MOSCOW (Reuters) - Russian state development bank VEB signed an agreement on Tuesday to attract 6 billion yuan (£682 million) from China Development Bank for innovations, including the development of blockchain technologies, VEB head Sergei Gorkov told reporters.
Blockchain technology provides an electronic record-keeping and transaction-processing system, which lets all parties track documentation through a secure network and requires no third-party verification.
In a separate statement on Tuesday on the deal, VEB said it had signed a framework agreement with China Development Bank under which the Russian lender will receive 50 billion roubles ($844 million) in financing over 15 years.
VEB is under Western sanctions over the Ukraine conflict and therefore cannot raise long-term financing from U.S. and European investors.
VEB has been grappling with a mountain of bad debt after projects in Russia such as construction for the Sochi Winter Olympics.
The framework agreement was signed during Chinese President Xi Jinping’s visit to Moscow.
The financing will be in the form of participation in private equity funds and the repurchase of bond issues. It will be targeted at supporting high-tech and innovative projects.
The money provided “can be used to finance projects in energy, transport, industrial and energy infrastructure, cross-border projects in Siberia and the Far East,” Gorkov said in a statement.
China Development Bank has been a partner of VEB for about 11 years and has signed credit agreements with VEB for more than $10 billion, the statement said.
Reporting by Denis Dyomkin and Kira Zavyalova; writing by Dmitry Solovyov and Polina Nikolskaya; editing by Katya Golubkova and Jason Neely