Anton Siluanov, First Deputy Prime Minister, encouraged subjects of the Federation to use the experience of Smolensk region

Smolensk, March 25. During a videoconference on improving the business climate with the heads of subjects of the country, Anton Siluanov, First Deputy Prime Minister of Russia - Minister of Finance, encouraged them to use the experience of Smolensk region in attracting investment. The detailed plan of such work was presented to the First Deputy Prime Minister by Governor Alexey Ostrovskiy.

At the meeting, Maxim Oreshkin, Minister of Economic Development, presented a consolidated rating of the quality of the investment policy in the regions, based on the indicators in the four key areas: high-performance jobs; real wage dynamics; staff number at small and medium enterprises; investment activity excluding treasury money.

Smolensk region ranked tenth out of 85 in this rating. As for other regions of Central Russia, only Moscow also entered the top 10. Alexey Ostrovskiy spoke in detail about the designed plan for attracting investments to the region, so that their level exceeds a quarter of the gross regional product:

“Smolensk region has achieved some positive results in attracting investments in the region development:

- in 2018, the volume of investments increased compared to 2017 by 14 billion rubles and exceeded 71 billion rubles. This is the highest value in the entire history of the region (+ 17.7% in comparable prices, while in Russia it is 4.3%);

- according to the dynamics of the investment volume in fixed assets over the past year, Smolensk region ranks second among the subjects of the Central Federal District (second only to Moscow Region) and 13th among the 85 regions of the Russian Federation;

- the share of investments in the gross regional product for 2018 was 24.7%, which is 4% higher than the previous year.

It is fundamentally important that this result was achieved not at the expense of the budget, but precisely at the expense of private investment, the share of which has so far increased up to 83-85%. In 2012, when the leaders of the country entrusted me with the task to head Smolensk region, this figure was only 72%. In two years, we have risen from the 80th to the 31st place (+49 positions) in the investment climate rating. To achieve the goals to ensure economic growth and increase the share of investments in the gross regional product by more than a quarter, set by the President of our country Vladimir Vladimirovich Putin, I gave instructions to the relevant authorities to develop a clear and concrete action plan for attracting investments.

The plan for the investment development of the region has been designed taking into account modern realities, best practices, needs and abilities of our region, and its potential”.

The governor reported on what had had already been done:

“First, on the regional level, the nine priority sectors have been identified to be focused on when attracting investments. For example, among them there is flax growing, greenhouse vegetable growing, dairy farming, fertilizer and composites production.

Second, investment volumes have been calculated for each priority, taking into account the market capacity and the resources available in our region. For example, in the region per capita consumption of vegetables is 49 kg less than a set norm. We need at least 12 billion rubles of investment to create 60 hectares of greenhouses to meet this demand. Thus, a specific and quantifiable task has appeared before the investment and agricultural blocks of the Administration and regional development institutions. The same is true in all the priority sectors.

Third, in the strategy there is an answer on who the potential investors are. To this end, we have carried out the analysis of business development plans, investment programs of Russian and foreign companies operating in our priority sectors. We have compiled long-lists of investors and begun to work with these specific companies on localizing investment projects in Smolensk region.

Fourth, all our priorities and investment projects are clearly connected to the municipalities. Now, investors know for sure where there are electric power supplies or land plots for example, for flax growing, available, or where there are available wood cutting areas for organizing wood processing. Through this connection, it is clear where it is possible to create special economic zones, advanced development territories or industrial parks, which territories, first of all, need engineering and transport infrastructure. It serves as a basis for designing an investor-oriented plan of infrastructure development, which is synchronized with investment projects. It is fundamentally important that each municipality understands the priorities in their work.

Fifth, the revision of state support measures has been performed considering their orientation towards the needs of investors in specific segments. This will help to increase saving, improve the efficiency and rationality of the use of financial resources allocated for state support of investment activities and increasing growth rates.

I should note that due to the work we have done, we can accurately assess the effect of attracting investments in terms of the growth of the gross regional product (GRP) and increase in the share of investments in it, as well as the increase in the taxable base. In fact, to achieve the goals set by the Head of State, we have to attract about 190 billion rubles by 2025. This will allow to create about 16 thousand new jobs, the share of investments in GRP will reach 27%. Thus, clear tasks for the entire system of development management in Smolensk region have appeared both at the level of the subject and at the municipal level.”

Aleksey Ostrovskiy assured Anton Siluanov that this investment strategy will make it possible to deal with strategic tasks in the economy sector much more efficiently and systematically:

“I believe that designing similar plans for attracting investments at the level of the subjects of the Federation, followed by consolidating them into unified plans for federal districts, will help to avoid duplication of production and infrastructure facilities being created, reduce the risks of overproduction, and achieve targeted results determined by the President of our country more quickly and at lower cost".

After such an informative report from the Governor of Smolensk region, First Deputy Prime Minister acknowledged:

“This interesting experience could probably be taken note of by the other subjects of the Russian Federation. Well, the results are not bad. You said that it was 17.7% of the growth of investments over the past year and, accordingly, the 13th place in Russia in terms of the overall, so-called composite, indicator, on the investment attractiveness of the subject. So thank you for this work. I think that colleagues could also make use of your experience.”

It should be reminded that according to the results of the “Russian Investment Forum”, Alexey Ostrovskiy has set the task to bring Smolensk region to the top-20 in the investment rating of the “Agency for Strategic Initiatives”.