Last month, production of IBM personal computers began at the Kvant plant in Zelenograd, near Moscow. Way back in 1991 IBM Corp announced that it had begun negotiations with Moscow city government on local assembly, and according to the company, the arrangement with Kvant was the culmination of these discussion. The Kvant plant is a unit of the Nauchny Tsentr – Scientific Centre – which is involved in a whole range of scientific research projects. Most are in need of investment, and some, like a nanotechnological tool for manufacturing extremely small electronic circuits, could have a bright future. Zelenograd itself was build in the 1960s as a centre of scientific excellence to support the space and defence industries. An interesting aspect of the agreement is that IBM Russia is using the plant as a contractor and it has signed no more than a co-operation agreement with Kvant, the Nauchny Tsentr and Moscow City Government. It was probably this issue that held up progress over the last two years. Since the late 1980s there has been a deep-seated belief in Russia that all foreign companies should have to form some kind of joint venture with local organisations to be able do to business in Russia. This was particularly strong in the manufacturing sector. IBM’s policy in Russia was always very anti-joint venture and was in fact one of the very first western companies to register a wholly-owned subsidiary in the Russian Federation (then the Soviet Union). IBM has equipped Kvant with modern production equipment and has provided training for about 70 Russian workers at the Greenock, Scotland family. All the production plant and components were transported from Greenock but future plans call for components to be sourced from around the world and, if possible, from within Russia itself. Until the end of the year, the plant will be manufacturing the IBM PS/1 model 451 – 25MHz 80486SX, 85Mb disk and 2Mb to 32Mb memory. From next year production will switch to the 33MHz PS/1 model 461. The plant aims to assemble about 50,000 machines per annum. IBM now has five distributors and some 260 dealers in the Russian Federation.