Support from the Moscow government boosts investment

Moscow rose to 10th place in Russia’s investment rating, securing its place among a group of regions that can offer comfortable conditions for business. Natalya Sergunina, Deputy Mayor for Economic Policy and Property and Land Relations, made the announcement during the economic forum in St. Petersburg.

After going over the data provided by the Strategic Initiatives Agency, which puts the rating together, Natalya Sergunina notes that the jump in ratings is a reflection of the work done by the Government of Moscow over the past 5 years. The authorities worked to simplify and shorten the time it takes to complete administrative procedures, implemented electronic technology and, most importantly, developed benefits systems and other ways of supporting entrepreneurs.

Legislation aimed at supporting investors and active companies has been passed. “Real sector enterprises are assigned the status of ‘industrial complex,’ ‘technopark’ or ‘industrial park,’” the Deputy Mayor explained, “thanks to the introduction of these statuses and clearly defined criteria for obtaining them, we shifted from providing individual companies with benefits to supporting effective enterprises and territories. This has allowed us to reformat the activities of big business. Now, our goal is to ensure that business is interested in developing their platforms and participating in the procurement process. We also support effective enterprises based on indicators such as investment in production, revenue per hectare and average salary.”

The city has already assigned the status to 22 technoparks. 90% of technopark residents are small or medium-size enterprises.

Minister of the Moscow Government and Head of the Department of Economic Policy and Moscow City Development Maksim Reshetnikov pointed out that a rating score is a tool, not an end goal in itself. “What is important for the city, for Muscovites, isn’t the score itself, but investment, the creation of new high-paying jobs for qualified personnel and good standards of living,” he pointed out. The minister also pointed out that an efficient feedback system between business and the authorities has been established over the past few years. Almost all of the decisions that can affect the business climate are made with input from the business community.

It’s worth noting that representatives from the business community and experts evaluate each region across four key areas when putting the rating together: regulatory climate, institutions for business, infrastructure quality and availability and small business support.

During the economic forum in St. Petersburg, the Moscow Government discussed measures for supporting the industrial sector with investors. Natalya Sergunina, Deputy Mayor for Economic Policy and Property and Land Relations, met with representatives of international industrial companies.

Meeting participants discussed investment opportunities of the capital, its specific advantages compared to other mega-cities and key Moscow government initiatives taken to boost investment into the real economy. Natalya Sergunina introduced investors to a support mechanism for active effective enterprises and new investment projects. “The city is offering existing enterprises new tax breaks or land lease incentives,” she said, “while new investment projects can receive assistance with utilities, land plots and protection from non-commercial risks.”

According to the Deputy Mayor, the city government is developing an innovative infrastructure for advanced technology enterprises. The government is also working to promote the establishment of new industrial parks and technoparks, where enterprises will also have access to equipment, services and consultations.

Minister of the Moscow Government and Head of the Department of Economic Policy and Moscow City Development Maksim Reshetnikov, who also took part in the forum, pointed out that the overall reduction of the tax burden for industrial companies within the scope of the new support mechanism will amount to up to 25% depending on status (industrial complex, technopark or industrial park). “Tax breaks are applied to the income tax, property tax and land tax,” the minister explained, “Support is provided to enterprises that effectively use their territory, invest actively and pay high salaries.”

It is worth noting that the Moscow Government has very recently assigned the status of “industrial complex” or “technopark” to another four companies. JSC Khlebozavod No.28 and JSC MTZ Transmash acquired “industrial complex” status, while LLC UK Phystech-21 and JSC RC Module acquired “technopark” status. Over the past month, 10 companies have used the new support measures. The total land plot area for all companies that received benefits amounts to about 50 ha, the number of employees totals 13,300 people, investment volumes over 5 years amount to over 10.7 billion rub., while the annual salary fund is over 8 billion rub. Over 40 companies that either conduct industrial and research activities in Moscow or are planning to took place in the event. The list of companies includes PepsiCo, ABB, Renault, Schneider Electric, Samsung, Phillips, Abbott Laboratories, Airbus Group and others. Managers from a number of companies that are already taking advantage of benefits, including PepsiCo and Renault, gave high assessments of the support provided by the Moscow Government, pointing out that the program boosts investment volumes and promotes the development of production.


Founder: Department for External Economic and International Relations of the Government of Moscow

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