Leasing in Russia - 2001
Radisson Hotel - Vienna
17th - 18th September 2001
Ekaterina Shafigullina - Deputy General Director
AFES Insurance company - Russian Federation
Insurance cover for those involved in renting and finance leasing for aircraft At this point in time 90% of the Russian aircraft fleet is made up of outdated aircraft.
Financial indicators for airline companies are getting worse and the volume of air traffic is falling. This is taking place against a background of high prices for new aircraft, which run into millions of Dollars. Under these conditions leasing deals can be a way of attracting investment into the process of renewing the aeroplane fleet.
However, the opportunities for negotiating leasing contracts are at present very limited. The fact is that 70% of airlines in Russia are not profitable. And the legislative framework in the leasing sector is very complex. In addition we have to adapt to the changes in the 25 chapters in the new Tax Code of the Russian Federation. And there is nothing even resembling an adequate government guarantee for the parties involved in leasing contracts.
As a result we see high levels of financial risk for potential investors - who might otherwise become involved in programmes to rent or provide finance leasing for aircraft.
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