Russia's Jewish region builds bridge to China

By Robin Paxton

BIROBIDZHAN, Russia (Reuters) - Russia's Jewish Autonomous Region, a curious territory for Jews created by Josef Stalin, is playing a big role in a new drive by Russia to boost exports to China.

Located in the far southeast of Russia and closer to Beijing than to Moscow, the region is gearing up for construction by 2010 of a bridge across the Amur River, the first to link Russia and China.

The bridge will carry iron from largely untapped deposits in Russia's Far East to steel mills in China, a new front in Russia's push to develop the region and sell raw materials to China.

"Products from Moscow to Kamchatka will cross the border in our region," said Valery Gurevich, deputy governor of the region, referring to the volcanic Kamchatka peninsula thousands of kilometers (miles) to the north.

In his office overlooking a statue of Lenin in Birobidzhan, the province's administrative capital, Gurevich's telephone rings several times a day with business proposals from China.

The calls will only grow more frequent after the bridge is constructed, Gurevich, the son of Jewish settlers who arrived here in the 1930s, told Reuters.

Stalin carved the oblast, or region, out of the marshy fringes of Russia's Far East as a homeland for Soviet Jews, part of a policy in which each national group in the Soviet Union had its own territory. It received autonomous status in 1934.

Today, 185,000 people live here and only a minority is Jewish. Jews account for about 5 percent of the 75,000 residents of Birobidzhan, but more are returning after an exodus following the break-up of the Soviet Union.

A 540-kilometre (340-mile) stretch of the Amur River defines the border between the region and China's Heilongjiang province, where nearly 40 million live.

Pending approval from the Kremlin and Beijing, the river will be bridged at the town of Nizhneleninskoye. Much of the traffic will be iron ore mined at the Kimkan and Sutara deposits in an $800 million project run by London-listed miner Aricom Plc

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Aricom plans to ship over 3 million tonnes of iron from 2011 to steel furnaces in China, which produced nearly 420 million tonnes of steel last year -- a third of the world's total.

"The deposit is undoubtedly one of the largest unexploited iron ore projects in the world and benefits from both excellent infrastructure and close proximity to end market," Aricom Chief Executive Jay Hambro said.

The bridge would almost halve the cost of transporting iron to China, he says, to just below $5 a tonne from $9.15 using the current projected cross-border route.

The iron will further help Russia's trade balance with China. Last year, it exported $15.8 billion worth of goods to China and imported $12.9 billion.