Far Eastern concessions are reconnected to the budget

The Ministry for the Development of the Far East plans to tie the instrument of the Far Eastern concession, which allows investors to return the costs of infrastructure construction within 10–20 years, to master plans for cities in the Far East. Plans, in turn, should include priority infrastructure upgrade projects. So far, only eight projects worth 12.3 billion rubles have been approved under the mechanism, but the requests of the regions are much wider – the majority are counting on the construction of new social facilities. Investors, in turn, indicate that they still lack clear rules of the game and long-term guarantees.

The Far Eastern concession instrument (a target mechanism for attracting private investment in infrastructure with a return of funds from future taxes in installments for 20 years) will be focused primarily on the development of master plans for the Far Eastern cities, Alexei, Minister for the Development of the Far East and the Arctic, said at the Eastern Economic Forum Chekunkov. Such plans are being developed by 25 cities of the Far Eastern Federal District, 17 of them are ready. In particular, a master plan for the development of Petropavlovsk-Kamchatsky was presented the day before.

In total, within the framework of the Far Eastern concession mechanism, launched a year ago, eight projects worth 12.3 billion rubles were approved. It was assumed that the concession would make it possible to build infrastructure faster (its volume was estimated by the department at 500 billion rubles), but the increase in Central Bank rates in the spring made financing concession projects unprofitable for the budget. Now the Ministry for the Development of the Russian Far East is discussing with the Ministry of Finance the possibility of introducing long-term limits for the program in order to link budget planning with the terms of concessions beyond it. Anatoly Bobrakov, deputy head of the department, promised to provide investors with a “very transparent picture of the sources of financing obligations” of budgets under agreements to be concluded by the regions, and to present criteria for selecting projects. While the tool is used to solve the operational problems of the regions, it should stimulate the attraction of private investment not only in industrial, but also in social infrastructure, he noted.

The mechanism of the Far Eastern concession allows the use of other support measures, in particular, to attract concessional financing. The regions are already receiving infrastructure budget loans. This year, within the framework of the project, it is planned to allocate 15 billion rubles, half has already been received by the regions, the Ministry of Construction reported. In total, 98 projects with a budgetary participation of 41 billion rubles have been announced until 2025. (extrabudgetary investments should amount to 687 billion rubles), including the construction of a bridge across the Lena, the financing of which was delayed for a long time. The regions are also raising funds through infrastructure bonds – a total of nine projects worth 21 billion rubles have been approved, and another 18 projects worth 50.6 billion rubles. are under consideration by DOM.RF.

In total, according to the National PPP Center, there are more than 600 such projects in the Far East (440 of them are in the housing and communal services sector, mainly the construction of boiler houses), the macroregion accounts for 760 billion rubles. investments (out of a total of 4 trillion rubles), more than 500 billion rubles. of this amount – investments of banks. Investors still lack clear criteria for selecting projects and guarantees for the entire period of their implementation, the scale of the instrument should also be larger, said Mikhail Chachin, vice president of Sberbank, estimating the volume of announced investments in five infrastructure industries over the past year at 350 billion rubles. InfraVEB, in turn, asked the Ministry for the Development of the Far East to revise the methodology for evaluating related projects (for example, the construction of roads to industrial facilities) – now they are getting negative reviews. Regions and banks also need general rules – in order to better negotiate, the company noted. So far, investors lack the data to test financial models and estimate what payments the region should make over the next five to ten years.

Regions, in turn, need support in the preparation of primary documentation for complex projects. The best practice for launching concessions is now in Yakutia. Here they ask not to tighten the criteria for selecting projects, but to approve long-term limits so that large investors are attracted to the concession, and not just regional operators. In the rest of the regions, they expect that the allocation of priority projects within the framework of master plans will make it easier to attract funding.

Tatyana Edovina, Vladivostok