ANATOLY GOLOMOLZIN: RUSSIA AND KAZAKHSTAN OUTLINE THE WAYS OF COOPERATION

During a working visit to Kazakhstan, Deputy Head of FAS held several meetings where he presented experience of developing exchange trade in Russia and discussed the prospects of international cooperation in this field

On 12-13 December, upon an invitation of Kazakhstan, a Russian delegation comprising Deputy Head of FAS Anatoly Golomolzin, President of “SPIMEX” JSC Alexei Rybnikov, and Managing Director of the Moscow Exchange Igor Marich, discussed the conditions, mechanisms and prospects of developing exchange trade with Heads of Kazakh ministries and departments, representatives of “Atameken” Kazakh National Chamber of Entrepreneurs and the exchange community.

At the meeting with Kazakh Minister of National Economy, Ruslan Dalenov, the parties discussed why exchange trade in Russia is entrenched at the top government level as a priority of the state competition policy.

“This institution enhances efficiency of the economy and state antimonopoly, tax, and tariff policy. Our colleagues showed a considerable interest to our legislative framework of exchange trade and the extensive practice of exchange trade in various sectors of the economy”.

“Exchange trade enables solving a broadest range of problems and issues – from putting things to order and decreasing shadow turnover on some markets to creating preconditions for sustainable development of the economy based on increasing pricing transparency and developing mechanisms for hedging  price fluctuation risks”, commented Anatoly Golomolzin, Chairman of FAS Exchange Committee.

Deputy Head of FAS pointed out that exchange trade in Russia is one of the key elements of state competition policy. He hihlighted that No. 618 Order of the President of the Russian Federation “On the main directions of the state policy for developing competition” of 21 December 2017 emphasized the importance of the work in this area, its development is formalized in a number of sectoral Road Maps approved by the Government of the Russian Federation.

The parties specially discussed the work of the Exchange Committee, as a format enabling to coordinate, as it has been done in Russia, activities of all interested bodies, including the founders of the Exchange Committee (the Bank of Russia, FAS, the Federal Tax Service), as well as all interested bodies, commercial infrastructure entities, sellers and buyers of exchange commodities. Considerable results were achieved through their coherent collaborative efforts.

“The annual traded value on the spot market in Russia is about 1 trillion RUB, on the market of derivatives - around 20 trillion RUB. At the same time, the line of traded commodities is constantly expanding and exchange tools are developing: contracts on the spot market, deliverable and derivative futures, etc. Development of exchange trade, in its turn, required considerable changes of a business-model, business conduct of market participants to be ready to operate in the modern market economy”, pointed out Deputy Head of FAS.

He added that “such work enables competitiveness of the Russian economy and the states of the Eurasian economic space under global competition”.

As a result of the meeting, the parties outlined the avenues of further cooperation with the Ministry of National Economy and other economic bodies and the business community.

During the meeting with Kanat Bozumbaev, Minister of Energy of Kazakhstan, Deputy Head of FAS discussed fulfillment of the Road Map for developing competition on the markets of oil and oil products, natural gas, coal, and products of their processing.  The system of exchange quotations, off-exchange price indices and prices on comparable foreign markets were discussed.

The parties emphasized a common understanding that such work facilitates performance efficiency of the fuel-and-energy markets.

“Exchange trade development is the key element of the structural reforms in the fuel-and-energy complex”, emphasized Anatoly Golomolzin.

He specially described the role and significance of operations of commercial infrastructure entities such as the exchange, clearing and commodities pool operators (“Transneft”, “Gazprom Mezhregiongaz”, “Russian Railways”).

“Development of the institution of commodities pool operator on the oil products markets decreased the delivery time for oil products from 25-30 days to 1-2 days, on the gas market this is the key activity for developing a balancing gas market, which improves considerably the market efficiency in general and solvex cost-efficiently a lot of issues related to debottlenecking of production infrastructure”, explained Deputy Head of FAS.

Finally, the parties agreed to hold an additional meeting in Russia, with involvement of Kazakh specialists and experts, for detailed studying of various aspects of exchange operations and the work of the Exchange Committee.

“Arrangements are also reached to synchronize collaboration on developing common markets of gas, oil, oil products, and the electric power industry. Exchange trade, market pricing and off-exchange quotations – all this are the key elements of these markets, and must be launched no later than 1 January 2025, and a programme on launching these common markets must be adopted no later than 2022”, commented Anatoly Golomolzin.

The Russian delegation also visited the Ministry of Trade and Integration of the republic of Kazakhstan. The objective of the meeting was discussing practical aspects of performance and development of the exchange markets in Russia and development of the common exchange space in the EAEU [the Eurasian Economic Union], the CIS and other countries in the world.