that we signed a long-term agreement to this effect isn’t. Of course, this isn’t the case for educated Italians who with the Russian Ministry of Industry and Commerce. In es- are able to think critically about what they read. Obviously, we sence, the agreement is about localizing Italian enterprises that educate people at Confindustria, but from a business perspec- work on the development of new technologies. tive. Over the past few days, we put together a list of about 30 Italian pharmaceutical companies that produce medicine and But where do you find potential partners and how do you equipment. We selected companies that have an interest in lo- bring them together? calization and establishing joint ventures in Russia.

That is precisely the objective of Confindustria Russia, which I You know, it’s no coincidence that Confindustria Russia was founded a year and a half ago. The association already includes established precisely a year and a half ago, when the crisis 150,000 different Italian companies that want to do business in first started and sanctions were imposed. Prior to this, there Russia. I’ll also point out that the Confindustria network brings was no need for the association. I noticed that a lot of com- together 98 percent of industrial enterprises in Italy. panies started to ask me for advice: what to do in specific situations, what the ruble forecast is, what the oil prices It’s important to note that when we talk about localization, are going to be, what demand looks like, offers… I started about joint ventures, we aren’t talking about huge investment to set up free consultations for people and a lot of people amounts. And I am confident that these kinds of joint ventures started showing up. These were members of Confindustria will be very competitive. In a nutshell, our objective is to con- Italia, and they were the ones who suggested that I establish vince Italians that, in spite of the sanctions, the drop in oil prices a Confindustria branch in Russia. I realized that this would and ruble devaluation, you can and should continue to work be very good in Russia and agreed right away. Maybe I was in Russia. You have to learn to adapt to the new conditions, motivated by my Russian roots: my mom is Russian and my study the market and analyze it. You know, there are Italian dad is Italian. My dad was one of those Italians who came to companies that have been selling their products in Russia for Russia to study. Almost all of the students married Russian the past 30 years, but were confused when they encountered women and I also ended up with a Russian-Italian family. I the recent changes on the market. We have to explain to them was born and raised in Italy, in a kind Russian-Italian fam- that there are a lot of positive aspects to what happened. For ily, and I was often accused of espionage or of working with example, there are now tax benefits such as exemptions from Russia because of my Russian roots. All of this was nonsense, the VAT for a period of 6 years. But you can only take advantage of course. I don’t see any contradictions, I think like both a of this if you come to Russia now instead of spending the next Russian and an Italian. Even under these new circumstances, 5-7 years considering all the pros and cons and stepping aside when there are sanctions, I am telling you: not a single com- to make way for the German, French or the Chinese, who move pany in Italy will say, “thank God there are sanctions,” not a very quickly because they have a well-developed systemic ap- single one! If we ignore politics and look at the problem in proach here. terms of business alone, everything looks very optimistic and there are opportunities to keep moving forward. Otherwise I’ll say it again, it is important to wise up and come here in or- we will be outpaced by Germans, the Chinese, and I don’t der to create joint enterprises or open companies here that will know who else. It seems like, in spite of the sanctions, no- take part in ruble tenders. It is important to learn how to think body wants to be on bad terms with Russia. in rubles, to train your staff and to move forward - from Russia to Kazakhstan, for example, to Belarus, Armenia and so on. Could you talk about how politics influence what you do?

In your opinion, what sectors of the economy are the most A lot, I won’t tell you otherwise. And I must point out that the appealing for Italian businessmen and investors in Russia? Italian government is one of the most active in terms of the number of visits from officials. Our Prime Minister, for example, Before anything else, engineering. This sector accounts for al- was at the economic forum in St. Petersburg in June, and last most 40 percent of exports from Italy to Russia. week he had a telephone conference with the Russian Presi- dent. This speaks to the fact that there is a lot of interest in So far as I understand, Confindustria Russia is like a guide, developing bilateral relations at the highest levels, which is very right? It helps Italian businessmen and investors who important for business. Because when people in business know aren’t familiar with Russia figure out what to do here? that there is government support behind them, it boosts con- Could you tell us what Italians think when they hear the fidence. word “Russia”? Could you tell me about Italian businessmen who have al- Nothing negative. Italians have always loved Russian culture, ready worked in Russia? How many Italian companies op- read Dostoyevsky and respected Russia. On the other hand, I erate in our country? must admit that our media these days unfortunately publishes a lot of materials that don’t portray your country in the best About four hundred companies. They are truly investing in the light. The majority of people believe the media. People who Russian economy.

52 CAPITAL IDEAS January-March 2017 www.cremonini.com www.ariston.com www.pirelli.ru

January-March 2017 CAPITAL IDEAS 53 FACE TO FACE www.confindustriarussia.it/ru

Did anybody leave after the sanctions were introduced? have to come here. We are ready to explain things and to help. There is another thing - taxes. I think that taxes in Russia are I haven’t seen any Italians leave this market. They understand some of the lowest in the world. At the same time, there are all that if they leave now, it will be very difficult to come back sorts of generous benefits. when the situation improves and oil prices increase. What scares an Italian businessman or investor about Out of those who are successful in Russia, I can point to Cre- Russia, aside from the sanctions? You gave a very good ex- monini, for example, which is a meat processing company. They ample with bank loans. If, for example, the person doesn’t have been on the Russian market for 20 years. It continues to know much about Russia, are there any Russian business grow and increase investments. Another well-known company practices that can be off-putting? And a very important is Termomeccanica, which has always sold pumps and com- question that I wanted to leave for the end: are there any pressors in Russia. Recently, they have established a unique specific features that are unique to the Russian market? joint venture with Konar and Transneft. Now they make pumps in Chelyabinsk as well. Other examples of companies that are Russia is the same as other countries. But, of course, it has its doing well in Russia are Ariston and Pirelli, which make tires, as own particularities. The most important thing is that you have well as Eni and Enel. The latter two have been doing business to pour your heart into doing business here. The same goes for with Russia for half a century already! Italy, by the way.

What advice would you give to Italian businessmen and in- What does that mean? vestors in order to motivate them to come to Russia? I noticed that when a German or French company comes to I’d have to say the following: time flies, don’t let it pass you by, Russia, the main priority for them is business and profit. For load up on wisdom, will and strength, and come here. It’s im- Italians, where 72% of companies are small and medium-size portant to take advantage of this moment in order to establish family businesses, the most important thing is your relation- an alliance with a Russian partner. Don’t be afraid, because we ships with partners and trust. For Italians, much like for Rus- will always help you. Yes, banks in Italy are careful about giv- sians, everything starts at the table, when you drink coffee ing loans to those who want to do business in Russia. But if a together, have lunch and explain your interests to each other. company truly has the desire to enter the Russian market, there Personal connections mean a lot in Russia. But you don’t need won’t be any problems with the bank. In reality, people often connections to get preferential treatment, you need them to make up their own problems. They don’t actually exist. You just get the information required to establish trust. ■

54 CAPITAL IDEAS January-March 2017 around the world Since the beginning of 2013 Capital Ideas has been successfully presented at Destination Moscow roadshows held in London, Frankfurt, Tokyo, Boston, New York and many other cities around the world

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January-March 2017 CAPITAL IDEAS 55 NOTHING VENTURED Time t implement a green tariff

“Currently, Russia has all the conditions necessary to start resolving the problem of MSW management via the construction of additional disposal sites as well as via MSW processing and therefore shift to fundamentally new business models,” said Alexey Volostnov, Business development director at Frost & Sullivan in Russia, in an interview with Capital Ideas.

When we introduce a company, we usually begin by talk- F&S has been working with Russian clients since the beginning of ing about what it has to offer the local market. But when it the 2000s. Until 2011, we worked through the company’s London comes to Frost & Sullivan, which positions itself as a global and Warsaw offices. In March 2011, we opened an office in Mos- organization that encompasses “all regions and indus- cow. In 2009-2011, we were actively consulting companies across tries,” it’s perhaps better to ask the following: why is your different sectors - microelectronics, automotive, mechanical en- company interested in Moscow? gineering, pharmaceuticals - and this determined the decision.

F&S is an international company that has over 40 offices all Out of the areas that are relevant for Russia (and the Mos- over the world. We work across all continents, implementing cow region as well), you have highlighted the problem of research and consulting projects in over one hundred countries. municipal solid waste management. Why have you fo- However, the key focus of our company is high-tech markets cused on this? or markets that apply a lot of advanced technologies. In this sense, I would not limit our attention to Moscow. Of course, The issue of municipal solid waste (MSW) management has the Moscow market is huge and appealing, but we usually don’t been a problem for Russia and for Moscow in particular for a discuss it separately from Russia as a whole. In spite of spe- very long time. Our company works with the leading foreign cific problems in the Russian economy, a number of industries players in this sphere, tracking new MSW treatment technology are experiencing rapid growth. Even given the current climate, and analyzing specific infrastructure projects. Currently, Russia companies are considering plans for development, plan to in- has all the conditions necessary to start resolving the problem troduce new products and services on the market, think about of MSW management via the construction of additional dis- finding international partners, expanding abroad and updating posal sites (the ones in and around Moscow don’t have any their development strategies. We provide our clients with con- more room for expansion) as well as via MSW processing and sultations across all of these areas. Of course, the crisis had an therefore shift to business models that are fundamentally new impact on our business, but this doesn’t mean that our number to Russia, including the generation of heat and electricity from of clients dropped. It’s just that the list of services our clients MSW. Due to increased interest toward this sphere from Rus- has shortened. sian clients, we are ready to offer them our expertise when it comes to this issue. Under what circumstances did Frost & Sullivan first appear on the Moscow market? Or on the Russian market, Households in Russia pay a lot less for garbage disposal since you prefer that? than people who live in other developed Western coun-

January-March 2017 CAPITAL IDEAS 57 NOTHING VENTURED

We have to admit that Moscow has been “exporting” waste to neighboring regions for decades. Now, because the capital has expanded, MSW disposal facilities and dumping grounds are technically within city borders. They are located around construction sites and new transportation routes. In your opinion, how much is required in terms of time and resources in order to get rid of these unwanted neighbors?

“Exporting” solid waste to neighboring areas is not a problem that is unique to Moscow. A lot of big cities have done this, and continue to do it today: New York, London, Dubai, Mexico City, Tokyo - all of these cities have disposal and processing facilities in neighboring cities and states. The expansion of disposal facilities has been a problem for a long time. Right now, it is difficult to assess what the total cost of processing all MSW recultivat- ing the city dumps, but it is obvious that complete recultivation may take dozens of years and require billions of rubles in funding. On the other hand, projects like this increase the investment appeal of the whole territory and have a positive effect on the city’s image. tries. Can this specific industry develop here in spite of Frost & Sullivan experts track emerging technologies. the general population’s limited economic opportuni- What kind of selection criteria do you use? Are there inno- ties? vations that caught your company’s attention in Russia?

Yes, fees for the removal and disposal of solid waste in Russia Every year, there is a list of the top 50 technologies that are are fairly now. However, the implementation of new tech- the most appealing in terms of monitoring, research and in- nology isn’t connected solely to the raising rates. The imbal- vestment. The 50 emerging technologies rating is based on an ance between payments for the transportation and dispos- analysis that takes into account many factors, including pat- al of solid waste needs to be fixed (there are high fees for ents, the technology readiness level, the degree of a market’s transportation, while disposal is paid for with whatever is left development, potential for future development and scaling, etc. over), the legislative framework that would provide a “green Selection and analysis are done by our company’s analysts, who tariff” for the use of energy generated from solid waste pro- regularly cooperate with scientists, inventors, entrepreneurs, cessing needs to be refined, and so on. In this case, the in- investment funds and so on. crease in the cost of MSW disposal will not be as significant. In return, we will put a stop to the growth of waste disposal Our clients have technologies that are in-demand glob- sites and the contamination of groundwater and soil. This ally. Continuous commercialization of inventions is not yet a is why it is important to take the environmental costs into strong suit of Russian companies and research centers, but consideration. even in this area we can see a willingness to improve the process and help increase the number of innovative technologies What technologies and solutions out of those available and solutions. in global MSW management practices are the most applicable to Moscow? How are your approaches differ In your opinion, how transparent is the Moscow Govern- from those of other companies that specialize in this ment and other city organizations? How receptive are sector? they to the initiatives, ideas and principles promoted by Frost & Sullivan? As we already discussed, we work with different companies in the MSW processing sector. We have clients who use combus- Moscow is implementing a large number of innovations, in- tion technology, bio-fermentation and pyrolysis. The implemen- cluding green innovations, across multiple sectors: information, tation of these techniques depends on a number of different transport, construction and others. Innovative infrastructure factors: the morphological composition of MSW, the presence facilities are being erected and programs that support entre- of opportunities to invest in high-tech projects, the availability preneurs working in tech are in place. On the other hand, much of separate collection of household waste, etc. In this sense, it like any big city, Moscow takes a level-headed approach to makes sense to point out that Moscow will probably use an in- implementing new solutions, since it is necessary to maintain tegrated approach that combines several techniques (combus- a balance between innovation and providing for the stable option and low-temperature pyrolysis, for example). erations of various city systems. ■

58 CAPITAL IDEAS January-March 2017 useful info

City Government Address: Voznesensky Per., 21, Moscow, 125032 Ph: +7 (495) 633-51-90 http://www.mos.ru/en/index/php

Moscow Investment Portal Address: 119019, Moscow, Novy Arbat St., 11, bldg. 1 E-mail: [email protected] http://www.mosinvest.mos.ru

Moscow Innovation Development Center Address: Voznesensky Per., 22, Moscow, 125009 Business Center Usadba Ph: +7 (495) 225-92-52 http://inno.msk.ru

Business Protection Headquarters Address: Voznesensky Per., 22 (5th floor), Moscow, 125009 Business Center Usadba Ph: +7 (495) 620-20-45 http://shtab.mos.ru

Department for Competition Policy Address: 12 Pechatnikov Pereylok, Moscow, 107045 Ph: +7 (495) 957-99-31, +7 (495) 957-99-77 Fax: +7 (495) 957 99 95 E-mail: [email protected] http:// www.tender.mos.ru

January-March 2017 CAPITAL IDEAS 59 NOTHING VENTURED We believe in developing our business in Russia Heidelberg Cement has over 3,000 representative offices in over 60 countries all over the world. We sat down to talk with Mihail Polendakov, General Manager of Heidelberg Cement in Russia, about the company’s activities.

Cement has always been and When did Heidelberg Cement come to Russia and why did you make the decision to enter the Rus- continues to be a hot commodity: sian market? Was there demand for cement and gravel in Russia? not a single construction project can be completed without it. The HC had plans and investigates the market situation since 2002. A final decision was made to enter the talented entrepreneur Johann market in 2005. Certainly there was a demand for Schifferdecker realized the potential cement and gravel of high and permanent quality in Russia. We seriously believe in further positive devel- for development in the cement opment of our business here. industry and purchased the Bergheim What objectives did your company initially set mill back in 1873. The mill was a small when it entered the Russian market and what kinds cement production factor on the of challenges did you encounter in the beginning? Neckar River in the German city of Our aim was to establish a long term operation after a thorough research of the Russian market. To be Baden-Württemberg. This is where honest we did not encounter any difficulties unique the story of Heidelberg Cement to Russia. It was a process similar to a market entry in many other countries around the world. started. Since then, the company has come a long way and is not one of the A lot of people would be jealous of Heidelberg Ce- ment’s success in Russia: suffice it to say that the leading manufacturers of cement and company has three factories here. Tell us about concrete. For six years, Heidelberg these enterprises: where are they located, what do they make and what are their capacities? Cement has been on the list of top German enterprises according to the That is for you to judge. So far, our success in Russia is based on the daily work and efforts of our manage- DAX performance index. ment team and our people. We have cement plants in

60 CAPITAL IDEAS January-March 2017

NOTHING VENTURED

How many employees does Heidelberg Cement have in Russia?

1,481 people as of the end of September of this year.

Obviously, you need highly qualified professionals for your business. Where do you find them?

Our priority is to search from within either all of our operations in Russia or globally within our Group. Our team consists of few expats and predominantly Rus- sian people.

Could you give us an approximation of what Hei- delberg Cement’s share is in the overall volume of cement and other construction materials used in Russia?

It depends on the methodology: I can only say that we are one of the small players. Roughly we account the Tula region, in Sterlitamak, the Republic of Bash- for about 5.5-7% of the Russian market and for about kortostan, and in Slantsy, the Leningrad district. The 9-11% of the Moscow market. And once again it fully overall capacity is 4,6 MIO tons. depends on the way you calculate it.

Aside from these factories and the Moscow office, Heidelberg Cement is probably well-repre- what else does Heidelberg Cement own in Russia? sented on the Moscow construction materials market. What facilities and buildings (admin- We have built terminals in Kaliningrad and Murmansk istrative, economic, cultural and so on) were and we have our administrative, SSC, HR and techni- constructed with materials produced by your cal center in Podolsk. company?

62 CAPITAL IDEAS January-March 2017 We supply major players of the Moscow construction market with high quality cement that they use for different projects. Mostly it’s housing and infrastructure projects such as metro stations, stadiums, road infrastructure etc.

Right now, construction of facilities for the up- coming 2018 FIFA World Cup is underway in Rus- sia. Does your company supply construction materials for the implementation of these projects?

There are some projects which are being built with our products, but we never work directly - we supply the projects’ subcontractors.

Have the economic sanctions against Russia, which remain in place today, affected Heidelberg Cement’s business here?

Not much. We are a local producer. Cement is a local business. We occasionally have some compliance and legal issues to take care of, but I would say it’s the You have been working in Moscow for five years same for all foreign strategic investors. already. Could you talk a little bit about your im- pressions of the city? Are you comfortable in the Considering the current challenging economic Russian capital? climate, do you still think that doing business in Russia is promising? I feel at home in Moscow. My family as well. It’s a booming and cosmopolitan metropolis with an inter- For sure. Otherwise we would not be planning the esting and rich cultural life. I like this city, I hate the long term strategic development of our business in traffic. I feel very comfortable in Moscow. The only the Russian Federation. thing I dislike are the traffic jams. ■

January-March 2017 CAPITAL IDEAS 63 NOTHING VENTURED Massimiliano Perri: We are going to expand our presence in Russia The Italian company Iveco is quite unique for the Russia (now belongs to the multinational CNH Industrial). It entered the Russian market almost 40 years ago, and continues to successfully develop today. Back on the 1970s, Iveco started supplying its powerful trucks for what was referred to as “the construction project of the century” - the Baikal-Amur Mainline. Now, the company carries out a much wider range of activities in Russia. We sat down to talk about the company with Massimiliano Perri, Business Director of Iveco in Russia.

n the spring of this year, the territory of the for- tantly - is sufficiently sturdy for Russian roads, which mer retro car museum at Rogozhsky Val opened aren’t always the smoothest. a new museum called “Moscow Transport.” The collection is based on cars, trucks, passenger Massimiliano Perri, who heads up Iveco in Russia, can transport and special technology - 300 exhibits be truly proud of this elegant model made by the Ital- Iin total. A lot of these models are the only examples ian company in cooperation with Russian manufacture left over from the past. company “Nizhegorodetz”. This is what Massimiliano said over a cup of strong coffee during our conversation. Public transport is represented by several dozen legendary buses and trolleys from the past, includ- Tell us please about your cooperation with the Moscow ing the first Moscow bus ZIS-8, the famous ZIL-158 City Government. As far as we know you've already and the most popular bus of the 20th century, the supplied the city with 220 minibuses. What’s next? LiAZ-677. - That’s not quite right - this year we supplied almost The museum’s exhibits, of course, don’t include Iveco’s 500 minibuses for the Moscow City Government. passenger minibus, the Iveco Daily, which has recently It's a unique product that is built in Russia and cor- appeared on the city streets. However, it seems like responds to all safety and emissions regulations. Each this is the model that will become a symbol of Mos- bus is equipped with a device for people with reduced cow’s 21st century public transport! In any case, Mus- mobility, so we believe that it will change the passen- covites really like this bus, which is painted a soft blue ger experience and provide a new level of accessibility color. It is comfortable, spacious, and, most impor- for people with disabilities. We look forward to 2017

January-March 2017 CAPITAL IDEAS 65 NOTHING VENTURED

with optimism, as we have a unique offer in the 6-8 ton bus segment, providing the full range of safety features and high durability.

Our meeting with Mr. Perri took place in the company’s office in Moscow, which is located inside one of the high-rise buildings in the business center on Len- ingradskoye Highway. Although Massimiliano only recently moved to this office, he feels very confident here, just like he does in Moscow. The Russian capital has long become a cosmopolitan city that has everything that you can find in every other major city in the world. Perri doesn’t even miss Italian food here, and not only because there are a ton of great Italian restaurants in Moscow. “It’s just that when I’m abroad, I like to try the local food,” he says, smiling.

However, Perri’s confidence extends beyond the fact that he is comfortable in Moscow. The main reason is Iveco’s success in Russia, which is no coincidence. Per- ri is an experienced manager who knows everything there is to know about Iveco because he has almost twenty years of experience with the company. In other words, the heads of Iveco, which is headquartered in Turin, knew full well who they should send as their representative to Russia. developing their product and service portfolios. Speaking Massimiliano started his career in 1998, as an employee of his new appointment, Perri says: “I am glad to head up of the Astra division, which specialized in the manufac- Iveco in Russia. It’s a very interesting experience, consid- ture of heavy trucks and heavy machinery. From 2001 ering that in 2010 and 2011 I worked closely with our Rus- to 2003, he was in charge of the logistics department sian colleagues regarding customer service issues. We for spare parts at Iveco in France. After, Perri headed up plan to expand our presence on the market, regardless the customer service department in Poland and stayed of the current economic climate. I am sure that we will there in 2004. He then moved back to Italy, where he be able to strengthen our positions thanks to the great was in charge of purchasing parts for the manufacture quality of the products and services we offer.” of commercial vehicles. In 2007, Perri moved to Austra- lia, once again as head of the customer service depart- “Quality” is the key word here. The thing is that, ac- ment. In 2010, he started to oversee 30 European and cording to Perri himself, Iveco has a lot of competi- Asian markets, including Russia. tion in Russia from leading domestic manufacturers, which account for 75 percent of the market. Prior to his arrival in Moscow at the end of 2015, Massi- miliano Perri was the General Director of Iveco in Poland, So how do you look good on the market under these conditions?

“We leverage on the quality of our trucks, and, accord- ingly, the search for niche markets that are a good fit - the search for niche goods that nobody else can provide. Moreover we believe that our product line-up perfectly fit the needs of large national corporations, where the quality and cost effectiveness of the products are fundamental” he says. According to him, the microbus we already discussed is one of such niche products, as well as the joint Russian-Italian venture Iveco-AMT, which is located in Miass, Chelyabinsk Oblast. “This enterprise,” Perri explains, “doesn’t manufacture standardized vehicles. Aside from the large portion of localization, the plant almost never makes two vehicles that are exactly alike.” The vehicles are made specially for specific cus-

66 CAPITAL IDEAS January-March 2017 tomers who have specific requirements. There isn’t another manufacturer like this in Russia. Note from Capital Ideas:

But Perri doesn’t plan to stop here. It seems that his Iveco is a brand of CNH Industrial N.V., a World leader in mind is always preoccupied with figuring out how to improve Iveco’s operations in Russia: “We are looking Capital Goods listed on the New York Stock Exchange (NYSE: into different options for upgrading Iveco-AMT. We CNHI) and on the Mercato Telematico Azionario of the Borsa are figuring out what kinds of investments we will need to increase our plant capacities. Right now, our Italiana (MI: CNHI). Iveco designs, manufactures and markets level of localization already exceeds 50%. For some a wide range of light, medium and heavy commercial vehicles, products, the level of localization can reach 60-70%. off-road trucks, and vehicles for applications such as off-road They are almost fully Russian vehicles.” missions. Has the crisis affected company operations? The brand’s wide range of products include the Daily, a vehicle “Yes,” Massimiliano says, “right now, our primary con- that covers the 3 – 7 ton vehicle weight segment, the Euro- cern is figuring out how to improve after sales services to our clients”. In order to ensure this, Iveco has cargo from 6 – 19 tons, the Trakker (dedicated to off-road recently opened a new spare parts warehouse in the missions) and the Stralis, both over 16 tons. In addition, the Moscow region and is developing various service programs for client support. A key aspect for the company Iveco Astra brand builds off-road trucks, rigid and articulated is, of course offering exclusive products to corporate dumpers as well as special vehicles. clients. Iveco offers high quality trucks, which deliver an extremely competitive Total Cost of Ownership Iveco employs close to 21,000 individuals globally. It manages (TCO). Thanks to the reliability of our products, fuel efficiency and safety we can provide solutions to our production sites in 7 countries throughout Europe, Asia, Af- clients which minimize the costs of owning and op- rica, Oceania and Latin America where it produces vehicles erating truck or commercial vehicles. Moreover, the featuring the latest advanced technologies. 4,200 sales and majority of the newly supplied trucks are usually sold to leasing. “Right now,” Perri said, “we are cooperating service outlets in over 160 countries guarantee technical sup- with several companies and are constantly looking for port wherever an Iveco vehicle is at work. the best offers for our clients.” ■

January-March 2017 CAPITAL IDEAS 67 NOTHING VENTURED Moscow is becoming a great place for developing industrial manufacturing

The establishment of technoparks is becoming one of the tain types of equipment to Russia. But the sanctions don’t have key trends when it comes to Moscow’s development. The ap- any effect on setting up assembly lines for equipment inside the pearance of yet another space begs the logical question: how country. Naturally, companies that want to develop their busi- is the Technopolis METMASH project different from the rest? ness in Russia because they see a lot of potential in our market want to take advantage of this window of opportunity. Here is what Alexander Pirozhenko, CEO, Center of Metallur- gical Machine Building, VMM Holding Company, says: “We are Can you give any examples? creating the first industrial park in Moscow, and perhaps in all of Russia, that focuses on the latest metalworking technolo- For example, we have the company KOSKO, which is the ex- gies. We chose to focus on this because it has historically been clusive distributor for the Italian company Bonetti. Last year, our area of specialization. The territory that has been occupied Bonetti Construzioni Meccanice S.r.l. decided to expand its by VNIIMETMASH Institute of Metallurgical Machine-Building presence on the Russian market and set up a full cycle produc- for over half a century houses about 150 small and medium size tion plant for bandsaw machines through KOSKO under the enterprises, including 20 diversified tenant companies, and we auspices of the Technopolis METMASH project. This is how the wanted to create a more comfortable environment for them.” enterprise Bonetti Opus Rus, the first resident company of the VNIIMETMASH, as a prominent resident of the industrial park, should become a point of attraction for companies that are connected to us through the production chain or through col- laborative intellectual product projects. We are currently holding negotiations with several potential participants who are interested in relocating to our space.

Are there any foreign companies among them? What about this project interests them?

We are just starting our project, and right now the ratio of foreign companies to Russian companies is about 60:40. From the foreign business side, the interest is primarily coming from companies that are planning to localize production. As you know, because of the sanctions Western companies cannot sell cer-

January-March 2017 CAPITAL IDEAS 69 NOTHING VENTURED

industrial park, was set up. This company is not only our ten- trepreneurship, does not allow the area to be converted into a ant, but also our client because we we make the frames for residential space. their equipment on our plant. We would like to establish similar working relationships with other resident companies as well: What advantages can a company that decides to have a that is, to not only rent out the space, but also collaborate on plant here expect to receive? the development of joint production activities. The main advantage is our plant, which I already talked about. What is the total area of the industrial park? What does it This is one of the few machine building enterprises in Moscow have today and what can we expect in the near future? with a multipurpose machine pool, which we plan to use as the future shared metalworking space. This base can be used, for The total area amounts to 17.5 hectares. It houses our engineer- example, to make equipment ordered by industrial enterprises ing center, which employs about 200 designers (about 2,000 in Moscow, which there are a lot of because our city continues visit or work in this space on a daily basis). Moreover, there is to be a major industrial center with a large number of hitech the experienced plant VNIIMETMASH, which can perform just machine building enterprises. This is a sizeable market segment about any kind of metalworking activities and make parts of that is always generating orders for parts, replacements, and varying complexity. We plan to incorporate about 100,000 components. Right now, a lot of these orders have to be fulfilled square meters of space into the industrial park development outside of Moscow. Because of this, timelines for projects have program. We need to assess which buildings can be renovated to be extended and costs for logistics and transportation go up and which buildings need to be torn down and replaced with as well. Thus, a company that is able to fulfill these types of modern industrial or office buildings. If the tenants need ware- orders in Moscow automatically has a competitive advantage. house space or other auxiliary facilities, we are prepared to erect them as well. There is also potential for further develop- Some people say that having an industrial plant in Moscow ment. The city authorities have given us a permit that allows us doesn’t make much sense. You have to pay more for every- to double in size, to 230,000 square meters. thing - land, rent, services, the cost of living here is higher and so are the wages. What do you think? Is your engineering center the proprietor of this area? Moscow is undoubtedly an expensive city. Still, it makes sense No, the land is owned by the Government of Moscow: they own to have this type of business here. Today, the cost of renting a 100% of our industrial park’s shares. Therein lies the guarantee space at VNIIMETMASH is comparable to the rent prices for in- for its development in the aforementioned industry. It is no se- dustrial spaces in the neighboring regions. We plan to raise the cret that a lot of developers would like to purchase spaces here rent prices as the quality of spaces and infrastructure improve, in order to erect residential buildings. Taking into account the along with services for tenants. But this shouldn’t be anything high cost of housing in Moscow, this could be very profitable. significant for the resident companies we are targeting, espe- But this approach would disrupt the harmonious development cially considering the benefits they will receive in return. For is the city, which must have room for both residential housing them, the most important thing is having the opportunity to and places of employment. This is why the city government, attract a qualified workforce. Considering the fact that we are specifically the Department of Science, Industrial Policy and En- in a historically industrial area of Moscow, there is no problem

70 CAPITAL IDEAS January-March 2017 with finding qualified employees at all. If the employer is ready Moreover, the investor gets a return on the funds spent on in- to pay good salaries, they will be able to find highly qualified frastructure development. We consider these methods and in- experts in any profession. centives to be sufficiently effective.

Of course, an investor can choose another location for a plant, Is it difficult to get to the industrial park by public transport? where everything will be cheaper. But in this case the company will have to figure out where to get qualified employees, where In this sense, we have positive changes to look forward to. In to house them or how to set up transportation for them. All 2018, there will be a new metro line that goes here. One of of this sometimes amounts to expenses that can override the the stations, Stahanovskaya, will be located practically inside money saved on capital investment. the industrial park. Today, people can already use a recently launched mode of above-ground transportation - the Mos- Will the capacities you currently have need to be upgraded? cow Central Circle (MCC), which I use frequently myself. The trip to the closest MCC station takes about 5-7 minutes. Do This needs to be done. Our machine pool is a bit out of date. The to the rapid rate of development in this district, future plans machines themselves are quite reliable, work well and allow us include the establishment of a major transport interchange to produce equipment that meets all quality requirements. But hub, as well as the construction and expansion of roads. So the speed isn’t that great, and we would also like the machines our space has a lot of advantages in terms of access to public to be more up to date in terms of automation. We are already transportation. taking steps forward in this regard. Thanks to support from the Moscow government, which provided us with a grant, we have What prompted you to start working on the Technopolis an opportunity to start upgrading our equipment. Among other MATMASH project and why are recent graduates involved things, we plan to acquire a machine that will allow us to in- in the project, as opposed to experienced project managers? crease the finishing quality of parts. I came to VNIIMETMASH two years ago. Prior to this, I worked In your opinion, who can invest in the development of an in- in various Russian government institutions for ten years. I grew dustrial park and what kinds of incentives can they count a bit weary of the endless cycle of documents and reports - ev- on? erything that has to do with bureaucracy. I wanted something practical. I am very grateful that the Moscow government gave This depends on the concept, which is currently under develop- me this opportunity. Of course we’re launching this project at ment. The logic is that investors can be companies that are in- a difficult time. The institute and experienced plant are going terested in the acquisition or long-term lease of industrial facili- through a challenging time. After all, during the Soviet era it ties in the park. Banks can also provide funding for investments. was a big engineering center for metallurgy both domestically For example, Sberbank has a program called “New Industrial- and internationally. Now we’re changing the team around and ization,” which allows clients to attract long-term financing at focusing on young people, putting faith in their energy, fresh preferential rates. The Moscow authorities and the Govern- outlook, and ability to find original solutions. After all, the coun- ment of the Russian Federation also subsidize the interest rates try’s future is in the hands of young people, who will draw on all on loans for the development of industrial park infrastructure. the best things developed by previous generations. ■

January-March 2017 CAPITAL IDEAS 71 EXPERT TIPS The regulations for business success

How foreigners can avoid additional costs and fines when supplying their products to Russia

Today, many foreigners want to start or expand their business in Russia. But if, by law, the products they supply require certification, problems can arise. Although many regulatory documents have already been harmonized with directives in force in Europe, there are still some particularly Russian anomalies. Yulia Beliakova, Marketing and Development Director at “Techno-Standart” Scientific and Technical Centre, tells us, using real examples, how foreign businessmen can avoid fines and extra costs when supplying their goods to Russia. Situation 1 An Italian manufacturer of industrial ma- The lesson for us all is: it is essential to check out your chinery turns to a law firm to arrange per- counteragents carefully. Whether it be a law firm or an mits for the products he intends to sell in the agency, you need to identify which body it is that will be Russian Federation. All the work was carried issuing the certification, and to request a reference list from them. It is also important to know that in Russia out by the deadline stipulated in the agree- there is a unified register of certificates and declarations. ment, and subsequently the manufacturer Therefore, once the certification work has been carried has received all the necessary certificates out, information regarding the documentation issued and documentation. But the very first time needs to be entered onto it. his machinery is delivered to Russia, problems arise with the customs authorities. It It is essential to check out your counteragents suddenly comes to light that the certificates carefully. arranged by the Italian company were not entered into Russia’s unified register.

As it turns out, the law firm which assisted the Italians in drawing up their documentation, without going into detail, Situation turned to a product certification agency with a poor reputa- 2 In 2006, a well-known American company tion on the market. As a result, the work done on the confor- was supplying the Russian market with mity assessment involved violations. The customer incurred unforeseen costs due to the deliveries being interrupted. mining equipment. Then, as early as 2013, Eventually, of course, the situation was resolved once the the same US company once more signed a Italian company arranged the documents in the correct way. contract to supply the exact same equip-

72 CAPITAL IDEAS January-March 2017 ment. But during this process, it suddenly came to light that arranging certification for a foreign applicant in the same way as Situation had been done in 2006, was no longer per- 4 missible under Russian law… A well-known German supplier of electrical goods sells its products to seven businesses In the time that had passed, legislation governing technical regulations had changed substantially. And from 2012, in Russia. But in accordance with the require- the Technical Regulations of the Customs Union (TR CU) ments of the TR CU which came into effect came into effect. For example, under the GOST R system, in 2012, the applicant can only be a company as well as under the RF’s technical regulations, the appli- registered on the territory of the Customs cant could be a foreign company. But in accordance with Union. This scenario is very much reminis- the requirements of the Technical Regulations of the Cus- cent of the one we have already examined in toms Union, the applicant for conformity assessment can only be a company resident in a Customs Union country. Situation 2. But the solution which was found A solution was of course found: the applicant for certifi- in that case is not applicable in this one: cer- cation of these deliveries became the Russian company tificates of conformity for seven different which was itself purchasing the equipment. businesses would have to be drawn up seven times! Such a state of affairs for the supplier In Russia, the Technical Regulations of the Customs would cost, as they say, a small fortune. Union (TR CU) have come into effect. However, a solution to a problem such as this does exist. And it substantially reduces the costs incurred by the businessman supplying his products to Russia. To minimize the costs and loss of time in this case, the legal entity needs to be registered within the Customs Union territory. And so, in this case, the German supplier, to get Situation 3 out of the situation which had developed, opened, and legally formalized, a branch of his company on the ter- A German company which makes power tools ritory of the Customs Union. And at this branch all cer- had the equipment it supplies certified in Rus- tificates and declarations for subsequent deliveries to all sia in accordance with TR CU 010/2011 “On the seven Russian customer companies were drawn up. ■ Safety of Machinery and Equipment”, as well as with TR CU 004/2011 “On the Safety of Low- With large-scale supply to different partners in Voltage Equipment”, and stamped its goods Russia, it is worth registering a legal entity on the with an EAC mark. But… on selling the goods, territory of the CU. it was fined for unlawful product marking. For Capital Ideas courtesy of BIGMOSCOW The point being that goods stamped with the EAC mark have to meet all the requirements of the Technical Reg- ulations of the Customs Union which apply to them. And STC “Techno-Standart” offers its clients services on this occasion the goods had to be shown to be in ac- related to the validation of product conformity, cordance with another Technical Regulation of the Cus- industrial safety, and diagnostics of equipment and toms Union: TR CU 020/2011 “Electrical Compatibility of Technical Equipment”. materials using non-destructive testing methods. STC “Techno-Standart” operates under the Before making an application for certification, the applicant must be precise in identifying the appropriate Tech- authorization of Certificate of Accreditation ROSS. nical Regulations of the Customs Union which govern RU 0001.11АВ72, issued by RusAccreditation, and, the products declared. It is a veritable minefield. In the since the 7th of May 2010, under FSETAN licence RF Code on Administrative Violations there is article 14.46 No. DE-00-011534, issued by the Federal Service (para. 1), which sets out responsibility for the unlawful use of a mark of conformity on goods on the market. In accor- for Environmental, Technological, and Nuclear dance with this article, a fine for responsible parties and Supervision, and with a Certificate of Attestation for legal entities of up to 300,000 roubles can be imposed. non-destructive testing laboratories No. 7А010080. In addition, in 2014, STC “Techno-Standart” was You must be precise in identifying the awarded accreditation to carry out work on the appropriate Technical Regulations of the voluntary certification of equipment (materials) used Customs Union. at hazardous industrial facilities on Russian territory.

January-March 2017 CAPITAL IDEAS 73 Travel Moscow is among top cities Moscow has been named one of the world’s best cities, according to Lonely Planet’s Best in Travel 2017 list.

ussia may not have revealed all its Revolution- centennial plans, but it’s as clear as a crenellated Kremlin facade that there will be radical changes in Moscow,” says Lonely Planet in its introduc- tion. The city will host football matches in the “R2017 Confederations Cup and the 2018 FIFA World Cup, so the race is on to bring an inkling of the ultra-modern to a metropolis renowned for bombastic architecture. The new Ramenskoye Airport and a new metro line will mean an all-time high in the city’s connectivity, and Moscow will gain a blockbuster attraction in the Polytechnic Museum and Educational Centre, relo- cated to a dramatic building in the Vorobyovy Gory hills.

Why people love Moscow?

Here’s opinion of Mara Vorhees, one of Lonely Planet writers, that she shares on its site: “The Russian capital never ceases to inspire, confound, disgust or delight me in some unexpected way. This time I was thrilled to discover the capital's new ob- session with 'park life'. Not just summer cafes – I've always ap-

74 CAPITAL IDEAS January-March 2017 Moscow is among top cities

preciated that – but also bike paths, ping-pong clubs, outdoor theatres and dance parties. It's hip to be outside and active; and the city has accommodated with gorgeous green spaces. The Park of Culture and Leisure (aka Gorky Park) has finally come into its own – along with a new generation of health- conscious, hopeful Muscovites.”

Among sights of Moscow Lonely Planet names: The Kremlin, Red Square, The Pushkin State museum of fine arts, The State Tretyakov Gallery, The Novodevichy Convent and many other wonderful places of interest of the Russian capital.

Moscow is definitely changing for better now. As the Guard- ian puts it: “Moscow is already transforming. From plans for Zaryadye Park– Moscow’s first new park in 50 years – to burgeoning creative industries, rapid gentrification and a food revolution, the fabric of the city is being reworked. Plans involve pedestrianised embankments along a transformed riverfront, high-speed water transport and brand- new cycling infrastructure.” ■

January-March 2017 CAPITAL IDEAS 75 Travel To Russia with cash The number of Chinese tourists visiting Russia rose significantly in the first five months of this year, according to the head of Russia’s Federal Tourism Agency (Rosturism) Oleg Safonov.

n the first nine months of 2015 the number of tourists from China to Russia grew by 21 percent, this year the growth is already 63 percent,” Sa- fonov“I said at a meeting on tourism at Most Chinese tourists visit Moscow, Ka- Chinese tourists arrive by the busload the State Duma. zan and St. Petersburg. Sochi has also each week to pay their respects to Wang become a popular destination since the Ming, a Chinese Communist leader bur- China's Foreign Ministry intends to es- 2014 Olympics. ied here alongside some of Russia’s most tablish visa-free travel with Russia to prominent writers, composers and politi- increase tourism. “We are going to make A report from Bank of America Merrill cians. tourism another sector for strengthen- Lynch said 174 million Chinese tourists ing ties with Russia. Simplifying the visa are expected to spend $264 billion on “We’re learning about (Vladimir) Lenin regime is one of the methods to attract- overseas shopping by 2019 in compari- and (Josef) Stalin, and how they created ing tourists,” said Gui Tsunyu, head of the son with the 109 million who spent $164 this country,” said 39-year-old Cheng Department for Europe and Central Asia, billion in 2014. Ling, an accountant in Shanghai, as she Ministry of Foreign Affairs of China. slid ruble coins along the side of the red A third of the tourists will be 25-34-year granite plinth, a tradition ensuring the He said Russia and China had already olds, with 15-24-year olds accounting for dead have money in the afterlife. working on boosting tourism to both around 27 percent, said the report. countries, in particular, providing visa-free Russia’s relations with the West have de- travel for tourist groups of at least five “To see how good relations are between teriorated amid the conflicts in Ukraine people. But, according to Tsunyu, even Russia and China these days, check out and Syria and its economy has been that no longer satisfies Chinese tourists Novodevichy Cemetery here,” writes battered by punitive sanctions and low wishing to visit Russia. from Moscow Amie Ferris-Rotman in oil prices. But the country is welcoming the Wall Street Journal article entitled record numbers of Chinese visitors, who According to data from the Moscow city “Russia Welcomes Growing Wave of are taking advantage of a weak ruble, vi- tourism department, over one million ‘Red Tourists’ From China”. The article sa-free group travel, and the opportunity tourists from China visited Russia in 2015, has also a subtitle, which says “Nos- to retrace Communist history. spending nearly $ 1 billion. talgia for Communist past as well as capitalist bargain-hunting draw more Red tourism – visiting sites relevant to In June 2015, Russia and China agreed Chinese visitors”. the Communist Party of China – has to open ten more 'red tourism' routes. flourished under President Xi Jinping, at Twenty tour operators from both coun- Here’s the full story from The Wall Street home and abroad. In June 2015, Russia tries cooperate on the trips. Journal: and China formally agreed on opening up red-tourism routes, a deal signed in Shaoshan, the birthplace of Mao Zedong.

Chinese tourism to Russia jumps 63% “Travel to Russia is considered politically correct,” said Wolfgang Arlt, director of

76 CAPITAL IDEAS January-March 2017 Chinese tourists spent $1 billion on To Russia with cash holidays in Russia last year

the China Outbound Tourism Research together with their parents as a way to Along with Communist nostalgia, a dash Institute, which is based in Beijing and sort of honor them.” of capitalist bargain-hunting is also Hamburg. proving a draw. In Moscow’s flashier Next year’s centenary of the 1917 Bolshe- shopping malls, signs in Chinese boast of In addition, terror attacks in France and vik revolution is expected to bring a del- better prices than in Hong Kong. Belgium have unnerved many Chinese uge of Chinese visitors to Russia, he said. travelers, he said. “Russia is seen as a very The German birthplaces of Karl Marx and Struggling with bags of merchandise at safe option.” Friedrich Engels are also preparing for a shop in the center of Moscow, Qing more tourists. Yue from Shandong province in eastern More than 1.1 million Chinese tourists are China said: “History is also good, but this expected to visit Russia this year, about According to adventure tour company is better.” 16% more than 2015, according to figures Russian Discovery, around 200,000 from market-research firm Euromonitor Chinese visited Russia last year on com- But there’s one problem to which points released in June. That puts Russia at No. munist-inspired travel. This includes ex- Euronews: and it is the Chinese language. 16 on the list of top destinations for Chi- peditions in Lenin’s footsteps, beginning nese tourists, behind the U.S. and France with his birthplace of Ulyanovsk in cen- So far around 30 tourism businesses in but ahead of the U.K. tral Russia, followed by the city of Kazan Russia including shops, hotels and res- where he studied, St. Petersburg for the taurants are currently involved in the As many as half of last year’s visitors are October revolution and Moscow, where Chinese Friendly International initiative. estimated to have traveled to the Europe- his embalmed body lies in a pool of red an part of Russia, which includes the more light in a mausoleum. The initiative includes, for example, the affluent, history-soaked cities of Moscow appearance of maps and guidebooks in and St. Petersburg. Russia and China, former Communist ri- Chinese at hotel receptions and Chinese vals that share a 2,500-mile border, have menus in restaurants and the recruit- Russian flagship carrier Aeroflot report- been steadily drawing closer as East- ment of staff with Chinese language ed increases in trips to and from China West ties strain. On Oct. 1, Russian Presi- skills and Chinese-language newspapers of 15% and 14% in 2014 and 2015 respec- dent Vladimir Putin said relations were at and television channels in hotels. tively. Russian tourist officials say 2016 an all-time high as he congratulated Mr. should see even more, matching at least Xi on the 67th anniversary of the People’s But one thing is still very important - the $1 billion they spent last year. Republic. Mr. Xi in June described Russia to find Chinese speaking profession- and China as “friends forever.” al guides. If at the beginning of 2016 Senior citizens are particularly attracted there were only 96 officially accred- by the country, Mr. Arlt said. “They re- At the G-20 summit last month , Mr. Putin ited standard Chinese speaking guides member singing Russian songs as chil- gave a tub of Russian ice-cream to Mr. Xi. in Moscow, now the number has in- dren. The younger folks travel to Russia Now the dessert is flying off the shelves. creased to 200. ■

January-March 2017 CAPITAL IDEAS 77 FACEMOSCOW TO FACE VOCABULARY

This section of the magazine - “Moscow Vocabulary” – was born of remembering … Ronald Reagan, who appeared to be a fan – and collector - of Russian proverbs and sayings. Well, and we would like to guide you into a world of Russian idioms – just as bright and colorful.

НА ЛБУ НАПИСАНО – na lbu napisano. (It’s written on the forehead) Explanation: Something about a person is pretty obvious by the look on his face.

ДУША НЕ ЛЕЖИТ к чему-либо/кому-либо – dusha ne lezhit. (One’s soul doesn’t lie for something or someone) Explanation: One feels no inclination toward something or somebody, one has a distaste for something.

РОДИТЬСЯ ПОД СЧАСТЛИВОЙ ЗВЕЗДОЙ – rodittsa pod schastlivoy zvezdoy. (To be born under a lucky star) Explanation: To be lucky, successful.

Pictures by Anastasia Saifulina Pictures СДАТЬ В АРХИВ – sdat’ v arkhiv. (To relegate to the archives) Explanation: to bury in oblivion as something obsolete or useless.

СЕТЛАЯ ГОЛОВА – svetlaya golova. (A bright head) Explanation: A clear intellect.

78 CAPITAL IDEAS October-DecemberJanuary-March 2017 2016 CВОРОТИТЬ ГОРЫ – svorotit’ gory. (To shift mountains) Explanation: To do something very important.

САДИТЬСЯ НЕ В СВОИ САНИ – sadittsa ne v svoi sani. (To get into someone else’s sleigh) Explanation: To occupy a post for which one is unsuited.

РАЗРЯДИТЬ АТМОСФЕРУ – razr’adit’ atmosferu. (To discharge the atmosphere) Explanation: To relieve tention.

ПОПАСТЬ НЕ В БРОВЬ, А В ГЛАЗ – popast’ ne v brov’ a v glaz. (To hit not the eyebrow but the eye) Explanation: To guess right.

ПОКАЗАТЬ, ГДЕ РАКИ ЗИМУЮТ – pokazat’ gde raki zimuut. (To show someone where the crayfish winter) Explanation: To punish someone.

ПАЛЬЧИКИ ОБЛИЖЕШЬ – palchiki oblizhesh’. (You’ll lick your fingers clean) Explanation: Delicious, tasty.

СМОТРЕТЬ В КОРЕНЬ – smotret’ v koren’. (To look into the root) Explanation: To look deep into the matte.

October-DecemberJanuary-March 20162017 CAPITAL IDEAS 79 Life&leisure

Ice skating is a favorite pastime for Muscovites in the winter. People used to attach blades to their snow boots, but now anybody can rent skates at the ice rink. This pastime, which is both a sport and a leisure activity, is truly enjoyable, helps you stay healthy and gives your mood a big boost. This winter, there will be a total of 1,445 ice skating rinks, including 187 rinks with artificial ice. We’ve put together a selection of the biggest and most popular open-air skating rinks. Don’t be bored this winter, Review of the most popular ice rinks in Moscow get your skates and head out! Ice rink at VDNKh

This rink was named the country’s main ice rink by the Russian Book of Records in 2014. There isn’t a single rink in Russia or in the whole world that can compete with the one at VDNKh in terms of scale or infrastructure. This winter, the largest rink with artificial ice will be located along the main alley, from Pavilion No.1 to Pavilion No.58. The ice rink will run by two major fountains and will have a total area of over 20,000 square meters. If we take the infrastructure into account, the total area is actually 60,000 square meters! 4,500 people can be on the ice at VDNKh at the same time. For those that aren’t comfortable on ice skates yet, there are always 30 instructors on the rink who are ready to help out. Like during previous winters, there will be a bridge across the ice - a beautiful spot for romantic dates and impressive selfies. Address: Prospect Mira 119, m. VDNKh Aside from the “Crystal Bridge,” the lights on the rink will transform the space into a true fairy Tel: +7 (495) 544-34-00 tale. Lights will be everywhere: around the rink, on the rink, even the ice will glow from the inside. A giant media screen imbedded in the ice rink will feature over 100,000 LED modules. The Hours: Tuesday – Thursday: 11.00am – 11.00pm, control system for the screen is able to reproduce 16 million different colors. Friday – Sunday: 10.00am – 11.00pm. The organizers promise that the ice rink will be a great place to spot celebrities, become a char- Web: http://katok.vdnh.ru acter in fantastic shows, celebrate all of your winter holidays and even meet the love of your life. Guests will also be able to take part in daily dance workshops and morning fitness classes.

GUM skating rink on Red Square

An artificial skating rink in the heart of Moscow with perfect ice and excellent views of the Kremlin. The area of the rink is 3,000 square meters. Many capitals all over the world have made it a tradition to turn a main square into a skating rink in the winter: Trocadero in Paris, the Tower in London, the Rathaus square in Vienna. The GUM rink on Red Square is next to a lot of key landmarks: St. Basil's Cathedral, the Kremlin, and the Mausoleum. This year, fans of hockey are in for a surprise. On the weekends, there will be free hockey workshops for visitors. The ice rink will also be open on New Years Eve. There will be a fair around the skating rink, where visitors will be able to treat themselves to pies and glint wine. This year, there will be 28 festive wooden houses that will sell Christmas orna- ments, decorative boots, knitted mittens and boots, dolls, and shawls. There will also be treats Address: Red Square, m. Okhotny Ryad, Teatralnaya of all kinds - crepes with caviar, tea, mead, sbiten, hot cakes and baked potatoes. And there will Tel: +7 (495) 788-43-43 be more than just Russian cuisine on offer. If you want to submerge yourself in a European atmosphere, you can also get glint wine, Viennese waffles or roasted chestnuts. Hours: Every Day, 10.00am – 11.30pm Web: http://www.gum.ru/projects/rink/

80 CAPITAL IDEAS January-March 2017 Don’t be bored this winter, get your skates and head out! Ice rink in Gorky park

Modern street art, from sticker art to full-fledged graffiti, will be the main theme of the ice rink at Gorky Park. The platforms will be decorated with light installations, while the skate rental and ticket booths will be spruced up by modern artists. The alley next to the Garage modern art center will be turned into a 60-meter light tunnel that is made up of flickering arcs. The rink’s central installation will be a frozen fountain and fluorescent lights will create the illusion of running water in the evenings. In the daytime, colorful spotlights will be used to give the illusion of movement to the fountain. The installation will be 8 meters in height and 25 meters in diameter, which is almost equal to the summer fountain in scale. The ice rink at Gorky park is one of the largest artificial ice rinks in Europe. The total area is 18,000 square meters, and it can accommodate up to 4,000 people. 15 ticket booths and 5 rental Address: Krimsky Val 9, m. Park Kultury, Oktyabrskaya booths operate on the ice rink every winter. There are a total of 5 different areas with 33,000 Tel: +7 (495) 995-00-20 LED lights built into the ice. Hours: Every Day: Daytime Hours – 10.00am – 3.00pm, There will also be a Street Art Shop operating on the ice. The shop will sell bags, badges, hats, Evening Hours – 5.00pm – 11.00pm books about the park, albums about street art and commemorative trinkets. Web: http://park-gorkogo.com/places/177 All winter, there will be parties with DJs on the ice. The ice skating rink at Gorky Park will also have a separate space for children and people who just want to take it easy. Those who like an adrenaline rush are welcome to head over to the hockey rink. “Ice” skating rink at Sokolniki Park

The skating rink located in the Festivalnaya Square of Sokolniki Park is one of the best equipped winter facilities in the capital. The rink doesn’t depend on weather conditions: thanks to a special ice-generating mechanism, the ice rink is always ready to go long before we hit below freezing temperatures. The total area of the ice rink amounts to 5,300 square meters. Those who do not have their own ice skates can rent a pair from one of the 2 available renting booths. There are a total of 1,700 pairs available (for hockey, figure skating or children). In the evening, the rink is lit up in neon colors and the media facade shimmers with shades that resemble the Northern Lights. This year, the rink turned into a dance and music platform that will be called “Rock Rink.” The space will be decorated with a two-meter guitar that symbolizes the main theme of this season. Address: Sokolnichesky Val 1, bldg.1, m. Sokolniki The ice will be painted with special stripes that visitors can follow in order to learn dance moves. The radio will play music by artists like Elvis Presley or Nirvana. Tel: +7 499 39-39-222 Hours: Every Day, 10.00am – midnight Web: http://park.sokolniki.com/activities/152

January-March 2017 CAPITAL IDEAS 81 Ice rink at Patriarch’s Ponds

The first ice rink appeared at Patriarch’s Ponds all the way back in the 19th century, when it was organized by a gymnast association. Since then, it has become a favorite spot for everybody who enjoys ice skating. Going ice skating at Patriarch’s Ponds is a century-long tradition that has been documented by writers such as Tolstoy, Kuprin and Vyazemsky. Now, much like a century ago, Muscovites come here to skate under the soft lights of decorated trees, enjoy music and visit a nearby cafe for a cup of hot tea. The rink is about 12,000 square meters in area. There are no changing rooms, but there are two skating zones (a separate one for children), as well as ice slides.

Address: Bolshoy Patriarshiy Pereulok 3, m. Tverskaya, Pushkinskaya Hours: Every Day, 24h, rentals – noon – 10.00pm Ice rink at Hermitage Garden

The story of Hermitage Garden begins in 1878. It was founded by the famous theatre figure Mikhail V. Lentovskiy. In 1894, management of the Hermitage Garden was transferred to the theatre entrepreneur and philanthropist Yakov Shchukin. The garden was equipped with the latest technology at the time. The results followed: just a year later, the garden had been visited by over 70,000 people. It became the center of Moscow’s theatre community and still attracts brilliant talent today. In the winter, an ice rink opens at the Hermitage Garden. There are two areas: one with natural ice that is 4,000 square meters in area, and another with artificial ice that is 900 square meters in area. The skating rink can accommodate 2,000 people at the same time.

Address: Karyetny Ryad 3, Bldg.7, m. Checkhovskaya, Tverskaya, Pushkinskaya Hours: Monday – 2.00pm – 11.00pm, Tuesday – Friday – Noon – 11.00pm, Saturday – Sunday – 10.00am – 11.00pm Tel: +7 (963) 726-60-39, +7 (910) 008-55-64 Web: http://www.superkatok.ru Ice rink at Bauman’s Garden

One of the most cosy and beautiful ice rinks in the center of Moscow. The total area of the rink is 1,000 square meters and, thanks to artificial ice technology, the rink can operate at a temperature of up to +10 degrees. The rink is a five minute walk from the Kurskaya or Krasniye Vorota metro stations and is easy to get to by car or via public transportation. There is a warm changing room, a skate rental space, a cafe, bathrooms, a skating school and a coat check. The artificial ice rink can accommodate up to 2,000 guests every day. The excellent quality of the ice and a serene environment is a perfect match for those who aren’t all that confident in their skating abilities. Next to the rink, you can also take a ride on a snow racer. Those who like to go old-school can take a traditional sled ride across the gardens. This tour is particularly interesting, since the park has been open since 1920. Address: Ulitsya Staraya Basmannaya 15, m. Kurskaya, Krasnaya Vorota Hours: Monday – Friday – 2.00pm – 10.00pm, Saturday – Sunday – 11.00am – 10.00pm Tel: +7 (499) 261-58-83 Web: http://sadbaumana.ru/outdoor-ice-rink/about-the-rink

82 CAPITAL IDEAS January-March 2017 Ice rink at Chistiye Prudy

The ice rink at Chistiye Prudy is a legendary spot for winter fun and is also one of the oldest rinks in the city. One of the few free rinks in the center of Moscow, it is always cosy, spacious, gorgeous and has enough room for everybody. As the temperature inches below zero, the pond surface is turned into an ice skating rink. The total area amounts to 12,000 square meters, and has three areas: one for children, one for those who like to take it easy, and a third one for hockey players. The cons include a fairly uneven surface and the lack of changing rooms or other places to store documents. However, all of these minor inconveniences are compensated by the convenient location of the rink. At night, colorful lights and decorations light up the area around the pond, making it look like a Hollywood Christmas movie. There are also plenty of cafes where you can pop in for some glint wine and a snack. Address: Chistoprudniy Boulevard 12, bldg. 1, m. Chistiye Prudy Hours: Every Day – 10.00am – 10.00pm Ice rink at the Kolomenskoye Museum-Reserve

The rink at Kolomenskoye is one of the oldest rinks in Moscow. It dates all the way back to the 19th century! Interestingly, the headquarters for Napoleon’s army were located here in 1812. By the end of the 19th century, it was the best skating rink in Moscow, where members of the first athletic organization in Moscow (Emperor’s Yacht Club) used to go skating. The open-air rink is 4,500 square meters in area and only operates when the weather conditions allow. Aside from a top-quality rink, visitors get to enjoy warm changing rooms, a cafe with a wide selection of warm beverages and holiday music. Visitors can also use a skate sharpening service or rent skates if needed. There is also an option to rent skis and double-blade ice skates for added balance.

Address: Prospekt Andropova 39, m. Kolomenskaya, at Yarmarochnaya Square Hours: Monday – Friday: Noon – 10.00pm, Saturday – Sunday: 11.00am – 10.00pm Tel: +7 (499) 782-89-17 Web: http://www.mgomz.ru

“Ice Boom” rink at Vorovsky Park

The rink is located in the center of the park, which was previously known as “Park by the Var- shava Movie Theatre.” The park’s story begins all the way back in the 19th century. You can not only go skating with your family here, but also organize a corporate party, a birthday or other events. The rink’s team will help you orchestrate a truly spectacular show with the help of different decorations. The open-air rinks are ideal for a family: there is an area for kids, while adults can learn how to skate from professionals.

Address: Ploshyad Ganetskogo 1, m. Voykovskaya Hours: Monday – Friday – Noon – 10.00pm, Saturday – Sunday – 10.00am – 11.00pm Web: http://bumkatok.ru Ice rink at Krasnaya Presnya Park

The Krasnaya Presnya park was founded in 1932 at the Studenets estate and is a historical and architectural monument, a monument to the 18th and 19th century landscape art in Russia. The park’s natural ensemble has been preserved to this very day – old alleyways, picturesque ponds with small islands and arch bridges. An open-air rink with artificial ice that is 800 square meters in area is located to the right of the entrance to Krasnaya Presnya park. Visitors can enjoy the spectacular view of Presnenskaya Na- berezhnaya. There is also plenty of space for those who like to ski, as well as ice slides for those who enjoy extreme sports and sledding.

Address: Ulitsya Mantulinskaya 5a, bldg. 2, m. Ulitsya 1905 Goda Hours: Every Day – 11.00am – 10.00pm Web: http://p-kp.ru

January-March 2017 CAPITAL IDEAS 83 FACE TO FACE This and that Tea with sugar! Most people believe that Russians like vodka, but this isn’t necessarily the case. The beverage Russians truly enjoy is tea. At least according to a popular opinion survey conducted by Synovate Comcon, over 94 percent of Russians drink tea regularly.

lack tea is popular across all regions, age of the table, kicking off a tea drinking marathon groups, as well as among all classes and that could go on for a very long time. The tea genders. Green tea is preferred by young drinkers would chat and drink one cup of hot tea people in the 16-19 age group, as well as after another, periodically wiping tea and sweat byB women and people with higher education. from their faces with a towel that they would pre-emptively hang from their necks. Another The number of people who prefer tea in tea bags tradition is drinking tea from a saucer. That is, versus loose leaf tea is also roughly the same - people would pour tea from a cup into the saucer 49% and 52%, respectively. and would drink it from there as they nibble on sugar. People no longer drink tea “with a towel,” The average Russian drinks three cups of tea a but Russia has maintained a lot of its own tradi- day. However, 10% of respondents said they drink tions when it comes to tea consumption. six or more cups of tea a day. People in the 35-44 age range who live in cities with populations of In Russia, people usually drink tea after a meal, 100,000 - 500,000 people drink more tea than and sometimes separately from the meal alto- anybody else. 10% of Russians of all ages don’t gether. Tea is served with baked goods or with drink tea at all, and the majority of them are chil- sweets, so tea replaces dessert. Depending on in- dren and teenagers in the 10-19 age range. dividual tastes, people might add sugar, lemon or lemon juice to the tea, along with honey or jam. It isn’t clear when tea first appeared in Russia. Jam is usually consumed from a spoon or with a

Pictures by Anastasia Saifulina Pictures Some sources point to some time during Pe- piece of bread along with the tea, but sometimes ter the Great’s reign, others suggest that it was people put it directly into the tea as well. Rus- brought here in the middle of the 16th century sians also sometimes put honey on white bread by Cossacks, while other still claim that Russians or put it into the tea directly, as a substitute for started to drink tea during the first half of the sugar. We also sometimes add milk or cream. 17th century, when Michael I received a few cases Occasionally, brandy or rum is added as well. of tea as a present from the Chinese. Regardless of how it got here, tea has found a home in Rus- In Russia, water for tea was traditionally boiled sia and became the national drink of choice. “Tea in a samovar, which could keep the water warm for Siberians is like potatoes for Irishmen,” one for a long time, as well as warm the teapot for European traveller noted, “many people drink 40 improved extraction. The samovar would be put cups a day!” in the middle of the table, closer to the hostess, or on an additional small table next to the host- Although tea came to Russia from China, neither ess for the convenience (no need to go anywhere Chinese nor Japanese traditions found a home if a guest needs more tea). This allowed the hosts here along with it. There is a particular way Rus- to demonstrate their wealth, as heavier samo- sians drink tea, and it is truly Russian in nature. vars meant the family had more money. How- For example, one of the most bizarre ways of ever, samovars (which are now mostly electric drinking tea is “with a towel.” What does this samovars) have become extremely rare. Usually, mean? A giant samovar was put in the middle people opt to boil water in metal or electric tea

84 CAPITAL IDEAS October-DecemberJanuary-March 2017 2016 kettles. However, the production of samovars (including wooden samovars) continues in Rus- sia. A lot of them are sold as souvenirs, which foreign tourists who come to Russia for a visit love to take back home with them.

For festive and formal occasions, porcelain tea sets with smaller cups (200-250 ml) are set on the table. In day-to-day life, people drink tea from any cup or glass that happens to be around. Railways have maintained a tradition of serving tea in a glass in a metal cup holder.

Tea plays such an important role in the lives of Russians that it has become a part of Russian culture, including in painting and even in our language in the form of many proverbs and popular sayings. Tea has also been a popular subject among artists, including Boris Kustodiev, Vasily Perov, Nikolai Bogdanov-Belsky and Vasily Bak- sheev.

So far as Russian language is concerned, there are many different ways tea is incorporated into everyday speech. For example, if you enter a room and see that people are drinking tea, you can say: “Tea and sugar!”. The expression, in this case, is the equivalent of saying “bon appétit” to people who are eating.

In the latter case, you will definitely be invited to have a cup of tea, by the way. If not, then you can confidently say to yourself: “they didn’t even offer me tea.” This expression is a way of saying that you were treated to a cold, unwelcoming reception. But more likely than not, you will be invited to have a cup of tea with a phrase like: “Have a cup, forget your sorrows!” ■

October-DecemberJanuary-March 20162017 CAPITAL IDEAS 85 LIFE&CULTURE Art as food for thought The New Year is finally here. Every single person is waiting in anticipation for the new things that lie ahead - something interesting, bright, original that we can talk about with our friends or our significant other over a cup of hot tea, warm apple pie or a ginger cookie during the winter evenings. A trip to the theatre, a concert or an exhibition can provide you with this kind of food for thought for your conversations.

86 CAPITAL IDEAS January-March 2017 Art as food for thought he capital’s residents lovingly refer to this Mos- cow theatre as “Tabakerka.” This is because it is headed up by Mr. Tabakov, one of the heavy- weights of Russian theatre, a living legend who Trecently celebrated his 80th birthday but continues to amaze the public with his new masterpieces. Now, Oleg Pavlovich has a place where he can do whatever he wants. This past fall, a new stage under his leadership was opened on Malaya Sukharevskaya square. Even the mayor of Moscow took part in this important opening ceremony. Why? Because one of the longest theatre construction projects was completed. The mayor personally congratulated the theatre group. “Congratulations on your new home,” he said, “Oleg Pavlovich said that it’s a shame this didn’t happen in 2017, which would have marked 20 years since a decision was first made to build a new stage. Nonetheless, we tried to revive the abandoned construction site and did everything we could to ensure Just like 26 years ago, Oleg Tabakov was the director. that we would have a comfortable, technically mod- The play used to be banned under censorship laws, ern theatre that gives us new opportunities.” and Tabakov was the first to produce it in 1990 in the basement on Ulitsya Chaplygina. The play immediate- The Tabakov theatre opened in Moscow in the fall of ly became a theatre hit in Moscow. All of Tabakerka’s 1978. For almost 10 years, it was funded solely by Mr. stars were featured in it: Vladimir Mashkov, Evgeniy Tabakov himself. In 1986, the theatre, which already Mironov, Sergey Bezrukov and Oleg Tabakov himself. managed to win over the audience, finally obtained Today, Oleg Tabakov’s son Pavel is starring in the main state theatre status. It used to be located in the for- role of the play. Just like 26 years ago, the public will mer “red corner,” which was located on the first floor hear the story of Abram Schwartz and his boundless and basement of a residential building on Ulitsya love for his son. Chaplygina 1. Prior to this, the basement had served as a coal depot.

Oleg Tabakov’s theatre is in the same location today as well: a modest auditorium that can sit 114 people, a small foyer, rehearsal hall and several offices. Taking into account the merits of the theater and its popular- ity, in 1997 the Moscow government decided to build a new stage for Tabakerka, the design and construction of which began only in 2005. Construction was halted due to various financial, economic and technical problems and resumed only in 2012.

It’s a complicated story. The new stage adheres to all new modern requirements: a capacity of 400 people, the first 4 rows of which can be folded and used to expand the stage. The newest technologies are used to convert the stage, allowing the staff to quickly change stage decorations in the middle of a play. The first play graced the stage on September 27 - a pre- miere of the new version of "Sailor's Silence" by Alex- ander Galich, one of the most prominent Tabakerka productions.

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There are also excellent plays at the Operetta The- trusted. Anna is played alternatively by two actress- ater. There is a musical based on one of the most es: Ekaterina Guseva and Valeria Lanskaya. Original well-known Russian novels in the world. “Anna Kar- libretto, great vocals, spectacular choreography and enina” is a dramatic love story by Leo Tolstoy that music performed live by the theatre’s orchestra are has become an international classic. The romance just a few major selling points of this phenomenal between the married woman Anna and the young musical performance. officer Alexey Vronsky leads to a tragic end - suicide! The woman throws herself under a train. In spite of At the end of January, the Bolshoi Theatre will be the fact that the story is over 100 years old, it is still showing the legendary ballet “La Bayadère.” Back relevant today. A lot of us have dealt with cheating, before the revolution, the famous Mathilda Kshesin- or the contradictions between doing what we want skaya, the favorite ballerina of the Romanov family to and doing what’s right. Some people have even and mistress of Nicholas II, starred in the ballet as Ni- experienced the pain of witnessing our world crum- kiya. Now, the part is danced by Ekaterina Krysanova, ble because of a betrayal by the one person they Svetlana Zakharova, Olga Smirnova and other balle-

88 CAPITAL IDEAS January-March 2017 rinas. The ballet was originally staged by the famous choreographer Marius Petipa. He came up with the unbelievably beautiful dance in the ballet’s third act - the romantic dance of shadows in the Himalayas. 32 dancers, dressed in white, descend slowly down the mountain and form a rectangle. The shadow dance is hypnotizing. In the beginning of the 90s, Yuri Grigoro- vich brought the ballet back to the Bolshoi, sticking to the Mariinsky Theatre original as much as possible. Grigorovich kept the old choreography but also came up with a lot of new dances as well.

On February 1st, the State Kremlin Palace will host the 75th birthday celebration of Lev Leshenko, the favorite singer of Leonid Brezhnev and performer of the “Vic- tory Day” hit. Decades have gone by and new per- like it’s been through a romp during a sleepless night, formers became popular, but Lev Leshenko remained daring outfits that boldly highlight curves, and long as popular as ever. The anniversary evening will legs. The song titles surely follow suit: “I have a new have many celebrity guests: Iosif Kobzon, Alexander lover,” “Magic,” “Get lost,” “Anti-Geisha,” and “Don’t Rosenbaum, Vladimir Vinokur, Philip, Gennady Khaza- Leave Me, Lover!”. nov, Vyacheslav Dobrynin, Igor Krutoy, Stas Mikhailov, Nadezhda Babkina, Valery Meladze, Nikolay Baskov, On February 18, the stage will be graced by another Tamara Gverdtsiteli, Oleg Gazmanov, Lolita, Lyme Va- kind of singer. She is best known for her original tone jkule, Natasha Koroleva, Soso Pavliashvili, Alsou, and of voice, original costumes and unusual hairstyles. She many others! looks like an alien who came to Earth from a distant planet. And there are no overt erotic undertones, and On February 17, Crocus City Hall will host a perfor- even her creative pseudonym suits her character: mance by VIA Gra. The name speaks for itselfs - it’s Yelka. Yelka, which means “Christmas Tree” in Rus- a reference to a pill for men who are having issues sian, is associated with the New Year, happy holidays, with potency. VIA Gra is a project by the famous com- a family dinner and long-awaited presents. All of this poser Konstantin Meladze, and has been around for a undoubtedly puts people in a better mood. Yelka her- long time, since 2000. The members of the band have self tries to infect her audience with positivity at every changed a lot over the past 16 years: some have left show. and started families, had children (one of the soloists, Vera Brezhneva, married Meladze), started their own On March 5, there will be the main rock music event careers. However, the group remains popular today. of the year. Yuri Shevchuk and the band DDT will The women are definitely sex symbols of Russian presenting the anticipated program “The History of show business. Bright makeup, messy hair that looks Sound.” There will be a selection of the best songs www.levleschenko.ru

January-March 2017 CAPITAL IDEAS 89 LIFE&CULTURE

from landmark albums of the legendary band, from This is why the lyrics talk about "black lights from the early days to the present, all brought together neighboring gates, hatches, cuffs, torn mouth." And into a single program at Olimpiyskiy National Sports also these lines: “I’m going home, let them say she’s Complex. ugly. I like her anyway, even though she’s no beauty.” Later, in 1991, DDT recorded a song called “Born in The band has been gearing up for this this large- USSR,” which was a reaction to the collapse of the scale concert for a long time. They are true pioneers Soviet Union. The most famous song about the war of Russian rock music, born in the USSR. The leader, in Chechnya, called “Dead City. Christmas,” was born Yuri Shevchuk, has a special place in Russian rock in 1995. After this, Shevchuk ran away from every- music. He has always sang about his surroundings, thing for a few years to a remote village because he trying to make sense of his reality. Shevchuk became didn’t want to lose his mind after everything he saw a significant personality of the era of change, of per- in Chechnya. Fans will hear the famous hits “Fall,” estroika. One of his hits, “Rodina,” was written in 1989 “Home,” “Malchiki-Mazhory,” “The Last Fall” and after he read Boris Pasternak’s novel “Dr. Zhivago.” “Revolution.”

90 CAPITAL IDEAS January-March 2017 On International Women’s Day, March 8th, the fa- Kremlin Palace will be hosting a concert with Charles mous designer Valentin Yudashkin will have a show at Aznavour, a symbol of an era. Aznavour, who will be the Kremlin Palace. His dresses and suits are in muse- 93 on May 22, is recognized as the best pop singer of ums all over the world, even at the Louvre in France! the century by both CNN and TIMES magazine. Over His works are also at the International Museum of the course of his 70-year-long career, he sold 100 Olympic Games in Lausanne and at the fashion muse- million records, wrote 1,200 songs, played 80 differ- um in California. And, of course, at the State Historical ent roles in films, released 294 albums and held over Museum in Moscow. 1,000 concerts across 94 countries all over the world. The list of Aznavour’s famous songs includes “Eternal Fans of the opera are also in for a surprise. On March Love,” “Ave Maria,” “La Boheme,” and “Only Yester- 12, the International House will host a concert of song day.” The composition “Eternal Love” was translated and dance by the Alexandrov Ensemble. Over the into multiple languages, including into Russian. By the course of several decades, the famous ensemble has way, he performed the hit together with Mireille Ma- been shocking the world with its brilliant performanc- thieu in the 80s. ■ es. The program includes masterpieces of Russian and Western European classical music: arias from the opera "Carmen" by Bizet, "La Traviata" and "Nabucco" by Verdi, "Boris Godunov" by Mussorgsky, "Iolanta" by Tchaikovsky, "Turandot" by Puccini, the cantata "Alex- ander Nevsky" by Prokofiev and more.

On March 14, the State Kremlin Palace will have a show for fans of the French pop legend, the inimitable Mireille Mathieu. The singer will be 70 this year, but she is still in great shape. This brilliant and charming woman has performed in Moscow several times and has always received a warm welcome. This time, she will be doing a program called “The History of Love.” It will be a true night out in Paris. After all, Mireille Mathieu is one of the most famous French women in the world.

After Mathieu, another French legend will be per- forming at the same venue. On April 5, the State

January-March 2017 CAPITAL IDEAS 91 FOOD&DRINK Irina Khodzinskaya: I like feeding people!

92 CAPITAL IDEAS January-March 2017 I like feeding people! It seems there isn’t a word out there that has as many different meanings as the word “simple.” Even dictionaries can’t convey the many different connotations of this word. After all, “simple” can mean “natural,” “easy to understand,” “close,” or “without cheating.” In any case, the patrons of the cafe “Simple Things” intended for all of these meanings to be a part of the establishment’s name.

he center of any capital is a tense, noisy place. Moscow is no exception. Among the endless buildings made out of brick and concrete, there is a sea of people in cars who are all in a hurry. But once you find yourself at 1-ya Brestskaya 41, you will feel like you’re in a totally different city, a different century or,T if you prefer, even in a different dimension. This is exactly what Irina Khodzinskaya felt in March of this year, when she first came to this magical place. “It seemed like you were magically transported from a concrete jungle into an oasis with a cosy two-story home, trees and unexpected silence,” Irina remem- bers, “It was so wonderful that I didn’t want to leave!”.

January-March 2017 CAPITAL IDEAS 93 FOOD&DRINK

What she saw before her eyes impressed Irina so much that she immediately decided that there needs to be a cafe here. In May, the area was already equipped with a summer terrace and in the beginning of fall the house turned into an elegant cafe called “Simple Things New Vintage.”

However, Irina wouldn’t have been able to do all this had it not been for over a decade of experience in the restaurant business in Moscow. Suffice it to say that she has become the owner of three Simple Things cafes in Moscow during this time. Although all of them have the same name, each cafe is different. One of them, for example, offers visitors a selection of 80 different wines. And this isn’t some fancy wine bar where a pompous know-it-all talks down to customers. Much like in all of her other cafes, everything here is simple: the waiter will gladly make suggestions about what kind of wine you might like with different dishes, and will also offer you a taste of each one before you com- mit to a glass or a full bottle. In other words, opening a fourth cafe was just a matter of logistics for Irina.

94 CAPITAL IDEAS January-March 2017 Interestingly enough, Ms. Khodzinskaya doesn’t consider herself a “businesswoman.” Does she need to make money? Of course she does! But the art of the trade has always come first for her. She loves what she does so much that she refers to it as her hobby. “If someone had told me that my hobby would make me money, I would have never be- lieved it,” she says.

Irina has always known that, sooner or later, she would definitely open her own cafe. In any case, she really hoped her dream would come true.

Where does someone who has a degree in finance and worked as a CFO of a big organization before getting into the restaurant business draw this passion? “I like feeding people,” she explains. Irina’s sig- nature dish is the Wellington meat pie, which she occasionally makes at home for her friends and family. She spends the rest of her time, every day from morning to night, in her cafes. “I live there,” Irina says with a smile.

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For example, she approved every dish on the menu herself. What are the criteria? “It’s simple,” Ms. Khodz- inskaya says, “it just has to taste good!”.

Aside from Irina, the cafe’s chef Alexey Eisen works to make sure the menu is delicious. There is a wide selection of appetizers, salads, soups, main dishes and desserts. You won’t get anything totally out of the ordinary like monkey brains or turtle soup when you visit Simple Things. The cafe’s menu focuses on skill- fully prepared simple items with fresh products everybody is familiar with. The produce is delivered from farms that the cafe has had a long-term relationship with. The vegetables come from outside of Moscow, the beef and rabbit come from Bryansk, the lamb is delivered from Dagestan and Kalmykia, while the fish comes from the Black Sea.

The chef’s exclusive craftsmanship lies in the way the dishes are prepared. Here are just some of the items on the menu: “Tuna Salad with Zucchini, Av- ocado and Mint,” “Sweet Far Eastern Shrimp with Baked Carrots and Dried Apricots,” “Foie Gras with Spicy Fig Jam,” “Halibut with Cream of Beet Tops and Tarragon” and “Crab Cakes with a Light Ginger Sauce and Salad.”

One of the cafe’s big sources of pride is the cocktails. The main catch, which was invented by mix- ologist Max Rochman, is that they taste like different types of desserts. For example, guests can get cocktails that taste like peaches with mascar- pone, lemon tarts and Parmesan cheese mousse with raspberry jelly. People who try these delicious cocktails just once will inevitably return for another round. “We don’t have accidental guests,” Irina says with pride, “People come here in order to return.” ■

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