It Is Not the Strong One That Wins, the One That Wins Is Strong. Franz Beckenbauer

STRATEGIES FOR BUSINESS IN MOSCOW

It is not the strong one that wins, the one that wins is strong. Franz Beckenbauer

A PROPOS

Oh football, you are everything! Now, on the eve of the Confederations Cup and the FIFA World Cup, there is no need to make such elaborate ad- In July 1979, a year before the Olympic Games in Mos- justments in preparation for the event. And this isn’t just cow, the Kremlin adopted a secret document. about sausages and other products, which supermarkets It had a very long name, but the essence of it was sim- all over Russia are packed with these days. The thing is ple: to make Moscow look as appealing and presentable that Moscow has been improving for a very long time, as possible for the Olympic Games. According to the becoming a more comfortable, clean and safe city for document, some Muscovites were asked to take time both local residents and tourists. The capital has plenty off and leave the city for the duration of the Games, of new roads, new metro stations, parks and squares... while other “undesirables” were simply rounded up and Moscow is changing for the better almost every day. driven outside the city borders. Only people with special No wonder that according to Lonely Planet’s Best in permits were allowed to come to Moscow from other Travel 2017 list, the Russian capital is in the top 10 cit- cities during this time period. ies to visit. In light of this, it seems strange that some All of this was done not only for the sake of security, but Western politicians and journalists tell stories about also to make sure foreign visitors didn’t see the endless “aggressive Russians” and try to implore others to boy- lines in front of stores, which ruined the image of the cott the World Cup. On the other hand, Russia isn’t new Soviet capital. In the USSR, a lot of people used to come to these accusations. It might seem strange, but some to Moscow from other regions in order to buy prod- people abroad know so little about Russia that they still ucts - like sausage, for example - they couldn’t purchase think bears roam the streets of Moscow! What can I elsewhere. There was even a joke about it: “What is long, say? Come and see for yourself! green and smells like sausage? It’s a long, green train that Responding to my question about how confident he was guests take out of Moscow to go back to their cities.” that everything will go smoothly during the World Cup, During the 1980 Olympic Games, Moscow had an Olympic Champion and Head of the Moscow Depart- abundance of different kinds of food. You could pur- ment of Sports and Tourism Nikolay Gulyayev said: chase anything at the store, even things that were usu- “I am sure that Moscow will host a real football festival, ally impossible to get - Finnish salami, different types and it will be organized in a superb way. We have ev- of cheese, juice, jam and canned beer! Muscovites used erything to make this happen: the city and sports infra- to joke that 1980 was the year communism was built in structure that work impeccably, that come together as a Moscow. The joke was especially funny because Nikita single unit. When I say ‘sports infrastructure,’ I mean the Khrushchev famously promised to build communism two new stadiums - the Luzhniki Olympic Complex and by 1980 during a communist party meeting in 1960. Spartak.” In the interview, which is featured in this issue, Unfortunately, this brand of communism only lasted a Mr. Gulyaev also said that Moscow is expecting around little over two weeks, from July 19 to August 3, while one million guests for the World Cup, which will take Moscow was hosting the 1980 Summer Olympics. place on June 14 - July 15, 2018.

Sergo Kukhianidze Editor in Chief

[email protected] Moscow Official CAPITAL IDEAS Mutual business interests stay Founder: Department for External Economic and International Relations of the Government of Moscow strong Address: Tverskaya, 13, Moscow, 125032. The Russian capital will strengthen ties with Bavaria Ph: +7 (495) 633-68-66, Fax: +7 (495) 633-68-65 E-mail: [email protected] www.dvms.mos.ru The exchange of experience Publisher: National Review Ltd continues CEO – Sergei Oposhnyanskiy Moscow and Berlin signed a memorandum on friendship and Phone.: +7 (495) 784-69-71 cooperation E-mail: [email protected] 6 – 9 CAPITAL IDEAS STRATEGIES FOR BUSINESS IN MOSCOW

Editorial staff: 9 – 13 Editor-in-chief – Sergo Kukhianidze Production crew of the edition: Elena Egorova (deputy editor-in-chief), A fruitful meeting Tatyana Akimova, Vladimir Dolmatov, Marina Ershova, Marina Ogorodnikova, The Mayor of Moscow met with the Mayor of Paris Anastassia Paloni, Vladimir Smelov, Marina Urshina Consulting – Gennagy Charodeev, Evgeny Khokhlov Design – Robert Saifulin Vectors of cooperation Photo editor – Victoriya Oposhnyanskaya confirmed Page layout – Alexander Saifulin Assistant – Nadezhda Ratanova For the first time in the history of relations between the capitals of Russia and Iran, Tehran With assistance of Moscow Center for International Cooperation hosted Days of Moscow’s Economy, organized CEO: Sergei Anikanov by the Department for External Economic and Address: 105005, 68/8, build.1, Baumanskaya str., Moscow, Russia International Relations of the Government of Phone: +7 (499) 267-46-56, E-mail: [email protected] Moscow Distribution – "Trans-Media" Ltd Acknowledgements to: Moscow-Doha: New PHOTO – www.mos.ru, www.dvms.mos.ru, www.stroi.mos.ru, ITAR TASS Agency, RIA-Novosti, Getty Images Russia, companies and organizations, horizons represented in the issue. A Moscow Government delegation visited Qatar 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 12. 04. 2017 Face to Face

Nikolay Gulyayev: Moscow in words We are ready for a What’s New 34-35 26 – 31 football festival Nothing Ventured Head of the Moscow Department of Sports Government and business and Tourism answered our questions in an José Campusano Alarcón: exclusive interview with Capital Ideas. Playing to win We're not afraid of 14 – 18 Moscow is first among Russian regions in terms of public-private partnerships competition City’s graph development On wine, salmon and Luis Corvalan 19 32-33 36-38

20 – 24 Face to Face Valery Gazzaev: Russia is overdue for a football reform Russia is getting ready to hold two major international athletic competitions - the FIFA Confederations Cup in the summer of 2017 and the FIFA World Cup in the summer of 2018. Valery Gazzaev, Deputy Сhairman of the Duma committee on sports, tourism and youth policy (“A Just Russia”), talked to Capital Ideas about legislative changes in this sphere, how the country plans to respond to the anti-doping scandal, and young people’s athletic prospects in general.

25 City’s graph

April-June 2017 CAPITAL IDEAS 3 Nothing Ventured Nothing Ventured Nothing Ventured KNAUF Group: Russia Japanese quality with You can do business in remains a strategically a Russian soul Russia without getting important market If you’re still having doubts about whether your hands dirty KNAUF has been a long-term partner of or not it’s possible to do business in Russia, Berlin native Philipp Rowe became a Muscovite Russia, having established business contacts just look at ISUZU. This company is the right after getting his degree in Germany. In here all the way back in 1970’s. In 1993, the perfect testament to the fact that doing 2007, he decided to start his own business. company started to heavily invest in its business in Russia is great. Suffice it to say Today, his company Rufil Consulting, which is business activities in Russia. Janis Kraulis, the that ISUZU is currently the number one located in the center of the city, employs about head of Knauf Group CIS, talked about the foreign company in terms of truck sales. 20 Russian and foreign workers. company in an interview with Capital Ideas. 40-43 48-51 56 – 60

44 – 47 52 – 54 62 – 65 Nothing Ventured Nothing Ventured Expert tips Xu Jiangsheng: We still Ramnik Kohli: It’s important Territory of have a lot of potential to know and love Russia Justified in Russia In 2014, phones from the Indian brand Micromax first Risks appeared on the Russian market. In a few years, the On the Russian auto market, Chery is one of company became one of the top three major mobile The Frenchman Jean-François the top three most successful Chinese brands phone importers in Russia. Ramnik Kohli, head of Marquaire is convinced that in terms of sales volumes. In an interview Micromax in Russia in the CIS, talked about the Russian markets are a good with Capital Ideas, Deputy CEO of Chery development of Micromax on the Russian market and prospect for foreign investors. International Xu Jiangsheng talked about the his life in Moscow in an interview with Capital Ideas. company’s achievements and plans, as well as about his life in the Russian capital.

4 CAPITAL IDEAS April-June 2017 Our interview

Jun Kondo: I know what Life&Culture This and That Muscovites like Zelfira Tregulova: Football, Russian style: Jun Kondo, Head Chef at FumisawaSushi, came to Moscow a year ago at the invitation of the Art heals the soul when will our love for the Russian restaurateur Arkady Novikov. He has “A trip to the museum and everything that worked in Canada and China, which means he you get out of that trip helps people cope with game yield results? understands both European and Asian palates. problems they encounter in everyday life,” said There is no denying that football is an exciting In an interview with Capital Ideas, Jun revealed the director of Moscow’s Tretyakov Gallery game. But why do Russians enjoy it so much? what’s special about Russia and talked about Zelfira Tregulova in an exclusive interview with After all, football is a summer sport and Russia is a overcoming obstacles. Capital Ideas. northern country! 66 – 68 74 – 77 86 – 87

70 – 73 78 – 79 88 – 91 Between past and future Moscow Vocabulary Life&leisure Onward... into the 80 – 85 Time for a pint! Life&Culture Middle Ages! An overview of the best sports bars in the city

“There is no other city in the world Moscow thaw: from 92 – 96 that is changing for the best as quickly as Moscow is today,” says Jan Gehl, a Strauss to KISS Food&Drink professor of design and architecture from We’re finally seeing the first warm days Denmark. that everybody in Moscow waits for in Konstantin Ivlev: anticipation. Over the long winter months, Russian cuisine is about the city’s residents get tired of snow, freezing temperatures, icy roads and slush on warmer much more than just days. Now, we are ready for gentle sunrays, flowers and green grass. Everybody feels like borscht! singing and finding joy in everything: unique Konstantin Ivlev, host of the popular culinary exhibitions, interesting lectures, an opera, a show and one of the most famous chefs in beautiful Viennese waltz or a tour of your Russia, is a connoisseur of Russian cuisine. favorite band from your university days… We asked him whether or not foreigners in Moscow are interested in Russian cuisine.

April-June 2017 CAPITAL IDEAS 5 MOSCOW OFFICIAL

Mutual business interests stay strong The Russian capital will strengthen ties with Bavaria

The Moscow government is hoping for closer economic cooperation with Bavaria, Mayor of Moscow Sergey Sobyanin said during a meeting with Horst Seehofer, Minister-President of Bavaria. The meeting was also attended by Deputy Moscow Mayor Natalya Sergunina, Minister of the Moscow Government and Head of the Department of Foreign Economic Activity and International Relations Sergey Cheremin, Head of the Moscow Department of Education Isaac Kalina, Chairman of the Moscow City Duma Alexei Shaposhnikov and other officials. t’s great that in a period of turbulence, we are to learn about Moscow’s experience and look into the maintaining ties between two actively devel- possibility of applying technology used in the Russian oping regions in Europe at the regional level. capital back home. Bavaria has always been one of the most “Iimportant economic and cultural partners for us. 850 Sergey Sobyanin also took part in the meeting be- Bavarian entrepreneurs are working and developing tween Vladimir Putin and Horst Seehofer, which took their business in Moscow,” Sergey Sobyanin said. place at the Kremlin on March 16.

According to him, interest in business cooperation has “I know that, like the last time, you came at the invi- not waned, in spite of economic challenges. “We can tation of the Mayor of Moscow and have a lot to do: be more proactive in terms of developing relations in meetings with business representatives and our col- the sphere of the economy, relations with business, leagues in the Government of the Russian Federation. to restore our former, stronger formats of this type of Bavaria undoubtedly is first in terms of trade and eco- cooperation. We are ready to develop our relations,” nomic ties with Russia among other Federal States of the Mayor of Moscow noted. Germany,” the Russian president said.

Horst Seehofer thanked Mr. Sobyanin for inviting him Last year, exports from Bavarian enterprises to Russia to the Russian capital, proposed to continue meeting increased by 4 percent, while exports from other parts every year, and invited a Moscow delegation to visit of Germany fell by 4.8 percent overall. “This is thanks Bavaria. He pointed out that relations between the two to your efforts, Mr. Minister-President ,” President Pu- regions remain strong in spite of geopolitical tensions. tin said, “I hope that this visit will also be helpful in terms of developing our relations.” The Minister-President of Bavaria recalled his visit to Moscow last year: “Everything that you told us about In turn, Horst Seehofer thanked Vladimir Putin for the your city and your city’s development was very valu- opportunity to meet, hold talks and cooperate at the able for us.” Horst Seehofer also added that he was federal level. “And of course, we continue working very impressed by the healthcare sector. “You shared with our partner city, the City of Moscow,” the Min- with us that, generally, you are aware of what person ister-President of Bavaria said. He added that Russia can or needs to make appointments with a certain and Bavaria have a great opportunity to continue to doctor. This was very impressive,” he pointed out. expand on the established good relations. Horst See- hofer pointed out that Bavaria finds it very important The Minister-President of Bavaria also noted that the to expand cooperation in the spheres of science, cul- ministers who were part of the delegation are ready ture, the economy, and agriculture. ■

April-June 2017 CAPITAL IDEAS 7 MOSCOW OFFICIAL

The exchange of experience continues Moscow and Berlin signed a memorandum on friendship and cooperation

Mayor of Moscow Sergey Sobyanin and Mayor of Berlin Michael Müller signed a Memorandum on Friendship and Cooperation between the Government of Moscow and the Senate of Berlin. The ceremony took place in the Blue Hall of the Moscow City Hall. The talks were attended by Deputy Mayors Maksim Liksutov and Leonid Pechatnikov, as well as Minister and Head of the Department for External Economic and International Relations Sergey Cheremin.

n important event took place last year - Moscow and Germany amounts to about $10 billion. 25 years of contractual relations between Accumulated investments account for $6 billion. This Berlin and Moscow. I hope that today we active cooperation between companies in Moscow, will sign a Memorandum on continuing Germany and Berlin continues in spite of certain chal- “Athis long-term cooperation. Relations between Mos- lenges. After signing the Memorandum, we will con- cow and Berlin not only date back several decades, but tinue to exchange experience across various spheres: are also mutually beneficial. Trade turnover between education, healthcare, culture, management. The establishment of friendly ties between our cities, your ence, youth exchange programs and more. “I think it’s visit to Moscow, today’s opening of the Days of Berlin very important that such large European megacities Cinema is a major cultural event for Moscow and a support relations with each other, learn from each further development of our relations. The more we other, exchange experience. Berlin is a growing city. get to know each other, the more open our relations I know that Moscow is growing even more rapidly. become,” Sergey Sobyanin said. According to the information I have, the city grows by about 150,000 new residents every year. This brings The Mayor of Moscow also congratulated Michael new challenges in urban planning, residential con- Müller on being elected Mayor. “Allow me to congrat- struction, educational infrastructure and transporta- ulate you on being elected to the post of Mayor. I un- tion. This gives us the opportunity to cooperate and derstand that this event took place recently,” Sergey learn from each other,” the Mayor of Berlin said. Sobyanin added. Russian and German capitals are successfully develop- Michael Müller pointed out that relations between ing partner relations in terms of the economy and the Moscow and Berlin have existed for a long time, but sphere of education, as well as healthcare and culture. signing the Memorandum will give them new impe- The Days of Moscow’s Economy in Berlin and Days of tus and will activate cooperation in the spheres of sci- Moscow in Dusseldorf will take place this year. ■ A fruitful meeting The Mayor of Moscow Met with the Mayor of Paris

Mayor of Moscow Sergey Sobyanin met with the Mayor of Paris Anne Hidalgo, who was in the Russian capital for a work visit in February.

ergey Sobyanin thanked her for the warm re- The mayors of the two cities also discussed issues ception of the Moscow Government Delega- related to further cooperation between the capitals tion in June 2016 during Moscow Days in Paris. of Russia and France. These issues included the ex- During the visit, Sergey Sobyanin and Anne Hi- change of experience and information on preparing Sdalgo signed a cooperation program between the two for and holding major international athletic competi- capitals for 2016-2018. tions, and the expansion of direct contacts between cultural and educational organizations, including stu- “It was an interesting and fruitful trip that gave serious dent exchanges. ■ impetus to bilateral relations,” the Mayor of Moscow pointed out. In turn, Anne Hidalgo spoke about the hos- pitality the Paris Delegation has been shown. “Moscow is magnificent and picturesque in the winter. Your city is especially beautiful in the evening, when the festive lights are on. It’s a good thing that there are more French tourists in the Russian capital,” Anne Hidalgo said.

She also expressed gratitude to the Government of Moscow for constructive cooperation between the two cities within the scope of the C40 Group. At the sug- gestion of Anne Hidalgo, who is chairman of the C40 group, one of the next meetings between the mayors of participant cities may be organized in Moscow.

The C40 Cities Climate Leadership Group was established in 2005. It currently includes 90 of the largest cities in the world with a total population of 600 million people, including Moscow. the main goal of the group is to draw attention to climate change issues and city initiatives aimed at reducing carbon dioxide emissions.

April-June 2017 CAPITAL IDEAS 9 MOSCOW OFFICIAL

Vectors of cooperation confirmed For the first time in the history of relations between the capitals of Russia and Iran, Tehran hosted Days of Moscow’s Economy, organized by the Moscow Department for External Economic and International Relations.

A Delegation of the Moscow Government, led by head of the Department - Sergey Cheremin, visited the Iranian capital

he delegation also included directors of the by internationally acclaimed speakers in the sphere city’s leading companies, which participate in of entrepreneurship and management. Moscow’s key infrastructure, transportation, environmental, healthcare and IT projects. Members of the Moscow Government Delegation OnT the first day, a business forum was held during took part in the exhibition dedicated to Iran’s ac- which topics concerning the development of mega- complishments in the production of various manu- cities, creating a comfortable environment and ef- facturing equipment. fective management were discussed. Almost 1,500 participants had the opportunity to learn about An official meeting took place between Sergey Cher- Moscow’s accomplishments and listen to speeches emin and Tehran’s Deputy Mayor of Transport and Traffic Maziar Hosseini, who actively supported the idea of supplying technological solutions to Tehran’s Russian capital’s initiative to develop cooperation in municipal sector under Iran's sovereign guarantees. the sphere of developing and implementing Tehran’s transportation strategy, proposed by employees of Questions of cooperation between cities as financial the Center for Traffic Management of the Moscow centers were discussed with the leadership of the Department of Transportation. During the conversa- Iranian stock exchange. Sergey Cheremin offered tion, the Iranian side showed an interest in innovative Tehran to support Moscow’s initiative in establish- solutions and technologies introduced by the Mos- ing and International Financial Center Alliance. The cow Mayor's office in the reconstruction of streets, President of the Iranian stock exchange expressed provision of public services in electronic form, and a lot of interest in this type of cooperation, which, improvement of the city’s residential services. in his opinion, would help to reach a new level of cooperation with global IFCs. The next day, Tehran’s Chamber of Commerce hosted presentations dedicated to Moscow’s develop- Within the scope of Days of Moscow’s Economy, a ment strategy. Sergey Cheremin thanked the Mayor productive meeting took place between the Mos- of Tehran Mohammad Bagher Ghalibaf for help in cow delegation and representatives of major phar- preparing the Days of Moscow’s Economy, pointing maceutical companies under the leadership of Iran’s out the roles both embassies played in the event. Ministry of Healthcare. During the meeting, the two The Minister invited the leaders of the Iranian capi- sides agreed to explore prospects of localizing the tal to take part in the Moscow Urban Forum and to production of medicinal products for Russian man- hold Days of Tehran’s Economy in Moscow. ufacturers, as well as the possibility of establishing a plant for producing advanced medicinal products Over 100 Iranian entrepreneurs and heads of main Russia. The two sides agreed to send an Iranian jor companies learned about the implementation pharmaceutical business mission to Moscow in the of state target programs in Moscow. Infrastructure near future. projects that are appealing to investors were presented as well. In turn, the Iranian partners talked Numerous business events illustrated the growing about their achievements in the sphere of city solu- investment appeal of both capitals and tangible in- tions. terest in developing business cooperation between major Russian and Iranian companies, as well as Questions of increasing trade turnover and sup- between representatives of small and medium-size porting export-import operations were discussed businesses. For the first time, the capitals had the by the Moscow Government Delegation with the opportunity to take part in such major events that Deputy Mayor of Economic Relations and Finance including official meetings, business discussions, of the Islamic Republic of Iran, who supported the round tables and cultural programs. ■ www.tonkosti.ru

April-June 2017 CAPITAL IDEAS 11 MOSCOW OFFICIAL

Moscow - Doha: new horizons A Moscow Government Delegation Visited Qatar

The East is a delicate matter. This formula is perfectly applicable to relations between Moscow and Doha, which went through a difficult period recently. But it looks like these challenging times are behind us. In any case, this is the conclusion one can draw when looking at rekindled contacts between representatives from Russia and Qatar.

t the end of November of last year, Doha interested Qatar is in meeting with the Muscovites. hosted a conference entitled “Moscow - a Aside from interest, there was also a sense of ex- city that’s convenient for business.” It took citement. After all, it’s not that often that business place at the Qatar Chamber of Commerce. people from these two countries meet. But this ex- A Moscow government delegation, headed by Min- citement passed as soon as the conference started. ister and Head of the Department for External Eco- Everything went smoothly. nomic and International Relations, visited Doha in order to participate in the event. Vice President of the Qatar Chamber of Commerce Mohamed bin Twar Al Kuwari gave the opening The fact that the hall in which the presentation speech at the conference. He announced that he is took place was completely packed speaks to how happy about improved relations between the two countries, which open great opportunities for coop- “In spite of the crisis, the city is rapidly developing eration between businessmen. He noted that Qatar and not giving up on its ambitious projects,” the is currently going through a real economic boom, so head of the DVMS pointed out. This includes the there are plenty of areas for business cooperation. construction of the Moscow Central Circle, new metro stations, Zaryadye park, and a complete Qatar is one of the wealthiest countries in the transformation of the banks of the Moscow River, world. According to the International Monetary which stretches 80 kilometers outside of Moscow. Fund, the country has been in the lead for several If the only thing next to the river right now is high- years in terms of GDP per capita. Qatar ranks third ways, in the near future 76% of this space will be in the world in terms of natural gas reserves, is the dedicated to various cultural and leisure facilities. sixth largest exporter of natural gas and is a major exporter of oil and oil products (ranked 21st in the The conference was also attended by the Russian world). Qatar is part of the Organization of the Pe- Ambassador to Qatar Nurmakhmad Kholov, repre- troleum Exporting Countries (OPEC). sentatives from Sberbank, and directors of Russian companies, financial and investment groups. In response, Sergey Cheremin noted that political and economic relations between Moscow and Qatar After the conference at the Chamber of Commerce, have recently improved. “We would like to maintain dialogue between Muscovites and Qatar business this trend,” the Minister said. He recalled that in Jan- representatives continued at an investment fund uary 2016, Emir of Qatar Tamim Bin Hamad Al Thani and then at the mayor’s office, where the sides met with the Mayor of Moscow Sergey Sobyanin talked about changes in relations between the two during an official visit to Russia. During their meet- countries and new horizons. ing, the subject of Qatar investors participating in the development of transport infrastructure and the In the evening, an official dinner took place at a fish construction of transfer hubs came up. Aside from restaurant located on the picturesque shore of the transport, there are plenty of other spheres in Mos- Persian Gulf. Everybody at the table enjoyed the cow that can attract businessmen from Qatar. meal, talked, joked and laughed. ■ www.free-stock-illustration.com

April-June 2017 CAPITAL IDEAS 13 FACE TO FACE Nikolay Gulyayev: We are ready for a football festival Head of the Moscow Department of Sports and Tourism answered our questions in an exclusive interview with Capital Ideas.

These days, it seems Olympic champion Nikolay Gulyayev needs just as much stamina as he did back when he was winning gold medals for speed skating. And no wonder. The Moscow Department of Sports and Tourism, which he became in charge of at the end of the last year, is coordinating all programs related to the Confederations Cup and the FIFA World Cup next year. Mr. Gulyayev is difficult to catch in his office: he is always busy with meetings and other errands. We met him at the Chertanovo football school, which was hosting an event in honor of 100 days before the opening of the Confederations Cup. After getting out of the car, the head of the department immediately headed toward the football field, where young football players were practicing. He joined them with ease, and even managed to score!

14 CAPITAL IDEAS April-June 2017

FACE TO FACE

Mr. Gulyayev, it seems like you’re no stranger to football. to the Confederations Cup and the World Cup, and there are a lot of them: transportation, safety and so on. Much like a lot of other kinds of sport. I think that the head of this type of department needs to set a personal example in The “Sport Moskvy” program has not been cancelled, and we order to motivate people to exercise and play sports. continue to work on it every day. In other words, we continue to work on everything we used to work on before. This in- You’re going to tell me that you do your morning exer- cises too...

Yes, I do, but an abridged version, since my work doesn’t allow me to spend much time on it. Without exercise it would be tough to stay in shape, which I need to stay in good health and handle all of the issues the department needs to resolve before the upcoming events.

Moscow isn’t new to hosting important international competitions, but the FIFA World Cup is special. Other- wise, the city government would not have created the special department that you’re in charge of, right?

I’ll clarify right away: the department wasn’t created specifically for the World Cup. The government simply added “Tourism” to the existing Department of Physical Education and Sports. As stated in the order issued by Mayor of Moscow Sergey Sobya- nin, this was done in order to effectively prepare for and conduct different international competitions, including the Confedera- tions Cup and the FIFA World Cup. Right now, this is one of our priorities. We are in charge of coordinating all programs related

16 CAPITAL IDEAS April-June 2017 cludes the development and promotion of physical education and sports in Moscow, as well as making the Russian capital more appealing for tourists with the goal of increasing the number of travellers coming to Moscow.

Combining sports and tourism is a sound decision. They really do go hand in hand.

Of course. Fans are tourists. When fans travel to a foreign country for a game, they visit the local attractions, go to museums, and visit cafes and restaurants. By the way, some people go to games for the sole purpose of getting to know a new country and being part of the festive atmosphere. It’s a truly unforgettable experience. Anybody who plans on coming to Moscow will get to experience this amazing atmosphere to the fullest.

How many fans are you expecting to come to Moscow for the World Cup?

I think that about a million guests will visit Moscow over the course of that month. I’ll put it this way: we will be hosting the most important What worries you the most right now? matches. The Russian capital will be hosting the opening match and the final. To be honest, there is nothing specific that I am constantly worried about. There isn’t anything that’s troubling me. In your opinion, have the negative attitudes of Western We’re doing everything according to our schedule, and ev- countries toward Russia impacted the World Cup at all? erything is going as planned. Of course, like with any other project, not everything goes smoothly. But trust me, these I don’t think so. I’ll give you an example. A record number of are minor technical challenges. Every day, as we overcome tourists visited Moscow over the Christmas holidays (from them, we are confidently moving toward our final goal - suc- the middle of December to the middle of January), includ- cessfully hosting an international football festival. ing tourists from abroad. So even if there is somebody in the West trying to say negative things about us, we’re say- Aside from Moscow, the matches will be taking place in ing: “Guys, our doors are open! Come and see everything for several other Russian cities. Is there any competition yourself!”. According to international assessments, by the between cities, are they trying to one-up each other in way, Moscow is one of the safest capitals in the world, not to terms of being the best hosts? mention it’s a clean and beautiful city.

April-June 2017 CAPITAL IDEAS 17 FACE TO FACE

You probably know that England recently aired a documen- here. After all, Moscow is more than just the Red Square and tary where fans are warned to be careful with Russians... the Kremlin. Recall how we hosted the Champions League final in Moscow a few years ago, which had two English teams That’s not right. But anyway, they say all kinds of stuff about with fairly aggressive fans. Back then people also doubted us in the West! Up until recently, they thought there were whether or not Russia could host a match like this. But we bears roaming our streets here! So we’re telling everybody: did it, and everything went well. “Don’t believe what they say in newspapers and show on television about Russia! Come visit us and figure things out Are you drawing on international experience during for yourself!”. Moreover, I know for certain that those who your preparations for the Confederations Cup and the have visited Moscow will tell their friends how great it is World Cup?

Of course. Although compared to other cities Moscow has a lot of experience in hosting large-scale international athletic and cultural events. Still, it would be foolish to turn a blind eye on things that have worked well for others. We went to the FIFA World Cup in Brazil for this purpose, to see what works and apply it here.

So fifteen months before the start of the World Cup, you are one hundred percent confident?

I am sure that Moscow will host a real football festival, and it will be organized in a superb way. We have everything to make this happen: the city and sports infrastructure that work impeccably, that come together as a single unit. When I say “athletic infrastructure,” I mean the two new stadiums - the Luzhniki Olympic Complex and Spartak.

And last question: who will be playing at the World Cup final?

Those who deserve it most! (Smiles) ■

18 CAPITAL IDEAS April-June 2017 CITY’S GRAPH Preparation program for holding the 2018 FIFA World Cup in the Russian Federation

Ministry of Sport of the Russian Federation Construction and renovation of 12 stadiums

104443,8 Mln. rub

Ministry of Transportation of the Russian Federation Transport infrastructure modernization Road network Passenger transport infrastructure

236457,5 Mln. rub

Federal Air Transport Agency Renovation and modernization of 11 airports

100938,3 Mln. rub

Federal Tourism Agency

Construction of 60 hotels and hotel complexes

65471,0 Mln. rub

April-June 2017 CAPITAL IDEAS 19 FACE TO FACE Valery Gazzaev: Russia is overdue for a football reform Russia is getting ready to hold two major international athletic competitions - the FIFA Confederations Cup in the summer of 2017 and the FIFA World Cup in the summer of 2018. Valery Gazzaev, Deputy Сhairman of the Duma committee on sports, tourism and youth policy (“A Just Russia”), talked to Capital Ideas about legislative changes in this sphere, how the country plans to respond to the anti- doping scandal, and young people’s athletic prospects in general. Mr. Gazzaev is also a former football player and coach, as well as the former President of FC Alania. As a coach, Mr.Gazzaev has won the most titles in terms of the number of medals and cups in the entire history of Russian football. He was the only Russian coach to lead his team to victory at the UEFA Cup in 2005.

Mr. Gazzaev, how is the State Duma preparing for fines the criteria for professional and popular sports, and, the FIFA Confederations Cup and the World Cup? most importantly, outlines how they are financed.

I think you may be misunderstanding… yes, the Russian In terms of football, we should have started seriously parliament does have its own football team, but in my preparing for the World Cup at least seven years ago. opinion we have a long way to go before taking part in And had we adopted the reforms I suggested in 2014, the Confederations Cup or the World Cup. We did hold everything would be different. There would have been a the Parliament Games recently. There was a team from revival in Russian football. And there wouldn’t be such a Latvia, Belarus, Serbia, Kazakhstan, and Russia. Russia problem with recruiting! When there are no results in ju- won, so judging by these results anything can happen. nior leagues, there are no additions to the national team I’m joking, of course. either.

But on a more serious note, Russian football is in need In your opinion, what needs to be done? of reforms, including legislative reforms. We are already working on this. In November 2016, for the first time in Reforms are long overdue for Russian football. We need the history of modern Russia, we adopted a law that de- to cut down the number of professional teams. We cur-

20 CAPITAL IDEAS April-June 2017

FACE TO FACE

rently have 105 professional clubs, which is more than zens in sports by 2020. The positive trends we are seeing anywhere else in the world. We have to stop chasing af- today give us every reason to expect that this goal will ter quantity and focus on the quality of the game. The be achieved. Today, 43.5 million people regularly go to Premier League and the First League should be profes- the gym, which is almost a third of the country! sional, and the rest should be regional teams and semi- professional teams. Our goal is to focus on quality. The During his speech at the “Russia - country of sports” First League needs to operate according to a territorial forum, Vladimir Putin said: “Undoubtedly, we are go- principle. This will allow us to cut down on transpor- ing to welcome those who take on the responsibility of tation costs. We need to establish three First Division establishing neighborhood teams, developing sports at zones - Center, West, East. We also need to expand the schools and universities, and holding competitions. We Premiere League to 18 teams. In essence, we need to will support athletic organizations and the revival of the develop a professional football mechanism and incor- GTO movement.” porate all regions into a system of professional, junior, popular and amateur football. Last year alone, 584,000 students took the GTO challenge. 11 percent of them completed the challenge Undoubtedly, a lot of problems come back to funding. with a gold badge. Funds from the state budget and I believe that professional clubs should only be funded other sources have been used to establish about 2,500 through private investments or through public-private testing centers. In the near future, another 400 cen- companies and corporations. In order for this to happen, ters will open at the municipal level. I bring these there need to be tax benefits at the legislative level for numbers up for a reason. In my opinion, they serve as people who invest in football in Russia. proof that the GTO complex, which was established at the President’s initiative, is becoming a popular trend We also need to improve the quality of football programs for young people. for children and young people. This is a nation-wide task for all regions. As the World Cup approaches, it would Due to the anti-doping scandal, is it possible that be great to launch a series of programs across three or Russia will lose the right to host the World Cup? four national TV channels dedicated to this event. There will be fabulous stadiums, the best teams in the world There has never been as much prejudice toward our are coming - this is a great reason to promote football country from international athletic organizations as in to children. 2016. Unfortunately, we have to conclude that sports has become a tool of political pressure. And there is an What do you think about the campaign to integrate explanation for this: Russia is becoming one of the lead- the GTO complex in Russia? ing political players. Our President has a lot of authority and influence both domestically and internationally. Of In our country, sports has traditionally served a social course this provokes our opposition. Similar processes and educational function. The Russian sports develop- take place in professional sports. For many people, the ment strategy aims to involve 40 percent of Russian citi- accomplishments of our athletes at the international

22 CAPITAL IDEAS April-June 2017 level are like a sharp knife… Plus there is competition, sincere its intentions are. But we’re open to working political bias and just regular jealousy. So far as the World with them... Cup is concerned, I don’t think it will come to such a critical situation. I am sure that common sense will prevail The President’s Address to the Federal Assembly talks in the end. After all, reasonable people understand that about establishing a national program to combat dop- without the participation of a country like Russia major ing, which would allow to tackle this problem at the international competitions don’t make much sense. international level. Moreover, the committee headed by Vitaly Smirnov has established a dialogue with the It was recently announced that the State Duma has President of the International Olympic Committee, the established an expert committee to analyze the director of WADA and other international organiza- McLaren report. What are some of the preliminary tions. Russia is a great athletic power. I think we need conclusions? to change our communication style with WADA. We shouldn’t be on the defensive. We need to offer our There are a lot of questions when it comes to the no- own solutions to the problem. torious report. For example, why does such thorough screening only apply to Russia? Incidentally, this ob- What do you think about Russian athletes be- vious bias causes a lot of indignation among famous ing banned from qualifiers to the 2018 Paralympic foreign athletes and sports figures as well. Doping is Games? What plans and proposals do you and your an international problem. It is necessary to develop the colleagues have? rules that would apply to everybody who participates in international athletic competitions. This is what our The International Paralympic Committee has declined President talked about in his Address to the federal As- the application for admission of Russian Paralympians sembly. From our side, we have already accepted all the to the 2018 Winter Paralympic Games in Pyeongchang relevant documents at the legislative level. Our foreign against our concrete guarantees. The formal reason is colleagues, on the other hand, don’t seem to be in a the anti-doping sanctions. On February 8th, we dis- hurry to do so. cussed this situation with the Deputy Minister of Sports of the Russian Federation Pavel Rozhkov during a com- McLaren’s second report basically repeats the previous mittee meeting. statements. Again, there are no specifics, no proof, just abstract words. Yes, there is a problem and it needs to be I have suggested that we prepare an appeal to the the addressed. I think that athletes who test positive need International Paralympic Committee and invite IPC rep- to be excluded from competitions and sanctioned. But resentatives to Russia so they can see for themselves the what do national teams have to do with this? Like a lot work being done with respect to anti-doping legislation of his colleagues, McLaren is using old demagogic tricks, and the strict regulations Russian athletes are subjected substituting one concept for another. to. Some of my colleagues aren’t sure they will come. In this case, declining our invitation would show the whole Within the scope of implementing the President’s world that there is a political agenda behind this sus- Address, are you preparing an initiative to amend picious process. But we have to invite them. After all, the Criminal Code of the Russian Federation in Western mass media is very skillfully adding fuel to the terms of establishing responsibility for falsifying fire around this conflict with the Paralympics and Rus- doping tests? sian sports in general.

Last year we passed a law that establishes criminal li- In my opinion, any normal person would have no ability for doping. The next step in this regard will be in- doubt that paralympians are extremely brave people troducing criminal liability for falsifying doping tests for who push themselves to the limit both spiritually and athletes. I want to point out that stricter laws are not physically. I consider any attempt to prevent them from the end goal for us. Establishing criminal liability is more achieving their dreams to be the height of cynicism and of a preventative measure. After all, this means the end dishonesty. of any athlete’s career. New amendments to the Crimi- nal Code will be introduced and considered by the Rus- In your opinion, is there hope that the new US Presi- sian parliament in 2017. dent Donald Trump will put an end to the sanctions imposed on Russian athletes? It’s been announced that WADA wants to help Rus- sia develop a system to combat doping. What do In my opinion, we’ve been paying too much attention you think about this? to the new US president lately. Of course I greatly respect the choice of the people in the US, but I think I’ve already said what I think of this organization. Right that Russia and our leader have enough international now, it is politically biased and I have doubts about how authority and opportunities to look after our own na-

April-June 2017 CAPITAL IDEAS 23 FACE TO FACE

tional interests. If Donald Trump puts an end to this Our country is a multinational state and the people campaign of demagogic lies and political blackmail, who live here belong to 130 different nationalities. Rus- that will be great. But I wouldn’t advise anybody to sia’s history, pride and glory is a history of different count on it. Russia has proven several times that our lands coming together and the peaceful coexistence of domestic and foreign policy is independent. Yes, we are different nations, cultures and languages. The national ready for a constructive dialogue regarding the most symbols of all peoples should be protected by Russian pressing issues of today. law equally.

Are you preparing initiatives to guarantee safety The law that is in effect now protects the flag and coat during athletic events? of arms of the Russian Federation. It protects the honor and historical dignity of our homeland, which is embod- Recently the State Duma adopted in the first reading a ied in our country’s symbols. At the same time, symbols draft federal law No. 48959-7 "On Amendments to the of the subjects of the Russian Federation aren’t afforded Code of the Russian Federation on Administrative Of- the same level of protection. When modern-day vandals fenses." cynically desecrate the flag of some region in front of a camera, tearing it in half, stomping on it, setting it on In order to avoid misunderstandings in the future, I’ll tell fire and using it for their propaganda purposes, the most you what it says verbatim: to establish increased ad- they have to fear is being accused of petty hooligan- ministrative responsibility if the violation of the rules of ism, violation of public order and fire safety regulations. conduct in official sports competitions is ill-mannered. Wouldn’t you agree that this a shortcoming of the cur- These violations include offenses that pose a threat to rent legislation? the violator’s own safety, life, health or the safety, life, health of others who are at the venue of the official Many subjects of the Russian Federation have estab- sports competition or on the adjacent territory. Also, lished in their legislation on administrative offenses violations that result in the delay or termination of a responsibility for desecrating official symbols of the sports event will be included here. region - insulting, cynical inscriptions, destruction or use of the emblem or flag in a way that implies Penalties: fine of up to 20,000 rubles or administra- mockery. At the same time, it is clear that these mea- tive arrest up to 15 days with the imposition of a ban sures are not enough. In my opinion, only the Crimi- on visiting venues of official sports competitions of up nal Code is a reliable guarantee of adequate protec- to 7 years. If the ban is violated, the fine will be raised tion against encroachments on sacred symbols that to 50,000 rubles or an administrative arrest of up to 15 represent home for some citizens. In addition, it is days will be applied. only possible to stop such actions if they are committed in the territory of another RF subject through In cases where a gross or repeated violation of the rules federal law. of conduct at an official sports event is committed by foreign citizens or stateless persons, it is proposed to es- I’m proposing to establish legal protection of regional tablish a fine of up to 20,000 rubles with the possibility symbols along with administrative responsibility for of administrative expulsion from the Russian Federa- desecrating the national symbols of Russia. And, in my tion. In this case, the expulsion measure can be replaced opinion, this is logical and fair. by the court with an administrative ban on attending sports competitions for up to 7 years. In general, my proposals were approved by most colleagues. Although I will admit there were objections. I In my opinion, the adoption of this legislative act is es- will take into account all sensible remarks pecially important on the eve of the 2018 World Cup and the 2017 Confederations Cup. Major events like these What is your forecast for the 2017 Confederations will attract fans from all over the world, and it is our ob- Cup and the 2018 World Cup? ligation to ensure an appropriate level of safety during the competition. I can say that experience with holding large-scale athletic competitions such as the Winter Olympic Games You recently submitted a bill to establish criminal in Sochi gives us confidence that all of the necessary responsibility for desecrating the coat of arms and infrastructure will be prepared at the proper level. The flag of the subjects of the Russian Federation on organizational part also doesn’t cause any concerns. And par with the state coat of arms and flag to the State I really hope that our national team will resolve its inter- Duma. What is happening with this bill? nal issues and play a great game. A World Cup at home gives us the opportunity to demonstrate to the whole I wouldn’t focus on so-called “football fans” alone. The world that Russia is a great athletic power! We simply measures I’ve proposed are much wider in scope. don’t have the right to miss this chance! ■

24 CAPITAL IDEAS April-June 2017 CITY’S GRAPH 10th FIFA CONFEDERATIONS CUP June 17 - July 2, 2017

2017 Russia 2013 For the first time, three teams representing one Brazil Confederation (UEFA) The tournament 2009 will take part in the FIFA brought together four Confederations Cup. teams that had won the South Africa World Cup at different times - Uruguay, Italy, The first truly high-profile Brazil and Spain. tournament to take place in Africa. Brazil won for the second time in a row.

2005 Germany The last tournament in which Australia 2003 represented Oceania. France In 2006, the Australians 2001 joined the AFC. The French became the first South Korea/Japan team to retain the title they had won in 2001. For the first time, the Confederations Cup was used as a rehearsal for the FIFA World Cup.

1999 Mexico The first tournament to take 1997 place outside of Saudi Arabia Saudi Arabia. A total of 8 teams played in The tournament gets a new the tournament. name - FIFA Confederations 1995 Cup - and a new format: champions from each FIFA Saudi Arabia confederation are invited The number of participants 1992 to play, along with the host grew to 6 teams, including country team and the winner of teams from Asia and Europe. the last tournament. Saudi Arabia Four teams took part in the first intercontinental tournament, which was called “King Fahd Cup.” Fan zone at 2018 FIFA World cup

the World Cup, other than the stadiums,” Nikolay Gulyev said.

The FIFA fan festival will be located across from the Lomonosov MSU building. The platform at Vorobyevy Gory will open two hours before the beginning of the first match and close after the last game of the day. The fan zone will have commentators for the matches for the entire 25 days of the championship. The area will also have special places in the front rows for people with disabilities.

The area will have an information center for tourists with bi- lingual staff who will be able to talk to guests in Russian and English, and will have information about the most popular famous attractions in Moscow and Russia in general. Fans will n 2018, Moscow will become the center for the World Cup. also have an opportunity to visit the biggest souvenir store with The Big Sports Arena at Luzhniki and the Spartak Stadium 2018 World Cup memorabilia. It will be located either inside of will serve as the official stadiums for the matches. The World the fun zone or at the entrance and will feature brand name Cup will take place on June 14 - July 15, 2018. The Confedera- clothes, t-shirts, footballs and other souvenirs. tionsI Cup, which serves as a kind of practice round for national teams, will take place at the Spartak Stadium on June 17 - July 2, Moreover, the FIFA fan festival will have a food court and stands 2017. At the end of 2017, the final draw for the 2018 FIFA World where tourists will be able to buy matryoshkas, Khokhloma Cup will take place in Moscow. crafts and much more. FIFA will finalize the final list of products that will be on sale. A 140 square meter media screen will be installed at Vorobyevy Gory for the 2018 World Cup. The screen will show live broad- Free buses from Kievskaya metro station and Luzhniki Stadium casts of all FIFA matches. The screen will serve as a central will transport guests to the fan zone. They buses will be able to point for the festival’s fans. Below will be a stage that will host transport 2,500 people per hour. The shuttles will most likely performances by Russian and foreign entertainers. Free Wi-Fi be decorated with FIFA logos. Cyclists will be able to park their will be available throughout the entire fan fest territory. bikes at the bike parking lot in front of the fan zone.

According to the head of the Moscow Department of Sports The fan zone at Vorobyevy Gory will be able to accommodate and Tourism Nikolay Gulyaev, the stage will be decorated with 40,000 fans and its total area will encompass 36,000 square elements that symbolize football and the City of Moscow. “The meters. There will be festival platforms across 11 cities, where fan fest will undoubtedly be the best place to spend time during 267,000 fans will be able to cheer their teams on at the same time. ■ 870 hotels receive ratings

ll Moscow hotels have been rated in preparation for the 2018 FIFA World Cup. 870 hotels with a total of 58,100 rooms received ratings, ranging from “five stars” to “no stars.” 27 hotels in the capital received 5-star ratings, A74 hotels were rated 4 stars, and 184 hotels were rated 3 stars. 98 hotels were rated two stars and another 40 got one-star ratings. Another 447 hotels, including 230 hostels, received no stars. Hotels are obligated to renew the ratings once every three years.

“We need the classification system in order to provide guests with an accurate picture of the kind of service they are getting. If a hotel doesn’t meet the requirements of the rating it be used during the championship, and will make up another proclaims to have, the rating will be lowered,” explained Niko- 15,000 rooms. Temporary hotels can also be set up on ships lay Gulyaev, head of the Department of Sports and Tourism. along the Moscow River. In other words, there will definitely be He mentioned that hotels located outside of Moscow will also enough room to accommodate fans. ■

26 CAPITAL IDEAS April-June 2017 Information stands on wheels

information stands on wheels will be installed in Mos- cow for the 2017 Confederations Cup. the information stands will be staffed with volunteers who speak Eng- 37lish and will be able to give the capital’s guests directions. The mobile information stands will be located outside the ring line metro stations, as well as outside of Biblioteka Imeni Leni- na, Okhotny Ryad and Lubyanka metro stations. There will also be stands at the railways stations and airports in Moscow.

A total of 1,850 city volunteers and about the same number of organizational committee members will be working during the Con- federations Cup. Volunteers will greet guests of the capital, take part in holding festivals, talk to journalists and assist medical staff. The volunteers will be the first people fans see when they arrive erations Cup (June 17 - July 2, 2017). The volunteers will assist the in Moscow. capital’s guests from early morning into the late evening. About 140 volunteers will be recruited for this task. According to the Mosvolonter resource center, the mobile information stands will be operating for the duration of the Confed- “The volunteers are entrusted with the important task of making the guests feel welcome. The city volunteers will do more than just give directions to the stadium that will be hosting the matches; they will recommend museums, parks and other tourist attractions in the city,” said Oleg Dyachenko, head of the city volunteer program at the Mosvolonter resource center.

The information stands will be decorated in the same style as the tournament. Tourists will recognize them by the official logo of the competition - a cup decorated with firebird feathers. The stands will have signs in English that say “Information.” The volunteers will be dressed in bright clothes with the word “Volunteer” written on the back. ■ The first gadget restaurant in the world opens on Tverskaya

ADGET STUDIO has opened its doors on Tverskaya Street. The establishment features menus on tablets, free high speed Wi- Fi and wireless chargers for all gadgets. It is aG restaurant-pub, a coworking space and a hi tech showroom where you can try out and purchase the latest gadgets. Moreover, the restaurant will host live broadcasts of presentations for new Apple products and other hi-tech events. The restaurant is located across two floors. The first floor has areas for lectures and coworking spaces, while the second floor houses a restaurant with a bar and a stage.

“There are restaurants for hipsters, designers and other groups, but nothing for tech fans yet. I want to watch a presentation for a new iPhone, like other people watch football: at the bar and with a good According to the project’s website, anybody can take part in the translation,” founder of the project nikolai Turubar ex- project’s development by investing a specific sum of money. The plained. According to him, the restaurant’s menu will minimal investment amounts to 30,000 rubles. The restaurant’s include cocktails like “Blue Screen of Death,” “Zucker- founders claim that over a million dollars have already been in- berg” and “Dial-up.” vested into the project. ■

April-June 2017 CAPITAL IDEAS 27 Synchronized swimming olympic center at ZIL

other facility - a water entertainment center called “Arena of Legends.”

The total area of the center will amount to 28,500 square meters. The center is a single building with several gyms, swimming pools, utility rooms and an outdoor pool. The five-story building will have two main functional blocks with separate entrances: • The Olympic Synchronized Swimming Center named after Anastasia Davydova, which will be a part of the Olympic reserve athletic school “Yunost Moskvy” • A water entertainment center with fitness and spa centers

The Olympic Synchronized Swimming Center named after An- astasia Davydova is equipped with: • two pools (for competitions and training, 30 x 25 meters he construction of the Synchronized Swimming Olympic and 3 meters in depth) Center named after Anastasia Davydova at ZIL has been • bleachers that can accommodate 450 people completed. “At the Order of the President, a synchronized • acrobatic room swimming center has been erected in Moscow. It is a mod- • general fitness room Tern facility, one of the best in Russia and the world. This makes • two choreography rooms (150 and 100 square meters in area) sense, since athletes from Moscow make up 90% of our national • medical and recovery center synchronized swimming team. Our national team has been the • 22 rooms for temporary housing athletes best in the world for the past 20 years and there are about 1,500 • conference hall synchronized swimmers in Moscow. This wonderful athletic cen- • two cafeterias and a cafe ter, of course, will give impetus to these efforts. And I think that Moscow athletes will bring joy to their audience for many years to The water entertainment center will be located on a 13.5 square come,” Sergey Sobyanin said during his visit to the center. meter area and will house: • an indoor 50 x 22 meter, 2 meter deep pool The Mayor of Moscow thanked Olympic champion Anastasia • an outdoor pool with a water entertainment area for chil- Davydova for her initiative in the establishment of a new cen- dren and adults ter, and expressed his gratitude to the investors as well. Anas- • a 35 x 25 meter gym tasia Davydova, Director of the Olympic Center for Synchro- • a spa center with rooms for massage, physical therapy and nized Swimming, noted that the center has all the equipment light therapy necessary to train synchronized swimming teams and athletes. • a cafeteria and two fitbars.

The Olympic Center for Synchronized Swimming is an invest- All construction and installation work at the facility has been ment project and an example of a private-public partnership. completed and work on the facade is currently in progress. The The investor is currently in the process of constructing an- center should be completed in Q2 2017. ■ New hotel and business complex

new hotel and business complex will complete the business cluster on the first kilometer of the Rublevo- Uspensky highway. The total area of the building will amount to 135,000 square meters. The building will houseA a business center and a four-star hotel.

Construction will begin in 2017 and is scheduled to be completed in 2020.

The business park currently includes the administrative and business center Pallau RB (with a total area of 56,000 square meters) and the Porsche center, which is the biggest sportscar center in Europe.

28 CAPITAL IDEAS April-June 2017 New two-story trains in Domodedovo

his year, Aeroexpress will start running new two-story trains to Domodedovo. On March 7, an additional platform and a temporary terminal began operating at the airport. Five two-story trains have already Tbeen delivered to Russia and another 6 are expected in the middle of the year. The train cars were put together specifically for Russia, and the engineers took into account extreme weather conditions. The cars meet all safety regulations and requirements.

The construction of another platform and new passenger terminal are underway. It will be the second terminal in Domod- edovo and will be linked to the existing complex. After reconstruction, the airhub will double in size and the area of the terminal will increase to 500 square meters. The airport capacity will be 45 million passengers per year. Construction work takes place around the clock and the facility will be completed on time. The terminal will welcome its first passengers in 2018. ■ Gastronomic NEWS

Bolshoy Patriarshny Pereulok 8. The chef’s resume includes working at Michelin star restaurants and taking part in Alain Ducasse’s projects in France and Monaco. For the past few years, the Sardinia native has been successfully working in Moscow, specializing in meat dishes. Karlo Greku decides what he’s going to sell at his store every day. He picks the suppliers himself. Every day from 11.00am to 11.00pm, you can come here to find top quality meat: ribs, wings, tongues, minced meat, sweetmeats, meatballs and much more. There is also house marinade and an exclusive collection of sauces - barbeque and salsa for beef and spicy sauce for mutton. There are also condiments (a mixture of peppers, sea salt with spices, Himalayan salt) and olive oil (spicy, with rose- mary, with Provencal herbs).

Chef Karlo Greku has fulfilled his dream. He has The store also sells pastrami, raw duck, sausages, pelmeni opened a meat stand called BUTCHER, modeled of various kinds, pates, cheeses, olives, Uzbek tomatoes and after Italian and Spanish stores and located at red onions. There is a 20% discount in the evenings.

TARTARIA is a Scandinavian and masculine project. The main ingredient of the restaurant is meat: beef, lamb, venison and more. The chefs cook on a stage and guests get to watch the cooking process while enjoying their meals. The menu includes ten tartars, the best steaks, a couple of fish dishes and a few options for vegetar- ians. There is a selection of thirty wines, both red and white, which are perfect to enjoy with meat. Just a few glasses and you’ll feel like you’re in a raw wine bar somewhere in Copenhagen.

April-June 2017 CAPITAL IDEAS 29 torical Museum. Beluga, a Russian cuisine restaurant and a caviar brasserie opened by Alexander Rappoport, is located right above the famous Dr. Zhivago, on the second floor of Hotel National. The menu was put together by Evegeniy Mesheryakov, who perfectly combined the tra- ditions of Russian cuisine, his own cooking techniques and original presentations!

Here, you will find a wide selection of traditional Rus- sian dishes and new interesting combinations, as well as sandwiches with black caviar that evokes pleasant nos- talgia. By the way, it would not be an exaggeration to say that this restaurant has the most elaborate caviar bar in the world! It features a plethora of items that can be the main dish and an addition to a main dish as well. Beluga also offers guests salo made out of toothfish and stellate sturgeon. By the way, the chef salts the sturgeon himself. The national northern dish, suguday of whitefish, is served A unique gastronomic attraction called BELUGA with a with onion caviar and potato “rocks,” and the beloved ki- phenomenal view of the Red Square and the State His- evskaya burger is transformed into an eskimo.

TOCHKA DZI is a new street food project on Tsvetnoy Bulvar. The idea behind the project is to offer several versions of the most popular lunch dish in Asia - noo- dle soup. The menu includes Tom Yum, Ramen, classic Udon soup, Pho, plus all kinds of Asian noodles and spring rolls. Every soup is available in two sizes - big (700ml) and small (350ml). The menu also features “Asian burgers” - steamed buns with different fillings. Maksim Fazy- lov, who graduated from the prestigious culinary school Le Cordon Bleu, is in charge of the kitchen. Vietnamese cooks from Danilovsky market are in charge of preparing pho and cooks from Lyublinsky market make Ramen. The restaurateurs plan to make the project into a chain, which means there will be several Tochka Dzhi food stands in Moscow soon.

Carrot sponge cake, cheesecake with mascarpone and dor blu, chocolate cake with dark rum, yogurt with fresh raspberries, honey cake with homemade sour cream - you can find all of this at the confectionery of festive cakes at YULINA KUHNYA Cafe.

Confectioner Victor Averkov (formerly at Oblomov, Pavil- ion, Life of Pi, Zolotoy and Bistrot) is serving up a mix of international hits, Yulia Visotskaya’s recipes and his own creations. He also actively incorporates the latest trends: fresh flowers and berries, chocolate drawings, edible gold, patterned caramel, etc. Delivery is free, there are holiday discounts and a free bottle of wine with birthday orders. The price is 2,500 rubles per kilo.

30 CAPITAL IDEAS April-June 2017 MAGNUM wine bar is a new project in Belaya Ploshad business center. The creators say that the establishment is not the usual Moscow enoteca with a complicated wine card, but a compromise in terms of atmosphere, the wine selection and the format of interacting with guests. The wine card, which took almost a year to put together, contains around 100 items, 55 of which are wines by the glass. The wine card is split up into 4 main sections: “Wine for every day” (350 rubles/glass), “Wine for an occasion or no occasion at all” (550 rubles/glass), “Gourmet wine” (950 rubles/glass), and “Wine for connoisseurs” ( 8,900 - 59,900 rubles per bottle). The “great seconds” sections are very interesting - these are versions of the best cuvees in the world at affordable prices. The “great neighbors” are items that can’t compete with masterpieces for a number of reasons - historical, climate related, etc. - and remain largely in the shadows of their illustrious cousins. Another curious section on the wine the world (rare autochthonous varieties, unexpected turns card is called “for gentlemen who know a lot about perver- of vinification, tannins white and rosé wines, aromas of wet sion”: this selection is for everyone who is tired of traditional wool and leather seats). The card has sparkling and dessert and familiar flavors and includes the most unusual wines in wines, and of course magnums.

taurateur Andrey Dellos (Maison Dellos) specializes in Russian fish and seafood, which are shipped to the restaurant’s kitchen from all over the country. Chowach, omul and muxun come from rivers in Siberia, the eel and lamprey come from the Baltic region, and the mussels and rapans come from the Black Sea. Of course, there are crabs and shrimp from the Far East, as well as salmon and halibut from the north. The interior is typical of traditional seafood restaurants, which focus on the food as opposed to fancy new decorating trends. The stand with ice for the freshest seafood serves a very practical function here as opposed to a decorative one. The menu is based on simple recipes from real fishermen, which means that the fresh, natural taste of fish is the highlight of the meal. For example, fried mussels with white wine is a classic dish for residents of the Black Sea coast. River trout fried The Russian fish restaurant VOLNA is the over fire or halibut baked in alder paper are both tradi- newest brainchild of the famous Russian res- tional recipes from the North.

A new Russian snack bar BERIOZKA opened next to Apothecary Garden in Moscow. Found- ers of the establishment Dmitry Biryukov and Anna Sokolova (restaurants Syrnaya Dirka, Restoran Morskih Gadov, Oranzhereya and De- lovaya Kolbasa) have opened a city cafe that serves food that is known and loved by everyone, along with drinks. And there is no messing with original recipes here. The chefs simply take Russian products and make traditional, delicious dishes with no frills.

April-June 2017 CAPITAL IDEAS 31 GOVERNMENT AND BUSINESS

Playing to win Moscow is first among Russian regions in terms of public-private partnerships development

Moscow placed first in the ratings of Russian regions according to the level public-private partnerships (PPP) development, exhibiting a growth of 30% from 2016 to February 2017. Maksim Tkachenko, Executive Director of the PPP Development Center, made the an- nouncement during the 6th Infrastructure Congress “Russian PPP Week,” which took place in Moscow at the end of March.

he capital actively engages business in resolving According to him, Moscow is an absolute leader in terms of es- city-wide issues with the help of PPP mechanisms. tablishing a regulatory and legal framework for the develop- The city has set out to thoroughly re-work the le- ment of investment projects in the sphere of PPP and in terms gal and economic conditions for long-term projects. of making their projects appealing to private investors. Special attention is being paid to the further devel- Topment of the PPP mechanism via adopting the necessary The following two parameters are taken into account for the regulatory acts. The volume of contracts related to PPP proj- PPP ratings: investment appeal and the regulatory and legal ects that Moscow entered into in 2013-2016 amounted to 575 framework. billion rubles. Moscow also placed first in last year’s PPP ratings, with a score of “Moscow has become a leader among Russian regions in terms 60.2%. St. Petersburg came in second with 59.9% (the city placed of the level of PPPs in the period from 2016 to the beginning of fifth in 2017 with 72.2%) and Samara Region placed third with 59.6%. 2017 with a final result of 90.1%. The Moscow region is in second place with a final result of 82.7% and Samara Region is in third Dmitry Presnov, First Deputy Head of the Moscow Depart- place with 82.7%,” Tkachenko said during his speech. ment for Economic Policy and Development, pointed out that

32 CAPITAL IDEAS April-June 2017 Moscow is leading the ratings because the city’s administration cal practice offices (“Doctor Ryadom”), and private schools and stays proactive. “We continue to be leaders in the PPP ratings kindergartens. because we are proactive and try to use as many tools as possible in order to make sure our projects are appealing to private “Projects like these are extremely important for integrating investors,” Presnov said. business into the development of city infrastructure. Our objective is to replicate the experience we’ve gained over the past The Russian capital’s achievements in the sphere of public- few years, using it to implement new projects and work with private partnerships are no accident. Moscow is a world-re- investors to create new PPP mechanisms. Moscow welcomes nowned pioneer in this sphere. The city started experimenting investment initiatives of any scale and invites qualified inves- with PPPs way back in the early 1990s, when most regions has tors who know how to attract financing, build and operate no idea that this kind of cooperation between business and infrastructure facilities to cooperate with the city,” said Leonid government is even possible. It is no wonder that Moscow leads Kostroma, Director of the Moscow City Investment Agency, the ratings today and that representatives from other regions during his presentation at a panel discussion at the Congress. come here to learn about the capital’s experience. The PPP Development Center organized the “Russian PPP One of the features of public-private partnerships in Moscow Week” Congress with participation from relevant federal min- is that the authorities do not get in the investor’s way. Recog- istries and the support of the Chamber of Commerce and In- nizing that the investor is better at doing business, they do not dustry of the Russian Federation, the Agency for Strategic interfere with operational activities. The investor implements Initiatives and "Delovaya Rossiya." The program included best everything on their own. The one thing both sides aren’t quite PPP practices in transport, housing and the social sphere. Ex- happy with is the amount of time that lapses between generat- perts discussed the possibility of implementing projects in the ing an idea and signing the concession agreement. But for the spheres of agriculture, manufacturing and IT. sake of fairness, this is the main problem for business and government representatives in just about any country. In Moscow, The PPP Development Center was founded in 2009, initiated by this time period amounts to about two and a half years. The major commercial structures, government representatives and goal is to shorten this time period to nine months. socio-political organizations. The center’s priority tasks include the development of federal and regional legislation on public-private Projects implemented within the scope of public-private partner- partnerships, the development and integration of an implementa- ships are often projects that have social significance - housing, tion methodology for PPP projects, and training of qualified per- healthcare, education, transportation… a prominent example of sonnel in the field of PPP in cooperation with leading universities. a recent project is the construction of the Kutuzovsky Prospect northern relief road. Western companies often represent the While the Congress was in progress, the PPP Development Cen- business side on these projects. The Congress featured presenta- ter and the Moscow City Investment Agency signed a coopera- tions about construction with German business representatives tion agreement with the goal of developing the institutional en- of a polytechnic college. Graduates from the school will receive vironment in the sphere of public-private partnerships. The Mos- diplomas that will be valid in both Russia and Europe. cow City Investment Agency was founded in 2011. The agency’s objective is to promote investment opportunities in Moscow and Other examples of PPP projects in Moscow include the follow- Russia abroad, develop legal and economic conditions for the ing: the acquisition of metro cars for the Moscow metro, the implementation of investment projects, including those imple- acquisition of low-floor buses and trams, the establishment mented on the basis of public-private partnership, and introduce of several transfer hubs, the establishment of general medi- mechanisms to improve the investment environment. ■

April-June 2017 CAPITAL IDEAS 33 MOSCOW IN WORDS

The joy of seeing Yuri Gagarin flying in space is only superseded by the joy of a good penalty save. Lev Yashin, Russian football goalkeeper, considered by many in the world to be the greatest goalkeeper in the history of the game

A hockey player must have the wisdom of a chess player, the accuracy of a sniper and the rhythm of a musician. Anatoly Tarasov, Russian innovative coach of hockey. Mr. Tarasov was the first European coach to have his portrait in the Hockey Hall of Fame in Toronto.

The example of foreign teams has finally convinced us that in order to catch up to professional teams we must be professionals. Professionalism is psychology about one’s responsibility towards one’s work”. Nikolai Starostin, Russian footballer and ice hockey player, and founder of Spartak Moscow

34 CAPITAL IDEAS April-June 2017 You can become a big master in chess only if you see your mistakes and short-comings. Exactly the same as in life itself. Alexander Alekhine, the fourth World Chess Champion

I am, in principle, against putting in less effort when we’re winning big. The audience doesn't come to see just the first period, but a full 60 minutes of hockey. There is nothing on the ticket that says the team will stop giving it their all if they're winning 4-0. And not giving it your all is a bad habit that can harm you during a critical moment. Victor Tikhonov, prominent Russian hockey coach

Do something...I need to come back. I need to score... Eduard Streltsov, the "Russian Pele" (just after injuring his leg during an important match)

April-June 2017 CAPITAL IDEAS 35 NOTHING VENTURED José Campusano Alarcón: We're not afraid of competition On wine, salmon and Luis Corvalan

t would be tough to find a Russian person who hasn't tried “We can talk about Chilean wine forever,” José says, “but I’d like some kind of Chilean product. It is no wonder that the Chil- to talk about a specific kind of wine today – Carménère. This ean stand at the recent international food fair in Moscow wine is made from a type of grape that is only available in Chile. It was one of the most elaborate stands there. first appeared in Bordeaux, France, which is famous for its wine. I However, it was completely wiped out in Europe by pests in the A total of ten Chilean companies took part in the food fair. They middle of the 19th century. So now Carménère is only made in brought fish, poultry, pork, tomato paste, juice and, of course, Chile. Why? Because Chile has a microclimate that was created wine. “Wine is our key ambassador,” said head of the Trade De- due to its unique location. The country is surrounded by the Pa- partment at the Chilean embassy in Moscow (“ProChile”) José cific Ocean and tall mountains, there is the Atacama Desert, plus Campusano Alarcón in an interview with Capital Ideas. If this is - the proximity of Antarctica! As a result, the soil, water, and air really the case, the ambassador is doing a fantastic job. Suffice there are so pure that we end up with top-quality wine!” it to say that Chilean wine is served at official gatherings, including the economic forum in St. Petersburg last year. It is also Of course, good quality isn’t limited to Chilean wine. It ap- widely available at Russian grocery stores. plies to just about any produce grown in this South Ameri- www.prochile.gob.cl

April-June 2017 CAPITAL IDEAS 37 NOTHING VENTURED www.prochile.gob.cl can country. Incidentally, the wine Mr. Alarcón is talking Why wouldn’t business people from two countries try to create about ranks fourth on the list of the most popular Chilean joint ventures – for example, to build poultry farms together? products on the Russian market. The winner here is salmon: in 2015, 97% of salmon sold in Russia was of Chilean origin. “A number of proposals have already been made by business- “As we wait for the official 2016 numbers to be released, we men from Armenia and Kazakhstan the last time a Chilean del- hope that we will keep our lead in terms of salmon exports,” egation of officials and business representatives visited coun- José says. tries that belong to the Eurasian Economic Union,” José Cam- pusano Alarcón responds. Chile isn’t afraid that the sanctions Out of all the food products Chile exports to Russia, 68.89% will be lifted. “We are prepared to compete with anybody,” José is fish and seafood (mainly salmon). Fresh fruit (apples, pears, says with confidence. and grapes) account for 11.87%. Frozen vegetables, fruit and berries come in third at 7.07%. Wine is fourth (4.56%) and pork However, this doesn’t mean that Chilean businessmen have is fifth (4.47%). “In the 1970’s, Russians associated Chile with it easy in Russia. They understand that a lot still needs to be Salvador Allende, the singer Victor Jara and Luis Corvalan,” done in order to establish their place on the Russian mar- José jokes, “For this generation, it’s salmon and wine before ket. And this isn’t just about business, but also about know- anything else!”. ing how to present and sell your products. There is another sphere closely related to business, which has a direct impact Considering the growing trade volumes, there are few prob- on sales volumes of wine, juice, and just about anything else lems with logistics between Russia and Chile. All Chilean prod- you can imagine. ucts are shipped by sea to Riga or St. Petersburg, then delivered to different parts of Russia. What is it?

Aside from Russia, Chile exports fish and agricultural products - “Let’s do a thought experiment,” José Campusano Alarcón ex- to other parts of the world as well. So how did a country whose plains, “Imagine that there are three identical red apples in front primary export had always been copper suddenly become one of you. One of them is from Chile, one from South Africa and of the world’s agrarian leaders? It happened because of eco- one is from Serbia. Which apple will you choose?” nomic diversification programs that began in the 90s, when democratic forces once again came to power in Chile after Pi- I say that I would pick the apple from Chile. And not because I nochet. “These changes could have happened even sooner, back want to flatter José, but because I know how good Chilean ap- in the 1970s, after Salvador Allende’s victory,” José says, “He was ples are. “But generally speaking, if you don’t have preferences already planning agricultural reforms back then. But the coup ahead of time, a person will pick the apple from the country that happened in September of 1973 put a stop to these plans they like the most,” José says, “a country that produces litera- for a long time.” ture or art they enjoy. This is why I think it is important to introduce Russians to our culture, our sports and so on.” Today, in light of the economic sanctions and unstable oil prices, we talk a lot about the need to diversify the Russian economy. Russians will have an opportunity to get to know more about Perhaps some things can be learned from Chileans in this re- Chilean football this summer, when the Chilean team comes to spect. Agriculture is, after all, where we started our diversifica- Russia for the Confederations Cup. After all, they are the best tion process… team of the Americas. ■

38 CAPITAL IDEAS April-June 2017 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

April-June 2017 CAPITAL IDEAS 39 NOTHING VENTURED Japanese quality with a Russian soul If you’re still having doubts about whether or not it’s possible to do business in Russia, just look at ISUZU. This company is the perfect testament to the fact that doing business in Russia is great. Suffice it to say that ISUZU is currently the number one foreign company in terms of truck sales.

Information about ISUZU’s leadership was recently presented by the leading information agency “Autostat Info.” According to the agency, the Japanese company sold the most trucks compared to all foreign truck manufacturers, posting a growth rate of 7 percent. Last year the company also opened warehouse in Vladivostok in addition to Moscow. This enabled the company to cut down on delivery time for spare parts, as well as to expand the range of products by 20 percent. So why is this famous Japanese company, which celebrated its 100 year anniversary last year, so successful in Russia? Jun Kimura, Finance & Administration Director of ISUZU RUS, answered this and other questions in an interview with Capital Ideas.

Mr. Kimura, what is the secret behind your com- First, the sanctions, which have depressed the Rus- pany’s success in Russia? sian market. And second, the legislative challenges, which, frankly speaking, is incomparable to those of It has to do with two key principles that we adhere other countries. to - excellent service quality for our clients and a wide range of products. I’d like to ask you a question about mentality. Business is not just trucks, pickups, wheels and But you adhere to these principles on any market. spare parts. Business is people. In my opinion, Isn’t the Russian market different from Europe or for example, it’s difficult to find two nationali- the Middle East? ties more different than Russians and Japanese people. But if you’re here, then we do have some- Of course the Russian market has its own features. thing in common, right? To put it mildly, Russia is a fairly difficult country. As a representative of Sojitz Corporation, a minority share- You know, my experience is limited: I have only been holder of ISUZU RUS, can say that we always look at working in Russia for a year. But what I have expe- the local market from a long-term perspective. rienced and heard from colleagues who have been working here for a long time leads me to believe that When you say that Russia is a challenging mar- the Russian mentality is quite similar to ours. Both ket, what do you mean? Russians and the Japanese value personal relation-

April-June 2017 CAPITAL IDEAS 41 NOTHING VENTURED

ships, and both are interested in developing long- A more general question about relations between term relationships. Russia and Japan. Recently it seems like they are improving. In December of last year, Vladimir Pu- So at the foundation of both business cultures is tin was in Russia and a Japanese delegation came developing personal contact between people, es- to Moscow in the beginning of this year. Is there tablishing trust on a personal level, right? a positive trend in terms of trade and economic relations between our countries? Absolutely! Mutual trust between us and our clients is extremely important. Yes, we can really see this. The meetings between Putin and Abe are opening new opportunities for us, Last question about this topic - is it difficult to es- private entrepreneurs. tablish contact with Russians? But is there something that still gets in the way? (Mr. Kimura pauses to think for several seconds) The biggest obstacle is the lack of transparency in Please answer honestly! Russian legislation. There are a lot of details that are unclear. But both of our governments are working on To be honest, such contacts really are difficult to estab- this problem. lish at first. Especially when it comes to government officials. When it comes to private business representa- This question is probably not for you, but I will tives in Russia, it’s easy for us to find common ground. ask anyway. Do you think the fact that the Rus- We speak the same language as Russian businessmen, sian President is a big fan of judo helps him under- since both of us are looking toward the future. stand Japanese people better?

You call everything you make in Russia “Japa- Yes, judo is the true spirit of Bushido. The study of nese quality with a Russian soul.” What does this Bushido helps to better understand Japanese cul- mean? ture, history and Japanese people themselves, our mentality. It means that quality control of the final product is carried out in accordance with the Japanese standards So far as I know, Vladimir Putin likes to read books of ISUZU Motors. But the products are assembled by about judo. He even has a sculpture of Kanō Russian people, on Russian equipment, with a Russian Jigorō, the founder of judo, at his house. Have you approach at our plant in Ulyanovsk. So that’s why we heard about this? have Japanese quality with a Russian soul! I haven’t, but if he does, that’s great! (Smiles) People all over the world like to talk about the mysterious Russian soul. Do you think the Rus- What kind of advice would you give to Japanese sian soul is mysterious? businessmen who are planning to come to Russia?

I’ve only been here for a year, so it’s hard for me to Anybody who comes here has to be thinking about judge. In any case, I have yet to encounter any of the long-term. You have to plan your business activity these mysterious aspects. (Laughs) in Russia for several years in advance.

So it’s pointless to count on making a quick buck, right?

Yes. I’ll give you an example. Among other things that SOJITZ group (where I came from) is doing in Russia, we have a project - the development of an airport in terminal Khabarovsk. In spite of support from the Jap- anese government, we understand that this will take several years.

Why so long? It can’t be because Russia is so cold?

Generally speaking in Russia, planning takes a long time, construction takes a long time and waiting for profits to come in takes a long time.

42 CAPITAL IDEAS April-June 2017 In order for me to understand the reasons better, could you explain - a similar project in Europe or Note from Capital Ideas: Japan wouldn’t take this much time?

Yes, it would not take as long to implement it there. ISUZU RUS – ISUZU RUS is the official manufacturer and distributor of the Japanese brand ISUZU in Rus- You’ve been in Moscow for a year. What do you think about this city? sia. The company was founded through joint efforts of two Japanese corporations - ISUZU Motors Lim- My impressions of Moscow are much better than what I expected to see before I came here. I thought ited (74% of shares) and Sojitz Corporation (26% of that it would be dark and cold here. But my wife and I shares). are in Moscow and we’re happy with everything. We like going to museums and ballet , for example. The company manufactures and sells the full range of

What happened between ISUZU and Sollers? ISUZU commercial vehicles weighing 3.5 to 33 tons and D-Max pickup trucks through a national dealer- Sollers decided to leave. Instead of looking for a local partner as a replacement, ISUZU decided to expand ship network, which currently amounts to 52 dealer- its participation. We have a good local team here and ships (including Kazakhstan and Belarus). The com- excellent management. And we’re not afraid of continuing to work in this format. pany’s production facilities are located in Ulyanovsk. ISUZU RUS employs a total of 246 people. The com- Do you have a lot of hope about the future, or are you more cautious? pany’s branches are located in Moscow, Yekaterin- burg, Novosibirsk and Vladivostok. I have hope. I am very positive. Relations between our countries are improving. This year will be a year of transition, and next year will be great! ■

April-June 2017 CAPITAL IDEAS 43 NOTHING VENTURED

Xu Jiangsheng: We still have a lot of potential in Russia On the Russian auto market, Chery is one of the top three most successful Chinese brands in terms of sales volumes. The most popular Chery model in Russia is the compact crossover Tiggo, which has been on the market for several years and has acquired a reputation as a reliable, good quality vehicle. In an interview with Capital Ideas, Deputy CEO of Chery International Xu Jiangsheng talked about the company’s achievements and plans, as well as about his life in the Russian capital.

n spite of the crisis that the country’s auto mar- energy allowed Chery to establish itself on the Rus- ket is going through, Chery has not cut back on sian auto market. business activities in Russia. In fact, the company is planning to expand the range of vehicles Xu Jiangsheng has been permanently living in Moscow available to Russian customers, as well as to infor 9 months and is starting to understand Russian Icrease the pool of dealerships in the country. culture and customs, as well as learning first-hand how to make a Chinese auto brand successful on the Xu Jiangsheng spent 5 years working in a similar po- Russian auto market. sition in Spain with Haier, the largest Chinese home appliances manufacturer. He first came to Moscow “In spite of the fact that the situation on the Russian 10 years ago, when the city looked very different auto market, and the economy in general, is not the from the way it is today. Even during his first visit, most simple, we at Chery understand that the coun- Jiangsheng was impressed with the Russian capital try has tremendous potential for growth,” Mr. Xu says – the people, the unique architecture and the city’s with confidence, “I must point out that, judging by my own special flair. He liked everything except for the interactions with people here, people who live in Rus- weather, especially the winter. It was tough getting sia have a lot of patience. They probably learned how used to such low temperatures. Even back then, Mr. to be patient from the long winters.” Xu noted that Moscow is a city with a lot of energy and that you can turn into the most ambitious The Russian car market has not stabilized yet. For plans into reality here. Over the past 10 years, this example, sales in Russia amounted to 2.3 million cars

44 CAPITAL IDEAS April-June 2017

NOTHING VENTURED

in 2014, but forecasts for this year amount to just 1.3 Note from Capital Ideas: million cars. But there are also some positive aspects of the Russian market – it’s large capacity, as well as Chery Automobile Co., Ltd. is a Chinese auto company fairly low levels of motorization. These other factors founded in 1997. CHERY currently manufactures 900,000 will stimulate growth in car sales after the market downturn is over. cars of 21 different models. Chery Automobile Co., Ltd includes 6 automobile plants and 11 assembly plants all over Before working in Russia, Mr. Xu worked in Spain for several years. He recalls that the work culture in Spain the globe. The company is a leader among Chinese car resembled the work culture of Europeans in general. It’s manufacturers in terms of export volumes. Chery cars are different in China. Russia is located between Europe and the East but, according to Mr. Xu, still adheres to Euro- supplied to 80 countries, including 4 European countries. pean business management standards. “At the same Chery was named the most recognizable Chinese brand in time, I notice a lot of Russians have Asian management habits,” he says, “For example, many people work over Russia at the 15th annual “Automobile of the Year in Russia the weekend, which is almost unheard of in Europe.” 2015) At the end of April of this year. When Mr. Xu first came to live and work in Russia, he struggled for a long time with finding a balance

46 CAPITAL IDEAS April-June 2017 between European and Eastern styles, which he en- order to make sure our values are communicated to countered in business, the economy and even every- the Russian auto market.” day life. His partners and colleagues from the Russian Chery office helped him find this balance. Being efficient on a market that’s going through a downturn is impossible without having a special long- During his time in Russia, Mr. Xu has done a lot of term strategy. Chery has a strategy like this, and one traveling in the European part of the country. He also of the most important points on the list is localization visited several cities located past the Urals. He was, of of production in Russia. The company is currently dis- course, impressed by the scale of the country, by its cussing plans to localize production with our Russian beauty and nature, the different cities and their local partners and is looking for a production facility. flair, as well as the warm welcome he received everywhere. Another important area is the expansion of our consumer audience. Once the new Chery crossovers are Xu Jiangsheng is in charge of developing the Chery introduced, the company will be able to offer Russian brand in Russia. Locals are very familiar with the clients the most popular models, attract the attention brand, which is first and foremost due to Chery’s ex- of younger motorists and increase customer loyalty. tensive history. The company has been on the Rus- sian market for over 10 years. Over the years, Chery A company needs an effective dealership network has been able to transfer its technical competencies in order to have good sales numbers. Further devel- to the Russian market. According to Mr. Xu, Chery opment of the dealership network is also a part of will introduce three new crossovers in Russia in 2016- Chery’s strategy in Russia. Extensive development is 2017 – Tiggo 5, Tiggo 3 and Tiggo 2. “It doesn’t matter planned even on very competitive markets like Mos- whether or not we’re in a crisis right now,” he says, cow, St. Petersburg and other big cities. ■ “The company needs to keep working with its client base in Russia and is simply obligated to offer the newest and most up to date cars available.”

The attitude Russian buyers have toward Chinese cars has changed radically over the past few years. Of course, all Chinese companies that have been operating in Russia played a role in this change in perception, including Chery. This is more than just the work of marketing. It also entails constant technical improvements made to the cars Chery supplies to Russia. The integration of new facilities for the manufacture of new cars allows Chery to guarantee good quality and durability of their products.

There is also the work done by the customer service department in the company, specifically the after- sales service division. Chery has over 100 dealerships in Russia. The company constantly works closely with the dealership network in order to ensure that customers have access to good quality, timely support. The Russian Chery team has achieved great results in the customer service sector. Just recently, the team received an award from the company’s head office. They had placed second in the world in the international Chery customer service competition “Super Skilled 2016.”

“It’s no secret that the quality of a car directly impacts consumer attitudes toward the brand,” the Deputy CEO of Cherry International says, “But the efforts of the whole team also play a part in creating a positive image. The Chery office in Russia has a lot of employees that have been there since the beginning. They are loyal to the company and its goals and do a lot in

April-June 2017 CAPITAL IDEAS 47 NOTHING VENTURED You can do business in Russia without getting your hands dirty

Philipp Rowe helps foreigners do business in Russia

Berlin native Philipp Rowe became a Muscovite right after getting his degree in Germany. He came to Russia several times as a student as well. “This was a time when I believed in all the stereotypes about Russia: that it’s always cold, there are nuclear plants and KGB agents everywhere, and bears roam the streets,” Rowe tells Capital Ideas in perfect Russian, “There cliches dissipated quickly. It became apparent that Russians and Russia are much better than their image abroad.” After graduating, he started an internship at the German embassy in Russia. However, a future career as a diplomat didn’t appeal to him. He spent a year working for a Kuehne + Nagel, a logistics company. In 2007, he decided to start his own business. Today, his company Rufil Consulting, which is located in the center of Moscow, employs about 20 Russian and foreign workers.

48 CAPITAL IDEAS April-June 2017 Mr. Rowe, why did you decide to go into consult- land and Luxembourg. Incidentally, I didn’t think about ing? competition when I started my business; I just started it. Moreover, you shouldn’t be afraid of competition. Because I have always wanted to help German com- The fact that it exists means that you’re working in a panies do business in Russia. When I first arrived field where you can make money. There is no compe- here, I immediately noticed that German products tition in fields where you can’t make money. and technology is popular here and in high demand. I also understood that not everything in Russia is easy As Germans like to say, it’s always hard to get for Germans and Western Europeans in general to started. What kinds of challenges did you run into understand. German companies in Russia need help, when you started your business in Russia? especially when it comes to bureaucratic details like accounting and taxes. This is primarily the type of Looking back, I can say that I really didn’t run into any consulting I’m talking about. overwhelming difficulties. Though of course there were challenges when I was starting out. For exam- Rufil Consulting is not the only company in Rus- ple, some things were tough just because I’m a for- sia that offers these services. Is it tough on the eigner. I had to register my own company in Moscow, Russian market in terms of competition? get a work permit… It was especially difficult in the very beginning, before I had assistants and didn’t have Of course there are a lot of consulting companies, but the money to hire professional agencies who could you have to keep in mind that I’m German. This is a big help. I had to do a lot of running around. I wore out advantage for my clients, who mostly come from Ger- several pairs of shoes before everything was settled. man speaking countries: Germany, Austria, Switzer- But it was a good kind of challenge.

April-June 2017 CAPITAL IDEAS 49 NOTHING VENTURED

There weren’t any other difficulties? Russian market, we have gone through several crises, ups and downs. During the “Russian boom,” when ev- There were other kinds of difficulties. It’s hard to do erybody wanted to come to Russia, the most impor- work when you don’t have any clients. I started with tant thing for German companies was to open a busi- no clients. I opened my company and looked for cli- ness in Russia and set up accounting. A lot of German ents, talked to hundreds of people. It took a couple of companies established their own companies in Russia years before people started to take me seriously. just so they could be on the market, and only started thinking about how to sell their products here after Did you need a lot of startup capital? the fact. After the Ukraine crisis happened and sanctions were introduced, German and other western I didn’t have much trouble with money. I lived simply. companies decided to wait things out and put their plans on hold. But now everybody has gotten used to But you needed some kind of capital to start with, the current state of affairs and have an understanding right? of how to move forward. So western investments are starting to pick up in Russia again. German companies My startup capital was a laptop and a suit. So I didn’t that want to work with Russia are determined to take need much money to start with. advantage of the situation here and make investments. They haven’t lost faith in Russia and under- What was the most important thing for you at stand that Russian-German economic ties date back this stage? centuries. These companies are taking advantage of the fact that things are cheaper in Russia right now. The most important thing in the beginning is to stay For example, you can buy land to build a plant or get motivated. After you get a “no” for the 100th time, you special terms and government benefits for business have to keep going and asking more people. But these development and attracting investments. are challenges that aren’t unique to Russia. I actually think that it was easier for me in Moscow in this re- Some foreign businessmen insist that the market spect than it would have been in Berlin. in Russia is no different from other markets these days. But there are nuances, right? Did you run into any bureaucratic obstacles in Russia? The Russian market is developing, and is now at the stage of saturation. Russia is a huge country with a Of course, since bureaucracy is my business. It’s what population of 140 million people. Moreover, Rus- I do every day. On the other hand, I have yet to run sia has always been a special market for Germans – into a bureaucratic hurdle in Russia that I wasn’t able it worked out that way historically. This market is to overcome. practically at our doorstep, not across the ocean somewhere. Of course Russia is a difficult market that There is a lot of talk about corruption in Russia... is very different from Germany. However, it’s easier to work with than many other markets. It’s easier for us Some typical questions that my clients ask me when to navigate than the markets in China, Japan or the talking about doing business in Russia: Do you need Middle East. connections? Do you have to pay everybody off? I established Rufil Consulting, as well as a lot of compa- So you think that Russia will continue to be an at- nies for my clients, we do accounting and taxes for a tractive market? lot of businessmen and I’ve never run into a situation where I had to pay a bribe for something. And I don’t I am convinced that Russian-German relations are recommend that anybody does this, by the way. I tell important not just for our countries, but for the world my clients that you can do business in Russia without in general. Germany has traditionally been able to in- getting your hands dirty. fluence other governments through trade. There was a time when leading German companies like Siemens Much like any other market, the consulting mar- did a lot in Russia, and this was important for both ket is developing. Are consulting services espe- Russia and Germany. cially in demand in Russia today? I think of my work in Russia as my patriotic duty. You’re asking how much the market has changed in For Germany, there is nothing more important than this segment. Nothing is ever stagnant, including the keeping peace with Russia and strengthening our ties market in Russia, which is always changing. For me, here. I also owe a lot to Russia. I started my career this is a positive moment that opens up new opportu- here, my business is here, my family is here and I live nities. Since 2007, when I first started working on the here. I really like being in Russia. Of course there are

50 CAPITAL IDEAS April-June 2017 issues, but I am very happy to be here. Initially I didn’t turn a profit in Russia right now. But it will definitely think that I would go into consulting, accounting and come if you’re aiming for the long-term. For new in- taxes. I just wanted to support Russian-German rela- vestors, right now is a good time to make acquisitions tions. And now I work in this sphere. in Russia.

A lot of people complain about the crisis and how What kind of advice would you give to business- difficult things are in Russia right now. Has your men who want to try entering the Russian mar- company experienced this? ket?

Yes, of course. Business has slowed down and the Definitely come to Russia first and feel things out. You growth we experienced prior to 2013 has come to a won’t get far trying to set things up remotely. And halt. My clients have been affected by it, which means forget everything that the German media says about I feel it too. Russia. Forget everything you read about Russia in Spiegel and Bild and saw on ARD and ZDF. Clear your So would it make sense to start doing business in head and come see Russia for yourself. Russia right now? Once you’re here, plan your time a bit differently than Of course. I am sure that every German enterprise you would in Germany. In Russia, you will need more that does business abroad can enter the Russian mar- time to do everything: to get to your hotel from the ket, provided, of course, that the company profile and airport, to open a bank account and so on. Prepare products are a good fit for Russia. It’s even possible to be patient. If these is one thing Germans can learn that entering the Russian market is easier now. For from Russians, it’s definitely patience. By the way, example, buying some kind of enterprise or real estate if you’re going to Russia in the winter, make sure to would be a good investment right now because the bring weather-appropriate clothes. Fashionable shoes prices are fairly low. Nobody should expect to quickly are not a good choice for Russian winters (laughs). ■

April-June 2017 CAPITAL IDEAS 51 NOTHING VENTURED Ramnik Kohli: It’s important to know and love Russia In 2014, phones from the Indian brand Micromax first appeared on the Russian market. In a few years, the company became one of the top three major mobile phone importers in Russia. Ramnik Kohli, head of Micromax in Russia in the CIS, talked about the development of Micromax on the Russian market and his life in Moscow in an interview with Capital Ideas. Mr. Kohli is also a member of the Expert Council on Transfer of Payments in National Currencies. The council is part of the Department of Foreign Economic Activity and International Relations of the City of Moscow, which provides legal support to foreign companies on the Russian market. The department also assists Russian companies operating in India. The council resolves issues related to transferring payments in national currencies between countries.

Mr. Kohli, when did you first come to Russia? sia. None of my fears or the fears of my friends and What was your first impression? family came true, thankfully.

I can call Russia my second homeland, since I spent As a foreigner, I had the unique opportunity to watch the majority of my youth here. I came to Russia after how Moscow changed. For example, my first impres- winning a competition - the main prize was the op- sion of the capital in the late 90s was that there were portunity to study abroad. I first studied Russian in no signs in English. But this changed very quickly! Voronezh, then moved to Moscow in September of I have lived through three crises in Russia and have 1997 and continued to study marketing at the State seen how this country has changed. I can say that a University of Management. I graduated in 2002 and lot of these changes have been for the best. enrolled in a post graduate program immediately after. In 2006, I successfully defended my Ph.D. thesis Did you leave Russia afterward? in bank marketing in India. When I was planning to move to Russia, some of my close friends and rela- Yes, after getting my degree I came back home and tives were worried because things were really un- worked for Indian branches of the Russian companies stable here back then. I was prepared for everything, VTB and MTS-India. I came back to Moscow in 2013 to but when I got here I felt totally comfortable in Rus- implement Micromax projects in Russia. I was happy

52 CAPITAL IDEAS April-June 2017

NOTHING VENTURED

to see that the city has become comfortable and safe There are 5-6 major retailers in Russia, which make for foreigners. Moreover, doing business in Moscow, up the majority of the market. They have a thorough making new products, and launching new projects approach when it comes to selecting suppliers and go has become easier as well. for brands that help them grow, especially the high- margin brands. Micromax has established a great Ramnik, as a foreigner you are familiar with the reputation for itself, since for the past three years we qualities of Russian businessmen. have worked closely with Russian retailers and did everything possible to establish mutually beneficial In my experience, Russian businessmen are some of partnerships. You can find our products at Beeline, the strongest businessmen I’ve had to work with. I re- Megafon, Svyaznoy, and independent retail stores spect them for their perseverance and ability to work throughout the country. I’d also like to point out that and grow their business during economic downturns. Micromax is the top-selling brand in terms of phone In my opinion, nobody is better at managing risks. Of quantity and in the top three brands in terms of sales course the Russian market is going through a tough in the independent retail segment. period right now, but I am sure that the country has a lot of resources to help overcome this difficult time. Where in Russia have you seen the most growth? I also have to say that my Russian team does superb work. The Micromax office in Russia mostly employs We have the most sales in the central part of Rus- Russians. They are like a second family to me, I spend sia, as well as in the south. These regions have the a lot of time with them. We work closely together and highest population density, as well as major whole- achieve great results. sale companies operating in mobile phone sales. Customer loyalty to our products points to high de- What are the market conditions in Russia like for mand for our phones, along with the low percent- your business right now? age of returns, which speaks to the quality of our products. The general state of affairs on the Russian market has not had a serious negative impact on Micro- What are your company’s goals in Russia? max. I consider the current crisis to be a window of opportunity for us. Micromax specializes in mobile Our goal is to switch button phone users to Micro- phones in the budget segment, which is current- max smartphones. I want to point out that we have ly expanding because demand for products in the a big share of the button phone market as well. Our budget segment is growing. Micromax offers af- budget smartphones have features that used to only fordable mobile phones that aren’t limited in terms be available for premium products, like fingerprint se- of functionality. curity scanners. Our goal is to democratize technology. We are able to make solutions like this available In your opinion, what are some distinguishing in the budget segment thanks to our optimization of features of the Russian mobile phone market? production expenses. The phones are developed and manufactured in India and China, and we also have low marketing and promotion costs.

What do you like most about Russia? What kind of advice would you give to someone else who wants to come here from India to work and live?

If I have to leave Russia some day, I will definitely miss it, especially my friends and acquaintances, whom I love, as well as Russian weather and cuisine. I really like Russian cuisine and am pretty good at making Russian food. An Indian person who wants to live and work in Russia needs to at least speak some Russian. It’s important to spend some time studying Russian culture, and it’s also very interesting. Understanding the Russian mentality and learning about Russian history is very important for successfully doing business in Russia, since these things affect the behavior of both consumers and potential partners. It’s also important to study the structure of the market and find out who the top players are. ■

54 CAPITAL IDEAS April-June 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

April-June 2017 CAPITAL IDEAS 55 NOTHING VENTURED KNAUF Group: Russia remains a strategically important market KNAUF has been a long-term partner of Russia, having established business contacts here all the way back in 1970’s. In 1993, the company started to heavily invest in its business activities in Russia. Janis Kraulis, the head of Knauf Group CIS, talked about the company in an interview with Capital Ideas.

Mr. Kraulis, KNAUF started to invest in Russia right Was it hard to start doing business here? How was after the collapse of the USSR. What informed the your company able to establish itself on the Russian decision to enter the Russian market? market?

The first contacts between KNAUF experts and the It was very difficult. At the time, the Russian market had USSR’s scientific community were established way encountered somewhat of a paradox – there was a lot back in the 1970s, when there were very few threats of demand for modern, high-performance construction to the economy and the USSR as a state. The Soviet finishing materials and no knowledge or skill when it gypsum industry was in need of research and technol- came down to working with them. So the company had ogy and KNAUF had always been very strong in terms to put in a lot of education efforts, to train and retrain of research and development. We had the experience professional staff. By 1995, KNAUF opened its first train- and the know-how. We quickly opened KNAUF Engi- ing center in Russia outside of Moscow. neering in the USSR, which was an engineering company that was part of Knauf Group. So when the Rus- KNAUF has its own production facilities in Russia. sian market opened up, KNAUF was familiar with the Where are your company’s enterprises located and gypsum industry. Incidentally, this knowledge didn’t what do they manufacture? necessarily give us the confidence we needed to invest in the Russian market. In the 1990s, most gypsum These are mining enterprises that provide natural gyp- enterprises were in bad shape, both financially and in sum stone for our own enterprises, as well as compa- terms of technology. Moreover, the political and eco- nies in the cement industry and other gypsum-based nomic climate was unstable, the rules were constantly construction materials manufacturers. We also have changing and there wasn’t much potential for foreign metal enterprises, factories that manufacture gypsum investors. A key argument for investing in the Russian boards and plasters, primers, thermal and acoustic in- market was the significant potential of the Russian sulation materials, building chemicals, as well as Rus- construction materials market. Russia is a huge coun- sia's largest plant producing cardboard from waste try where millions of people need better residential paper. In 23 years, KNAUF has erected or acquired and conditions and a good quality, comfortable environ- renovated 15 production facilities, which are located all ment for work and life in general. over the country. We want to provide our clients with

56 CAPITAL IDEAS April-June 2017

NOTHING VENTURED

We employ about 4,000 people in Russia. Our staff members include different kinds of specialists: miners, drivers, assembly line workers and office workers. Only a few of our employees here are foreign professionals. We use local labor markets to do the vast majority of our hiring, recruiting employees from communities located nearby. Moreover, I want to point out that our situation now is fundamentally different from what we were dealing with when KNAUF first entered the Russian market.

Now, specialists at Russian KNAUF enterprises go on business trips to other parts of the world to work on establishing new plants with international teams. The people sent on these business trips must have unique competencies and experience, and Russian specialists definitely meet these requirements.

Your company opened a KNAUF Academy in Russia, and there are KNAUF training centers all over the country. Could you talk a little bit about what these the optimal conditions for acquiring KNAUF products centers are? Where are they located and what do and solutions. they do?

Did you acquire your production facilities in Russia The KNAUF Academy includes 78 KNAUF training cen- or did you build them from scratch? ters, a big community of experts, gurus of industrial training and demonstrators. There are 10 KNAUF train- In the beginning, KNAUF was interested in participating ing centers in the CIS that are based out of our enter- in the capital of construction material manufacturers that prises. There are 54 resource centers operating in pri- already existed at the time. We purchased shares at in- mary and secondary vocational education institutions. vestment tenders. KNAUF’s investment activities in Russia Finally, there are also 14 KNAUF consulting centers commenced in 1993 with the purchase of a share in TIGI, based out of universities. a thermal insulation and gypsum products factory at the Krasnogorsk plant. We then purchased shares in Kubansky How effective are the training centers in terms of Gips in Krasnodar region, Pobeda and the cardboard plant promoting KNAUF in Russia? in St. Petersburg and Leningrad Oblast, Gips in Tula region and Avangard in Nizhny Novgorod region. The existing KNAUF is proud of our systemic approach to our work lines were renovated or partially replaced with new ones. with clients, which means that we go beyond simply sup- The second phase was the construction of new plants, plying finishing materials – we offer comprehensive so- first in the industrial buildings already available to us, then lutions for construction projects. Education is one of the in the surrounding areas. Finally, in 2003 the first KNAUF components of our system, along with consulting sup- manufacturing enterprise in Russia built from scratch port, delivery and documentation, for example. We want opened its doors. The KNAUF GIPS Kungur location had clients to use our construction materials correctly. This never housed a production plant before – just unfinished guarantees that the consumer will get top quality results buildings of a future plant for the production of parts for that meet expectations and we won’t have to process large-panel buildings. Nonetheless, there was already any complaints. Of course, these centers also serve as an some infrastructure in place there. We did build our new excellent platform for promoting drywall construction plant in Irkutsk Oblast completely from scratch. However, technologies in Russia, since there are still people who are we still haven’t been able to secure access to natural gas biased against it. Expanding the sales market is especially there and have to use the more expensive CNG option. important for the industry right now, since existing man- Today, the situation for investors who want to erect their ufacturing facilities in Russia exceeded market capacity own production facilities in Russia is completely different several years ago. from what it used to be in the mid-2000s. This year we are finishing up construction on a new plasters produc- The main consumers of drywall systems are commercial tion plant at in industrial park in Chapayevsk, Samara real estate construction projects. They are ahead of the Oblast. The support we are getting from the local govern- curve in terms of assessing and implementing new tech- ment there is tangible. nology.

How many people does KNAUF employ in Russia and In anticipation of the FIFA World Cup 2018, a lot of at- where do you find the right people? tention is focused on erecting athletic facilities for

58 CAPITAL IDEAS April-June 2017 April-June 2017 CAPITAL IDEAS 59 NOTHING VENTURED

I think that KNAUF construction materials are used in the construction of all these facilities to some extent, along with hotels, media centers and other infrastructure elements. KNAUF offers a whole series of unique solutions that are a lot more efficient than their alternatives. For example, we supplied a large number of our innovative Aquapanel cement boards for the reconstruction of Luzhniki.

Last year wasn’t exactly the best in terms of relations between Russia and the West, and this was reflected in the economic indicators. Was 2016 a successful year for KNAUF in Russia? Could you give us your thoughts?

KNAUF is engaged in business and, according to the company co-founder Nikolaus Knauf, does not have any economic reasons for altering its business strategy in Russia. 2016 was a difficult year, but KNAUF CIS was still able to reach our objectives. Our ruble turnover didn’t fall compared to the previous period and we were able to retain our market share. We were able to achieve these results the event. Is KNAUF taking part in preparing for this thanks to our programs targeting the reduction of pro- athletic celebration? duction costs, resource base optimization, increased ef- ficiency of the production processes, introducing new Hosting the World Cup in 2018 is a big responsibility and a product on the market and continuing our localization unique opportunity for Russia and the construction indus- processes. We are trying to use more components made try. On our part, we are providing multi-faceted support, in Russia for our products. from developing the initial design to finishing the facilities. Especially since KNAUF has accumulated a lot of ex- Judging by the number of KNAUF plants in Russia and perience in providing support for the construction of new by their product line, your company is playing a lot athletic facilities, from football stadiums for the European of attention to localizing production. Will this trend championship in Germany and the last World Cup in Rio continue into the future? Is KNAUF planning any new to multiple facilities in Sochi, which hosted the Winter investments in Russia? Olympic Games in 2014. Every time, KNAUF was ready to offer a comprehensive approach for the project, supplying According to KNAUF’s Managing Partner Manfred Grund- systems and solutions as well as providing technical sup- ke, Russia is a strategically important market for the com- port at the facilities. pany. Over the past 24 years, KNAUF has invested over $1.6 billion into the Russian construction industry. We Could you give specific examples? Which 2018 WC fa- continued to invest in 2015 and 2016, and plan on mod- cilities are built with KNAUF construction materials ernizing our enterprises in the future as well. About 80% and technologies? of our business in Russia has been localized.

Of course, considering the current state of the economy, Note from Capital Ideas: significantly investing into development is not a simple decision. At the same time, it’s a testament to the fact Today Knauf is one of the world’s leading manufacturers of that we are serious about working in Russia and plan to modern insulation materials, drylining systems, plasters and be here in the future. The main objectives for KNAUF CIS are increasing localization, optimizing production pro- accessories, thermal insulation composite systems, paints, cesses, promoting new products and searching for new floor screed, floor systems, and construction equipment and product niches. tools. With over 200 production facilities and sales organisa- We plan the launch of several new production lines and tions in over 80 countries, 26,000 employees worldwide, the enterprises in 2017. These include the plasters plant in Samara Oblast, the modernization and construction of a Knauf Group is without doubt one of the big players on the similar plant in the Mari El Republic, as well as the plant market – in Europe, the USA, South America, Russia, Asia, for Aquapanel moisture-resistant cement boards in Tula Oblast. We also plan on launching a large-scale invest- Africa, and Australia. ment project to improve the production of cardboard at the KNAUF PETROBOARD plant in Leningrad Oblast. ■

60 CAPITAL IDEAS April-June 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

April-June 2017 CAPITAL IDEAS 61 EXPERT TIPS Territory of Justified Risks Frenchman Jean-François Marquaire this time, Jean-François has seen has been living and working in Moscow and participated in widely differing for the past 10 years. Since 2008 he situations in his clients’ work. The has headed the Russian branch of the economic situation in Russia has international law alliance CMS, which changed before his eyes, and the provides services to foreign and Russian “rules of the game” in the economy business in the CIS countries. During have changed too.

r. Marquaire, information was proaches vary from one country to another. In some, they recently published on the in- prefer to be cautious and wait. But France, for example, has ternet, on the website of the been investing in Russia and is continuing to do so. The same Franco-Russian Chamber of can be said of Italy and some other European countries. Commerce, about the activities of CMS, along with your Can you give any specific examples? commentary, in which you say – I quote – “We predict a I won’t name any actual firms, but I can point out the sec- high level of business activity tors in greater demand. Quite a lot of investments are being in the M&A (Mergers & Acquisitions) sector in 2016, be- made in retail trade, which may sound rather unexpected. cause the situation in Russia is beginning to stabilize…” But if you look at real estate prices, now is the right time to So you think the situation in the Russian economy is buy new shops and warehouses. stabilizing? Furthermore, the output of agricultural produce is growing Yes, certainly. The investment climate in Russia today is more rapidly in Russia. Food processing and the output of food stable and calm than it was, say, two or three years ago. And products are in very high demand and developing further. And on the whole, I think the Russian economy is now in a better investments are going there. I know of several joint ventures position. in the process of being organized. Also, the Russian high-tech sector is developing with its traditional confidence. There are In other words, in these conditions, the risks of invest- plenty of good companies in Russia. Therefore joint ventures ing in Russia are justified? are set up, and the process of mergers and takeovers takes place. As a whole, the market is redeveloping. I would say they are more justified than they were before. Prices have settled at a sensible level, which has created a But there is still tension in relations with the West. It is unique opportunity for European investors to invest in the known that some companies have even decided to wind Russian market. And I must say that Europe is showing that up their activities in Moscow and Russia. Do you have it has the appetite for such investments. Of course, the ap- any of these among your clients?

62 CAPITAL IDEAS April-June 2017 Territory of Justified Risks The Frenchman Jean-François Marquaire is convinced that Russian markets are a good prospect for foreign investors

Only a few. Maybe three or four clients. And even they have volatile at that time. Now, the situation has stabilized. People not left altogether they have only partially reduced their ac- have become used to it, and are finding ways out of the situation. tivities. Most of them intend to stay in the Russian market. I cannot say that I have recently encountered clients who When I hear Western politicians say that Russia is suffering badly have given up investing in Russia because of political prob- from sanctions, I want to tell them that this is not so. Russians lems and international tension. Yes, some are behaving cau- have one outstanding ability. They are very inventive and good at tiously and thinking twice before taking any kind of steps, adapting. And that is their strong point. but on the whole, Russia shall not be considered a country in which it is dangerous to invest. This is not an easy place to In Russia today, the emphasis is on import replacement. For conduct business, partly because of sanctions, but it is not a foreign firms, this means localizing production too. How in- place where the political risks are so great as to be a barrier teresting and economically attractive do they find this? to investment. We are experiencing a strong tendency towards building manu- You mentioned sanctions. Do you feel any influence from facturing facilities in Russia. The rules of the game have changed. them in your work? Russia wants to create strong production capacity of its own, and this means localization. And foreign investors are realizing that if Of course, as do many Russian businesses. In connection with they want to continue selling their products here – and this is sanctions, we have all lived through two phases, you might say. a big market, one in which you want to keep your share – you At first there was a reduction in activity. People did not know will have to manufacture here. The trend towards localization how to carry on working. They felt a certain shock from the in- did not start yesterday. It already existed in agriculture and the troduction of sanctions. Plus the fact that the rouble was highly motor vehicle industry. Now it has become general. Brasil, China

April-June 2017 CAPITAL IDEAS 63 EXPERT TIPS and India (to cite a few) have already taken steps to localize pro- On paper, your legal system differs little from the French or Ger- duction. Naturally, Russia is going the same way too. Many of our man. It is a feature of it that it is always changing. But for the clients are more and more inclined to take this decision. better. Today’s business climate in Russia, from the point of view of the laws, is more or less comparable with other developed How many clients do you have in Russia? countries. The system works. Of course, the legal practice is not yet far enough developed to be completely stable. Time is need- Around six hundred active clients. If you only consider those used. But from one point of view at least, I think your legal system ing our services now, there is more than a hundred. is excellent: it works quickly.

More than 50 qualified lawyers work in CMS’s Moscow of- In what sense? fice. Are they mostly foreigners or Russians? In a court dispute, we can reach the supreme cassation level in We only have six foreigners. only 18 months.

The CMS alliance represents the interests of many lead- That’s considered quick? ing international corporations in the traditional list of the 500 biggest European companies according to the Financial In France, for example, such a process can drag on for five to Times (FT European 500) and that of the 500 biggest Ameri- seven years. can ones according to Fortune magazine (Fortune 500). In Russia you have also been consultants to the most impor- From what you say, one might still get the impression that tant players – the VTB, Russian Railways, the Renaissance it is not that easy for a Western businessman to open his Capital Fund, GidroOGK... But do you also work with small own business in Moscow... and medium businesses? If you have bureaucratic procedures in mind, Russian bureau- We do. These firms have very interesting projects. They are rela- cracy is not much different from European. But the difference tively small companies, but very dynamic from the investing point is that the situation in Russia is improving. In 10 years of work- of view. Producers of dairy products and foodstuffs, and also retail ing in Moscow, I have observed significant improvements in the chains. I won’t give names, but we currently have, for example, a administrative system. There are fewer problems for business, fruit grower from Morocco who wants to start a business in Rus- everything is not yet ideal, but a huge process is going on. sia. Of course, we have more in the medium business category. After all, entering the Russian market involves certain costs. In your career, you have worked in Europe, America, Asia and the Middle East. And now 10 years in Moscow? Was this But you said that prices are more favourable in terms of a conscious choice? currency. Oh, it’s a long story. And it covers much more than 10 years. As a If you want to do everything right, you have to deal with ex- young man, I read Jules Verne’s novel “Michel Strogoff: the Cou- perienced people, and their services cost money. We are talk- rier of the Czar”, and came to imagine Russia as an enormous ing about people who know the market well, have been working country of adventures. I came here first in the latter days of the here for a long time and can tell you about the practical aspects USSR. At that time I was working in a large French company of business. which sold equipment for oil and gas industry enterprises. And I spent time not only in Moscow, but also in the provinces. I very I can say from my own experience that many if not most foreign much liked Saratov for example. I was enchanted with Russia. investors consider at first that developing markets are virtually all the same. I know, they think, how things are done in Brazil And when, returningfrom Houston and having thereafter turned and in India, so why should Russia be any different? Not at all. around three mid-cap companies in France, in the 2000’s, the Here we all do it our way. And you could say the same of any firm’s management said they were looking for someone for the other country. And those who “know everything in advance” Russian office, I did not hesitate for a moment! I said yes at once. usually don’t get very far. Two big retail chains in the USA and in But when I flew back to Moscow in 2006, I had a shock. Everything Europe – I won’t name them – decided that with their interna- had changed. It was a completely different city. Plenty of cars, res- tional experience, and the size of the Russian market, they had taurants, supermarkets, advertising everywhere, neons etc… far won from the beginning. The result was that it didn’t go well from the dark, quiet Moscow I had known before.. Though there and eventually they left the market... You have to understand the were still some elements of the Wild West here at that time. But rules of the game in a specific country, both the written and un- gradually everything became organized. If you compared Moscow written ones. Only when you have a good understanding of the 10 years ago to the great world capitals, it had not yet reached situation is it time to invest funds. In that case, you can reckon on their level. But today it is ahead of them in many ways. It is a beau- a high income from your investments. tiful city. There is more life here. It is becoming cleaner. The infrastructure and transport are improving. Take for example the latest So there are certain purely Russian rules for conducting innovation: the passenger service on the Maloye Ring Railway and business? Our law is different from European law? how it connects to the Metro network. It’s very convenient, and

64 CAPITAL IDEAS April-June 2017 solves some serious problems. I feel at home here. I could not have My daughter is only four, so we don’t go out into the said that when I came here in 2006, but today I can. world very often. But we make quite frequent trips out of the city. There are some very beautiful places in the area Does everything suit you? Or is there still something lacking? around Moscow. And I’m keen on sport too. I ride a bicycle along the riverside, from Muzeon on to Luzhniki and to I don’t really know what to say... I personally feel that Moscow Presnaya. does not have enough good restaurants with Russian cuisine, which I love. There are very few of them. And to be honest, I don’t The CMS website says you know French, English and Rus- understand why. There are other national cuisines and many es- sia. Did you learn Russian here? tablishments with an international menu. But as for good Rus- sian food... Still, you can always find what you want in Moscow Yes, I started studying it when I arrived. But I must confess that I these days. True, there is no French cheese now. But my fellow don’t speak it very well. countrymen have already appeared here, along with Swiss and Italians, and they are beginning to produce their cheese here. You are clearly being modest. But in general, can a foreign Things are not that bad. businessman get by in Moscow without knowing Russian?

Does your family live in Moscow too? In principle, you can live in Moscow without knowing Rus- sian. But I consider that Russian is essential for anyone Part of it. My sons are adults now, they work and live on their coming here to work. Now, even in the management of own. I am here with my wife and youngest daughter. international and foreign companies working in Moscow, more and more of the top managers are Russians. When What do you do in Moscow other than work? How do you you meet them you ought, as a minimum, to understand spend your leisure time? what they say.■

Five pieces of advice from Jean-François Marquaire to those wanting to open a business in Moscow 1 Form your own opinion of Russia Forget everything you have read about it in the western newspapers previously and on the way here. 2 Listen more Socialize, converse a lot, meet people. You will need an understanding of what is going on. You can’t manage without it. 3 Don’t let yourself get nervous And don’t expect everything to work out for you right away.

4 Constantly monitor your business At least until you get to know all the special features and trends here.

5 Always remain optimistic In Russia, even the very worst often turns out for the best

April-June 2017 CAPITAL IDEAS 65 OUR INTERVIEW Jun Kondo: I know what Muscovites like

Jun Kondo, Head Chef at Fumisawa Sushi, came to Moscow a year ago at the invitation of the Russian restaurateur Arkady Novikov. A graduate of Hattori Culinary University, the most famous culinary school in Japan, he has worked in Canada and China, which means he understands both European and Asian palates. In an interview with Capital Ideas, Jun revealed what’s special about Russia and talked about overcoming obstacles.

Jun, you haven’t been in Russia that long. What son, and this reason is sometimes only revealed to us are your first impressions? over time. Since I lived in Canada for a long time and worked in China and Europe, I knew I wouldn’t end up I came to Russia for the first time last winter at Arkady in a place where I’m used to everything. A lot of things Novikov’s invitation – it was our first meeting and food are different here. tasting. I remember that I came very late at night, when it was dark and very cold. Back then I didn’t understand Do you feel differently now? that Petrovka is the center of Moscow, what kind of people live here or what products are available… it wasn’t I like it here now, Moscow is my home. Even though the best first impression, now that I think about it. I spend most of my time at work, I really like my team and our regular guests. We always have lively conver- Why did you accept the offer? sations.

I’m used to not making snap judgments, which is part In your opinion, what are the big differences be- of Japanese culture. Everything happens for a rea- tween Russians and Japanese people?

66 CAPITAL IDEAS April-June 2017 The Japanese are very measured. They might be Most likely every foreigner will give you the same punctual, but they will fully submerge themselves answer – it’s hard to understand each other. There in a single process until they learn it like the back are only a couple people in the kitchen who speak or of their hands. Take, for example, our approach to understand English. I often have to rely on hand ges- culinary education – you have to go to school for al- tures. most 10 years in order to learn how to make sushi properly. Were there any pleasant surprises?

Russians love to multitask and doing things quickly, I really like working with Arkady Novikov. He comes sometimes only have superficial knowledge of a sub- by the restaurant often, knows what he wants and ject, are impetuous, impulsive and like doing every- what the clients will like. He helped me get through thing last-minute. my first adjustment period. Now I can say for a fact that I understand what Muscovites like. For example, What sorts of challenges did you encounter in we have Fumisawa rolls on the menu. These are clas- Moscow? sic salmon rolls topped with baked cheese. They’re

April-June 2017 CAPITAL IDEAS 67 OUR INTERVIEW

a major hit here, but wouldn’t have done as well in fin tuna and I secured us a supply of young bamboo. other countries where I’ve worked. Russia is a fairly advanced country in terms of restaurants and is open to experiments. I like that. Do you miss home? What do you miss the most? What kinds of personality traits are most impor- I have a real soft spot for my grandmother’s house, tant for foreigners who want to come to Russia family dinners and spending quality time with my and do business here? family. Mobility, flexibility and the ability to cope with What is missing in Russia in terms of business? stress. It’s best if there is a person they can rely on, someone who can help them understand the Rus- If you try hard enough, you can find or order any in- sian mentality. gredient here. For example, we recently ordered blue- What kind of advice would you give to other Japa- nese people who are coming to Russia in order to live and work here?

I think the most important thing to do before signing a contract is come over for a visit and learn about the project ahead of time – discuss objectives, tasks, to get a feel for the atmosphere. To do some research. Sometimes everything seems to look good on paper, but your intuition tells you to decline the offer. Some- times it’s the exact opposite.

What are your plans for the next 10 years?

I want to grow as a chef, to improve my technique and discover new products. I am interested in growing as a manager because cooking is about more than just food. It’s also about working on a team. It’s important for me to have a team that shares my values. For example, what’s the point of working if you don’t love what you do? Why put in a mediocre effort when someone else could be pouring their heart into the job? This is the philosophy I want to get across to the people I work with. ■

68 CAPITAL IDEAS April-June 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

Dear Ladies and Gentlemen! We hope that you like Capital Ideas. Please give us your feedback and send us your comments. This will all help to make Moscow a better place to work and live. Sergo Kukhianidze, Editor in Chief

Write to Sergo Kukhianidze at [email protected]

April-June 2017 CAPITAL IDEAS 69 BETWEEN PAST AND FUTURE Onward... into the Middle Ages! “There is no other city in the world that is changing for the best as quickly as Moscow is today,” says Jan Gehl, a professor of design and architecture from Denmark.

t would be tough to find a Moscow Government they basically like and hate the same things every- official who doesn’t know Jan Gehl. After all, he has where. This is why the principles of urban planning a lot to do with what’s happening in the capital. that I apply are the same everywhere - be it Green- But many people all over the world are familiar land or an Arab country, where I have also done work. with the 80-year old architect and designer from I have twelve such principles. They include, first and ICopenhagen, a “remarkably kind man.” This doesn’t foremost, safety, comfort, and an enjoyment of every- come as a surprise. Jan helped make a lot of cities more thing that surrounds you.” comfortable, including London, New York, Melbourne and Sydney. He was the one who urged Michael Interestingly, Jan considers the Piazza del Campo, the Bloomberg, Mayor of New York, to clear Times Square central square in the Italian city of Siena built in the of traffic, turning it into a phenomenal pedestrian area Middle Ages, to be a classic example of a totally com- that is pleasant to visit any time of the day. fortable urban space. According to him, back then city life and urban spaces were thought of as a whole. Cit- Getting rid of cars in public areas in cities is a key prin- ies in the Middle Ages expanded slowly and were in ciple in Jan Gehl’s urban philosophy. He is convinced tune with the changing needs of people. This is a big that people need to move around cities on foot or ride contrast compared to the rapid speeds of large-scale bicycles. “I think that we needed cars 120 years ago, design and construction, which took over in the be- maybe in Detroit, in the Wild West somewhere. Now ginning of the 1960s. In a rush to complete new build- it’s a completely inefficient mode of transportation. ings in record time, architects and urban planners At least in cities this is definitely the case. We spend more time in traffic than moving in cities. It seems like people all over the world are starting to realize this now and are using cars less,” Gehl said in Moscow during a presentation of his book How to Study Public Life, published with support from the city government.

Jan brought up his native city of Copenhagen as a classic example of a city that’s good for people and bad for cars. According to official statistics, last year was the first year in the history of the Danish capital that the number of bicycles was higher than the number of cars (by 13,000)! For the average Dane, riding a bike is as natural as brushing your teeth.

Of course, Moscow is no Copenhagen. It would most likely be impossible to implement the same solutions in this mega-city, right? “No, I don’t agree,” Jan Gehl objects, “People are people everywhere, which means

April-June 2017 CAPITAL IDEAS 71 BETWEEN PAST AND FUTURE

completely forgot to take into account the life that applied analytically to once again forge an alliance be- was supposed to take place between these high-rise tween life and space in cities.” buildings. This is why cities all over the world all of a sudden acquired so-called “bed and breakfast com- The same thought was expressed in an original way by munities,” which served as proof of cultural degrada- Enrique Penalosa, former mayor of Bogota: “We know tion in urban planning. almost everything about the habitats of tigers, gorillas and many other animals, but very little about the spaces However, people all over the world failed to under- people inhabit!”. Penalosa was one of the mayors who stand this, until Jan Gehl from Copenhagen, Jane Ja- was able to change his city completely. For example, cobs and William White from New York, Christopher he refused to invest in roads for cars and instead built Alexander from Berkeley and others started to speak pedestrian areas, bike lanes, parks and squares, kinder- up about it. gartens, schools and libraries. When he was mayor, one of the best public transportation systems in the world “No, of course they were not suggesting we go back was established in Bogota - TransMilenio allowed the to the Middle Ages. Of course, this is nonsense. A lot city to decrease traffic by 40%. One of his main guid- has changed since then,” says Jan’s colleague Birgitte ing principles is that the best cities are the ones where Svarre, “The solution is not to re-create pre-modern people want to spend time on the streets. This is also a cities, but to develop contemporary tools that can be guiding principle in Jan Gehl’s worldview.

72 CAPITAL IDEAS April-June 2017 This seemingly simple principle did not cross the minds of Moscow city officials for a long time. Every- thing changed when, at the end of 2010, Sergey Soby- anin became the Mayor of Moscow. Mr. Sobyanin decided to make it his mission to transform Moscow into a comfortable city to live in. “The new team needed new ideas and original information about how to change public space,” says Anton Kulbachevsky, head of the Moscow Department for Environmental Man- agement and Protection. In 2011, a Moscow delegation headed to Montreal for an international urban planning forum. One of the speakers turned out to be of particular interest to the Muscovites - Jan Gehl. “This is how we met and I invited Jan to Moscow so that he could see everything for himself. We looked at the city together in order to understand what needs to be changed and improved,” Anton Kulbachevsky says. At first, Jan was of course horrified by the number of cars, parking lots, and the embankment of the Moscow River, which had also been taken over by cars. Gehl expressed his opinion and work on improving the city started. Tverskaya street, the courtyard next to the Tretyakov Gallery, Mayakovsky Square - this is just the beginning of the list of ideas that were thought of by the Danish architect and have already been implemented.

“Only a lazy person wouldn’t notice everything that has been done in Moscow over the past five years,” Anton Kulbachevsky says, “In other cities, the same kinds of changes took thirty years to implement. I won’t hide that not everybody was excited about the changes. Some people were apprehensive about them. They would ask, for example, why we need a swing set on Mayakovsky Square. But it turned out to be for the best. A record number of people is out enjoying the city streets today. People talk to each other and become kinder, more tolerant. I can say for sure - we won’t stop here. We will continue to do everything necessary to make sure that Moscow is a comfortable city for people to live in. ■

April-June 2017 CAPITAL IDEAS 73 Life&Culture Zelfira Tregulova: Art heals the soul “A trip to the museum and everything that you get out of that trip helps people cope with problems they encounter in everyday life,” said the director of Moscow’s Tretyakov Gallery Zelfira Tregulova in an interview with Capital Ideas.

yodor Dostoyevsky was wrong. It isn’t beauty phone screen, neglecting to meet in person due to our that will save the world, but culture. But isn’t busy schedules. No wonder that people need some culture a synonym for beauty? Isn’t the whole source of artistic energy to help keep us afloat. Af- point of culture to awaken the good in people ter spending 2 hours at an exhibition or museum, it’s so they can become better and respect oth- much easier to return to our everyday problems and ers,F even those who aren’t like them? routines. This is because you come back with an understanding that there is something else, something I thought a lot about this during my hour-long discus- greater than this, and you can use it as a source of in- sion with Zelfira Tregulova, the director of the State spiration when you need. It’s a kind of medicine - one Tretyakov Gallery. She has no doubts about the fact that heals your soul. A trip to the museum and every- that culture nourishes the human soul, even though thing that you get out of it is something that stays she is reserved when it comes to discussing the sub- with you for a long time and helps you overcome the ject. When I asked her whether or not culture makes problems you encounter.” people better, Zelfira Ismailovna instantly responded: “At the very least it’s supposed to help people not become worse, to preserve their humanity.”

No wonder that these days, in times of financial crises, spikes in terrorism and general confusion, people grav- itate toward beauty. Here’s a good example: 200,000 people visited the Tretyakov Gallery on Krymsky Val in 2014, but over 800,000 visitors came last year. “What’s interesting is that these numbers aren’t only going up in Moscow or in China, which opened over 5,000 new museums recently,” Ms. Tregulova says, “but also in Europe and the US.”

So what’s the reason behind this trend?

“When we come to a museum, we fulfill a certain, special need for individual communication,” she says, “I get the impression that we’re losing the connections we used to have with close friends and family. We move these relationships to a computer or smart-

April-June 2017 CAPITAL IDEAS 75 Life&Culture

Art not only helps us overcome our individual prob- teenth century Russian artists. This year, the Tretya- lems, but can also help address broader issues rele- kov Gallery will have an exhibition at the Vatican for vant to all of humanity: misunderstandings between the first time. All of this, according to Zelfira Ismailov- nations, for instance. For example, an American or na, is important not only for the museum, but for Rus- Japanese tourist who comes to the Tretyakov Gal- sia as a whole. “This work needs to be continued,” she lery will immediately fall in love with Russia, right? “Of says, “It shouldn’t be terminated.” course not. It’s not that simple,” Ms. Tregulova smiles, “But for the most part, culture helps us understand “If politicians are talking past each other, for some other countries, to find common ground with the reason regular people have to suffer,” Ms. Tregulova people who live there. After all, people in any coun- points out, “What we keep at the Tretyakov Gallery is try are to some extent shaped by their culture. This humanity’s heritage. These are works of art that have means that you can start figuring out what Russia is universal significance.” and what Russian people are like by exposing yourself to Russian culture. After this, you can move on to a There is no denying that culture is strength. But deeper mutual understanding with Russians, one that what does it mean to be a cultured person? “It’s is grounded in trust.” tough to say exactly,” Zelfira Ismailovna says, “but it definitely means a person who thinks about things The Tretyakov Gallery does a lot to facilitate this kind deeply. It’s a person who contemplates things in- of understanding, including organizing unique exhibi- stead of just absorbing everything they come across tions abroad. One of these exhibitions recently took blindly. It’s a person that has a moral backbone. place at the National Portrait Gallery in London, giving Without these qualities, a person certainly can’t be British people the opportunity to learn about nine- considered cultured.” ■

76 CAPITAL IDEAS April-June 2017 April-June 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.

НАЖИМАТЬ НА ВСЕ КНОПКИ – nazhimat’ na vse knopki. (To press on all the buttons) Explanation: To use every direct or indirect means in order to attain a goal.

ГЛАДИТЬ кого-либо ПО ГОЛОВЕ – gladit’ po golove. (To stroke someone’s head) Explanation: To show approval.

НАВОСТРИТЬ ЛЫЖИ – navostrit’ lyzhy. (To sharpen the ski) Explanation: to run away.

ВОТ ГДЕ СОБАКА ЗАРЫТА! – vot gde sobaka zaryta. (Here’s where the dog’s buried) Explanation: That’s the main point!

КАК ПО МАСЛУ – kak po masly. (Like sliding on oil)

Pictures by Anastasia Saifulina Pictures Explanation: Things are going well, smoothly.

ПОДНЯТЬ ВСЕХ НА НОГИ – podn’at’ vsekh na nogi. (To raise everybody to his feet) Explanation: To make everyone be more active.

78 CAPITAL IDEAS April-June 2017 ЛОМАТЬ ГОЛОВУ над чем-то – lomat’ golovy. (To break one's head over something) Explanation: To think hard.

НАШЛА КОСА НА КАМЕНЬ – nashla kosa na kamen’. (The scythe has struck a stone) Explanation: A clash of interests, opinions.

РАЗБИВАТЬСЯ В ЛЕПЕШКУ – razbivattsa v leposhku (To smash oneself into a flat cake) Explanation: To do next to impossible to attain one’s end.

НИ ЗА КАКИЕ КОВРИЖКИ – ni za kakie kovrizhki. (Not for any gingerbreаd) Explanation: Not for anything.

НЕ ЗА ГОРАМИ – ne za gorami. (Not beyond the hills) Explanation: Something’s going to happen very soon.

КАК ДВАЖДЫ ДВА ЧЕТЫРЕ – kak dvazhdy dva chetyre. (Like two times two is four) Explanation: Obvious to everyone.

April-June 2017 CAPITAL IDEAS 79 LIFE&CULTURE Moscow thaw: from

We’re finally seeing the first warm days that everybody in Moscow waits for in anticipation. Over the long winter months, the city’s residents get tired of snow, freezing temperatures, icy roads and Strauss to KISS slush on warmer days. Now, we are ready for gentle sunrays, flowers and green grass. Everybody feels like singing and finding joy in everything: unique exhibitions, interesting lectures, an opera, a beautiful Viennese waltz or a tour of your favorite band from your university days..

he Exhibition Hall of the Patri- French museums, as well as manuscripts arch's Palace of the Moscow and documents from the National Library Kremlin is hosting an exhibition and the National Archives of France. for those who are interested in French history - “Saint Louis and History buffs may also be interested in a Tthe Relics Sainte-Chapelle.” Visitors will series of lectures by experts from muse- get to see true masterpieces of Gothic ums of the Moscow Kremlin, which will art from the era of this French king. The take place on Manezhnaya Street. For majority of the exhibits will be shown example, there will be a series of lectures in Russia for a long time, including the called “Faberge - the famous dynasty stained glass from the most beautiful of jewelers.” The lectures will tell the Gothic chapel of the world, built on the story of a firm that became the largest island of Cité in Paris, as well as unique and most successful jewelry enterprise everyday objects from large collections in Russia at the end of the 19th century. such as the Louvre, the Musée national Visitors will find out Faberge’s famous du Moyen Âge, a number of provincial clients, which included members of the www.kreml.ru

80 CAPITAL IDEAS April-June 2017 Moscow thaw: from Strauss to KISS Royal Family and Russian aristocracy, financial magnates and representatives of artistic bohemia.

A separate lecture will be dedicated to Faberge’s most famous pieces - Easter souvenirs, which were ordered by Rus- sian emperors Alexander III and Nicholas II as Easter presents for their wives. Each Easter egg had a precious surprise inside - a tiny symbol of important historical landmarks of that time or events in the life of the royal family.

In the meantime, the Tretyakov Gallery on Krymsky Val will be presenting a major exhibition project dedicated to the Khrushchev Thaw until June 11. This time period starts in 1953, when the first am- nesties of political prisoners took place after the death of Joseph Stalin and ends in 1968, when Soviet tanks first entered Czechoslovakia.

This relatively short period of time, which www.tretyakovgallery.ru lasted just 15 years, received its own separate label for a reason. It was filled with important events, including cultural events. There was even a unique style, an original version of 1960s Soviet modern- ism, that emerged during the Khrush- chev Thaw. A lot of this was prompted by scientific accomplishments in space and nuclear energy. Space and nuclear energy had an influence on the way people thought, pushing them to broaden their horizons and look toward the future. Ev- erybody who participated in the creative process was looking for a new language that could adequately capture the times. Some artists looked to the heritage of Russian avant-garde. Film and theatre, prose and poetry, architecture and design all saw a new impetus for development. The exhibition tries to capture the

spirit of all of these social and cultural www.tretyakovgallery.ru

April-June 2017 CAPITAL IDEAS 81 LIFE&CULTURE www.strausscapelle.at

processes, including the explosion of cre- only in terms of arms, but also in terms once again perform in Moscow. Fans of ative activity. of promoting their lifestyles in the media. the orchestra remember the New Year The “Nuclear - Space” section demon- Vienna Gala - a triumphal New Year The exposition is a single installation that strates how the development of research performance of this orchestra together includes various artefacts: painting and institutions and access to higher educa- with the Vienna National Opera in Mos- graphics, sculptures, household items, tion produced new heroes - students and cow in 2011-2016, as well as the grandi- design samples, fragments of feature scientists. After the launch of Sputnik in ose "Johann Strauss Ball" at the House films and documentaries. The exhibi- 1957, space took over the minds of peo- of Music in the spring of 2016. This sea- tion space is divided into seven thematic ple. It became one of the main themes in son, the Vienna Orchestra has prepared sections. For example, the “International Soviet culture, impacting not only paint- for the Russian public a new program Relations” section focuses on the conflict ings and poetry, but also the design of of masterpieces by Johann Strauss and between the USSR and the US. The cold everyday items. Franz Lehar, featuring the Vienna Opera war and the threat of a nuclear explosion Elisabeth soloist Flechl (soprano) and influenced culture during this time peri- In the Spring, Johann Strauss Vienna Vienna Opera ballet soloists. This high- od. The two superpowers completed not Orchestra, directed by Rainer Ross, will light of the program will be the three most famous masterpieces of the king of waltz: "On the Beautiful Blue Dan- ube", the overture to the operetta "The Bat" and the famous "Vienna encore" - "March of Radetzky." In addition to this triad of hits, the program will feature the most beloved fragments of the op- erettas "The Bat" and "Merry Widow."

At the end of April, Tokio Hotel is coming to the Russian capital for a concert. After releasing their last album in 2014, the band performed across 20 countries all over the world. The record went platinum and was the number one hit in 30 countries. Over 7 million records were sold all over the world. The band is coming back to Moscow for a new show, but will of course perform their biggest hit over the past ten years of their existence. The band was formed in 2001 by two twin brothers from Germa-

82 CAPITAL IDEAS April-June 2017 ny, Bill and Tom Kaulitz. After watching the brothers perform, bass player Georg Listing and drummer Gustav Schafer joined them. When the band first got together, all of the members were between 12 and 14 years of age. Their songs include contemplations on serious social problems like drug addiction and sui- cide. The songs reflect topics that interest young people today. The majority of Tokio Hotel’s songs are in German. This is why the band’s fans have all started to learn German. The band even received a special thank you from the Goethe Institute for contributing to the popu- larization of German all over the world. However, many songs have English versions as well.

May 1st will bring a grandiose gift to all KISS fans - their only concert in Russia will take place at Olimpiyskiy National Sports Complex. Moreover, Moscow will be the first stop on the band’s European tour. The are performing at the Hartwell Arena in Helsinki on May 4, the Tele2 Arena in Stockholm on May 6, and Spe- ktrum in Oslo on May 7.

The legendary American band featuring Paul Stanley, Gene Simmons, Eric Singer and Tommy Thayer played a series of concerts across the US in the summer and fall of 2016. After an onslaught of re- quests from fans, they have now decided to head over to Europe.

KISS is internationally recognized as one of the most influential rock bands in the world. The band’s trademark is elaborate stage makeup and concerts featuring various pyrotechnic effects. KISS performances are considered to be some of the most spectacular shows to see! More- over, KISS has over 40 gold and platinum records, and have sold over 100 million records. The last concert KISS gave in Moscow was almost 10 years ago and the capital’s fans have had time to miss their idols, which is why the show in Moscow is one of the most anticipated concerts on the tour.

Fans of Makvala Kasrashvili are in for a treat as well. At the end of April, the Bol- shoi Theatre will host an evening with the famous opera singer. Kasrashvili was born in Kutaisi, Georgia. She graduated from the Tbilisi Conservatory in 1966 and immediately became a Bolshoi Theatre soloist. This talented woman takes part

April-June 2017 CAPITAL IDEAS 83 LIFE&CULTURE

in productions of leading opera theatres On May 31, the Great Hall of the Moscow turing the famous actor Oleg Tabakov all over the world (Covent Garden, the Conservatory will be hosting three piano in the lead role. This is what an ad for Metropolitan Opera, the Bavarian State concerts in one night. Visitors will be able the production says: “Not about poli- Opera, the Vienna State Opera, the to hear works by Schumann, Grieg and tics. Not about love. Not about money. Mariinsky Theater, etc.). Aside from op- Beethoven, performed by the Moscow About how pink is more frightening era arias, her concert programs include State Symphony Orchestra and conduct- than black, night is brighter than day, works by Tchaikovsky, Rakhmaninov and ed by Pavel Kogan and insanity is the most sane choice cantatas with oratorios (Rossini’s “Little when there is no option left...About how solemn mass,” Verdi’s “Requiem,” Brit- The Chekhov Moscow Art Theater is one head is good and three is bad. And, ten’s “War Requiem,” and Shostakovich’s hosting a new premiere: a play based on most importantly: a woman’s best ac- “14th symphony”). Evgeny Schwartz’s “The Dragon,” fea- cessory is modesty and a see-through dress.” Visitors are promised “the best songs, incendiary dancing, great actors, incredible sincerity, frightening candor, and the finest sarcasm.” So who is in charge of all this madness? The scandal- ous, ambitious and young director Kon- stantin Bogomolov. The main theme of “The Dragon” - the battle between good and evil - has always been of great interest to Moscow’s theatre directors. Konstantin Bogomolov always brings his personal touch to any play, but also tries to reflect the world of the person who wrote the play - Evgeny Schwartz. After all, his play is based on bitter irony, absurdity and a sense of horror before an imperfect world.

And another interesting experiment in Moscow’s theatre scene. It is dedicated to the last few years of Leo Tol- stoy’s life. The play “Russian Romance”

84 CAPITAL IDEAS April-June 2017 has been running since January at the lapsing into hysterical fits. And she has At the end of June, there will be a real Mayakovsky Theater. The production is reason to: a meeting with Tolstoy’s ag- cinematic boom in Moscow. The capital the work of two Lithuanian artists. This ing lover, whom she despises and is jeal- will be hosting the Moscow International dynamic, rhythmical play offers the au- ous of. Of course, the play covers Leo Film Festival. It is patronized by one of dience to look at the last few years of Tolstoy’s escape from Yasnaya Polyana the most famous directors in Russia, Ni- Tolstoy’s family life through the prism and his death. kita Mikhalkov. He manages to gather of key scenes from “Anna Karenina,” under his wing various cinematogra- stories about temptations of the flesh On June 21, the House of Music will host phers from all over the world. For exam- from “The Devil,” and Tolstoy’s journals. an event for fans of jazz. Daniel Kramer ple, the main prize (Zolotoy Georgiy) last The great writer himself never actually has been holding “Jazz Games” across year went to Reza Mirkarimi, and Iranian appears on stage. Instead, the audience various capitals of the world by inviting filmmaker and director of “Daughter.” A watches Levin, Kitty, Anna and Vronsky colleagues to play music together. “Jazz special prize (Serebryanniy Georgy) went from “Anna Karenina” quarrel and worry, Games is kind of like my business card,” to the Bulgarian director Radoslav Spass- observes Aksinya from “The Devil” and the musician explains, “the name took ov for his film “Singing Shoes.” During the Tolstoy’s family members - his ambi- me a long time to come up with and it’s festival, all city residents have a unique tious but talentless son Leo, his straight- there for a reason. I don’t really play jazz. opportunity to learn about movies from forward daughter Sasha, and even his I play classical music, jazz, rock, funk, some of the most interesting and original dog Markiz. Sofia Andreevna, Tolstoy’s some blues, this can’t be considered pure directors all over the world. Fans also get wife, is in charge of the household and jazz. But I do everything I can and I try to to watch their favorite stars walk on the is struggling to win over the heart of do it so that jazz isn’t just a form of en- red carpet during the opening of the fes- her husband again. Actress Evgeniya tertainment, but is deeper than that. On tival. Some of the most beautiful actress- Simonova understands the psychologi- the other hand, jazz is relatively young es in Russia regularly make appearances: cal subtleties of the role - immensely compared to classical music. It needs Julia Peresild, Svetlana Khodchenkova, devoted to her husband and children, to mature. So in a sense I am playing Svetlana Ivanova, Paulina Andreeva, Vic- but by the end so completely exhausted, around, though I’m playing around seri- toria Isakova, Ekaterina Vilkova, Olesya half-mad and hysterical. Sofia, who had ously.” The concert is one hundred per- Sudzilovskaya, Irina Bezrukova, Ekaterina 13 children with Tolstoy, is constantly cent improvisation. Guseva and many others. ■

April-June 2017 CAPITAL IDEAS 85 FACE TO FACE This and that Football, Russian style: when will our love for

There is no denying that football is an exciting game. But why do Russians enjoy it so much? After all, football is a summer sport and Russia is a the game yield results? northern country!

ootball first came to Russia at the end of the football teams and use the fields to grow the 19th century. It was brought here by cucumbers. the British - by employees who worked at various Russian enterprises. They Even after last year’s terrible showing at the Fkicked a football around the field in their spare European Championship in France, Russian time, and the game gradually became popular fans haven’t given up on our national team among locals. The first Russian football team or on football in general. According to a sur- appeared in 1897, at an amateur sports club vey conducted by the Russian Public Opinion in Saint Petersburg. Moscow did not lag far Foundation, just a month after the champi- behind. The first football leagues in the coun- onship was over Russians voted for football try appeared in these two cities. In 1912, a Na- as their favorite sport. Hockey and figure tional Football Union was founded based on skating are in second and third place in terms the leagues in Moscow and Saint Petersburg. of popularity. The union was the predecessor of the current Russian Football Union. Incidentally, Russia Note that both of the latter types of sport are also joined the International Federation of As- considered winter sports, which makes sense sociation Football (FIFA) in 1912. considering the type of climate we live in. But still, we remain inexplicably drawn to foot- Who could have thought that 106 years later ball. For whatever reason, it remains our top Russia would be hosting the most important priority! FIFA tournament - the World Cup?! Representatives of other sports are starting Russia’s affinity for football has only in- to openly express how surprised they are by creased over the years, in spite of the fact our undying love for football. Famous bas- that Russian football was often a source of ketball player Victor Khryapa, a CSKA player disappointment rather than pride for foot- who spent some time playing for teams of ball fans. Our football players have lost many the National Basketball League abroad, said international games, and even our domestic the following: “I have absolutely no idea championships were often subpar. But, in why Russians love football as much as they spite of this, Russian football also has some do. It is definitely the most popular sport in accomplishments, even if these accomplish- the country. Frankly, I don’t understand it. ments date back to the era of the USSR. For If you compare the accomplishments of our example, in Soviet times we won the Eu- basketball players to those of our football ropean championships, won Olympic gold players, the basketball players have certainly medals and even placed fourth at the world done better.” championship in England, in 1966. But there haven’t been enough pleasant victories like But this isn’t about who is better, Victor, this these over the past hundred years. No won- is about true love! der one famous old man once exclaimed: “Our people most definitely can’t play foot- And has anybody ever been able to articulate

Pictures by Anastasia Saifulina Pictures ball!”. He then suggested that we disband all what true love actually is?!

86 CAPITAL IDEAS April-June 2017 Football, Russian style: when will our love for the game yield results?

In Russia, many people are beginning to Russia, new fans of this sport. The World Cup in think that it’s time we get to the bottom of 2018 will have a lot to do with this.” our love affair with the sport. Gianni Infantino supported the Minister and In the spring of last year, Russian Minister of the movement by proclaiming “I love foot- Sport Vitaly Mutko announced the launch ball” in Russian. of a popular movement called “Russia Loves Football!” during a press conference held in Even President Vladimir Putin has talked honor of the first visit to Russia by the new about our love of football. Right before the FIFA President Gianni Infantino. Confederations Cup, a tournament that traditionally takes place before the World Cup, “We need to change the image of football in Putin noted that “people in Russia love foot- Russia,” the Minister said, “Today we are launch- ball.” He added: “I’m really hoping that this ing a project called ‘Russia Loves Football!’. We love of football will transform into a top will talk about everything that is connected to quality game!” football in some way. It is crucial that along with the new stadiums, there is new football in Everybody in Russia hopes so! ■

April-June 2017 CAPITAL IDEAS 87 Life&leisure Time for a pint! An overview of the best sports bars in the city

Large-scale sporting events – the 2017 Confederations Cup and the 2018 FIFA World Cup – are almost here. Unfortunately, not all fans will be able to watch their favorite teams play from the stands. A lot of people in Moscow will be enjoying the football games from sports bars, which are equipped with everything one can ask for: enough room for friends, drinks, snacks and, most importantly, live broadcasts of football matches. Arena Olimp

The biggest sports bar in Moscow, with the atmosphere of a real stadium. There are live broadcasts of all key athletic events (you can find a detailed schedule on the website). The bar is split up into several areas: a big hall for 350 people with a ten-meter screen and 8 small VIP areas with plasma TV screens that can seat 5-45 people. High- quality sound systems make guests feel like they’re at a real stadium. The menu includes American and European cuisine.

Address: Avtozavodskaya Ulitsya 23, bldg.15, m. Avtozavodskaya, Tulskaya Website: http://arenaolimp.club Liga Pap

This restaurant is all about sports and food, and features 20 large format displays and a huge projection screen that shows the biggest athletic events in 3D. The main hall has tables mounted on stands and facing the screen so that guests can feel like they are a part of the action and immerse themselves in the game as if they were at the stadium. A lot of famous sports commentators broadcast directly from the restaurant. There is a special cold room for storing draft beer for every taste. The menu features snacks and main dishes from just about every corner of the world.

Addresses: Bolshaya Lubyanka 24/15, m. Chistiye Prudy, Turgenevskaya Krasnoproletarskaya Ulitsya 16, bldg. 2, m. Novoslobodskaya, Mendeleevskaya Website: https://www.ligapap.ru

88 CAPITAL IDEAS April-June 2017 Hooters

This is more than just another pub in Moscow – it’s a legendary Ameri- can sports bar in the very heart of the capital. 35 full HD screens let visitors enjoy every sports match to the fullest. The bar is just as serious about preparing for live broadcasts as the stadiums are about preparing for games. There are more TV screens than tables here, so guests can request to play a game they are most interested in seeing on the TV in front of their table. There are also 2 huge video walls here, which let guests watch three TV screens at the same time. The face of the sports bar is the Hooters Girl – beautiful, cheerful and friendly. They sport a spectacular uniform and are always ready to help the guests. Address: Bolshoy Zlatoustinskiy Pereulok 9, m. Kitai-Gorod Website: http://hooters.com.ru Bobby Dazzler pub

This spot is decorated like a traditional British pub and perfectly combines elements of the past and present. The wide beer selection, plenty of snacks to pick from, specialties and a friendly atmosphere have all made this pub a very popular place. Football here is like a religion, and love for any type of sport is highly encouraged. There is enough at the pub to keep you entertained without exhausting you. The TV screens feature live broadcasts of the most interesting matches. Moscow Reds, the Moscow Manchester United fan club, are regulars at the pub. When MU is playing, the bar is absolutely packed and the atmosphere resem- bles the stands at Old Trafford. Address: Kostyansky Pereulok 7/13, m. Chistiye Prudy Website: http://www.bobbydazzler.ru ShtirBeerLitz

A chain of pubs that host live football broadcasts. This is the ideal place for groups of men who love football. The main advantage of these restaurants is the location of the screens, which allow guests to watch the matches from anywhere in the restaurant. If guests are interested in a more private evening (a date of a business meeting, for example), there are also quiet VIP areas. The bar has over 15 kinds of beer from Germany, the Czech Republic, Belgium and Russia, along with a wide cocktail selection.

List of locations: http://shtirbeer.ru Tornado

A relatively new chain of sports bars that is sure to make the city’s sports fans jump for joy. There are great burgers and steak, along with plenty of great cold beer. Those who prefer stronger drinks or don’t drink at all can visit the café or club, which have a wide selection of drinks, from non-alcoholic cocktails to high-end wines. Everybody who can’t make it to a game can watch broadcasts here. Moreover, Tornado, which is also the Liga Stavok bookmaker bureau, is the leading bookmaker chain in Russia. Bets can be made online for all athletic events: football, hockey and basketball.

List of locations: http://www.sportbar-tornado.ru

April-June 2017 CAPITAL IDEAS 89 Life&leisure

Chelsea gastropub

A spot that combines the elements of a traditional pub with a great food selection, this pub is for true connoisseurs of English style and attitude. There are over 100 different kinds of whiskey, a big wine selection and fresh beer that all go great with the chef’s specials. The pub is a comfortable atmosphere for watching sports broadcasts around the clock, which is what sets it apart from other pubs. There are a total of four halls to watch the broadcasts from. The main hall can seat 80 people and is equipped with a big projector and three huge plasma screens. Different types of furniture and a podium add an extra layer of comfort. This English pub is perfect for politicians, businessmen and young people alike.

Address: Maly Gnezdnikovsky Pereulok 12/27, m. Pushkinskaya, Tverskaya, Chekhovskaya Website: http://chelsea-pub.ru

Greene King pub & kitchen

This is a real club for like-minded people with an unforgettable atmosphere that reminds one of England: the richness and restraint of dark wood, cozy soft green and walnut furniture and, of course, the taste of real British Ale. The restaurant is named after the famous English brewery Greene King, located in Bury St. Edmunds (close to the North Sea coast). The brewery has been making famous ales for over 200 years and has received multiple awards. In 2015, the first and only Russian pub that served beer from the famous brand opened in Moscow. The first floor of the bar can seat up to 100 people and the second floor can seat another 70. There are 2 big screen TVs and 8 plasma TVs, which means visitors can comfortable watch all types of athletic events.

Address: Mytnaya Ulitsya 7, bldg.1, m. Tulskaya, Oktyabrskaya, Dobryninskaya Website: http://gkpub.ru

The Red Machine

This sports café, which is open to everybody who appreciates sports and excellent food, is a great place for sports fans to get together. “The Red Machine” was also the nickname of the famous USSR hockey team. People come here to discuss the latest games, cheer on their favorite teams and athletes, celebrate recent victories and express the full spectrum of emotions by shouting and waving flags. Sports infuse everything here with a particular rhythm, which makes the space truly enjoyable for visitors. The plasma screens hanging on the walls put guests directly in the middle of the action, and watching the game becomes a truly spectacular and unforgettable event.

Address: Leningradsky Prospect 39, bldg. 41, inside the CSKA Ice Palace, m. Dinamo, Aeroport Website: http://www.rm-pizza.moscow

90 CAPITAL IDEAS April-June 2017 Lawson's bar

The story of William Lawson was immortalized in 1849, when a type of whiskey that has since taken the world by storm was named after him. In Moscow, Lawson’s Bar played a big role in promoting both the whiskey and the place of its origin – Scotland. A lot has changed since the bar first opened in 2012 – the cocktails have acquired an original colonial twist and there is now plenty if whiskey and craft beer as well. The bar is frequented by a lot of Chelsea club fans, who use the spot as their unofficial headquarters. The playlist includes blues, jazz and rock music, giving the space an additional touch of authenticity.

Address: Blagoveshemskiy Pereulok 1a, m. Mayakovskaya Website: http://www.lawsonbar.ru

Kosouhoff

The Kosouhoff entertainment complex is located in the very center of Northern Butovo. All kinds of entertainment can be found here – ka- raoke, a bar with live broadcasts and a men’s club. Go to the bar for a pint of cold beer, to catch a football game, play foosball with friends, or celebrate an important event with friends. The menu features dishes from different corners of the world: Italian, Caucasian, Bavarian and Belarusian. There are plenty of projectors and big screen TVs for fans and people who like live broadcasts. Visitors can come to support their team over a beer and a snack. Everybody who can’t attend games in person can catch live broadcasts at the bar instead of missing out!

Address: Ulitsa Grina 3a, m. Bulvar Dmitria Donskovo, Novoyasenevskaya Website: http://www.platinum-club.ru

Hmel & El

Come to this bar in the city center with a group of friends, talk about the latest news over a pint of cold beer and enjoy the wide selection of snacks. The establishment combines the best aspects of a sports bar, a classic pub and a sophisticated restaurant. No matter what kind of gathering you’re planning, everybody will feel comfortable here. There are live broadcasts of football games and plasma screens, delicious food, and quality drinks. The bar always plays the most popular and anticipated athletic events. There are also less popular games for true fans and those who follow sports closely. The sports bar can seat 70 people, which is enough for a big and loud group of people. After a night of watching the game, you have the option of taking a stroll along the Pa- triarchs Ponds, which are located nearby. Address: Trehprudny Pereulok 4, bldg.1, m. Pushkinskaya, Tverskaya, Mayakovskaya Website: http://www.hmel-el.ru

April-June 2017 CAPITAL IDEAS 91 FOOD&DRINK

Konstantin Ivlev: Russian cuisine is about much more

thanKonstantin, do you think foreigners just are interested in Rus- Butborscht! it’s not all bad. My colleagues and I are gradually working to sian cuisine? remedy the situation in Moscow. We want to bring joy to both foreigners and Russians. Foreigners are definitely interested in Russian cuisine. Why? Be- cause they see that Russia is developing and a lot has changed Just 10 years ago we announced that we are going to start in our country in the past 10-15 years. There are changes in the working on “new Russian cuisine” in order to show that we are economy, sports, literature, theatre, film and everything else. capable of more than just borscht. I started to think about what Same goes for our cuisine. Food has always been a powerful PR can be done with those forgotten products that have been lost tool for any country. Foreigners are curious to know what we under a thick layer of sea bass and mozzarella. eat, other than borscht. Unfortunately, a lot of restaurants have stopped at borscht, caviar, meatpies and pelmeni. They can’t offer It all started when we were opening GQ bar in Moscow with anything else. the famous restaurateur Arkady Novikov in 2007 (it has since

92 CAPITAL IDEAS April-June 2017 Konstantin Ivlev, host of the popular culinary show and one of the most famous chefs in Russia, is a connoisseur of Russian cuisine. We asked him whether or not foreigners in Moscow are interested in Russian cuisine. We often hear the same thing in conversations with expats from all over the world, be it Italy, Japan, France of England: “We really want to try real Russian food. But it’s impossible to find a restaurant like that here. There are Japanese restaurants, Italian food, Georgian, even Serbian.” Russian cuisine is about much more than just borscht!

April-June 2017 CAPITAL IDEAS 93 FOOD&DRINK

closed, unfortunately). Arkady asked me to make kotleti (burg- blue brick in a store that sold construction materials. It symbol- ers). I refused: “I won’t make kotleti.” He asked me to think of a ized the ocean to me. I put salmon on it, and it symbolized the substitute. I found a store that sold cans of different types of fish. I really love birch sap. When you wrap a pig in it and leave it juice, and came across a can of birch sap. I liked it so much that to stew, it smells like you’re in a sauna. An original presentation I cooked sterlet stewed in birch sap. is very important.

Did you know what this dish would taste like when you Another important point: there is Russian cuisine, and then thought of it? there is Soviet cuisine. Soviet public catering was a staple of life in the USSR until the 1980s and included dishes like the Stoli- The inside of a chef’s mind is like a library of different flavors. chny salad. And another nuance: technically borscht is a Ukraini- When I think of something and my mouth starts watering, an dish, and pelmeni are Chinese. These are not Russian dishes, there is a one hundred percent chance of this dish turning even though they are considered to be. But pirogis, kulebyaki and out great. If not, I keep working on it. And the first thing I rasstegai were dishes served at feasts during Ivan the Terrible’s do is put a dish together in my mind. What is birch sap? It’s a reign. We’ve gotten everything mixed up. I’ve been joking that combination of water, lemon and sugar. What is sterlet? It’s Ceasar salad and tiramisu are going to be considered Russian a fatty fish that can be found in Russian lakes. Sometimes it cuisine soon, since you can find them at any restaurant in our smells like algae. In Russian cuisine, we like to combine citric country. acid and fish. You have a lot of experience talking to foreigners. What For example, we marinade shish kebabs made out of salmon kinds of Russian dishes do they prefer? What are the top and sturgeon in lemon. This is because lemon partially neutral- five, in your opinion? izes that prominent flavor fatty fish have. So I thought, why not? The fish can cook in birch sap and absorb its flavor. And it Borscht would be in second place, or shchi. No way of getting turned out to be delicious. This dish is an example of what “new around that. Russia is famous for our soups. In the summer, for- Russian cuisine” is. It’s based on three key principles. The first: eigners like to try okroshka. Pelmeni are definitely in third place. we use domestic products. Of course, it’s impossible to only Everybody loves them, the Chinese and the Italians alike. The use domestic products here. That’s not necessary. But the main Italians compare them to ravioli. Fourth place... product in the dish must be a domestic one. Blini? The second principle of “new Russian cuisine” is to use modern culinary techniques. During the USSR, all of our chefs could only No, I wouldn’t say so. It would either be game meat like deer or fry, boil and bake. Now, on the other hand, we have access to wild boar or Russian fish, like sturgeon. cooking utensils and methods borrowed from our foreign colleagues. There is blast freezing and vacuum seal bags. Is there traditional Russian dessert?

And the third principle: an original presentation of the dish. You It used to be kisel. Now...there are a lot of different things. I ex- can put the dish on a plate, or you can choose to use different periment, for example. I really love our caramel candy called symbols of Russia - birch bark, khokhloma, gzhel. Once I ar- “Rakovaya Sheika.” I made cream out of them, splitting these ranged a pretty original presentation of sashimi: I found a 2.5 kg sweets into tiny pieces. So you eat cream that tastes like this

94 CAPITAL IDEAS April-June 2017 candy. I want to make a dessert for the spring menu at the Pro- fil Professional Club restaurant: add kozinaki (nuts-and-honey bar) made out of pistachios and hazelnut to prostokvasha (a type of yogurt) and decorate it with mint and berries.

What other interesting dishes do you make at your restaurant?

I’m the concept chef at this establishment. There was an interesting idea to combine a beauty salon and a place to eat. Clients who come in for sessions that last several hours (massages, haircuts and styling, pedicures, etc) can get hungry. They don’t come in for just five minutes. Usually all of them want to eat. Before the sessions, during and after. The vast majority of clients are women, so the food has to be beautiful, interesting and healthy. We have combined three types of dishes in the menu: new Russian cuisine, European dishes and Pan Asian cuisine.

What is your signature dish?

I really like Caucasian and Central Asian cuisine: lobio, khacha- puri, chebureki, manty, plov and much more. I make a crazy dish here: chicken breast (Yaroslavl broiler) at a low temperature (45 minutes at sixty degrees), then I spread it on caramel satsivi. I add sugar syrup to create an unusual flavor. Then I top it off with tomatoes, a bit of basil, olive oil, and some garlic. And I decorate all of this with fried basil.

But this isn’t a Russian dish?

As a person who was born in and raised in the USSR, I still can’t really separate Russian cuisine from Belarusian, Ukrainian, Georgian, and Uzbek cuisine.

When you come to a new restaurant, how can you tell whether or not it will be a good place to eat? Is it the smell?

I feel the energy of the place right away, as soon as I open the door. That’s the first thing. Second, when I see the people working there I immediately know what their attitude toward their business is. Third, the menu. If I see a big selection, I immediately get up and leave. I won’t eat at an establishment like this. As a professional, I can tell you that it’s impossible to control for quality if there are over 60 items on the menu. And some restaurants have 100-140 dishes! You start reading it and forget what appetizers you wanted by the time you get to the soup. This is madness! For me, the optimal amount of dishes is 50. 42 is even better. It’s best to have 6-7 salads, 2-3 soups, 5-6 main dishes with fish, and just as many with meat and poultry. Some desserts and fruit. And you can change the menu depending on the seasons. This is an option in our country. You make a small menu and, to make sure guests don’t get bored, add something new once every four months. You can host a festival featuring some specific product or wine. Then the chef won’t get bored either, and the guests will see that the restaurant is alive. There is always something new.

Just three years ago, eighty percent of products in Mos- cow restaurants came from other countries...

April-June 2017 CAPITAL IDEAS 95 FOOD&DRINK

Now it’s a fifty-fifty split. Not all Russian products can compete with their Western counterparts. For example, there is this white fish of the whitefish muksun family. It comes from the rivers and lakes in Siberia, and it’s fairly inexpensive. It’s about 360 rubles per kilo. But it just didn’t go over well. It wasn’t so popular. It’s not bad, but people prefer the sea bass and dorado definitely. Even if you cook muksun right, it’s still a little bit dry. And then you go to a food fair, for example, and representatives from a fish factory say: “Get a ton of muksun.” What am I going to do with that much fish? They haven’t found distributors yet. But it’s not so bad. There is some progress, and this makes me happy. But honestly, I use the old grandpa method. For example, I have friends in Sochi and they ship products to me on the train from there.

Through the conductors?

Yes. For example, say it’s wild garlic season. They send bags of it to me. We don’t have some things, like French cheese, for ex- when I’m travelling: in New York, Paris, Singapore. In Lon- ample, But we have forests full of wild animals and birds, mush- don, which is a trendsetter when it comes to fusion cuisine. rooms and berries. We have lakes, rivers and seas with plenty of The English had colonies in India and in other countries. They fish. We have things to show foreigners. There’s just not a lot of started combining different flavors a long time ago, adding it. There are about 9,000 restaurants and cafes in Moscow. And Indian spices to European dishes, for example. That’s inter- only about a hundred of them, in my opinion, have a good price esting. New York is a megacity that brings together every- to quality ratio. And I only go to five of those. thing. There are chefs from all over the world in that city. The French are powerful in terms of classics. But in Europe Can you tell us what they are? and the US the chefs dictate what guests want to eat and set trends. Here, it’s the opposite. Once, I was working with a I go to restaurants as a consumer - not to try new things, restaurant that was about to open. The owner told me: “No but just to eat. When I want fish, I go to “Porto Maltese.” borscht, Konstantin! Do what you want, just make it mod- If I want shish kebab, I go to Arkady Novikov’s restaurant ern and edgy!”. We opened the restaurant. The first night, he “Kavkazkaya Plennitsya.” I go to “Mister Lee” or “Yoko” called me and said: “Hey, Semyon Petrovich came by, didn’t when I want Japanese food. When a new restaurant opens see borscht on the menu and left. So let’s put borscht on the in Moscow, I go to support my colleagues, shake their menu tomorrow.” I decided to stop working with him. First, hand and cheer them on. Us chefs are all in the same busi- he broke our contract. Second, I need the restaurant own- ness and I have a lot of colleagues and friends. We ar- er to trust me. I’ve been trying to change attitudes toward gue sometimes, but we still talk. My guiding principle is chefs in our country for the past 15 years. We’re not drunks mutual respect. But I’ll be honest, I get more fresh ideas or thieves who go home with bags of groceries we steal from the restaurant, which is how things used to be in the USSR when I was a kid.

In France and Japan, chefs get less sleep than lawyers. What kind of training to Russian chefs get?

We still use programs from the 80s and 90s at culinary schools here. We teach the classics: Russian and Soviet cuisine. But we don’t teach the basics of modern cuisine. So all young chefs suffer from borscht syndrome. Thank God, there is a new generation now. They are interested in experimenting and, most importantly, the restaurant owners trust them now: “Do whatever you want!”. Unfortunately, modern Russian cuisine is hard to find at restaurants in Moscow. These dishes aren’t commercial food yet. Borscht, oliver salad, herring under fur coat - this is commercial food. These are real brands! Sometimes people will say they opened a restaurant featuring new Russian cuisine, but you go there and realize that it’s the same old song. Just the chef put it on the plate in a different shape. Or a friend calls me and says: “I came up with a new kind of borscht. I whipped it into a foam.” I ask him if he has lost his mind. There are some dishes that don’t need to be transformed. ■ 96 CAPITAL IDEAS April-June 2017

Football is the only sport where you put people together, it doesn't matter if you are rich, or poor, or black, or white. It is one nation. Pele