POSCO announced on September 26 that it signed a memorandum of understanding (MOU) with the Ministry for the Development of the Russian Far East to develop Russia’s Far Eastern Khabarovsk region on September 25 (local time). In the signing ceremony, POSCO president Park Ki-hong and Alexander Galushka, the Minister for the Development of the Russian Far East, promised to cooperate with each other for the construction of infrastructure such as housing and ports in the region, as well as the development of energy, resources, and innovative technology.
The fact that the Russian government signed a MOU to cooperate with foreign companies is very rare. Moreover, the September 25 agreement is the first one for Korean companies, after the establishment of the Ministry for the Development of the Russian Far East in 2012.
The Korean company is currently engaged in the construction of prefabricated houses in Siberia and the Far East region, the management of Amur steel mills, and harbor construction. POSCO has already created strategies for linking the abundant resources in the Far East region to energy development, after securing a logistics base.
Moscow made the economic development of the Asia-Pacific region its top priority, and created the Ministry for the Development of the Far East region in 2012. Currently, the Russian government is proceeding with 92 national projects worth US$160 billion.
The Russian Far East region is full of natural resources such as coal (estimated 20.4 billion tons) and iron ore (4.5 billion tons), and its importance as a logistics hub that connects East Asia and Europe is growing. A lot of infrastructure projects, including roads, harbors, and airports, are under construction.