Victor V. Koronelli
Ambassador
Russian Embassy in Mexico
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How the Russia-Mexico Relationship is Breaking New Ground

By Alessa Flores | Tue, 05/19/2020 - 09:00

Q: What are the three things the private sector and government should know about relations between Mexico and Russia today?

A: First of all, Mexico is one of the main political partners in Latin America for Russia. Our relationship is based on friendship, mutual respect for interests, as well as the coincidence or convergence of positions on the most significant issues of global impact. We share polycentric worldliness, the desire to reinforce the central role of the UN in preserving international peace, resolving disputes in different parts of the world and maintaining the non-intervention of third parties in the sovereign affairs of states. Both nations understand the great importance of continuing the disarmament process and of preventing the proliferation of weapons of mass destruction. These factors provide a solid foundation for the deepening interaction between the two countries in different international forums and within the framework of various integration mechanisms, including CELAC and the Pacific Alliance.

At the institutional level, the Russian-Mexican Joint Commission for Economic-Commercial, Scientific-Technical and Maritime Navigation Cooperation is the main instrument of our cooperation in the bilateral economic sphere. I believe that one of our most important challenges is to make full use of the great potential of the Joint Commission (COMIXTA) to review the success of the Mesoamerica Without Hunger Program (MsH) and to ensure that its meetings are held on a regular basis to provide fresh impetus to our relations. The same applies to the "Russia-Mexico" Entrepreneurs Committee of the Russian Chamber of Commerce and Industry, headed by Yuri Slyusar, Director General of the United Aircraft Corporation. 

Despite some stereotypes, Russia and its people are very open and highly hospitable to foreigners. Many experienced this during the 2018 Soccer World Cup, visited by more than 60,000 Mexican fans. Representatives of the Mexican government and the business community have also been able to observe this in person within the context of the already established International Economic Forum of Saint Petersburg, which has sadly been suspended for the first time in its history because of the COVID-19 pandemic. We hope that the situation will quickly normalize and that interactions between people will return to normal. The signing of the agreement to suppress the visas between both nations would greatly contribute to the increase in bilateral contacts. Russia has repealed visas with almost all the countries of Latin America and the Caribbean. Of the most important regional actors, we only need Mexico.

Q: How would you characterize trade relations between Mexico and Russia in 2019 and what were the main exchanges between the countries?

A: Mexico is, after Brazil, the second-most important partner for Russia in Latin America. Trade between our countries has grown at a sustained rate in recent years. According to Russian statistics, bilateral trade in 2019 was marginally less than in 2018, reaching US$2.6 billion. Russian exports amounted to US$1.5 billion and imports totaled US$1.1 billion. Russian exports reflect categories of products such as metals and their derivatives, chemicals and minerals. Machinery, equipment and automobiles, metals and their products, as well as food and agricultural raw materials are the main items of Mexican imports to Russia. 

Q: What are the most common barriers that Mexican and Russian companies face when they want to work together in Mexico? How is the embassy supporting the creation of business?

A: Aside from the problems of the spread of COVID-19, which is a common danger to all without exception, it must be understood that we have some difficulties with regard to bilateral trade and that we are trying to resolve them. The anti-dumping measures implemented by Mexico on imports of steel sheets originating in Russia have been in place for more than 20 years. The related negotiations between Mexico and Russia are underway to change the situation of our Mexican partners in this regard. It will certainly give us more motivation to continue to move forward with our business relationships.

Q: What are the opportunities for energy cooperation?

A: One of the leading operators in the Russian energy sector, LUKOIL, has been present in the Mexican market since 2015, participating in oil field exploration and development projects in five oil blocks in the region. The key shareholders of our business are the firms ENI and PEMEX. Each project has its own particularities, with an average profit share of 75 percent for the Mexican state. In the event of exploratory progress and assurance of the amount of reserves, the overall investment value for all ventures would rise to more than US$4 billion. In addition, as part of the fulfillment of the commitments set out in the Shared Production Agreement between LUKOIL and the National Hydrocarbons Commission (CNH) of Mexico, LUKOIL plans to invest more than US$500,000 in social development and technology transfer by the end of 2020.

Q:  What are some of the investment opportunities in Russia for Mexicans and what is the embassy doing to support these?

A: The Russian market provides many opportunities for Mexican entrepreneurs. One of the examples of productive cooperation is the company Nemak, which built an automotive component plant in the region of Ulyanovsk in 2015, in the European part of our country. Nemak’s total investment amounted to ₽$2 billion (US$33 million). 

In an attempt to encourage Mexican entrepreneurs to invest in Russia, the government of Moscow, with the support of this diplomatic mission and together with the National Chamber of Commerce of Mexico City, organized the "Smart and Sustainable Moscow" conference in December 2019. The head of the Russian delegation, Minister of the Moscow Government and the Head of the Moscow Department of Foreign Affairs and International Relations Serguéi Cheremin highlighted the new image of the city, particularly in the areas of infrastructure and social interests.

Russia intends to send two business missions to Mexico, with the first headed by President of the Committee of Entrepreneurs of Russia-Mexico of the Russian Chamber of Commerce and Industry Yuri Slyusar. More than 30 Russian companies specialized in machinery, information technology, energy, tourism, healthcare, transport and logistics, construction and engineering, education, financial and legal services will take part in this effort. We expect to conduct B2B and B2G sessions within the scope of this project. The mission, scheduled for March, had to be postponed due to the COVID-19 outbreak and a new date will be set later in the year. The second mission, scheduled for 3Q20, will consist of representatives of medicine manufacturers and representatives of the cosmetics and the medical sector, with the participation of the Ministry of Industry and Commerce of the Russian Federation.

Q: How has cultural diplomacy supported the relationship between Mexico and Russia?

A: Cultural relations between Russia and Mexico are characterized by mutual understanding between the two nations with a solid historical foundation. Mexican muralists, such as Orozco, Rivera, Siqueiros and Tamayo, were inspired by the Russian Revolution, while the great film director Sergei Eisenstein was influenced by Mexico's great culture and history leading to films like ¡Que Viva México! Cultural exchange continues to this day. In the last two years alone, we have held two editions of the Russian Film Week in Mexico, the Moscow Culture Days in Mexico, a concert by maestro Valery Gergiev with the Mariinski Theater Orchestra and the Esperanza Azteca Foundation and a major exhibition by Russian avant-garde painter Wasilly Kandinsky, to name some of our projects. All of these activities had a positive influence on the curious Mexican people, who know how to appreciate quality art. It is no accident that Mexico City is one of the world's capitals with the largest number of museums. 

In 2020, we planned a series of activities on the occasion of two symbolic dates: the 75th anniversary of the victory in the Great Patriotic War and the 130th anniversary of diplomatic relations between Russia and Mexico. One of the emblematic activities in the context of these festivities will be our appearance as a guest of honor at the Pachuca Book Fair, scheduled for August-September of this year. However, the COVID-19 contingency may force some changes to this agenda, so we will continue to see how things develop. In any case, we will continue to work to bring more Russian culture to Mexico.

Photo by:   Russian Embassy
Alessa Flores Alessa Flores Senior Journalist and Industry Analyst