Severgroup, which unites Alexey Mordashov's industrial assets, presented a list of investment projects worth several billion dollars as part of the discussion of the so-called Belousov list, said Severstal CEO Alexander Shevelev. “The companies presented their investment program, the implementation of which is planned. And at the stage of project implementation, assistance at the federal level will be necessary, ”he said.
Severstal is actively involved in the discussion process, the company is interested in forming transparent and understandable rules of the game and in the possibility of attracting regional and federal support for the implementation of capital-intensive projects, Shevelev said.
Preparing lists of priority investment projects of the company and officials began in the summer. Then presidential aide Andrei Belousov proposed to withdraw part of the income from 14 companies in the metallurgical, mining and chemical sectors. The government opposed and offered the business an alternative - to help fulfill the presidential decree and increase investment to 25% of GDP. It was decided that taxes will not be increased, but the business itself will increase investment in socially important projects.
Companies participating in the discussion (more than 20 private companies and companies with state participation) presented their list of projects in early September. The reaction of the authorities is still unknown, said employees of several of these companies. In mid-September, a list of almost 400 projects appeared from the government’s side in which business would be invited to invest.
Severgroup included in its list the most capital-intensive projects: modernization of coke-house production at the Cherepovets Metallurgical Combine, for example, coke-oven battery number 11, construction of pulp production, a number of environmental initiatives, Shevelev listed.
According to the top manager, the discussion around the list of Belousov is now proceeding in a way that everyone understands: “There are May presidential decrees, there are large-scale national projects, there are investment programs of companies. All groups of projects are aimed at common goals: digitalization, ecology, import substitution, export growth of non-primary goods ”.
According to Shevelev, a single list of projects, combining the proposals of companies and proposals of government structures, has already been formed. And this list, according to the general director of Severstal, has yet to be discussed in detail. As well as possible mechanisms of state assistance to companies.
From the point of view of shareholders, some investments are too risky or have a long payback period and because of this they are often deferred, says Nikolay Sosnovsky, director of metallurgy and mining of Prosperity Capital Management. At the same time, some of these projects may be useful for the region of presence (infrastructure and ecology, for example), which means that the state is also interested in them, and not just the company, the expert continues. “In such cases, shareholders may also have some support from local or federal authorities,” Sosnovsky believes.
The idea of Belousov is no longer taken seriously, the partner of the consulting company Urus Advisory Alexey Panin is sure. “The discussion of investment projects is likely to continue and it is even possible that some projects will start, but this is already very far from his [Belousov] initial idea. Statements about the need for state support from business seem, rather, a tribute to professional rhetoric, ”the expert argues.
The CEO of UK Sputnik, Alexander Losev, suggests that the metallurgical business remembers the crisis of overproduction after 2008, when excess capacity ate capital expenditures (CAPEX), collapsed steel and coal prices and reduced capital. Perhaps the business hints that any demands from above on increasing investments in production capacity, if they are not supported by guaranteed demand for products, can lead to a negative result, the expert argues.
“Perhaps in this way the business hints to the authorities that it is worth sharing responsibility for decisions that the business does not take at its own risk, but on the recommendation of the state authorities,” says Losev.