"We Are Actively Engaged in the Vladivostok Free Port"
In Khabarovsk Krai, relations with the residents of the Free Port are coordinated by the Regional Development Corporation. Deputy Director General for Investment Development Nikolai Alexandrov explains what exactly constitutes the practical work with investors.
– The Khabarovsk Krai Development Corporation is a relatively young organization. What are its goals?
– The name of our organization obliges us to pursue goals that lay the strategic foundation for the development of projects within the region's borders. Our main goals are to support the development of Advanced Special Economic Zone both in terms of attracting residents and creating new areas. One of the most important parts of our work is supporting the development of the Russian part of Bolshoy Ussuriysky island. We also provide practical help to complex investment projects. We are actively participating in the development of the Free Port regime in the region, working with potential and current residents of the Free Port of Vladivostok. This does is not all that we do.
– Have there been any results yet?
– Tangible results include the completed design documentation for a children's hospital complex in Komsomolsk-on-Amur; a feasibility report on installing a state border checkpoint on Bolshoy Ussuriyskiy island; a concept and plan for the potential development of the Nikolaevsk ASEZ; a development business plan for potato farming in Khabarovsk Krai; a business plan for building a sugar-mill in Sovetskaya Gavan; and a completed inventory of land plots allocated for FPV residents in Vanino District.
I could also mention dozens of negotiations conducted with potential investors, ASEZ and FPV residents; we have helped them resolve hundreds of issues – from cadastral registration to adjustments to financial models of business plans. Fortunately, we managed to build a team, small, but very competent, that easily resolves any "investment project relations".
– How does the Corporation generally influence regional development through working with investors?
– Within the Corporation, when resolving any issue, we don't seek just to resolve it. We implement a comprehensive approach. For example, the goal of the potato farming project is not just to make a profit, it is to use this profit to address tasks for the whole industry, such as seed farming development, etc. Another example. We are helping a potential investor to develop a concept for a food products logistics center. Being aware of the limits of the domestic market's capacity, we are establishing contacts with one of the leading food corporations in China and with producers in Khabarovsk Krai, which development will be affected by this project.
– Could you give us some more details about your work with FPV residents and issues regarding the development of this regime in the region?
— We have been actively engaged in FPV work since October 2016. During this period, the Corporation has organized work on providing consultation and methodological support for future FPV residents who are preparing applications to gain resident status for the Free Port of Vladivostok in Khabarovsk Krai.
We have already signed agreements with five companies, granting them the status of Free Port residents.
In terms of specific practical work, the Corporation has invested substantial efforts in preparing applications from the Toki Brick Factory and Forum DV. Namely, we completed prior verification of documents for compliance with the requirements of the Federal Law regulating activities that benefit from the Free Port of Vladivostok regime. We helped prepare investment project presentation materials and projects to be reviewed by the Commission within the Supervisory Board of Khabarovsk Krai.
Similar work with potential FPV residents is also underway. Today, there are five companies which applications have been approved; they are waiting for the agreements to be signed, which will allow them to cooperate with the Management Company of the Far East Development Corporation JSC. To make this happen, we actively cooperated with the Management Company on issues regarding the review of applications and making corrections in accordance with the comments, until a positive conclusion was reached regarding the projects and the investors were sent agreements on business activities.
Several initiators of investment projects are preparing their applications to the Management Company. They include projects for milk processing, services, aquaculture farming, deep fish processing, and construction. We are actively cooperating with them.
Apart from such "routine" work, we resolve general issues that impact on the development of Vanino City District. Most of Vanino City District territory suitable for the implementation of investment projects happens to be included in an area with restrictions related to Russian Ministry of Defense land. We have gone long way to prepare a plan for alterations to the borders of the restricted area, taking into account the position of the administrations of Vanino and Sovetskaya Gavan City Districts, as well as the deployment of potential sites for implementing investment projects. This plan was used to justify the claim by the Khabarovsk Krai Government to the Russian Ministry of Defense on this matter.
– How is the development of Bolshoy Ussuriysky island progressing?
For us, the development of this island remains a priority. The Ministry for the Development of the Russian Far East (Minvostokrazvitiya) has also taken an active position on this issue. It provides comprehensive support in promoting the island's interests and resolving issues at a federal level.
Nevertheless, despite all the efforts of the previous years, the concept of the island's development has still not yet been approved; its federal status has not been established, which prevents us from proceeding to the development of a plan for the future development of the area and other documents needed for the preparatory stage.
The most recent concept of the island's development and the action plan for its implementation (road map) was prepared by the Ministry for the Development of the Russian Far East (Minvostokrazvitiya) in 2015. However, they have not been approved by the Russian Ministry of Finance, because there has not been any confirmation for the sources of budget funding needed to build support infrastructure for the investment projects for the island.
Taking into account the deficit in the regional budget and limited capacities of the federal budget on funding island development activities, it is necessary to look for other ways of solving the tasks, propose public-private partnership formats that provide benefits for all the participants.
One of these formats, in our opinion, is when investors use their own resources to build infrastructure, primarily, hydraulic structures and a check-point, in exchange for the opportunity to implement their projects on the island at preferential terms.
I have to admit that it is our Chinese partners who are showing the most interest in this format. Concrete proposals were discussed in January and March this year. To support them, we have prepared an action plan for implementing bilateral cooperation, promoting the interests of federal executive bodies, Khabarovsk Krai government, the Chinese, etc.
Results of the work
• Design documentation for a children's hospital complex in Komsomolsk-on-Amur
• Feasibility report on the establishment of a state border check-point on Bolshoy Ussuriysky island
• Concept and prospective development plan for the Nikolaevsk ASEZ
• Business plan for potato farming development in Khabarovsk Krai
• Business plan for construction of a sugar-mill in Sovetskaya Gavan
• Inventory of land plots allocated to FPV residents in Vanino District