Transcript Investment Climate in the Republic of Tatarstan

The 8th Annual
Russian Economic Forum
Speech
by Minister of Trade and Foreign Economic
Cooperation of the Republic of Tatarstan
Hafiz Salikhov
Investment Climate
in the Republic of Tatarstan:
Experience, Estimations, and
Prospects for Development
London, 12 April 2005
GDP of the Russian Federation and
GRP of the Republic of Tatarstan in 2004 prices,
RUR billion
Tatarstan
GRP of the Republic of Tatarstan in 2004 prices
GDP of the Russian Federation in 2004 prices
335,8
Trend of Russia's GDP
324,4
Trend of Tatarstan's GRP
292,6
273,4
350
300
358,3
379,8
16000
Russia
14000
254,1
12000
250
100
16778,8
14600,6
13998,7
13332,1
12120,1
150
11391,1
200
15666,5
10000
8000
6000
4000
50
2000
0
0
1998
1999
2000
2001
2002
2003
2004
Industrial Production Structure
of the Republic of Tatarstan
construction materials
1,5%
forestry, woodworking,
pulp-and-paper
1,7%
light ind.
0,7% food processing
7,6%
mechanical
engineering and
metalworking
24,8%
other
2,4%
electric energy
6,8%
2004
fuel
36,5%
chemical and
petrochemical
18,0%
Increase in Output by Sector
in the Republic of Tatarstan
115
112,9
%
110
105,5
105
112,5
2004
111,1
107,1
105
104
102,4
100,7
100
99,3
100%
95
90
85
80
Total ineering chem ical aterials d-paper industry l industry r, cereals ic energy ocessing
fue
flou
light
l eng l & petro truction mg, pulp-an
lectr food pr
a
e
c
i
n
a
a
cons odworkin
mech chemic
wo
Investment Rating
of the Republic of Tatarstan
Credit Rating of the Republic of Tatarstan :
Foreign exchange borrowings rating
Ba1 stable outlook
Long-term credit rating
В- positive outlook
Investment rating among 89 Russian regions:
 6th in investment risk
 9th in investment potential
Structure of Foreign Investments
in 2004
Republic of Tatarstan
Russian Federation
Other
73,2%
Other
75,9%
Direct
13,3%
Direct
23,3%
Portfolio
13,5%
Portfolio
0,8%
System Elements for Infrastructure
of Investments Attraction
production (modern logistics centres and hubs,
transportation networks, warehousing facilities)
organisation of the economy (various centres
and services dealing with promotion of investments,
their insurance and export promotion)
quality of life (system of additional health
insurance, information support and other social
systems)
Main Reasons for Insufficient
Amounts of Attracted Investments
lacking well-developed infrastructure for attraction
of investments
insufficient development of the stock market, land
and real estate market, and the capital market
absence of prepared projects
direct foreign investments are
focused on several large-scale projects
being implemented under the auspices
of the republic's government
investments in ordinary projects are
virtually absent, though the republic has
some excessive investment resources
Composition of Investors
as a rule, only technologically related to
the enterprise are being invested
those primarily interested in the source of
raw material, a place for arranging the
production, and cheaper labour force
for the most part, investors do not
consider our economy as a safe and expedient
place to invest money and make profit
Programme for Improving the
Investment Attractiveness of the
Republic of Tatarstan
aimed at implementation of pilot infrastructural projects
identified by the Government of Tatarstan as priority
projects oriented to international financial and business
community
efficient commercial projects should stimulate business
activities in the republic and become a kind of growth
centres
they would be implemented on the pledge-free
commercial basis, with the use of insurance mechanisms
and instruments of securities market
Measures to Improve the Investment Attractiveness
of the Republic of Tatarstan
 Increasing the growth rates of people’s real income
 Increasing the financial efficiency of existing enterprises
 Attracting to the republic most high-performance and technologically
advanced enterprises
 Encouraging enterprises which provide the best earning records and
highest pay rises
 Providing incentives to the process of production re-equipment,
replacement and withdrawal of fixed assets
 Providing priority incentives to small business development as a factor to
increase the level of people’s real income and to meet consumer demand
for goods and services
 Developing transportation and communication infrastructure – primarily,
through wider use of up-to-date communication facilities
 Encouraging the funding of sciences and scientific services, establishing
technology parks and hi-tech cities
Risks Whose Indices Have a Potential of
Being Decreased



Legislative risks:
Non-transparency of investor support procedures
Lack of a system of documents contributing to the improvement
of the republic’s investment attractiveness
Environmental risks:
Still essential waste water contamination
Criminal risks:
 Rather high level of crime including such connected to drug
trafficking
Financial risks:
 Low rates of budget parameters improvement
Programme for Development of
Innovative Activities in
the Republic of Tatarstan for 2004-2010
special attention in implementing investment
programmes is devoted to innovative aspects and priority
development of hi-tech processing sectors
we intend to allocate government resources for
support of those sectors of the economy which can cause
a multiplicative effect on the development of other
sectors, ensure the innovative nature and growth in
efficiency of production and efficiency of labour in the
economy in general
Programme for Development of Innovative
Activities in the Republic of Tatarstan for 2004-2010
Tatarstan Investment Venture Fund which accumulates
investment and directs it to the implementation of innovative
projects
A number of sectoral innovative centres and technology parks
based on the leading universities of Tatarstan
State Non-Commercial Organisation “Stabilisation Pledge and
Insurance Fund of the Republic of Tatarstan” intended to ensure
financing for investment programmes and projects aimed at
economic and social development of the Republic of Tatarstan
Another important element for commercialisation of scientific
research results is the Innovative Technopark “Idea”
Creation of Industrial Districts
in the Republic of Tatarstan
Kazan
OAO Kazanorgsintez
Nizhnekamsk
OAO Nizhnekamskneftekhim
Naberezhnye
Chelny
OAO KamAZ
The project’s mission is to develop the industrial potential
of the republic by attracting a large number of small to
medium businesses.
Tatarstan Regional Investment Bank
(TRIB)
It will offer a complete range of financial services in
accordance with international practice
To date, a feasibility study for the TRIB project was
prepared together with Hogan & Hartson, a US leading law
firm; we are working to attract international financial
institutions to the implementation of this project
We invite potential partners who wish to do
business in our republic and are prepared to
cooperate with us in the implementation of this
project
Celebrations of the Millennium
Anniversary of Kazan
Kazan, the capital of the Republic of Tatarstan, was inscribed
in the UNESCO World Heritage List
one of the largest economic, scientific and cultural centres of
Russia
a city of higher education establishments, theatres and
museums, international festivals and contests
a city where Asia unites with Europe, mosques amicably
neighbour on churches, and hoary legends are carefully preserved
against the background of the onrushing advent of the latest
technologies
Празднование 1000-летия
города Казани
состоится 30 августа 2005 г.
Предстоящий юбилей является
событием не только российского,
но и мирового масштаба
Welcome!
Добро
Приглашаем
всех желающих
пожаловать!
на празднование города!
Рәхим итегез!