International Cooperation in Russian Civil Aircraft Industry under Sanctions

682
DOI: 10.20542/0131-2227-2018-62-8-88-96

M. Yevtodyeva (marianna133@mail.ru),
Primakov National Research Institute of World Economy and International Relations, Russian Academy of Sciences (IMEMO), 23, Profsoyuznaya Str., Moscow, 117997, Russian Federation;
I. Danilin (danilin.iv@imemo.ru), 
Primakov National Research Institute of World Economy and International Relations, Russian Academy of Sciences (IMEMO), 23, Profsoyuznaya Str., Moscow, 117997, Russian Federation 

Acknowledgements. The article was prepared at the Primakov National Research Institute of World Economy and International Relations, Russian Academy of Sciences and supported by a grant from the Russian Science Foundation (project no. 14-28-00097 “The optimization of Russian foreign investment ties under deterioration of relations with the EU”).


Abstract. The article analyzes the dynamics of internationalization in the Russian aircraft industry over the last decade (2008–2017) using the examples of implementation of the Sukhoi Superjet and MS-21 projects within two periods – before and after the introduction of economic sanctions against the Russian Federation in 2014. The authors examine such key elements of international cooperation in civil aircraft industry as cooperation with foreign suppliers in parts and components, export deliveries to foreign airlines, cooperation in R&D, sales and after-sales services. Since 2014 each of these areas witnessed either the same persisting problems which continue to exert negative impact on the prospects of sales (especially those in repair and after-sales services), or new challenges (decline in supplies of components to foreign customers, revision of some contracts’ terms). An important part in analysis is the study of investment mechanisms in the Russian aircraft industry, including foreign investments. The authors conclude that target public financing still maintains a high share in the structure of investments in aircraft industry, whereas the share of direct foreign investments has reduced in recent years. Evidently, sanctions slowed down internationalization of the Russian civil aircraft industry. They negatively affected the relations with key foreign partners, including major suppliers and customers, as well as the largest aircraft producers. Import substitution in the Russian aviation industry is developing. However, it faces difficulties due to the need to replace a considerable number of components in different aircraft models and, consequently, to pass expensive certification of new systems and components. According to the authors, the development of the Russian civil aircraft manufacturing under Western sanctions can be ensured by generation of effective business strategies (by UAC and its constituent companies) in order to increase efficiency of funding mechanisms, sales promotion and after-sales services. 

Keywords: Russia, sanctions, aircraft industry, international cooperation, United Aircraft Corporation, Sukhoi, foreign suppliers, foreign investments, import substitution 


REFERENCES

1. The quarterly report of JSC GSS for the 3rd quarter 2016 (In Russ.) Available at: http://ir.superjet100.com/assets/files/library/information_disclosure/quarterly_reports/2016/SCAC%20Quarterly%20Report%203Q2016.pdf (accessed 04.12.2017).

2. Nikol’skii A. V chem preimushchestva novykh razrabotok rossiiskogo aviaproma [What are advantages of new developments of the Russian aviation industry]. Vedomosti, 24.08.2015.

3. Murtazin I. Sto milliardov na odnom kryle [Hundred billion on one wing]. Novaya gazeta, 31.03.2015. Available at: https://www.novayagazeta.ru/articles/2015/03/31/63619-sto-milliardov-na-odnom-kryle (accessed 04.12.2017).

4. The “Irkut” corporation chooses suppliers of systems for the MS-21 program. Press release (In Russ.) Available at: http://www.uacrussia.ru/ru/press-center/news/%5C%5C/news_56552 (accessed 04.12.2017).

5. Evtod’eva M. Krizis sistemy voennogo i voenno-tekhnicheskogo sotrudnichestva Rossii s inostrannymi gosudarstvami [Crisis of system of military and military-technical cooperation of Russia with the foreign countries]. Razoruzhenie i bezopasnost’ 2013–2014 [Disarmament and security 2013–2014]. Arbatov A.G., Bubnova N.I., eds. Moscow, IMEMO, 2014, pp. 146-162.

6. The annual report of Sukhoi Civil Aircraft JSC for 2015. (In Russ.) Available at: http://ir.superjet100.com/assets/files/library/reports/annual_reports_ru/Annual_Report_GSS_2015.pdf (accessed 04.12.2017).

7. The strategy of development of the aviation industry of the Russian Federation till 2030. Short theses (In Russ.) Available at: http://minpromtorg.gov.ru/docs/#!strategiya_razvitiya_aviacionnoy_promyshlennosti_rossiyskoy_federacii_na_period_do_2030_goda (accessed 04.12.2017).

8. Thales Avionics will deliver to GSS avionics for $239 million (In Russ.) Available at: https://www.aex.ru/news/2016/2/12/149336/ (accessed 04.12.2017).

9. Kiseleva M. GSS predupredila o problemakh s postavkami detalei [GSS has warned about problems with deliveries of details (In Russ.)] Vedomosti, 18.08.2015.

10. “Superjet” collided with French greed (In Russ.) Available at: http://finobzor.ru/show-41851-superdzhet-stolknulsya-s-francuzskoy-zhadnostyu.html (accessed 04.12.2017).

11. Ministry of Industry and Trade of the RF worked out the plan of import substitution in civil aviation (In Russ.) Available at: http://www.ato.ru/content/minpromtorg-rf-sostavil-plan-importozameshcheniya-v-grazhdanskoy-aviacii (accessed 04.12.2017).

12. The annual report of United Aircraft Corporation public JSC for 2016 (In Russ.) Available at: http://www.uacrussia.ru/upload/iblock/cd1/cd 16c08a5f012f952c56b0d0f068603a.pdf (accessed 04.12.2017).

13. KUMZ develops the aviation division (In Russ.) Available at: http://www.metalinfo.ru/ru/news/42609 (accessed 04.12.2017).

14. The second joint venture of Boeing and VSMPO-AVISMA will open in the Urals (In Russ.) Available at: https://regnum.ru/news/2220645.html (accessed 04.12.2017).

15. With whom Airbus and Boeing in Russia work (In Russ.) Available at: http://www.poletim.net/technology/s-kem-rabotaet-airbus-i-boeing-v-rossii (accessed 04.12.2017).

16. VEB has completely disposed of equity stake in EADS. Vedomosti, 23.01.2014. (In Russ.)

17. Boeing design center (In Russ.) Available at: http://www.boeing.ru/Boeing-%D0%B2-%D0%A0%D0%BE%D1%81%D1%81%D0%B8%D1%8F/Boeing-%D0%B2-%D0%A0%D0%BE%D1%81%D1%81%D0%B8%D0%B8/%D0%9A%D0%BE%D0%BD%D1%81%D1%82%D1%80%D1%83%D0%BA%D1%82%D0%BE%D1%80%D1%81%D0%BA%D0%B8%D0%B8-%D0­%A6%D0%B5%D0%BD%D1%82%D1%80.page (accessed 04.12.2017).

18. ECAR. Разработка новых авиационных конструкций. [ECAR. Aviation Development Projects (In Russ.)] Available at: http://ecar-airbus.ru/projects/#!concept-development (accessed 20.01.2018).

19. The French refuse to buy aviadetails from the Russian Federation (In Russ.) Available at: https://utro.ru/articles/2017/06/26/1331520.shtml (accessed 04.12.2017).

20. Kiseleva M. OAK poluchit ot gosudarstva 100 mlrd rublei na grazhdanskie tseli [UAC will receive from the state 100 billion rubles for civil purposes]. Vedomosti, 30.03.2015.

21. Vorob’ev A. “Grazhdanskie samolety Sukhogo” konvertiruyut dolgi v aktsii [Sukhoi Civil Aircraft converts debts into stocks]. Vedomosti, 23.05.2016.

22. SuperJet International company became Russian for 90% (In Russ.) Available at: http://www.ext1.webpart.ru/content/kompaniya-superjet-international-stala-na-90-rossiyskoy?sea=29358 (accessed 04.12.2017).

23. Zagashvili V. Diversifikatsiya rossiiskoi ekonomiki v usloviyakh sanktsii [Diversification of Russian Economy under Sanctions]. Mirovaya ekonomika i mezhdunarodnye otnosheniya, 2016, vol. 60, no. 6, pp. 52-60. DOI:10.20542/0131-2227-2016-60-6-52-60

24. Dement’ev V.E. OAK i razvitie rossiiskogo aviastroeniya [UAC and development of the Russian aircraft industry]. Vestnik Universiteta (State University of Management), 2009, no. 3, pp. 315-331.

25. Kuznetsova E. Proekt SSJ snizhaet oboroty [SSJ project is slowing down]. Kommersant, 05.10.2015.

26. Vorob’ev A. Pochemu prostaivayut samolety Sukhoi Superjet [Why Sukhoi Superjet planes are out of operation]. Vedomosti, 26.05.2017.

27. Mexican InterJet airline disproved messages that it put several SSJ-100 to spare parts. Ekho Moskvy, 19.01.2018 (In Russ.)

28. USA hinder supplies of Russian “Superjets” to Iran. Novye izvestiya, 18.09.2017 (In Russ.)

29. Decisions on start of formation of new Corporate center and civil division of PJSC OAK are made (In Russ.) Available at: http://www.uacrussia.ru/ru/press-center/news/prinyaty-resheniya-o-nachale-formirovaniya-novogo-korporativnogo-tsentra-i-grazhdanskogo-diviziona-p (accessed 04.12.2017). 


Registered in System SCIENCE INDEX

For citation:
Yevtodyeva M., Danilin I. International Cooperation in Russian Civil Aircraft Industry under Sanctions. World Eсonomy and International Relations, 2018, vol. 62, no. 8, pp. 88-96. https://doi.org/10.20542/0131-2227-2018-62-8-88-96



Comments (0)

No comments

Add comment







Indexed

 

 

 

 

Dear authors! Please note that in the VAK List of peer-reviewed scientific journals, in which the main scientific results of dissertations for the degree of candidate and doctor of sciences should be published for the “MEMO Journal” the following specialties are recorded:
economic sciences:
5.2.5. World Economy.
5.2.1. Economic Theory
5.2.3. Regional and Branch Economics
political sciences:
5.5.4. International Relations
5.5.1. History and Theory of Politics
5.5.2. Political Institutions, Processes, Technologies

 

Current Issue
2024, vol. 68, No. 7
Topical Themes of the Issue:
  • The Supporting Structure of Global Security
  • Institutional Features of the Fourth Energy Transition
  • The Evolution of Modern German Christian Democracy
  • The Monarchies of the Persian Gulf and Central Asia
Submit an Article
INVITATION FOR PUBLICATION
The Editorial Board invites authors to write analytical articles on the following topics:
  • changes in the processes of globalization in modern conditions
  • formation of the new world order
  • shifts in civilization at the stage of transition to a digital society

The editors are also interested in publishing synthesis articles / scientific reviews revealing the main trends in the development of certain regions of the world - Latin America, Africa, South Asia, etc.