Representatives of RDIF and SCIC sign a memorandum of understanding to establish an investment platform under the witness of Prime Minister Nguyen Xuan Phuc and his Russian counterpart Dmitry Medvedev. — File Photo

Under the agreement, RDIF and SCIC will each invest US$250 million in the platform. The funds will be directed towards projects that promote bilateral trade, foreign direct investment flows between the two countries and the business activities of Vietnamese corporations in Russia.

RDIF and SCIC will identify attractive investment projects in bilateral trade, which are in line with Russian-Vietnamese strategic interests.

The signing ceremony took place in Moscow in the presence of Prime Minister Nguyen Xuan Phuc and his Russian counterpart Dmitry Medvedev.

Kirill Dmitriev, CEO of RDIF, said the investment co-operation between Russia and Viet Nam was currently mainly focused on energy projects. However, following last year's free trade agreement between the Eurasian Economic Union and Viet Nam, RDIF has identified a major opportunity to strengthen co-operation between the two countries in a broader range of sectors beyond commodities.

"This investment platform will focus on leveraging these potentially high-growth opportunities for the mutual benefit of Russian and Vietnamese businesses," Dmitriev said.

Nguyen Duc Chi, chairman of SCIC, said RDIF and SCIC were playing similar roles as the investment arms of their respective governments with an important mandate to grow the economy.

"Thus, for SCIC, strengthening the relationship with RDIF, especially by signing a Memorandum of Understanding, will enable RDIF and SCIC prepare an efficient framework for identifying and realising cooperation potential and effectively investing in projects in Russia and Viet Nam for mutual benefit," Chi said.

SCIC was established in 2006 under the orders of the Prime Minister. It is acting as the State's representative at companies and is investing in key industries and sectors of the economy to reinforce the State's contribution to the economy with respect to the market principles.

SCIC is currently managing a portfolio of various companies that are operating in diversified industries of the economy, such as financial services, energy, industry and telecommunications, as well as construction, transportation, consumer goods, healthcare and IT.

By April 2016, the total amount of state capital under SCIC's management had reached VND18.75 trillion, the estimated market value of which had reached VND98 trillion. By 2020, SCIC aims to become the government's strategic investor, a sizable financial group of the region and an effective drive to uphold the State's participation in key industries and sectors of the economy.

RDIF was established in 2011 to make equity co-investments, primarily in Russia, alongside reputable international financial and strategic investors. RDIF acts as a catalyst for direct investment in the Russian economy. Its management company is based in Moscow. — VNS