Presentation on theme: "Investment attractiveness of Saratov Oblast"— Presentation transcript:
1Investment attractiveness of Saratov Oblast The Saratov Oblast government. Russian Federation.Investment attractiveness of Saratov OblastThe Ministry of Investment Policy of Saratov Oblast
2Saratov Oblast – general information South-east of European part of RussiaAdministrative center – Saratov cityArea of the Oblast – thous. sq. kmPopulation of the Oblast ≈ 2600 thous. peoplePopulation of Saratov city ≈ 850 thous. peopleDistance from Saratov to Moscow– 858 kmNational boundary with Kazakhstan – 550 kmBorders with 7 oblasts of the Russian Federation (Samara, Penza, Volgograd, Ulyanovsk, Tambov, Orenburg, Voronezh)Location of Saratov city - at one of the largest navigable waterways – the Volga riverSouthern temperate climate and advantageous fourth zoneMoscowPovolzhskiy Federal District858 kmThe Russian FederationSaratovKazakhstan
3Main economic parameters of Saratov oblast – Year 2007 Gross Regional Product(billion rubles)Industry index* – Year 2007(in % to correspondent previous period))107.1%Saratov Oblast106.3%Average index in RussiaStructure of GRP – Year 2007:Structure of foreign-economic activity - Year 200730.1%Industry15.4%AgricultureTOTAL foreign-economic activity:1874,3 million USD15.0%Transport and communication7.6%ConstructionExport: million USDImport: million USD12.8%Wholesale and retail trade19.1%Other activities
4Industrial sector Main spheres of industrial sector of the Oblast: - oil & gas industry, oil processing, power generation, chemical production, construction & production of construction materials, machine & equipment construction, production of rubber & plastic goods, etc.Number of enterprises:-1969 large & middle-scale enterprises-3218 small enterprisesGrowth rates of production:- electro-, electronic & optic equipment: 143.7%- machines & equipment: 111.8%Construction :- volume of works: 31.6 bln. rubles- put into operation ~ 1 million sq. meters of apartmentsCompetitive production:rolled glassrubber itemsaccumulator batteriessynthetic fiberwooden furniturebearingstrolley-busescarriagestobacco productsmineral fertilizersrefrigerators & freezerschemical fibersynthetic detergentswallpaperMajor foreign companies investing in the Oblast:TNK – BP Holding: JSC “Saratov oil refinery”BOSCH group of companies: JSC “Robert Bosch Saratov''Henkel company: JSC “Henkel – Yug''BAT company: JSC “BAT – Saratov Tobacco Factory"Holcim group of companies: JSC ''Volskcement''
5Agricultural sector Number of enterprises & farm households: 2Number of enterprises & farm households:- 8,000 + enterprises & farm householdsVolume of agricultural production:- 49 billion rubles- 3rd place in the Volga Federal DistrictGrowth of cattle head :- sheep head: 113.0%- pig’s head: 100.1%- great cattle: 102.4%Budgetary provisions for agriculture:- growth rate: 122.2%- financing of cattle breeding and plant cultivation grew by 1.5 timesGrowth rates:- total agricultural production: %- milk production: 106.4%- meat production: 112.8%
6Investment activities Attractive Sectors of Economy for investmentpower engineeringconstructionconstruction materials industrychemical industryoil & gas extractionautomobile constructionbiotechnologyfood industryagriculturetourismprocessing industriesetc.Volume of investments:- capital expenditures: billion rubles;- growth rate: during the period , the volume of investments grew almost by 2.5 timesInvestment Rating ( according to data of leading rating agency ''Expert-RA'‘):- 3B1 (lower potential / moderate risk) was established in regards to Saratov Oblast as of results ofCurrent investment projects with foreign capital:Metro Cash and Carry (Germany)IKEA (Sweden)BOSCH group of companies (Germany)Holcim group of companies ( Switzerland)Ramenka (Turkey)BulgarConserv (Bulgaria)Baring Vostok Capital Partners (Great Britain)
7Competitive advantages of Saratov Oblast The Oblast has at its disposal a variety of competitive advantages in respect to the main factors of Business Doing:Saratov OblastGeographical locationPolitical situationEconomic & social situationLabour forceTransport infrastructureMineral resources baseLand resourcesEnergy resources
8Competitive advantage - energy security Superfluous electric energy supply:- the volume of generated electricity is 41 billion kilowatt-hour- regional own electricity intake is less than 30 % of volume of outputFuel & energy complex enterprises:- Balakovo Nuclear Power plant- Saratov Hydroelectric Power station- Thermoelectric Power stations- Saratov oil refinerySafe fuel market:- considerable gas & oil deposits at the territory of the Oblast- regional own gas-extraction & oil exploration- total-lot gasification of inhabited localities and enterprises- crude oil processing & production of oil products at the Saratov oil refinery- two crude oil main lines (JSC “Transneft”) pass through the Oblast
9Competitive advantage - attractiveness of land resources Availability of free lands for industrial use and construction :- sites are with all the distribution & supply lines, power & heat capacitiesAvailability of free agricultural lands:- total area of more than thousand hectaresLow cost of the land
10Competitive advantage – reach mineral-resources base Solid minerals:mineral deposits more than 280 of them are accounted by State balance of reservesoccurrenceszones- 53 prospective areasCement raw materials mln. tonsChalk mln. tonsConstruction sands – mln. cubic metersGlass - making sands – 390 thous. cubic metersExpanded clays – 53.5 mln. tonsBrick - tile clays – mln. cubic metersBuilding stones – mln. cubic metersHydrocarbon deposits:- 110 deposits, incl.: are accounted by State balance of reserves- 53 developed- 36 in conservation- 21 in explorationOil mln. tonesDissolved gas bln. cubic metersFree gas – thous. cubic metersCondensate – mln. tonsNet oil shale – 9.1 bln. tons
11Mineral resources base – solid minerals: brick - tile clays
12Mineral resources base – solid minerals: expanded clays
13Carbonate rock for lime production Mineral resources base – solid minerals: carbonate rock for lime productionCarbonate rock for lime production
14Mineral resources base – solid minerals: chalkstones & dolomite rocks
15Mineral resources base – solid minerals: sandrocks & siltstones
16Mineral resources base – solid minerals: construction sands
18Mineral resources base – solid minerals: mineral paints
19Mineral resources base – hydrocarbon deposits Oil & gas, shale oil, gas condensate
20Competitive advantage – unique transport infrastructure Railroads:- South-Eastern and Volga Area divisions of the Russian Railways- railway main lines connect the Oblast with Central Russia, Urals, Siberia, Northern Caucasia and Central AsiaMotor roads:- total stretch of network in general use – thous. km- the density of hard coated motorways is 104 km for 1000 sq. meters (average indicator in Russia - 31 km for 1000 sq. meters)River transport (on the Volga river):- river way connects the Oblast with Moscow, Western Urals, the Black Sea, the Caspian Sea, the White Sea, the Barents Sea, the Baltic Sea, the Mediterranean SeaAir traffic:- JSC «Saratov airlines», state airline with regular airline service(airport of II class, international status)Pipelines:- main lines of crude oil, oil products and gas transportation pass Saratov Oblast from the east to the west «Transneft», «Blue stream», «Gazprom»
21Saratov Oblast – one of the most important transportation points of Russia Railway roadsMotor roadsWater routes
22Competitive advantage – attractiveness of labour force Low cost of labour force:- average salary is about 9,000 rubles per month, that is much less than in Moscow OblastLabour potential- economically active population includes over 1300 thousand people, that is ~ 50% of the total population of the OblastAvailability of qualified labour resources, high scientific and technical potential:- 6 institutes of the Russian Academy of Sciences- 21 Research Studies Institutes- 19 design institutes- 14 Institutes of Higher Education, lots of technical & training collegesHigh cultural, medical and educational potential
23Competitive advantage – favorable socio-political, socio-economical situation Full concord between people of different nationalities, races and creedsPolitical stability in the Oblast :- Governor is authorized for 5 years, total change of authorities in the Oblast and in all municipal entities, as well as in many federal structuresLow criminality rateInflation in the Region:%, that is lower, than in average index in RussiaThe expenses for ecological and nature protection measures:- are comparatively lowHouse making:- put into operation 1 million sq. metres of apartments in 2007, that is on % + to 2006Communication and telecommunication securityWell developed banking and insurance sectors of economics- more than 60 banks and departments- more than 70 insurance companies
24Most-Favoured-Nation Treatment for Investors in Saratov Oblast Most – favored - nation treatment for investors in Saratov Oblast is provided by: Laws of Saratov Oblast:- “On most - favoured-nation treatment for Investors in Saratov Oblast”- “On Tax Rate on Organizations Profits with Regard to Investors Engaged in Investment Activity in Saratov Oblast”- “On Transport Tax Levy in Saratov Oblast”- “On Levy of Wealth Tax on Organizations in Saratov Oblast”
25The Oblast law “On Most-Favoured-Nation Treatment for Investors in Saratov Oblast” The Oblast law «On Most-Favoured-Nation Treatment for Investors in Saratov Oblast» which come into force from January, 1, provides the investor with:- tax preferences- budget credit and budget investments- implementation of management, information consulting,coordination of interactions between different levels of governance and business environment- providing state guarantees of the Oblast- providing objects of pledge fund of the Oblast with the aim ofensuring obligations by attracting investment resources forrealization of investment projects on the area of the Oblast- using other activities, that do not contradict to federal and regionallaws
26The Saratov Oblast law “On most - favoured-nation treatment for Investors in Saratov Oblast” The Ministry of investment policy of Saratov Oblast is authorized to make investment contract with investor.Investment contract guarantees:conditions and order of providinginformation about realization of investment projectForms of interactions between investorand system of regional governance in the process of investment activityInvestor is given investment certificate after the conclusion of investment contract.
27The Saratov Oblast law “On Transport Tax Levy in Saratov Oblast” No transport tax regards to taxpayers, that follow next requirements:taxpayer must be anew created organizationtaxpayer must realize investment project, that implies acquisition of transport, according to key directions of regional economy developmentFrom the moment of creation of organization taxpayer must do capital investments in the key assets located at the territory of Saratov Oblast no less than 50 million rubles, and no less than 650 million rubles into construction
28The Saratov Oblast law “On Transport Tax Levy in Saratov Oblast” In the aim of using the law the following kinds of economic activity are key directions for the oblast economy development:agriculture, hunting and wooden economymanufacturing industriesconstructiontransport and communicationhealth services and providing social goodsindustry and power, gas and water distributionmineral extractionPeriod of releasing from transport tax:Five tax periods from the moment of the beginning industry capital investment when it was put in accountant balance of organization - taxpayer.
29The Saratov Oblast law “On Tax Rate on Organizations Profits with Regard to Investors Engaged in Investment Activity in Saratov Oblast”Profits tax of organization that is taken in the oblast budget fixed in the rate of 13.5% for anew created investor organizations:implementation of investment project according to key directions of regional economy developmentimplement from the beginning of capital investments in the key assets located at the territory of Saratov Oblast no less than 50 million rubles, and no less than 650 million rubles into construction
30The Saratov Oblast law “On Tax Rate on Organizations Profits with Regard to Investors Engaged in Investment Activity in Saratov Oblast”In the aim of using the law the following kinds of economic activity are key directions for oblast economy development:manufacturing industriesconstructiontransport and communicationhealth services and providing social goodsindustry and power, gas and water distributionmineral extractionPeriod of releasing:Five tax periods from the moment of the beginning industry capital investment when it was put in accountant balance of organization - taxpayer.
31The Saratov Oblast law “On Levy of Wealth Tax on Organizations in Saratov Oblast” Taxpayer has a right to apply Wealth Tax in the rate of 0.1%,with implementation of the following conditions:to be organization-investorimplementation of investment project according to key directions of regional economy developmentimplement from the beginning of capital investments in the key assets located at the territory of Saratov Oblast no less than 50 million rubles, and no less than 650 million rubles into constructionProperty have to correspond the following requirements:to be created (acquired) by organization – investor after 1 January 2008 in the field of investment project implementationto enter into structure of tax payment property on the territory of Saratov Oblast until the beginning of investment project implementation.
32The Saratov Oblast law “On Levy of Wealth Tax on Organizations in Saratov Oblast” In the aim of using the law the following kinds of economic activity are key directions for the oblast economy development:agriculture, hunting and wooden economymanufacturing industriesconstructiontransport and communicationhealth services and providing social goodsindustry and power, gas and water distributionmineral extractionPeriod of releasing from the transport tax:Five tax periods from the moment of the beginning industry capital investmentwhen it was put in accountant balance of organization - taxpayer.
33The most-favored-nation treatment for investors in the Saratov Oblast Most-favored-nation treatment for investors in the Saratov Oblast is provided by:State support:- mechanism of efficient interaction with investor in implementation of the projects, that includes information consulting, ensure of interaction between regional, federal, municipal powers, establishments and organizations, business in the aim of investment project implementation- Investment Counsil under the Governor of Saratov Oblast considers the investment projects planned to be implemented in the Oblast
34Investment Council under the Governor of Saratov Oblast Tasks of the Counsil:assistance to creation of favorable economic, financial and organization conditionsassistance in implementation of important for regional economy investment projectsanalysis of the governance activity in the questions of administrative barriers removalelaboration of recommendations to the state and municipal governanceGovernor of Saratov Oblast is the chairman of Investment Council, who leads it activity.
35“One – window” regime procedures of investment contract concluding process Step 1Step 2Step 3Step 4Step 5