In a new illustration of the two countries’ willingness to strengthen their ties in the field of high technologies, the Russia-China Investment Fund (RCIF) and Chinese company TUS Holdings have agreed to establish a joint Russia-China Venture Fund (RCVF).
Signed earlier this week, the partnership has just been announced by the RDIF, Russia’s sovereign fund, which created the RCIF jointly with China Investment Corporation (CIC) in 2012.
The RCVF aims to “promote the development of trade and economic, investment, scientific and technological cooperation” between Russia and China, as stated by the RDIF.
The RCIF and TUS Holdings intend to be the main backers of the fund, whose initial target size is “up to $100 million.” This amount “may be further increased with participation from other Russian and Chinese institutional investors.”
The RCVF will target Russian tech companies, including startups, with a potential for further development in the Chinese market. Focus will be made on information technologies in the financial sector, Big Data, cloud technologies, biotechnology, biomedicine, clean energy, new materials, smart technologies (including robotics) and data transmission.
A series of giant funds
The RCVF is last in a series of bilateral investment vehicles to boost cooperation between Russia and China in the field of high technologies.
Thus in June 2016 Rostec, a major, government-backed Russian tech corporation, and China CYTS Industrial Development, announced a fund with “an initial $4 billion target” to develop projects related to China’s ‘One Belt One Road’ — an economic development strategy which includes the ‘Silk Road Economic Belt’ and the ’21st Century Maritime Silk Road’ across Eurasia. Under plans, a part of the fund’s resources will be used to fuel jointly-approved Russian IT and other high-tech projects.
Almost simultaneously, the RDIF agreed a partnership with several Russian and Chinese industry players to develop and manufacture medical robots.
In March, the Russian conglomerate Sistema was reported to be in the process of creating a venture fund in partnership with China’s TUS Holdings. This fund’s capital was not to exceed $100 million at start, with the Chinese side contributing 70% of this amount.
In January, Rusnano, Russia’s national nanotech investment corporation, and Zhongrong International Trust, a major Chinese investment and banking corporation, agreed to launch a joint investment fund in the field of nanotechnologies. The new entity was created to invest as much as $500 million “in the first phase,” with $25 million or more injected in each project.
A potential for cooperation between the two countries in the field of high technologies does exist — not only for large companies but also, at least theoretically, for small and medium-sized enterprises, according to a recent report.
