CONSULTING

Vietnam. The importance of foreign sales has increased and it represents about half of all revenues
for Rosatom, compared to 30 percent a decade ago, 928 with the objective to increase this to
50 percent by 2030. However, there is doubts as to the viability of these contracts. Steve Kidd,
formerly WNA's head of strategy, said: “Rosatom is pretty good at announcing $100 billion of
orders in 25 countries, but not an awful lot of these are firm contracts, they are just bits of
paper.” 929
A large part of the funding for these projects comes from Russia’s National Wealth Fund. A rough
estimate of the funding Russia has pledged is US$24 billion for plants now under construction and
an additional US$64 billion for future agreements—a total of US$88 billion over the next decade
or two. 930 However, the National Wealth Fund is also being used for stabilizing the Russian
economy. With falling oil and gas prices, the falling value of the ruble, and ongoing sanctions, the
nuclear export program will be disrupted for political and economic reasons. The Russian Finance
Minister was quoted as saying, “Our reserves volume will decrease by approximately 2.6 trillion
rubles (US$40.85 billion) — more than half. This means that 2016 is the last year when we are
able to spend our reserves that way. After that we will not have such resources.” 931 Funds for
overseas nuclear development have also been secured from the Russian Bank for Development
and Foreign Economic Affairs (Vnesheconombank or VEB), under a co-operation agreement
signed with Atomostroyexport in 2006, 932 and resulted in subsequent loans to Belarus, in 2014,
and proposed deals in Hungary and India. However, the VEB is now also under financial pressure,
in part due to Western sanctions and has now stopped lending. 933 Despite this, at the AtomExpo
2016, VEB and Rosatom agreed to develop their co-operation to “contribute to the growth of the
Russian economy and the expansion of Russia’s presence in the global nuclear energy market”. 934
The credit-rating agencies reflect these developments. In February 2015, Moody’s downgraded
Atomenergoprom—a 100 percent subsidiary of Rosatom, which as an integrated nuclear group
also building reactors is comparable to the French AREVA—to “junk” (Ba1) and assigned a
negative outlook. 935 Then in March 2016, Moody’s placed it on a further review for downgrade. 936
928 NIW, “Russia”, 6 November 2015.
929 Reuters, “Rosatom's global nuclear ambition cramped by Kremlin politics”, 26 June 2016, see
http://internal.uk.mobile.reuters.com/article/idUKKCN0ZC0QZ, accessed 29 June 2016.
930 Cheryl Rofer, “Can Russia Afford Its Reactor Exports ?”, Nuclear Dinner, 18 February 2015, see
http://nucleardiner.com/2015/02/18/can-russia-afford-its-reactor-exports/, accessed 2 July 2016.
931 Market Watch, “Weak oil prices deplete Russia’s sovereign-wealth fund”, 27 October 2015, see
http://www.marketwatch.com/story/weak-oil-prices-deplete-russias-sovereign-wealth-fund-2015-10-27,
accessed 2 July 2016.
932 VEB, “Vnesheconombank signs agreement on cooperation with CJSC Atomstroyexport”, 31 May 2006, see
http://www.veb.ru/en/press/news/arch_news/index.php?id_19=3524&from_19=146, accessed 2 July 2016.
933 Bloomberg, “Putin's Bailout Bank Needs a Rescue; It's an $18 Billion Whopper”, 28 December 2015, see
http://www.bloomberg.com/news/articles/2015-12-28/putin-s-bailout-bank-needs-a-rescue-it-s-an-18-billion-whopper,
accessed 2 July 2016.
934 WNN, “Russia's Rosatom signs $10 billion worth of deals at AtomExpo”, 1 June 2016, see
http://www.world-nuclear-news.org/C-Russias-Rosatom-signs-10-billion-worth-of-deals-at-AtomExpo-
01061601.html, accessed 2 July 2016.
935 Moody’s, “Rating Action: Moody’s takes rating actions on six Russian utility and infrastructure GRIs;
assigns negative outlook”, 25 February 2015, see https://www.moodys.com/research/--PR_319091, accessed
2 July 2016.
936 Moody’s, “Credit Opinion: Atomenergoprom, JSC”, 23 March 2016.
Mycle Schneider, Antony Froggatt et al. 211 World Nuclear Industry Status Report 2016