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Investment attractiveness of Saratov Oblast

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Presentation on theme: "Investment attractiveness of Saratov Oblast"— Presentation transcript:

1 Investment attractiveness of Saratov Oblast
The Saratov Oblast government. Russian Federation. Investment attractiveness of Saratov Oblast The Ministry of Investment Policy of Saratov Oblast

2 Saratov Oblast – general information
South-east of European part of Russia Administrative center – Saratov city Area of the Oblast – thous. sq. km Population of the Oblast ≈ 2600 thous. people Population of Saratov city ≈ 850 thous. people Distance from Saratov to Moscow– 858 km National boundary with Kazakhstan – 550 km Borders 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 river Southern temperate climate and advantageous fourth zone Moscow Povolzhskiy Federal District 858 km The Russian Federation Saratov Kazakhstan

3 Main economic parameters of Saratov oblast – Year 2007
Gross Regional Product (billion rubles) Industry index* – Year 2007 (in % to correspondent previous period)) 107.1% Saratov Oblast 106.3% Average index in Russia Structure of GRP – Year 2007: Structure of foreign-economic activity - Year 2007 30.1% Industry 15.4% Agriculture TOTAL foreign-economic activity: 1874,3 million USD 15.0% Transport and communication 7.6% Construction Export: million USD Import: million USD 12.8% Wholesale and retail trade 19.1% Other activities

4 Industrial 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 enterprises Growth 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 apartments Competitive production: rolled glass rubber items accumulator batteries synthetic fiber wooden furniture bearings trolley-buses carriages tobacco products mineral fertilizers refrigerators & freezers chemical fiber synthetic detergents wallpaper Major 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''

5 Agricultural sector Number of enterprises & farm households:
2 Number of enterprises & farm households: - 8,000 + enterprises & farm households Volume of agricultural production: - 49 billion rubles - 3rd place in the Volga Federal District Growth 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 times Growth rates: - total agricultural production: % - milk production: 106.4% - meat production: 112.8%

6 Investment activities
Attractive Sectors of Economy for investment power engineering construction construction materials industry chemical industry oil & gas extraction automobile construction biotechnology food industry agriculture tourism processing industries etc. Volume of investments: - capital expenditures: billion rubles; - growth rate: during the period , the volume of investments grew almost by 2.5 times Investment 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 of Current 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)

7 Competitive 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 Oblast Geographical location Political situation Economic & social situation Labour force Transport infrastructure Mineral resources base Land resources Energy resources

8 Competitive 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 output Fuel & energy complex enterprises: - Balakovo Nuclear Power plant - Saratov Hydroelectric Power station - Thermoelectric Power stations - Saratov oil refinery Safe 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

9 Competitive advantage - attractiveness of land resources
Availability of free lands for industrial use and construction : - sites are with all the distribution & supply lines, power & heat capacities Availability of free agricultural lands: - total area of more than thousand hectares Low cost of the land

10 Competitive advantage – reach mineral-resources base
Solid minerals: mineral deposits more than 280 of them are accounted by State balance of reserves occurrences zones - 53 prospective areas Cement raw materials mln. tons Chalk mln. tons Construction sands – mln. cubic meters Glass - making sands – 390 thous. cubic meters Expanded clays – 53.5 mln. tons Brick - tile clays – mln. cubic meters Building stones – mln. cubic meters Hydrocarbon deposits: - 110 deposits, incl.: are accounted by State balance of reserves - 53 developed - 36 in conservation - 21 in exploration Oil mln. tones Dissolved gas bln. cubic meters Free gas – thous. cubic meters Condensate – mln. tons Net oil shale – 9.1 bln. tons

11 Mineral resources base – solid minerals: brick - tile clays

12 Mineral resources base – solid minerals: expanded clays

13 Carbonate rock for lime production
Mineral resources base – solid minerals: carbonate rock for lime production Carbonate rock for lime production

14 Mineral resources base – solid minerals: chalkstones & dolomite rocks

15 Mineral resources base – solid minerals: sandrocks & siltstones

16 Mineral resources base – solid minerals: construction sands

17 Mineral resources base – solid minerals: gaizes

18 Mineral resources base – solid minerals: mineral paints

19 Mineral resources base – hydrocarbon deposits
Oil & gas, shale oil, gas condensate

20 Competitive 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 Asia Motor 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 Sea Air 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»

21 Saratov Oblast – one of the most important transportation points of Russia
Railway roads Motor roads Water routes

22 Competitive 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 Oblast Labour potential - economically active population includes over 1300 thousand people, that is ~ 50% of the total population of the Oblast Availability 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 colleges High cultural, medical and educational potential

23 Competitive advantage – favorable socio-political, socio-economical situation
Full concord between people of different nationalities, races and creeds Political 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 structures Low criminality rate Inflation in the Region: %, that is lower, than in average index in Russia The expenses for ecological and nature protection measures: - are comparatively low House making: - put into operation 1 million sq. metres of apartments in 2007, that is on % + to 2006 Communication and telecommunication security Well developed banking and insurance sectors of economics - more than 60 banks and departments - more than 70 insurance companies

24 Most-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”

25 The 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 of ensuring obligations by attracting investment resources for realization of investment projects on the area of the Oblast - using other activities, that do not contradict to federal and regional laws

26 The 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 providing information about realization of investment project Forms of interactions between investor and system of regional governance in the process of investment activity Investor is given investment certificate after the conclusion of investment contract.

27 The 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 organization taxpayer must realize investment project, that implies acquisition of transport, according to key directions of regional economy development From 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

28 The 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 economy manufacturing industries construction transport and communication health services and providing social goods industry and power, gas and water distribution mineral extraction Period 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.

29 The 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 development implement 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

30 The 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 industries construction transport and communication health services and providing social goods industry and power, gas and water distribution mineral extraction Period of releasing: Five tax periods from the moment of the beginning industry capital investment when it was put in accountant balance of organization - taxpayer.

31 The 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-investor implementation of investment project according to key directions of regional economy development implement 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 Property have to correspond the following requirements: to be created (acquired) by organization – investor after 1 January 2008 in the field of investment project implementation to enter into structure of tax payment property on the territory of Saratov Oblast until the beginning of investment project implementation.

32 The 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 economy manufacturing industries construction transport and communication health services and providing social goods industry and power, gas and water distribution mineral extraction Period of releasing from the transport tax: Five tax periods from the moment of the beginning industry capital investment when it was put in accountant balance of organization - taxpayer.

33 The 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

34 Investment Council under the Governor of Saratov Oblast
Tasks of the Counsil: assistance to creation of favorable economic, financial and organization conditions assistance in implementation of important for regional economy investment projects analysis of the governance activity in the questions of administrative barriers removal elaboration of recommendations to the state and municipal governance Governor of Saratov Oblast is the chairman of Investment Council, who leads it activity.

35 “One – window” regime procedures of investment contract concluding process
Step 1 Step 2 Step 3 Step 4 Step 5


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