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State Incentivization of Investment Activity in a Resource Region: far Eastern Version

  • INSTITUTIONAL PROBLEMS OF REGIONAL DEVELOPMENT
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Abstract—

The practice and emerging results of state investment activity incentivization tools within the framework of the “new model” of Russian Far East development have been investigated. The article demonstrates the peculiarities of implementing investment localization tools in a resource region (preferential regimes of priority development areas) and extraterritorial preferences like direct subsidies from the federal budget to infrastructure facilities of investment projects and regional investment projects of strategic importance. The results of implementing these tools in the Far Eastern Federal District in 2014–2020 demonstrate that the package of state measures to attract investment and its individual elements (mineral extraction tax incentives, criterion for maximizing private investment per budget ruble, etc.) stimulated predominance of investment in mineral extraction in their total volume for all considered support tools. The result of these preferences was further growth of raw materials industries in the structure of the Far Eastern economy (which, to a certain extent, projects the promising structure of the macroregion’s economy). Analysis of the accumulation rate (share of investment in GRP) as a factor of economic growth showed that in most Far Eastern federal subjects (except for the monospecialized raw material Sakhalin and Magadan oblasts and the Chukotka Autonomous Okrug), the role of raw materials industries as key drivers of economic growth has not been confirmed, which would justify the use of state preferences in resource extraction. Certain modifications were also identified in the state incentive tools themselves, implemented within the framework of the “new model” of development in the Far East, including: “erosion” of the boundaries of preferential territories to legitimize benefits for raw material companies; a change (decrease) in the role of regional authorities in implementing certain tools; the formation of “multilayer” benefits in the interests of resource companies. It is shown that in the studied contour of interactions of key actors in implementing individual tools of the new model of Far Eastern development (federal and regional authorities, business), a tendency towards the main results of preferences being formed in resource companies is increasingly observed.

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Notes

  1. State Program of the Russian Federation “Social and Economic Development of the Far East and the Baikal Region:” approved by the Order of the Government of the Russian Federation of March 29, 2013, no. 466-r. http://base.garant.ru/70351168/. Accessed September 2020.

  2. State Program of the Russian Federation “Social and Economic Development of the Far Eastern Federal District:” approved by the Order of the Government of the Russian Federation of April 15, 2014, no. 308 (as amended on March 25, 2020). http://pravo.garant.ru/document?id=70544078&byPara=1. Accessed September 2020.

  3. National Program of Socioeconomic Development of the Far East for the Period up to 2024 and for the Long Term until 2035: approved by the Order of the Government of the Russian Federation September 24, 2020, no. 2464-r. p. 5. http://www.consultant.ru/document/cons_doc_LAW_363186/. Accessed September 2020.

  4. National Program of Socioeconomic Development of the Far East for the Period up to 2024 and for the Long Term until 2035: approved by order of the Government of the Russian Federation September 24, 2020, no. 2464-r. p. 9. http://www.consultant.ru/document/cons_doc_LAW_363186/. Accessed September 2020.

  5. Hereinafter, the terms “Far Eastern Federal District,” “Far Eastern macroregion,” “Far East,” and “macroregion” are used as synonyms. The term “region” indicates the level of a federal subject. The term “resource region” is used to denote the predominantly resource (raw material) specialization of the economies of regions, regardless of their territorial hierarchy (region or macroregion).

  6. On amendments to the list of federal districts approved by Decree of the President of the Russian Federation of May 13, 2000, no. 849: Decree of the President of the Russian Federation of November 03, 2018, no. 632. http://kremlin.ru/acts/bank/43719/. Accessed August 2020.

  7. Federal Law on Priority Social and Economic Development Areas in the Russian Federation (no. 473-FZ of December 29, 2014) provides for various scales of their creation: from separate local zones to the territories of federal subjects (Article 3, Clause 4) and the possibility of changing the boundaries of PDAs (Article 3, Clause 7).

  8. On the creation of the Komsomolsk PDA: Resolution of the Government of the Russian Federation of June 25, 2015, no. 628 (as amended on May 15, 2019). https://invest.khv.gov.ru. Accessed October 2020.

  9. The borders of the Komsomolsk PDA are planned to be expanded for creation of a mining and processing plant / Government of Khabarovsk Krai, 2020. September 5. https://www.khabkrai.ru/events/news/179759. Accessed September 2020.

  10. Trutnev: We will do our best to implement the Baimka development project / Investment portal of Chukotka Autonomous Okrug. 2019. February 8. https://invest-chukotka.ru/news/trutnev-myi-budem-delat-vse-dlya-realizaczii-proekta-osvoeniya-baimki. Accessed September 2020.

  11. Chukotka Development Fund. https://fond87.ru/ ?page_id=504&lang=ru. Accessed August 2020.

  12. Supervisory Board members have discussed prospects for expanding the Zabaikalye PDA / Far East Development Corporation. July 16, 2020. https://erdc.ru/news/uchastniki-nabsoveta-obsudili-perspektivy-rasshireniya-tor-zabaykale/. Accessed August 2020.

  13. A mining and processing enterprise in the Komsomolsk PDA will receive a subsidy for the construction of infrastructure / Government of Khabarovsk Krai. February 3, 2020. https://www.khabkrai.ru/events/news/177286. Accessed August 2020.

  14. Methodology for calculating the indicators “share of investment in fixed assets in gross domestic product” and “share of investment in fixed assets in the gross regional product of a federal subject:” approved by Order of Rosstat no. 56, January 30, 2014. http://www.consultant.ru/document/cons_doc_LAW_158784. Accessed September 2020.

  15. National Program of Socioeconomic Development of the Far East for the Period up to 2024 and for the Long Term until 2035: approved by Order of the Government of the Russian Federation, September 24, 2020, no. 2464-r. http://www.consultant.ru/document/cons_doc_LAW_363186/. Accessed September 2020.

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  1. Economic Research Institute, Far Eastern Branch, Russian Academy of Sciences, 680042, Khabarovsk, Russia

    N. V. Lomakina

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Lomakina, N.V. State Incentivization of Investment Activity in a Resource Region: far Eastern Version. Reg. Res. Russ. 11, 638–647 (2021). https://doi.org/10.1134/S2079970521040110

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