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Competitive opportunities

The country is on the right track

First Deputy Governor of the Primorsky Territory Vasily Usoltsev - about the Eastern Economic Forum and about the changes that await the Far East in the near future.

Competitive opportunities

- Vasily Ivanovich, how is the preparation for the East Economic Forum going?

- Preparations for the event are actively. There is a three-level training management system: an organizing committee headed by Yury Trutnev, a directorate chaired by State Duma deputy Grigory Kuranov, and a working group led by Primorsky Territory Governor Vladimir Miklushevsky. We all work closely together. A working group led by the governor meets on a weekly basis. The management of the forum has already moved to Vladivostok. We expect over a thousand participants and more than 2,5 thousands of accompanying persons, including journalists.

The difference between the Eastern Economic Forum and Sochi and St. Petersburg is that ours will be more compact. Selection of participants is conducted by the organizing committee. A large number of investors will come to the forum. According to the Governor of Primorye, Vladimir Miklushevsky, the main goal of the forum is to be practical-oriented. Within its framework, it is planned to sign investment agreements and agreements of intent. All nine regions of the Far East will be represented at the forum: of course, we are waiting for profitable agreements for Primorye.

The forum should solve a number of tasks - to offer the competitive opportunities of the Far East for investors, to ensure a high level of awareness of the guests of the forum about Primorye, to promote the establishment of personal contacts of various business circles of the Asia-Pacific countries. The presentation of the opportunities and needs of the Far Eastern lands should be aimed at forming a portfolio of specific proposals for investors. We should not offer investors general thoughts about geographical location or possible prospects, but concrete conditions for the implementation of investment projects.

Also, within the framework of the forum, speech sessions are planned, in which representatives of the APR countries will take part. This is our specificity, we are oriented to the East. But, nevertheless, we are waiting for guests from the European Union, the USA, and Israel. It is equally important for us to participate in the forum of Russian investors.

- The price of participation in the forum is 150 thousand rubles for each participant. Why so expensive?

- This decision is made by the organizing committee, organizer of the forum. As far as I know, the decision on cost was taken on the basis of studying the average price for participation in Russian and foreign forums. The basic reason - the forum does not spend a single penny from the budget. The forum will be held at the expense of contributions from participants and sponsors.

- What should become the basis for the accelerated development of the Far East: the sale of raw materials or high technology?

- Here I will express my personal opinion, because I can not speak for investors and forum participants. As a resident of Primorsky Krai, a person who was engaged in the past business, worked in the legislative and executive branches of power, I think that it is impossible to divide the reasons or opportunities for the accelerated development of the Far East and, moreover, to say that natural resources are the curse of Russia. I believe that they are our competitive advantage. We must calmly, confidently and safely master raw materials, sell them abroad, try to find niches in which we are competitive in processing.

But this needs to be done not everywhere, because there are already constructed processing facilities that cannot be “surpassed”, or to attract the financial resources of the state so that duplicate capacities are built with us. In any case, it is necessary to approach carefully, find their specialization and quietly replenish the budget from commodities. For example, to make a metallurgical plant competitive, large volumes of extracted raw materials are needed, and then we can speak about the construction of processing facilities. In the meantime, our raw materials are mined separately. We still cannot realize the plans that were once considered in the Soviet Union when large, powerful processing plants were put on the coast and collected raw materials, concentrate, and ore. This is the only way to ensure large volumes of processing. If this is not possible, then it is necessary to make concentrates and sell them abroad. I do not see anything wrong with this, if it is a modern ecological production with good wages for people. This may be the easiest way to grow the Far East.

But do not forget about high technologies, in particular, in the Primorsky Territory, we are talking about the TOP on the Russian Island with three specializations. One of them is techno-innovative - it is the development of new technologies for future productions. In this we see one of the elements of the accelerated development of the Far Eastern Federal District. But if to speak with reference to the Primorye Territory, one of the sources of the accelerated growth of the Far East is transport and logistics services. Geography dictates its own, Primorsky Krai is the "gateway" for the entire Far East.

In addition, today, an investment project of Rosneft for the construction of a complex of oil refining and petrochemical facilities of CJSC Eastern Petrochemical Company and the Zvezda shipyard is being implemented in Primorye. The launch of the shipyard "Star" will increase the level of import substitution in the region. The shipyard is dozens of times different from the ship-repair load and processing volume. All industrial enterprises of the Far East will receive orders for inter-plant cooperation. This will increase productivity, there will be new jobs. Now at the Zvezda Shipyard, active work is underway on the first phase of construction. They will build ships for the development of hydrocarbon deposits on the Arctic shelf.

- Do we possess the appropriate scientific potential for the development of high technologies?

- This is a separate, difficult question. The whole world today is fighting for highly qualified specialists. If we talk about the Far East, we are not satisfied with the scientific potential and personnel that we have now. The task is complex, because besides the training of qualified personnel, we must convince them to stay in the Far East. Here our main task is to create the best conditions for them. But I can confidently say that there is no mass outflow of young people from Primorye.

In addition, young people today can get a good education in the region. This is the Far Eastern Federal University, where, by the way, many foreign tourists study. VSUES, in which, for example, there is an institute of international tourism and hotel and restaurant business. Its students undergo training abroad, and the specialists trained here are in demand all over the world.

- V.Putin signed the law on the "Free Port of Vladivostok": what future is the city waiting for?

- A great work has been done - a law that is meaningful for the entire Far East and opening up new opportunities for the territory is passed quickly and quickly. Free port Vladivostok is created for seventy years. At the same time, it is envisaged to extend both this term and early termination of the application of measures of state support for entrepreneurial activity on its territory.

In the Freeport will act special legal regime of the business and investment, and will create the best business environment in relation to the same areas, operating in the Asia-Pacific region.

Also, the law provides for additional mechanisms for supporting residents and established norms that allow the creation of a Freeport zone in the Free Port of Vladivostok.

The bill was developed with the involvement of a large number of experts, people from business, and a total of 750 people took part in the discussion of the law. We tried to use the best practices of the countries - “Asian tigers”, as they are called.

- The media writes that the law allows you to create the best conditions for business development throughout the APR, is this really so?

- The draft laws are based on the principles of creating a competitive business environment in comparison with the countries of the Asia-Pacific region. The accepted rate of social contributions is 7,6 percent. It is lower than in Singapore, Japan, Republic of Korea. In addition to Vladivostok, 15 municipalities of the region are included in the Freeport border - the entire southern part of Primorye. Simplified visa regime for foreign citizens staying on the territory of the Free Port on 8 days is an initiative of the Primorsky Territory, voiced during extensive public discussions of draft laws. According to business estimates, tax and customs benefits introduced in the Free Port will reduce the cost of implementing investment projects by up to 40 percent.

- It turns out, according to the law, a foreign company can buy the land, build a plant, and, without selling goods here in Russia, can bring it to other countries? And at the same time the company will pay VAT?

- Simply put, yes, the company will pay VAT, but it will return on an accelerated schedule. Such a company does not fall under customs duties, will not pay the first ten years of income tax, it has a simplified form of obtaining all construction permits, simplified land acquisition. In practice, the law simplifies the bureaucratic procedure and greatly facilitates the conduct of business.

- Then for us, the Far East, what is the profit from this?

- First of all, the law will allow to create favorable conditions for the expansion of cross-border trade, the development of transport infrastructure and the further integration of the Russian economy into the system of international economic relations of the countries of the Asia-Pacific region. For us, these are new jobs and, of course, additional revenues to the budget of the subject.

- There is such a practice that when investors build factories, they usually try to attract qualified personnel. If they are not among local specialists, they bring their own, foreign ...

- I do not see anything terrible in this. In any case, all countries of the world have passed this experience. And the same China, twenty-five years ago, brought in foreign specialists who helped in training the local residents, who are now working quite successfully.

Economic laws do not always have a linear effect. If you are behind by 20 years, then you can not say that there is no way to get around the competitor in a bend. And the leadership of the country has set such a task. Why now we are introducing unprecedented measures to simplify business conduct, because we realize that 20 years ago we missed somewhere, did not pay proper attention to our own manufacturer, we missed industrial policy somewhere. The main thing is to re-think in time, make an amendment to your policy. And now, in my opinion, the country is on the right track.

- And what will Vladivostok be like in the future - skyscrapers, glamor and splendor, and on Tigrovaya hill a huge tower like Seoul ...

- You see, I am not a person of stereotypes, I think that it is necessary, first of all, to understand why, and then what to build. Here, the skyscrapers would have been redundant - we have a large area for development, unlike Singapore, Shanghai, Seoul.

We signed an agreement on the Vladivostok agglomeration, which included the Vladivostok and Artyomovsky urban districts, the Nadezhda and Shkotovsky municipal districts. Agglomeration involves the integration of settlements without changing their boundaries. This will allow municipalities to pursue a coordinated urban planning policy, to form a unified management policy, to develop transport, engineering and social infrastructure. So it makes no sense for us to stick around on the same peninsula of Muravyov-Amursky. They build skyscrapers because they have little land. We have no need to go upwards, we better expand. We are Far Easterners, a little bit different, with a different scale, we need open spaces. Far East are strong because they built their own destiny with their own hands.

- Will TORs become breakthrough points of economic growth in the Far Eastern District?

- It is important to understand here that today we have at least three tools to support the economy and business: it is the Free Port of Vladivostok as the basic law that provides opportunities for the territory, business development.

In the TOP similar rules of the law on support and simplification of business. TORs differ from the law on the Freeport by the fact that they are supplemented by federal investments in infrastructure. The business receives as a bonus free roads, electricity, water, sewage, gas, all related infrastructure.

The third support tool is SEZ, which is more local than TORs: in addition to the infrastructure, production blocks for production are also provided. That is, there will be shops that the state will build at its own expense. There are few other forms of enterprise support.

- Vladivostok Airport since 2012, has an open sky mode, it was a kind of TOP form. The funds invested in the infrastructure, he has not yet justified. That is, it has not yet become such a port where planes from all countries would fly.

"It's a matter of competition, like in any other business." Next to us are the most powerful hubs of China, South Korea, Japan, which have such an infrastructure, and took away the client base. It's a matter of fighting for your client. Technical capabilities of the airport will allow us to implement the planned projects. Large projects will attract a large flow of people.

Now the construction of an integrated entertainment resort zone is underway in Primorye, and an aquarium on Russky Island will soon be opened for a thousand visitors a day. All this will certainly attract a large number of tourists to Primorye. At the same time, foreigners will be able to take advantage of the simplified visa regime at the entrance to the territory of the Free Port on 8 days.

- I noticed that this year there were not enough electric trains leaving the airport to the city.

- The problem of suburban transportation affected the whole country. Our railway has gone from federal co-financing, and the burden of subsidizing tickets has shifted to the subjects. All subjects were in a difficult position for suburban communications. We have a suburban message from the airport carried out by a private company, which declared then that it was not able to pay the losses and refused to provide such services. We annually subsidize 320 million rubles from the regional budget to provide suburban transportation. And in order to sustain the schedule that was previously, it still takes considerable time. We analyzed the demand for suburban transportation - canceled unclaimed flights, those in demand among the population - preserved.

- Will the Far East save 1 hectares? How is Primorye going to implement a new mechanism for attracting personnel to the Far East?

"The law will probably be accepted soon." There are a lot of land, but it is impossible to take - some of the lands are involved in agricultural turnover, some are recreational zones or specially protected natural areas.

The new bill is an additional measure to attract people to the Far East. I myself will gladly use this rule of law if it is adopted. Now citizens, having the right to receive land, receive it with great difficulties.

We are already being approached by a large number of people from all over the country with applications for receiving a hectare of land. It will be issued on 5 years, if during this time the land has mastered, then it is transmitted free of charge.

When our ancestors came to the Far East, they were given free land, they mastered it on their own. Today, there are additional financing mechanisms, for example, there are regional support programs for beginning farmers. I'm not saying that you can live at ease with 1 ha, but you can definitely provide yourself. This is a tool for securing the territory: land is not allocated within the city limits, it is rural, forest land, where you can engage not only in agriculture, but also in tourism.

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