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1 The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan REPUBLIC OF TATARSTAN REPUBLIC OF TATARSTAN INVESTMENT IN FUTURE INVESTMENT IN FUTURE Kazan Kazan Geneva Geneva

The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

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Page 1: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

1The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

REPUBLIC OF TATARSTANREPUBLIC OF TATARSTAN – – INVESTMENT IN FUTUREINVESTMENT IN FUTURE

REPUBLIC OF TATARSTANREPUBLIC OF TATARSTAN – – INVESTMENT IN FUTUREINVESTMENT IN FUTURE

KazanKazanGenevaGeneva

Page 2: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

2The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

Most attractive FDI destinations 2005Most attractive FDI destinations 2005FDI Confidence Index 2005, top 25FDI Confidence Index 2005, top 25

Most attractive FDI destinations 2005Most attractive FDI destinations 2005FDI Confidence Index 2005, top 25FDI Confidence Index 2005, top 25

1,136

1,157

1,208

1,267

1,276

1,336

1,341

1,363

1,398

1,42

1,951

2,197

1,133

Czech Republic

Hungary

Hong Kong

Germany

Australia

Brasil

Russia

Poland

United Kingdom

United States

India

China

Turkey

Low Confidence High ConfidenceValues Calculated on a 0 to 3 Scale

Source: A.T.KeameySource: A.T.Keamey

Page 3: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

3The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

Казань

Tatarstan is a centre of East European part of RussiaTatarstan is a centre of East European part of Russia

Republic of Tatarstan Republic of Tatarstan is situated in the centre is situated in the centre of a large industrial of a large industrial area of Russia, 800 area of Russia, 800 kilometreskilometres away to the away to the East from Moscow, at East from Moscow, at the junction of the the junction of the Volga and the Kama Volga and the Kama rivers. rivers.

It borders with 8 It borders with 8 Russian regions.Russian regions.

It has free access to the It has free access to the markets of regions with markets of regions with over 40 million over 40 million customers.customers.

Page 4: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

4The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

The Republic of TatarstanThe Republic of TatarstanThe Republic of TatarstanThe Republic of Tatarstan

TerritoryTerritory - 67,800 sq. km. - 67,800 sq. km. PopulationPopulation – 3.8 million – 3.8 million Population densityPopulation density - 55,8 persons per - 55,8 persons per sq. km.sq. km.

Natural Resources Natural Resources Oil - 800 million tonnesOil - 800 million tonnes

Gypsum - 72 million tonnes Gypsum - 72 million tonnes

Oil bitumen - 12.5 billion tonnesOil bitumen - 12.5 billion tonnes

Peat - 800 peat bogs Peat - 800 peat bogs

Construction stone - 35,3 million Construction stone - 35,3 million cubic meter cubic meter

Brick clay - 73,5 million cubic meter Brick clay - 73,5 million cubic meter

Chalkstones, dolomites, etc.Chalkstones, dolomites, etc.

Page 5: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

5The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

Investment AttractivenessInvestment Attractiveness

FavourableFavourable geographic geographic locationlocation

Well-developed transportation Well-developed transportation infrastructureinfrastructure

Availability of raw material Availability of raw material resourcesresources

Advanced manufactureAdvanced manufacture Legislation supporting Legislation supporting investment activitiesinvestment activities

Significant industrial and Significant industrial and scientific potential, qualified scientific potential, qualified labourlabour resources resources

Page 6: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

6The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

7,2 7,5

8,3

10,4

14,1

18,2

0

5

10

15

20

2000 2001 2002 2003 2004 2005

GRP of the Republic of Tatarstan

GRP of the Republic of TatarstanGRP of the Republic of Tatarstan and Russia and Russia per capitaper capita

0 20 40 60 80 100 120 140

2000

2001

2002

2003

2004

2005

GRP of the Russian Federation GRP of the Republic of Tatarstan

Real Growth of Gross Regional ProductReal Growth of Gross Regional Product Real Growth of Gross Regional ProductReal Growth of Gross Regional Product

Page 7: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

7The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

GRPGRP Structure of Tatarstan Structure of TatarstanGRPGRP Structure of Tatarstan Structure of Tatarstan

IndustryIndustry 47%47%

Trade & FoodTrade & Food 11,7%11,7%

ConstructionConstruction 9,0%9,0%

AgricultureAgriculture 8,0%8,0%

TransportTransport 6,0%6,0%

othersothers 18,3%18,3%

Page 8: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

8The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

107%

108%

109%

110%

111%

Tatarstan

Russia

7,80%

12,80%

0% 2% 4% 6% 8% 10% 12% 14%

Russia

Tatarstan

Financial StabilityFinancial Stability

Predictable business environmentPredictable business environment

Improvement of business Improvement of business climate and growth of economyclimate and growth of economy

Promotion of consumptionPromotion of consumption

Quality of life: Quality of life: consumer price index

Quality of life: real wages

Page 9: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

9The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

««Quality of lifeQuality of life»» index index««Quality of lifeQuality of life»» index index

1. Tyumen Region1. Tyumen Region

2. Moscow2. Moscow

4. 4. Saint-PetersburghSaint-Petersburgh

3. 3. The Republic of TatarstanThe Republic of Tatarstan

Page 10: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

10The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

««Quality of lifeQuality of life» » ««Quality of lifeQuality of life» »

(2005(2005 in in % % toto 2004) 2004)

0,65

1,141,50

2,05

2,50

3,25

4,08

5,40

0,00

1,00

2,00

3,00

4,00

5,00

6,00

1998 1999 2000 2001 2002 2003 2004 2005

IIncome ncome of populationof population

108,9%

130,0%

118,9%

128,2%

Real income Average wages

Tatarstan Russia

Retail business turnoverRetail business turnover

Growth of Growth of purchasing purchasing capacitycapacity

Page 11: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

11The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

Raising the competitiveness of

production

Main Areas of Economic Development Main Areas of Economic Development of the Republic of Tatarstanof the Republic of Tatarstan

Rise in living standards

Maintaining stable economic growth

Doubling the GRP

Page 12: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

12The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

ACHIEVEMENT OF MAIN OBJECTIVE

Doubling the GRP by 2010

Promotion of Promotion of innovationsinnovations

Attraction of Attraction of investmentsinvestments

Development of Development of hi-tech productionhi-tech production SME SupportSME Support

Page 13: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

13The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

Programme of Social and Economic DevelopmentProgramme of Social and Economic Developmentin in 2005-20102005-2010

Programme of Social and Economic DevelopmentProgramme of Social and Economic Developmentin in 2005-20102005-2010

Oil-Gas-and-Oil-Gas-and-Chemical ComplexChemical Complex

Chemical and Chemical and petrochemical petrochemical

companies of the companies of the republic produce republic produce

about about 1010 per cent of per cent of Russia’s chemical Russia’s chemical and petrochemical and petrochemical

products.products.

Mechanical Mechanical Engineering ComplexEngineering Complex

Represented by Represented by aircraft-building, aircraft-building,

automotive industry automotive industry shipbuildingshipbuilding, , and and

production of production of equipmentequipment..

Areas of growth of the Areas of growth of the economyeconomy

Small and Medium-Small and Medium-Sized EnterprisesSized Enterprises

In the last 4 years, the In the last 4 years, the contribution of SME to contribution of SME to the GRP has increased the GRP has increased from 12.7 to 16.5 per from 12.7 to 16.5 per

cent. cent.

By By 20102010, the figure , the figure should not be less should not be less

than 30 per cent and than 30 per cent and 37 per cent by 2015.37 per cent by 2015.

Page 14: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

14The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

6%30%

50% 50%

95%94%

71%

50% 50%

5%

Oil Tyres Centrifugal pumps Diesel motorvehicles

Gas turbines

Enterprises of the Republic of Tatarstan Enterprises of other regions of Russia

Share of enterprises of Tatarstan Share of enterprises of Tatarstan in the total industrial output of Russiain the total industrial output of Russia

Share of enterprises of Tatarstan Share of enterprises of Tatarstan in the total industrial output of Russiain the total industrial output of Russia

Page 15: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

15The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

PROMOTION OF INNOVATIONSPROMOTION OF INNOVATIONSPROMOTION OF INNOVATIONSPROMOTION OF INNOVATIONS

ProgrammeProgramme for Development of Innovation Activities for for Development of Innovation Activities for 2005 -2010;2005 -2010;

Development of economic clusters which ensure the Development of economic clusters which ensure the competitiveness of the republic’s economycompetitiveness of the republic’s economy; ;

Creation of a network of technoparks and business Creation of a network of technoparks and business incubators, industrial production areas, technology incubators, industrial production areas, technology transfer and new production mastering transfer and new production mastering centrescentres;;

Development of scientific research Development of scientific research centrescentres based on based on institutions of higher education as research institutions of higher education as research centrescentres;;

Increase in the proportion of scientific sector in the Increase in the proportion of scientific sector in the gross regional productgross regional product;;

OrganisationOrganisation and conduct of fundamental and applied and conduct of fundamental and applied R&D aimed at republic’s R&D aimed at republic’s programmesprogrammes. .

Page 16: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

16The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

3,53,8

9,8

10,7

13,0

0

2

4

6

8

10

12

14

2001 2002 2003 2004 2005

Share of innovativeproduction in GRP ofTatarstan

Share of innovative production in GRPShare of innovative production in GRPof Tatarstanof Tatarstan

Share of innovative production in GRPShare of innovative production in GRPof Tatarstanof Tatarstan

%%

Page 17: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

Kazan State University, Kazan State Kazan State University, Kazan State University of Technology, Kazan State University of Technology, Kazan State Technical University, Kazan University of Technical University, Kazan University of Economics and Finance Economics and Finance areare among t among thehe best Russian universities.best Russian universities.

Education and scienceEducation and scienceEducation and scienceEducation and science

286328

363399

424 436

0

100

200

300

400

500

2000/01 2001/02 2002/03 2003/04 2004/05 2005/06

Pe

rso

ns

Number of Students per Number of Students per 1010,,000 000 personspersons Tatarstan is the region with strong Tatarstan is the region with strong educational and scientific potential. educational and scientific potential. 170,000 persons are engaged in the 170,000 persons are engaged in the sphere of educationsphere of education.

Page 18: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

18The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

PROMOTION OF SMALL BUSINESSPROMOTION OF SMALL BUSINESSPROMOTION OF SMALL BUSINESSPROMOTION OF SMALL BUSINESS

small business crediting direct promotion of small businessdirect promotion of small businesscreation and development of the infrastructure of creation and development of the infrastructure of

support to small businesses engaged in the field of support to small businesses engaged in the field of research and technology;research and technology; favourable conditions for working in business favourable conditions for working in business

incubatorsincubators subsidising exporter companiessubsidising exporter companiescompetition competition ««The best exporter of the Republic of The best exporter of the Republic of

TatarstanTatarstan»» in the category in the category ««small business small business enterprises enterprises »»

Page 19: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

19The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

Investment Venture Fund of the Investment Venture Fund of the Republic of TatarstanRepublic of Tatarstan

Investment Venture Fund of the Investment Venture Fund of the Republic of TatarstanRepublic of Tatarstan

Stabilisation Pledge and Insurance Fund of the Republic of Stabilisation Pledge and Insurance Fund of the Republic of TatarstanTatarstan

provides financing for investment programmes provides financing for investment programmes and projectsand projects of of economiceconomic а аnd social development nd social development of Tatarstan including projects of small and of Tatarstan including projects of small and medium-sized businessesmedium-sized businesses

InnovationInnovation ProductionProduction TechnoparkTechnopark « «IdeaIdea»»

InnovationInnovation ProductionProduction TechnoparkTechnopark « «IdeaIdea»»

supports the introduction of supports the introduction of innovations into the manufacturing innovations into the manufacturing industryindustryaccumulates investment accumulates investment resources and directs them to the resources and directs them to the implementation of innovative implementation of innovative projectsprojects

www.ivfrt.ru

Innovation Activities in the Republic of TatarstanInnovation Activities in the Republic of TatarstanInnovation Activities in the Republic of TatarstanInnovation Activities in the Republic of Tatarstan

concentration of the most promising and perspective innovative companies

coordination and support on every stage of development

commercialization of innovative ideas

www.tpidea.ru

Page 20: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

20The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

Share of small and medium enterprises in Share of small and medium enterprises in GRP of TatarstanGRP of Tatarstan

Share of small and medium enterprises in Share of small and medium enterprises in GRP of TatarstanGRP of Tatarstan

12,7%14,6%

16,2% 16,5%

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

2002 2003 2004 2005

Page 21: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

21The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

Credit Rating of the Republic of Tatarstan :Credit Rating of the Republic of Tatarstan :Foreign exchange borrowings ratingForeign exchange borrowings rating

Ba1 Ba1 stable outlookstable outlookLong-term credit ratingLong-term credit rating

BB - positive outlookBB - positive outlook

Investment rating among 89 Russian Investment rating among 89 Russian regions:regions: 5th5th in investment riskin investment risk 8th8th in investment potentialin investment potential

Investment RatingInvestment Rating of the of the Republic of TatarstanRepublic of Tatarstan

Investment RatingInvestment Rating of the of the Republic of TatarstanRepublic of Tatarstan

Long-term rating in foreign exchange Long-term rating in foreign exchange and local currencyand local currency:: ««BBBB»» – – forecastforecast ”stable””stable”

(“Expert RA”, a Russian rating agency(“Expert RA”, a Russian rating agency ) )

Since 2005 the rating of Tatarstan raised five timesSince 2005 the rating of Tatarstan raised five times

Page 22: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

22The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

INVESTMENT FOCUSINVESTMENT FOCUSINVESTMENT FOCUSINVESTMENT FOCUS

• Republic of Tatarstan is a Republic of Tatarstan is a “supporting leader region”“supporting leader region”;;

• 6th place 6th place in thein the general rating general rating of Russian regionsof Russian regions;;

• 5th place5th place in the minimal in the minimal investment risk in investment risk in 2004/052004/05;;

• 5th place5th place in in the steadily low the steadily low investment risk over the last investment risk over the last

decadedecade;;

STUDIESSTUDIES of Expert RA Rating Agencyof Expert RA Rating Agency

1

4 43

5

9 9

56

5

14

9

14

87

109

8

15

0

2

4

6

8

10

12

14

16

Risk rank

Potential rank

Page 23: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

23The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

CCapital apital investmentinvestmentCCapital apital investmentinvestment

1,91,8

2,3

3

4,9

0

1

2

3

4

5

6

2001 2002 2003 2004 2005

Fixed capital expenditures

$ $ BillionBillion %%

Page 24: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

Food52,8%

Chemical and petrochemical2,6%

Crude oil processing3,8%

Finance3,1%

Other7,5%

Agriculture7,2%

Communications11,4%

Crude oil production11,5%

Accumulated Direct InvestmentsAccumulated Direct Investments

Page 25: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

25The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

Accumulated Investment Accumulated Investment (1995-2005)(1995-2005)Accumulated Investment Accumulated Investment (1995-2005)(1995-2005)0 200000 400000 600000 800000 1000000 1200000

Switzerland

Germany

United Kingdom

Cyprus

USA

Luxembourg

Austria

Ireland

Turkey

Other

As ofAs of 1 1 January January 20062006, , Tatarstan has accumulated foreign investmentTatarstan has accumulated foreign investment in the total amount of in the total amount of US$1.US$1.4343 billion billion

Page 26: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

26The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

Advisory Board for Foreign InvestmentsAdvisory Board for Foreign Investmentsin the Republic of Tatarstanin the Republic of Tatarstan

Advisory Board for Foreign InvestmentsAdvisory Board for Foreign Investmentsin the Republic of Tatarstanin the Republic of Tatarstan

GoalsGoals ::

to protect interests of domestic and foreign investorsto protect interests of domestic and foreign investors

to contribute to creation of a favorable investment climate in the republic to contribute to creation of a favorable investment climate in the republic

through timely resolution of issues arising in the course of attraction of foreign through timely resolution of issues arising in the course of attraction of foreign

investments and implementation of topical investment projectsinvestments and implementation of topical investment projects. .

Advisory Board Advisory Board

for Foreign Investmentsfor Foreign Investments

Chairman of Supervisory CouncilSupervisory Council– Prime Minister of Tatarstan R.N. Minnikhanov

Government authoritiesEnterprises

and organisations of

the Republic of Tatarstan

Large

foreign investors

Page 27: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

27The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

Law No.2180-XII of the Republic of Tatarstan of July 19, 1994Law No.2180-XII of the Republic of Tatarstan of July 19, 1994 "On Foreign Investments "On Foreign Investments in the Republic of Tatarstan"in the Republic of Tatarstan" (as amended on June 27, 2001 and on September 23, (as amended on June 27, 2001 and on September 23, 2003)2003)

Investment Legislation of the Republic of TatarstanInvestment Legislation of the Republic of TatarstanInvestment Legislation of the Republic of TatarstanInvestment Legislation of the Republic of Tatarstan

Law No. 1872 of the Republic of Tatarstan of November Law No. 1872 of the Republic of Tatarstan of November 25, 199825, 1998 "On Investment Activity in the Republic of "On Investment Activity in the Republic of Tatarstan"Tatarstan" (as amended and added on June 24, 2003)(as amended and added on June 24, 2003)

Resolution No. 123 of the Cabinet of Ministers of the Resolution No. 123 of the Cabinet of Ministers of the Republic of Tatarstan of March 11, 2001Republic of Tatarstan of March 11, 2001 "On Additional "On Additional Measures of State Support for Enterprises (Organisations) Measures of State Support for Enterprises (Organisations) of the Republic of Tatarstan Implementing Investment of the Republic of Tatarstan Implementing Investment Projects"Projects"

Page 28: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

28The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

The guarantee of legal protection of foreign investors;The guarantee of legal protection of foreign investors;

The guarantee of compensation in the event of nationalisation and The guarantee of compensation in the event of nationalisation and requisitioning of assets of a foreign investor or a commercial requisitioning of assets of a foreign investor or a commercial organisation with foreign investmentsorganisation with foreign investments;;

The indemnification and compensation for damages to foreign The indemnification and compensation for damages to foreign investorsinvestors;;

The guarantee of transfer of payments in connection with foreign The guarantee of transfer of payments in connection with foreign investmentsinvestments;;

The guarantee of use of payments in the currency of the Russian The guarantee of use of payments in the currency of the Russian Federation in the territory of the Republic of TatarstanFederation in the territory of the Republic of Tatarstan;;

The guarantee against The guarantee against unfavourableunfavourable changes in legislation of the changes in legislation of the Republic of TatarstanRepublic of Tatarstan. .

((Provided for by Chapter 2 of the Law No.2180-XII of the Republic of Tatarstan Provided for by Chapter 2 of the Law No.2180-XII of the Republic of Tatarstan

of July 19, 1994 "On Foreign Investments in the Republic of Tatarstanof July 19, 1994 "On Foreign Investments in the Republic of Tatarstan" " ))

State Guarantees for Protection of Foreign InvestmentsState Guarantees for Protection of Foreign Investments

Page 29: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

29The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

Tax Privileges for Foreign InvestorsTax Privileges for Foreign InvestorsTax Privileges for Foreign InvestorsTax Privileges for Foreign Investors

TaxTax RateRate

1. 1. Profit TaxProfit Tax 24%24%

for investorsfor investors 20%20%2. 2. Property TaxProperty Tax 22..2%2%

for investorsfor investors 00..1%1%

Granting of privileges for transportation tax, land tax, and import duties is also possible.

Page 30: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

30The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

The Special Economic Zone of Industrial Production Type in the The Special Economic Zone of Industrial Production Type in the territory of Yelabuga District of the Republic of Tatarstan is territory of Yelabuga District of the Republic of Tatarstan is

situated near Yelabuga of Yelabuga District of the Republic of situated near Yelabuga of Yelabuga District of the Republic of Tatarstan,Tatarstan, 25 25 km. from Naberezhnye Chelnykm. from Naberezhnye Chelny, 40 , 40 km from km from

Nizhnekamsk, and Nizhnekamsk, and 215 215 km. from Kazan km. from Kazan ((capital of the Republic of capital of the Republic of TatarstanTatarstan). ). The area of the Special Economic Zone is The area of the Special Economic Zone is 20 20 sq. km.sq. km.

The Special Economic Zone of Industrial Production Type in the The Special Economic Zone of Industrial Production Type in the territory of Yelabuga District of the Republic of Tatarstan is territory of Yelabuga District of the Republic of Tatarstan is

situated near Yelabuga of Yelabuga District of the Republic of situated near Yelabuga of Yelabuga District of the Republic of Tatarstan,Tatarstan, 25 25 km. from Naberezhnye Chelnykm. from Naberezhnye Chelny, 40 , 40 km from km from

Nizhnekamsk, and Nizhnekamsk, and 215 215 km. from Kazan km. from Kazan ((capital of the Republic of capital of the Republic of TatarstanTatarstan). ). The area of the Special Economic Zone is The area of the Special Economic Zone is 20 20 sq. km.sq. km.

NizhnekamskElabuga Nizhnekamskneftehim Airport

Naberezhnye Chelny

Kamaz

SymbolsRailwayHighways

River port

Airport

Polyanka

Distance up to locality

Territory of SEA

«Alabuga»

Elabuga

Mendeleevsk

Nizhnekamsk

Airport “Begishevo”

NaberezhnyeChelny

Krugloe pole

Naberezhnye Chelny

Kazan 210 km

Chistopol 170 km

Izhevsk 180 km

Ufa 385 km

River port

Kazan 210 km

r. Kama

r. Tojm

a

Kazan

TATARSTAN

Elabuga

Nab. Chelny

Nizhnekamsk

Railway station

Page 31: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

31The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

Tax Privileges for Participants Tax Privileges for Participants of Special Economic Zoneof Special Economic Zone

Tax Privileges for Participants Tax Privileges for Participants of Special Economic Zoneof Special Economic Zone

Tax RateDistribution by Budgets

Federal Regional Local

1. Profit Tax 24.0% 6.5% 17.5% -

For SEZ residents 20.0% 6.5% 13.5% -

2. Property Tax 2.2% - 1.1% 1.1%

For SEZ residents(for 10 years)

0% - 0% 0%

3. Land Tax 1.5% - - 1.5%

For SEZ residents 0% - - 0%

4. Transport Tax

Rates depend on type and horse power

capacity of the vehicle

-

Rates depend on type and horse

power capacity of the vehicle

-

For SEZ residents 0% - 0% --

Page 32: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

32The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

To become a resident of Special To become a resident of Special Economic Zone, one should:Economic Zone, one should:

To become a resident of Special To become a resident of Special Economic Zone, one should:Economic Zone, one should:

Sign an agreement on industrial production activities with SEZ Sign an agreement on industrial production activities with SEZ management authority management authority Invest in its production assets no less than EUR 10 million, of Invest in its production assets no less than EUR 10 million, of which at least EUR 1 million during the first year of which at least EUR 1 million during the first year of developmentdevelopment..

WHY MAKING BUSINESS IN THE SEZ?WHY MAKING BUSINESS IN THE SEZ?

Advantageous geographical location Readily available complete industrial production structure No importation and exportation customs duties Exemption from some taxes Privileges for basic taxes Up-to-date equipment and efficient services Closely adjacent potential users of the products

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33The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

INVESTMENT PROJECTSINVESTMENT PROJECTSINVESTMENT PROJECTSINVESTMENT PROJECTS

Chemical and Petrochemical IndustryChemical and Petrochemical Industry

ProjectProject ParticipantsParticipants DescriptionDescription

Complex of oil-refining and Complex of oil-refining and petrochemical plants in petrochemical plants in

NizhnekamskNizhnekamsk

Estimated cost of the projectEstimated cost of the project – – 130130..33 billion roublesbillion roubles..

Payback periodPayback period – – 1010..11 yearsyears

Estimated cost of the projectEstimated cost of the project – – 11..7575 billion roublesbillion roubles

Payback periodPayback period – – 44..7575 yearsyears

Total cost of the projectTotal cost of the project – – 251251..66 million US dollarsmillion US dollars

Payback periodPayback period – – 55..44 yearsyears

OAO Svyazinvestneftekhim

Construction of an oil-Construction of an oil-extraction plant rated at extraction plant rated at

300300,000 tonnes of seeds per ,000 tonnes of seeds per annumannum

OAO Kazan Fat Production Plant

Establishing the production of Establishing the production of expandable polystyreneexpandable polystyrene ( (EPSEPS) )

rated at rated at 5050,000 tonnes per ,000 tonnes per annum and ABS plastics rated annum and ABS plastics rated

at at 7070,000 tonnes per annum,000 tonnes per annum

OAO Nizhnekamskneftekhim

OAO Tatneft

ZAO Nizhnekamsk Refinery

OAO Nefis Cosmetics

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34The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

INVESTMENT PROJECTSINVESTMENT PROJECTSINVESTMENT PROJECTSINVESTMENT PROJECTS

Transport and LogisticsTransport and Logistics

ProjectProject ParticipantsParticipants DescriptionDescription

Toll roadToll road

““Alexeyevskoye-Alexeyevskoye-Almetyevsk”Almetyevsk” (140 (140 kmkm))

Total cost of the projectTotal cost of the project - - 1616 billion billion roublesroubles

Payback periodPayback period - - 99 yearsyears

Investment requiredInvestment required - -16 16 billion roublesbillion roubles..

Total cost of the projectTotal cost of the project – – 1212..0202 billion billion roublesroubles

Payback periodPayback period - - 1515 yearsyears

Investment required Investment required – – 77 billion roublesbillion roubles

Ministry of Transport and Roads of Tatarstan

Toll road Toll road

““Shali-Sorochy GoryShali-Sorochy Gory””

Ministry of Transport and Roads of Tatarstan

Sviyaga Interregional Sviyaga Interregional Multimodal Terminal-Multimodal Terminal-Logistics Centre of Logistics Centre of

Kazan Transport HubKazan Transport Hub

Ministry of Transport and Roads of Tatarstan

Total cost of the projectTotal cost of the project – – 55..9999 billion billion roublesroubles

Investment requiredInvestment required - - 770 770 million million roublesroubles

Form and volumes of state support Form and volumes of state support requestedrequested – – 33..594594 billion roublesbillion roubles

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35The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

0

1

2

3

4

5

6

7

8

9

10

11

1998 1999 2000 2001 2002 2003 2004 2005

Foreign Trade TurnoverForeign Trade TurnoverForeign Trade TurnoverForeign Trade Turnover

Billions of dollars

Ukraine Nitherlands Turkey Great Britain Poland

Germany Italy Finland Hungary Belorus

Kazakhstan Sweden Czechia Lithvania Others

More than 100 countries More than 100 countries are trading partners of are trading partners of

TTATARSTANATARSTAN

Page 36: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

36The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

0

20000

40000

60000

80000

100000

120000

2004 2005 1st Q 2006

Exports ImportsFTTBalance

US$ millionUS$ million

COMMODITYCOMMODITY EXPORTSEXPORTS

Mineral fuel, Mineral fuel, crude oil and oil crude oil and oil

productsproducts

9797..3%3%

Plastics and Plastics and plastic productsplastic products

22..6%6%

OtherOther 00..1%1%

COMMODITYCOMMODITY IMPORTSIMPORTS

Mechanical Mechanical equipmentequipment

5252..5%5%

Ferrous metals and Ferrous metals and productsproducts

1919..9%9%

Electric equipmentElectric equipment 1111..9%9%

OtherOther 1515..7%7%

Exports in 2005

Imports in 2005

COMMODITY TURNOVER BETWEEN TATARSTAN AND COMMODITY TURNOVER BETWEEN TATARSTAN AND SWITZERLANDSWITZERLAND

Page 37: The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan 1 REPUBLIC OF TATARSTAN – INVESTMENT IN FUTURE Kazan Geneva

37The Ministry of Trade and Foreign Economic Cooperation of the Republic of Tatarstan

Khafiz SalikhovKhafiz Salikhov

AAdddress: dress: 4 Ostrovsky St., Kazan 4201114 Ostrovsky St., Kazan 420111

TELTEL.: 7-843-299-10-07.: 7-843-299-10-07FAXFAX: 7-843-292-16-45: 7-843-292-16-45

E-mail:E-mail: [email protected] [email protected]: : www.tatarmintorg.ruwww.tatarmintorg.ru

The Ministry of The Ministry of TTraderadeand and FForeign oreign EEconomic conomic CCooperationooperation

of the Republic of Tatarstanof the Republic of Tatarstan