On November 25, 2002, a Memorandum of Understanding was signed between Vneshtorgbank, SIMEST international development agency of Italy and Mediobanca, a major Italian investment bank.
The Memorandum calls for mobilising efforts to finance investment projects worth ? 1.5 billion to be implemented in the Russian Federation with a proactive participation of Italian companies, whichong other things envisage developing a number of joint ventures. When necessary, the parties to the Memorandum could benefit from insurance cover by SACE, an Italian export credit and guarantee agency. In such cases, Vneshtorgbank will provide a direct bank guarantee. No guarantee by the Russian government will be required.
To translate the stipulations of the Memorandum into new business opportunities, a ten-year ?300 million General Loan Agreement was signed between Vneshtorgbank and Mediobanca to finance Italian investment commodities export to Russia. Admittedly, no other loan arrangement ever made in the Russian banking practice could match the above mentioned Agreement in terms of the volume and provisions of the long-term credit facilities.
Under the first project to be implemented within the framework of the Agreement, a ? 10.3 million credit line shall be extended to Gazkom joint-stock company for a 6.5 year-period. The credit shall be channelled into purchasing a leading-edge equipment produced by Italian company Alinia Spazio to mature the development of the two of "Yamal-200" innovative communications satellites.
Strategically, the opportunities, as well as challenges of the Memorandum and the General Loan Agreement signed make the furthering of multilateral economic relationship between Italy and Russia, as well as encouraging stronger Italian investment into the Russian economy even more urgent.