Russian Market

Heading for modernisation with plastics and rubber

The country continues to head for modernisation. This applies both to the industry itself and its infrastructure. There can be no doubt that machinery and systems are among the topmost import products in Russia. This development is set to continue and will be of benefit to foreign manufacturers. Financial experts are confident that, thanks to its large currency reserves and a well endowed stability fund, Russia is in a good position to cushion the impact of the current economic crisis, both in the long and short term. The expansion plans of Russian plastics manufacturers and chemical giants are as ambitious as ever, and the demand for high-quality processing and finishing machinery is likely to rise in the medium and long term. More and more customers are expecting to buy complete production systems, preferably from a single source. Industry experts believe that the future will see a demand for complete solutions such as entire production systems.

In focus: Russia's infrastructure

The 2014 Olympic Winter Games in Sotschi are an important motor for the building trade. Investments totalling over 10 billion US dollars are planned for the infrastructure, hotels, stadiums and apartments in the region. The dynamo for the Russian building economy will, however, be the development of the infrastructure. Government will invest more in roads, railways, ports and airports. One of the biggest projects over the coming years will be the extension of several trunk roads and the motorway from Moscow to Saint Petersburg. Furthermore, the central motorway ring around the capital will be completed. A total of 8,000 kilometres of new roads will be built and 6,200 kilometres of existing roads expanded.

In the long run, the Russian automobile market offers manufacturers and parts suppliers good business opportunities.

Even if the short-term production and profit goals of domestic and foreign producers will be out of reach in the coming two years: the number of vehicles will triple by 2020 from currently 30 million to an expected 90 million cars. Furthermore, extensive replacement investments are expected: almost one third of all cars in Russia are more than 20 years old.

Electricity industry

The electricity industry will trigger a great demand in the coming years. Following the reform of this sector the new generating companies are under a great pressure to modernise. It is planned to put new power plant capacities of over 34 gigawatts into operation by 2011. Two thirds of the necessary technology will probably come from international companies. Despite the muted economic activity, power plant operators want to expand their investment programs by up to 70 percent by the year 2013.

Packaging industry

The demand for packaging is still high in Russia and the interest in innovative technologies and materials for production unbroken. In view of the current turbulences on the global markets, demand on the Russian packaging market is currently limited, although Russia is on its way to becoming one of the world's biggest consumer markets. Local packaging manufacturers will thus have to invest to satisfy the future requirements of consumers in the food sector, sweets market, cosmetics sector and the pharmaceutical industry.

A material with innovative strength

The demand for plastic and rubber in Russia remains high, with the demand for these modern materials unbroken in all important fields of application. The plastic and rubber industry can draw self-confidence from their innovative strength and the corresponding forward-looking products. This demand will continue to grow with an increasing diversification of the Russian economy and the development of new fields of use for plastic products. This will open up new business opportunities for manufacturers and suppliers in the plastics processing industry.