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Yegor Borisov: In the last 7 years, we have attracted 1.5 trillion rubles of investments into Yakutia

Head of Yakutia Yegor Borisov talks about the need to establish an International Center for Mammoth Studies, about the ways the republic attracts investments, and about projects that are now on the agenda of the regional government

Yegor Borisov: In the last 7 years, we have attracted 1.5 trillion rubles of investments into Yakutia

– At a recent meeting with Vladimir Putin, you brought up the idea of creating a Center for Mammoth Studies in Yakutia. What are the goals of this project?

– The soil of Yakutia is a natural storehouse, where over the past two centuries people have been discovering the remains of mammoths as well as other animals from the Ice Age: prehistoric bison, horses, cave lions and rhinos. Thanks to permafrost, these remains are very well preserved. The creation of such a Center would enable scientists to study in detail the vast amount of information about this geological era, landscapes, and climate. This idea is of interest not only to Russian scientists, but also experts from Korea, France and Japan.

The draft concept of the Mammoth Center includes an international research institute in the archeology and paleontology sphere, with a repository of unique exhibits, the exhibition of mammoths and other fossils, an interactive paleozone for both children and adults, and an exhibition of paleontological and archaeological sites.

– How can the unique weather conditions of Yakutia be used for scientific and economic purposes?

–The cold is a unique phenomenon that can preserve many things over many, many years. As of today, we have built a unique cryogenic storage bank in Russia, which we use to preserve endangered plant species. Thanks to the cold and permafrost, the maintenance of this cryo-bank requires virtually no additional energy consumption.

Speaking about economic projects, Yakutia could become a platform for cold-endurance testing of any materials allowing the carrying out of field certification tests at minimal cost. This is especially relevant for the aircraft industry, where metals are tested at temperatures down to minus 50-60 degrees Celsius.

We should not forget that the cold can also be a source of energy. And today, it is high time to think about certain technologies that will enable us to turn it into a different kind of energy, such as electricity.

– What is the republic doing to attract investments into the region?

In the past 7 years, Yakutia has attracted 1.5 trillion rubles of investments. In 2015, we attracted 200 billion rubles in investments, while this year, because of the construction of the Power of Siberia Pipeline, we will attract 300 billion rubles. That is our estimate.

In general, Yakutia has huge investment potential, because in contrast to other Russian regions, we have large amounts of mineral resources. We produce diamonds, gold, coal, oil, natural gas, tin, etc. Currently we are trying to follow the same course as everyone else in Russia: we are striving to increase sales of processed products within the total volume of sales of extracted raw materials. The significant role here belongs to the development of small and medium-sized enterprises (SMEs).

The Kangalassy Advanced Special Economic zone (ASEZ) was established to support such SMEs. It is the only ASEZ in Russia that grants resident status only to SMEs. The priority of the development strategy of Yakutia until 2030 is expected to be providing support to those SMEs that are capable of solving social problems, creating jobs and paying salaries to the local people of Yakutia.

– What niche can SMEs occupy in the republic, given the fact that in Yakutia, mainly large-scale projects are being implemented, which are beyond the means available to small entrepreneurs?

–These are those industries and niches that are cost-effective, in terms of sales. First of all, this is the jewelry industry, which is a traditional one for us. Our IT-companies, which produce animated movies and software, have also started to perform very well on the global markets. Their products are in demand even in the American market. We are also going to develop other kinds of projects that require intellectual work, and that can be implemented within our republic or, at a minimal cost, beyond its borders.

For instance, agriculture can become one of the main areas of work for small and medium businesses. This is unique for us here, as no one else in the whole world develops agriculture in permafrost conditions, while we grow cereals, vegetables, potatoes, and breed livestock. We are going to increase our support for vegetable production and animal breeding in Yakutia, particularly since these are the industries that most of the indigenous population is involved in.

– The most important investment project in Yakutia is the construction of a bridge across the Lena River. You have been negotiating with a number of Chinese companies. What has been achieved so far?

– Two Chinese state-owned corporations are interested in developing projects: The Sinohydro Corporation, a subsidiary of Power China, and China Railway Construction Corporation (CRCC), represented by its affiliates – the Bridge Engineering Bureau and the China State Construction Engineering Corporation (CSCEC). At the moment, negotiations are still in progress. Our partners are gathering information, and analyzing certain technical solutions. We have agreed to continue our discussions at the Eastern Economic Forum. We expect that this year, we will have chosen both the financial model and the investor, and then in 2017, we will get down to the development of the project design. In 2018, we will proceed with the construction of the bridge and it will be placed into operation in 2022.

– Has the region started to draft documents to create a ASEZ in South Yakutia? Do you already have an understanding of who will become the anchor resident of this area?

– The ASEZ in South Yakutia is a new project of the republic, which we are going to showcase at the EEF. The purpose of the new ASEZ is to create a major industrial center for the deep processing of natural resources. I am talking about the processing of uranium ore of the Elkon Deposit, which is being developed by the Elkon Mining and Metallurgical Plant JSC, and the development of the Seligdarsky Apatite Deposit, considered to be the largest in the world. We are also planning to increase the volumes of coal production and enrichment at the Inaglinsky Coal Complex, and to produce oil and gas in Olekminsky District. This ASEZ may also include a wood processing complex.

The South Yakutia Development Corporation is currently carrying out preparatory work for the creation of the ASEZ in this region. During the EEF, we will learn to what extent businesses are interested in the new ASEZ, and based on this knowledge, we will decide to submit documents to the Ministry for the Development of the Far East to establish such an area.

– What projects will Yakutia offer to investors at the EEF-2016?

– The projects include the bridge across the Lena River, the ASEZ in South Yakutia, the creation of a high-technology IT-Park, and the comprehensive project to renovate and modernize the Zhataysky Ship Repair and Shipbuilding Plant. We will also demonstrate projects related to the development of mineral deposits of Yakutia, and in particular, the Tarynsky Gold Deposit and the project of the SakhaPetrol Company, involving the pumping and process of oil right in Yakutia.

This latter project is very important for Yakutia, because the republic annually consumes 2 million tons of fuel, which currently is imported here, after travelling through almost the entire country. These are large and unnecessary expenses, given the fact that we can produce oil products ourselves to cover the needs of the republic, and thus avoid enormous transportation costs.

In addition, this time, we will offer projects aimed at the development of SMEs. These projects are related to the hotel sector, as well as to commercial and food markets.