Glencore CEO: Russia a great investment opportunity
Glencore CEO Ivan Glasenberg speaks during his company’s listing ceremony at the Stock Exchange in Hong Kong on May 25, 2011.
Russia is a prime investment location because of its massive natural resources and its location next to the China, Ivan Glasenberg, the CEO of commodity trader Glencore said on Thursday.
"The world is going to have to feed China with more commodities", Glasenberg said at the Russia Forum in Moscow.
He urged the Russian government to make changes to encourage foreign investment and said the rule of law needs to be strengthened.
That would lead to more foreign investment in the country, he added, given that mining giants BHP Billiton, Anglo American and Rio Tinto are currently sitting on the sidelines.
Unlike other players, Glencore has been successful in Russia, the world's largest oil producer. In 2012 Swiss trading houses Vitol and Glencore became the largest players in the Russian oil export market, according to Reuters calculations, dominating supplies from the country after new government policies opened up trade.
It's estimated that the two firms trade over 4 million tonnes of Russian oil a month, worth over $3.2 billion.
"We fortunately have had success. Maybe we understood the country better than others. We had more perseverance than others. It's been difficult along the way," Glasenberg said.
Speaking at the conference, Glasenberg also urged Russian companies to invest more money and not just worry about cash flows.
"I think the major thing you see in Russia today is, even the Russian companies, you don't see them putting massive money back into the country and developing the resources in the country."
"Where the government is going to have to help is, it's going to have to develop better infrastructure, strong, better rail lines, better ports, better infrastructure, to encourage foreign investors to come into the country and put billions of dollars into the country."
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