During the course of the two-day visit the members of the Italian delegation to Crimea four commercial declarations of intent are signed which will lead to full-fledged cooperation agreements.
Crimean winemakers need Italian equipment, technologies, vine saplings and Italian businessmen are ready to provide the Republic with all the necessary resources. These are the results of the meeting of Crimean and Italian businessmen held on 15 October at Crimea’s biggest Massandra winery. Investments in other sectors – agriculture, industry and construction – were also discussed.
Meat Production and Water Desalination
Agriculture accounts for 27% of Crimea’s GDP, according to the data of the Ministry of the Republic of Crimea unveiled at the meeting by Andrei Grigorenko. The peninsula is self-sufficient in wheat, flour, pork, mutton, non-alcoholic beverages and confectionary products, but it is short of vegetable oil, beef, poultry, dairy products and fruits.
The owner of VERONESI company, Marcello Veronesi, showed an interest in the production of meat and meat products in Crimea. His company puts out meat products and animal feeds being the fifth largest agricultural producer in Italy which registered a turnover exceeding EUR 2.8 billion in 2013. “We are open to contacts and we appreciate this meeting organised at a high level to give us an idea of the prospects for cooperation,” the businessman said.
The Crimeans welcomed the business proposal made by Fabio Bosio, owner of the company BRESCIA, specialising in water purification. Mr. Bosio said he was ready to offer Crimea technologies for sea water desalination. The water purification plant he designed may provide the peninsula with electricity, drinking water and crop irrigation water. “Our technology is innovative and more profitable than earlier desalination methods, it has a patent and can produce drinking and industrial water. I would like to discuss plans to set up a joint venture in Crimea,” the owner of BRESCIA said.
Cooperation in Winemaking: Equipment and Saplings
Winemaking is the most promising agricultural sector in Crimea, said the Republic’s Minister of Agriculture. Vineyards occupy 16,000 hectares of land on the peninsula of which 13,000 produce grapes. An area of 5,500 hectares of vineyards is under spray irrigation. Crimea produces 90,000–95,000 tonnes of grapes a year and in some years more than 100,000 tonnes. The average grapes yield on the peninsula is 5,100 kilogrammes per hectare. Crimean winemakers – 32 enterprises (of which 22 are in active operation) – have the capacity to process 261,000 tonnes of grapes. The peninsula needs to increase grapes production. “This year more than 1,000 hectares of perennials will be planted, including vines. The main problem is to organise our local production of saplings. Crimea will need 20 million vine saplings before 2025. The state supports the production of saplings,” Mr. Grigorenko said.
The representatives of major Crimean wineries – Inkerman, Massandra, Novy Svet, Simferopol Wine–Cognac Factory and Magarach – noted that many of them use Italian equipment and buy vine saplings from Italy.
“We are using Italian equipment. Italy provides the best saplings in the world for our vineyards,” said Yanina Pavlenko, General Director of Massandra winery.
“We have two facilities, we are modernizing them and we could do with Italian help in providing equipment. Italian saplings are the best and we want to cooperate in this area. We would also like to gain experience in developing wine tourism. It is a promising industry in Russia, but so far we have little experience,” said Sergei Lebedev, General Director of Inkerman.
Italian winemakers are ready to work in Crimea, they are interested not in selling Italian-produced wines, but in developing production on the peninsula. This was confirmed by Atilio Carlesso, president of CANTINA di SOAVE, a major wine producer with 6,000 hectares of vineyards; Stefano Albrigi, owner of the company ALBRIGI which produces equipment for winemaking, pharmaceutical, cosmetic and food industries, and by Roberto Penazzi, a prominent specialist in wine-making technology.
“The place has potential, production traditions and the soil for wine production. In addition to history, we should also consider economic factors. We have a chance to make sure that our interests in cooperation may coincide in the future,” Mr. Carlesso told his Crimean colleagues.
“I was impressed that there are facilities here built in cooperation with the Italians. I have heard from my colleagues that Crimea has vast wine-growing potential. Wine production develops thanks to small high-standard facilities which are then followed by big middle-level producers seeking to be in the trend. We should give medium-sized wineries a chance to develop. In Italy there are successful producers who sell wine at up to USD 2,000 per bottle. I hope Crimea will get an opportunity to produce such wine too. This would set an example for other producers who will follow us,” Roberto Penazzi believes.
“The motives of Italian winemakers are clear, they have to win a promising market before Spain and France moves in. Therefore Italians are preparing contracts here, it has to be understood that 4–5 years must pass from the contract to the first vine crop, and sanctions may not last that long,” says Robert Steltz, a political expert from Austria who was also a member of Italian delegation. He is sure that Italian vine growing technologies could help treble vine yields without increasing the area under vineyards.
Italian Office of Russia’s Chamber of Commerce and Industry
Chamber of Commerce and Industry of Veneto Region Director Gianangelo Bellati called on businessmen to cooperate not only in winemaking noting that there are many other promising areas of cooperation in Crimea. “We can cooperate in ship-building, car-making, and building of infrastructure, and not only of hotels, in technologies for developing agriculture and agricultural product processing,” Mr. Bellati believes.
The members of the Italian delegation proposed to establish a mission of the Russian (and Crimean) Chamber of Commerce and Industry in Italy. This would improve interaction between businessmen in the two countries many times over, says Andrei Nazarov, Chairman of the Board of the Yalta International Economic Forum Foundation and Co-chairman of the All-Russia Public Organization Delovaya Rossiya. He said that the Italian delegation has already reserved 50 places at the third YIEF in 2017. That Forum is expected to sign contracts as a follow-up to agreements of intent which are being concluded at the meeting of businessmen. Four commercial agreements have already been signed. “The Agreement of Intent on construction in Crimea was proposed by the company KSK which is building an Italian Village. Italian investors would also like to build a turkey meat factory in Russia. We will sign a protocol of intent to build a five-star hotel in Simferopol. There are joint plans for producing Italian-Crimean wine,” Mr. Nazarov said.
During the meeting he reminded his Italian colleagues of the advantages of doing business in Crimea. “If you decide to invest in Crimea you will enjoy three advantages. There will be practically no taxes because we have a Free Economic Zone. You will live and work among the friendliest of people. And third, you will always have a chance to access directly the region’s top officials, and talk over mobile phone with the head of the Republic of Crimea, Sergei Aksyonov, or Sevastopol Governor Dmitry Ovsyannikov,” said Andrei Nazarov.
The final speaker at the meeting was Roberto Locicero Vaina, an Italian restauration expert who has come to Crimea to do business. “I want to convince my fellow Italians that it is safe to invest in Crimea, I want to reassure them that the investment climate in Crimea is good. The FEZ is working and the tax burden will hardly be noticeable at all. You can register your enterprise easily and quickly and the place has advanced information systems. The authorities interact with businessmen via internet. I am ready to share information and experience with my fellow countrymen. We are a local firm that is ready to support any initiative of our compatriots, we will be glad to welcome you to our restaurant Kappero Felice,” Mr. Vaina said addressing his compatriots.
Grapes from Italian Wine Make Their Way to Massandra cellars
While businessmen from Crimea and Italian regions were having their meeting a unique collection of Massandra wine vintage 2015 made from Italian Sangiovese grapes was laid to age at Massandra winery. Yanina Pavlenko, General Director of the enterprise, said that 500 bottles were put in storage in the niches of the “connecting gallery”. “We are very glad to welcome Europeans to the Russian Massandra and we have prepared for them this symbolic act, the laying in storage of Crimean wine made from Italian grapes,” Ms. Pavlenko said.
Sport Will Unite Italian and Russian Businessmen
A football match may take place between Russian and Italian winemakers’ teams during the III Yalta International Economic Forum to be held on 20–22 April 2017, said the head of Sport for All Commission of United World Wrestling (UWW) Georgy Bryusov, who is a member of YIEF Foundation Board. “Sport is a universal value which erases borders and unites people. That is why a football match between Italian and Crimean winemakers could provide not only an informal site for constructive dialogue, but would add colour to the Yalta International Economic Forum,” Mr. Bryusov said. He recalled that sport and sport tourism for which Crimea has a huge potential are a promising area for international business cooperation.
“Before 2020 the state will support the creation on the peninsula of a federal centre for the training of athletes in Alushta, modern sporting facilities in Simferopol, Yalta, Yevpatoria and Sevastopol. Considering Crimea’s unique climate and recreation zones and the status of a Free Economic Zone sport may provide an opening for the creation of public-private partnerships and international cooperation in this field,” said Georgy Bryusov, Member of YIEF Fund Board and head of the Sport for All Commission of United World Wrestling.
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The delegation of Italian politicians and entrepreneurs came to Crimea to promote cooperation in the economic, cultural and other fields. The visit’s programme includes meetings with the top officials of the Republic of Crimea and Sebastopol, the signing of agreements, business talks, acquaintance with the work of enterprises and the ongoing business projects in Crimea and the business climate in the region. The 19-strong delegation is the largest group of politicians and business people from a European Union state to visit the Crimean Peninsula after its reunification with Russia.
The trip was organised by the Yalta International Economic Forum Foundation jointly with the Government of the Republic of Crimea.
The Yalta International Economic Forum (YIEF) is an annual business event held in the Crimean Federal District. The YIEF 2016 Organizing Committee is chaired by the head of the Republic of Crimea and the Co-chairman of the All-Russia Public Organization Delovaya Rossiya, Andrei Nazarov. The organisers of the Forum are the Government of the Republic of Crimea, the Yalta International Economic Forum Fund with the support of the Russian President’s Administration.
YIEF 2016, which was held on 14–16 April 2016, was attended by more than 1,100 government officials, business people and economics experts, including 70 participants from 26 countries – politicians, business people and other opinion leaders. It is the largest foreign group to come to Crimea on a business visit since the reunification of Crimea with Russia.
During the second YIEF twelve investments agreements were signed to the tune of RUB 70 billion and a mechanism was devised to protect foreign investors wishing to work in Crimea against the negative impact of Western sanctions. During the Forum a RUB 32 billion agreement was signed on the building of a new terminal at Simferopol Airport, the largest investment project in the new history of the Republic of Crimea.