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Zavolzhye industrial zone has received industrial park certification

28.04.2011

The Ulyanovsk industrial zone Zavolzhye was one of the first three certified Russian industrial parks. Certificate number 3 was awarded during the international investment forum Industrial Parks of Russia 2011.

"For us this is a sign of quality," explained Sergey Vasin, Executive Director of Ulyanovsk Region Development Corporation. "There are 150 projects in Russia today called "industrial parks". However, many are not even projects but schemes. They are agricultural lands several kilometres from roads and railway lines. In actual fact, there are only about ten sites in Russia that could properly be called industrial parks that have utility and transport infrastructure. These have roads, power grids, management companies who own the land and the development concept has been developed.

To help guide investors through the various offers voluntary certification was introduced. This decision was taken by the Russian Ministry of economic development and the Association of Russian Industrial Parks. There are two types of certificate: an active industrial park (Ulyanovsk Region received this), issued for two years, and industrial park project (for one year). According to Mr Vasin, of the first eight zones to receive this document, four are brownfield (for these parks ready production capacity and sites were used). Zavolzhye industrial zone and three Kaluga projects are Greenfield, literally created on a clear field from scratch.

There are two large foreign residents in the Ulyanovsk industrial zone (and a few small local ones) and two more are being built. The industrial park occupies 500 hectares (it is partly owned by Ulyanovsk Region Development Corporation and partly by municipal and regional authorities). At the moment 340 hectares are unoccupied. Mr Vasin says that there is room for another 15 small enterprises.

"If an investor decides to place their production in an industrial park, they can save up to

50 percent of the time needed for the whole process, beginning from registering the land plot to launching the first products," commented Vladimir Kozin, First Deputy Governor of Ulyanovsk Region. "Ulyanovsk industrial zone residents are offered certain preferences: profits tax benefits, exemption from property tax, land and vehicle tax. But foreign investors today already expect more than simple benefits. We have developed transparent, non-targeted, support measures which depend on the number and quality of created jobs. An investor who implements a project worth five million euros gets their investment back, they receive regional grants for a period of eight years. Therefore, the more efficient the business the greater the personal income tax and correspondingly higher salaries and more jobs, so the support becomes more important. This approach is understood by Russian and foreign companies.

All together, over three years the regional government has a deficit of about 300 million roubles from providing incentives to industrial zone residents. But tax receipts from just two companies operating in Zavolzhye for 2010 were 1.2 billion roubles.

Ulyanovsk authorities intend to turn to the Russian Ministry of Economic Development and Trade and Ministry of Finance with a proposal to reward regions which attract the greatest number of investors, as tax agents attracting additional funds to the federal finances.

Source: Rossiyskaya Gazeta