How Taliya Minullina awarded Nail Magdeyev victory over Alabuga

PSEDA is more attractive than SEZ due to benefits on insurance payments from employees’ salary

How Taliya Minullina awarded Nail Magdeyev victory over Alabuga Photo: Oleg Tikhonov

The phenomenon of the marathon race for foreign investments in Tatars 'offshores'. The oldest Alabuga economic zone has ceded the leadership to Naberezhnye Chelny Priority Social Economic Development Area (PSEDA) for the first time in 10 years. At the final meeting on 27 December, head of the Tatarstan Investment Development Agency Taliya Minullina noted impressing successes from the diversity of tax benefits in the republic and mentioned 'now Yelabuga also started to feel different'. Defending the course on PSEDA, she promised the volume of direct investments in the republic's economy wouldn't fall by the end of 2017 but remain at last year's level, that's to say, $1,75-1,8 billion. Realnoe Vremya tells the details.

Taliya Minullina's victorious dress

On 27 December, head of the Tatarstan Investment Development Agency Taliya Minullina presented current results in attraction of investments to Tatarstan's economy as one of the supporters of the idea of PSEDA. She gave the hall to understand from the very beginning she had the victory in investment fights under her belt and it wouldn't be already possible to take it away.

''Why did I come in red today?'' she surprised functionaries, businesspeople and Turkish investors who gathered in Kazan Grand Hotel's hall a bit with an unexpected beginning. After this mysterious phrase, the guests probably started to look into the costume of the youngest member of the Tatarstan government. And they could make sure the speaker's dress wasn't made of a purple-crimson flag but noble, a bit muted hue of red and coquet lace insertions. In brief, they saw a usual strict woman's dress in which you won't guess the deep message without an evocative tip. But then she said: ''Investments in the situation we are in today are certainly a victory!'' Taliya Minullina explained the choice of her red dress, then modest men from the Tatarstan government spitefully smirked.

Taliya Minullina continued delivering her speech with her characteristic shocking behaviour in this victorious dress. According to her, now world investment flows can't reach the level of 2007, but Tatarstan conserves its investment attractiveness. ''Investments in the fixed capital will be 677 billion rubles of which 59% are enterprises' equity and 41% are attracted money,'' she presented the pattern of financial flows at the regional level. ''Turkey, China, Germany remain the main investors in the republic. Projects from South Korea, Japan and the UAE have appeared for the first time. Great Britain has a high share among the foreign investors, which is explained by the world financial system because Great Britain, the Netherlands, Luxemburg, Cyprus are financial hubs for transactions,'' Minullina presented the statistics on the attraction of foreign investments.

''Over 70% of all financial foreign investments came from Turkey only 3 years ago,'' Taliya Minullin mentioned the hot favourite. ''This year its share has reduced to 30%''

Turkey remains Tatarstan's major investor

''Over 70% of all financial foreign investments came from Turkey only 3 years ago,'' Taliya Minullin mentioned the hot favourite. ''This year its share has reduced to 30%, which happened due to clear reasons. Nevertheless, the Turkish Republic is first among investing countries in Tatarstan in 2017 as well,'' Taliya Minullina stressed. At the same time, she didn't name accurate digits of direct foreign investments. However, it was possible to know on the exhibition of TIDA's demo stand that the volume of foreign injections reduced by 2% and amounted to $1,75 billion. Indeed, minus two is little, probably unnoticeable, so one can easily put a red dress on and open champagne.

Gold coin from Chelny

But the director of TIDA was happy about record investments in the first Chelny PSEDA the most. This gold coin, as Taliya Minullina said, gave 24 billion rubles. ''Naberezhnye Chelny was assigned the status of PSEDA.''

''We see the result,'' she showed the slide where Chelny's vector was moving upwards and Yelabuga's one downwards in a diagram. ''Naberezhnye Chelny left Yelabuga District behind in terms of the volume of foreign investments for the first time in 10 years. Of course, something can change in the short run. But even current results speak about the effectiveness of this financial tool created for mono-towns,'' the TIDA director was happy for citizens of Chelny. And even if absolute digits weren't made public, one could see on the stand that Chelny provided 43% of the overall investment flow, Alabuga – 36% and Kazan – 20%. Earlier Alabuga accounted for 80% of investments, now there are another two sites. ''Now Yelabuga started to feel different as well,'' she noted during her report.

Chinese Haier concern provided Chelny with dominance in the fight of territories, of course. The company brought another 12 related factories to Chelny. According to Taliya Minullina, they are given a 127 ha land parcel to construct factories making washing machines, TVs, hot-water boilers and other equipment. In general, 24,6 billion rubles have been attracted this year, of which 13,7 billion rubles have been invested in production.

The director of TIDA was happy about record investments in the first Chelny PSEDA the most

How Nizhnekamsk won the heart of Haier's partner

But the Chinese company's subsidiary Qingdao Beijia'er Investment Kamastal that paints steel constructions turned out to be registered in the Nizhnekamsk PSEDA. In the second half of 2018, it is going to open a factory to process and paint coiled steel for 400 million rubles. ''Qingdao Beijia'er Investment paints sheet steel, they wanted to be in another place first, but we said to them that a PSEDA would be in Nizhnekamsk. This is why they agreed,'' TIDA director Taliya Minullina told the journalists. She says it is important that investors work in many single-industry towns.

Insurance payments frighten even foreigners

''Why did the dominance suddenly move to Chelny? Is the set of tax benefits wider?'' Realnoe Vremya's reporter asked Taliya Minullina. ''You know there is an anecdote: an entrepreneur comes to an investment consultant and says: ''If I knew taxes grew so, I would have invested in them only,'' she joked. Nevertheless, she admitted that insurance payments frighten investors a bit. ''It's profitable to enter PSEDAs for those who will have a bigger number of working places,'' she said by giving to understand the residents save money from insurance payments. A low rent is another reason. ''It's many times higher in Alabuga's industrial parks in comparison with Chelny,'' she pointed out the second circumstance. However, she did not rush to be happy and noted that it was early to draw conclusions and the balance of powers can change. ''It's early to make conclusions that the 4 th quarter gives more than a twofold increase. This is why these are current results. But another municipal district suddenly gives such a results for the first time in 10 years anyway!'' she was amazed.

Director General of Alabuga SEZ Timur Shagivaleyev was modestly diplomatic: ''We're patriots of Tatarstan and Russia and, in general, we're glad about Chelny's success. On the one hand, Alabuga became a benchmark that not only the republic but also the country started to look at. When people call industrialists and say they will make electricity like in Alabuga or the customs like in Alabuga, it means we improve the system for new factories in the country, and it is very cool. It didn't exist 10 years ago. But we are also on the go. Next year, we plan to attract at least eight residents. Are you asking about the volume of investments? You will know everything soon!'' he promised.

We can't help but note here that the entrance ticket to Alabuga SEZ is more expensive than in PSEDA. If in the first case, the minimum volume of investments is $3 million, in the Chelny PSEDA – 5 million rubles and 50 million in general. So it's clear why the favourite has changed. Nevertheless, Taliya Minullina is sure it's better if the investor stays with us than goes to another region.

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By Luiza Ignatyeva. Photo: Oleg Tikhonov
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