Putin Open to Foreign Investment in Troubled Russian Spaceport

(Bloomberg) -- President Vladimir Putin’s push to attract foreign investors to Russia has now moved to the final frontier -- space.

Russia’s ready to invite foreign partners to help develop its new Vostochny Cosmodrome, Putin told delegates Thursday at the Eastern Economic Forum in Vladivostok.

“It’s not a military cosmodrome,” Putin said during the forum’s plenary session. “We don’t just believe that it’s possible to work with foreign partners there, we are interested in this and will definitely include them in this cooperation.”

Russia views Vostochny, which is being carved out of the Siberian wilderness, as a critical national security project to give it a domestic launch base because its current Soviet-era spaceport at Baikonur is located in neighboring Kazakhstan. However, the $3 billion project has been was plagued by a series of corruption scandals, cost overruns and a failed satellite launch. Deputy Prime Minister Yury Borisov this week criticized the “unacceptable” state of construction and said the military may take over part of the work.

Putin ordered Russia’s Investigative Committee to examine construction at Vostochny during a visit to the space center after its first rocket launch faced delays in 2015. Months earlier, workers who hadn’t been paid for months went on hunger strike and appealed to Putin for help by painting a message on the roof of their barracks.

While the space center launched its first rocket into orbit in 2016, officials uncovered a critical defect on one of Vostochny’s launchpads as recently as last November, RBC news website reported. In 2017, a satellite launch failed after the rocket was programmed with coordinates for takeoff from Baikonur.

The Prosecutor General’s Office has opened a series of criminal cases after uncovering 10 billion rubles ($150 million) in losses during construction at Vostochny.

Dmitry Rogozin, who was appointed to head Russian space agency Roscosmos last year to clean it up, was at Vostochny Thursday to inspect construction of the second phase of the port, according to pictures posted on the agency’s Twitter account.

To contact the reporters on this story: Stepan Kravchenko in Vladivostok at skravchenko@bloomberg.net;Jake Rudnitsky in Moscow at jrudnitsky@bloomberg.net

To contact the editors responsible for this story: Torrey Clark at tclark8@bloomberg.net, Tony Halpin, Paul Abelsky

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