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Expert article 904 Baltic Rim Economies, 21.12.2011 Quarterly Review 5�2011
Special Economic Zones in Russia – new trends
By Stanislav Tkachenko and Dmitry Tkachenko
Special economic zones (SEZ) play special role in
implementation of Russian Government’s vision on how
national economy should be reformed and modernized.
Internal dynamics of their development is rather positive in
recent four years. Since the end of 2009, there are seven
new SEZ in several Russian regions and of different types
of them. In general, there are 24 SEZ in Russian
Federation today: 4 SEZ of industrial and production type,
4 SEZ of technological and innovation type, 13 SEZ with a
specialization in tourism as well as 3 SEZ in sea-ports and
logistics.
Among newly established SEZ there is highly
advertized by Russian Prime-Minister “The Titanium Valley”
in Sverdlovsk region, “Togliatti” SEZ in Samara region,
which should save so called “monocity” from consequences
of growing unemployment and even social unrest, and
Murmansk Sea-Port SEZ with specialization in logistics.
Following indicators demonstrates SEZ development in
Russian Federation in recent years:
Number of
residents
registered
Investment
announced,
billion RUR
Number of jobs
created by
SEZ
Volume of
sales of
products and
services,
billion RUR
2007 2008 2009 2010
2011
(January
-June)
50 141 207 267 288
34,237 90,839 144,864 219,900 n.a.
699 3709 3919 5234 n.a.
1,310 10,963 20,800
31,400
Source: The Chamber of Audits of Russian Federation,
2011
Despite of very optimistic statistics on SEZs, it should
be taken with cautious since all indicators, presented in the
table above, are nominal ones and describe intentions
rather than real achievements of SEZs administrations and
Russian government. For example, statistics on residents
of SEZs who actually started their projects is not available
as well as volume of real investments and jobs, provided
due to fulfillment of these projects. That’s why
representation of available statistics on SEZs is quite poor.
The growing skepticism on effectiveness of the whole
SEZ’s project and utilization of money from Russian federal
budget let the Chamber of Audit of Russian Federation to
start investigation of activities of SEZs in 2010-2011 and in
previous periods. We may sum up results of the
investigation by following:
� In 2005-2011 Russian budget devoted RUR 87,7
billion for implementing SEZs-related projects. Only
RUR 46,3 billion, or 53 %, has been spent in reality,
n.a.
64
other budget money has been secured at the
accounts of the governmental Vnesheconombank
(VEB). In April 2011 there were about RUR 40 billion
(i.e. € 1 billion) of deposits of the Joint-Share
Company “Special Economic Zones” at the VEB
accounts. SEZ in Saint-Petersburg at the end of 2010
has received from the JSC “SEZ” only $55 million of
$440 million, which has been approved by Russian
Budget for its development.
� Only 58 of 396 infrastructural projects has been
completed up to the Chamber of Audit investigation
(15% of planned).
� Only 206 of 288 residents of SEZs have started their
projects in SEZs, and their real investments has
reached the level of RUR 36,2 billion.
� Economic efficiency of budget resources in industrial
zones, is about 1,9 ruble per 1 ruble of budgetary
investments; in the case of technological and
innovation SEZs the figure is even less impressive –
RUR 0,3 per RUR 1 of budget money.
Analysis of the 2011 Chamber of Audit investigation
lead us to conclusion that at this moment the whole project
of SEZs faces serious structural and institutional problems,
which Russian Government don’t know how to deal with.
We have to mention here slow construction of infrastructure
for SEZs by regional authorities, bureaucratic inefficiency,
red-tape, lack of Russian managers with practical skills.
The most problematic sector is nowadays the tourist
and recreational SEZs. These zones are located mostly in
areas with very poor transport infrastructure and are hardly
accessible both for businesses to invest and tourists to
travel. The only exception is the tourist special economic
zone in Kaliningrad, but it faces another difficulty due to the
fact that it is located in national nature reserve (The
Kuronian Spit). Construction and development in such
areas are restricted by many environmental as well as
bureaucratic regulations. That’s why prospects for business
success of tourist SEZ in Kaliningrad are rather bleak
today. Poor infrastructure and lack of free land prevent
development activities in another ambitious Kaliningrad
project – Special gambling zone near the Yantarny
settlement.
Despite of obvious difficulties, related to SEZs’
establishment , their legal regime, effectiveness of
investments, etc, Russian Government continue to put
emphasis on them as very important driving mechanisms of
Russian economy’s modernization. In March 2011 the
Prime-Minister Vladimir Putin has announced that in
existing SEZs period of activities, which includes special
legal status and tax exemptions, should be prolonged from
20 years nowadays to 35-40 year in the near future. Today
there are several drafts of Federal Laws discussed by
Russian governmental officials and law-makers in the State
Duma and the Council of Federation. They include removal
of restrictions for residents of SEZs for non-profile forms of
activities, i.e. ability to lease their premises to other
residents, to provide food for company’s employees, etc.
Russian Government is intending to simplify the registration
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