The VEB.RF National PPP Center named restrictions for the implementation of priority projects in partnership between the state and business

Using the public-private partnership (PPP) mechanism, by 2030 in the Russian Federation, projects necessary to achieve technological sovereignty and for structural adaptation of the economy can be implemented, totaling 3.4 trillion rubles, as calculated by the National PPP Center. To do this, however, it is necessary to remove the existing legislative restrictions for the implementation of such projects, primarily in the industrial sphere.

The investment potential of the PPP market to solve the problem of achieving technological sovereignty is estimated at 3.4 trillion rubles. by 2030, according to a study by the National PPP Center VEB.RF.

The taxonomy of priority projects approved by the government divides them into two groups: technological sovereignty, aimed at creating new capacities, technologies and expanding production in industries where the degree of localization is less than 50% (for example, electronics, chemical industry, aviation and automobile industry), and structural projects adaptation of the economy, allowing the reorientation of product supplies from the Russian Federation to friendly countries (see “Kommersant” dated April 18). The priority list is planned to be used to lend to projects at more affordable rates by lowering risk ratios, and also to link them to other support mechanisms – for example, to a project finance factory (see “Kommersant” dated June 28) and the mechanism of investment tax deduction (see “Kommersant” dated March 1).

According to the center’s estimates, technological sovereignty projects worth RUB 2.5 trillion and structural adaptation projects worth RUB 0.9 trillion can be contracted under PPP by 2030. However, the authors warn, this is only possible if “legal, market and institutional” restrictions are removed.

Currently, the implementation of PPP mechanisms without legal restrictions is not possible in all necessary areas, the study says. For example, for PPP agreements, all areas of technical sovereignty are available only with restrictions and risks. Concessions are fully applicable for only two of the 13 areas (energy and shipbuilding) and completely inapplicable for five (for example, aircraft manufacturing and electronics). For projects of structural adaptation of the economy, for the most part, PPP mechanisms are suitable.

Let us recall that the PPP market is mainly concentrated on infrastructure projects; in the industrial sector, the mechanism is used much less frequently (see “Kommersant” dated September 14, 2022). This situation is due to the fact that, although formally PPP projects can be implemented in the field of industrial production, this form is unattractive for it due to legal restrictions. For example, it is not allowed to conclude PPP agreements regarding the reconstruction or modernization of privately owned facilities; the land plot must belong to the public party and the facility will be transferred to it at the end of the agreement (if the state’s share of participation is more than 50%).

The use of PPP in technological sovereignty projects is also hampered by other problems, which, as stated in the study, are systemic in nature: the high cost and duration of R&D, the unregulated distribution of technological risks and rights to intellectual property, lack of funding for the active increase in industrial production, long payback periods for projects with increased technological, marketing and credit risks.

To lift restrictions, experts believe, legislative changes are necessary.

First of all, in terms of fine-tuning the PPP mechanism itself by removing restrictions for use in industrial projects. It is necessary to allow state-owned companies to enter into agreements regarding private facilities and to participate on the side of the private partner, and on the public side – to development institutions that are the “holders” of support measures. It is also necessary to abandon the mandatory emergence of state ownership of an object when the share of participation of the public party is more than 50%, or at least provide for a mechanism for delayed privatization. It is also proposed to link the “classical” PPP with the so-called quasi-PPP (offset contracts, agreements on the protection and promotion of capital; SPPK) – in particular, by providing investors within the framework of PPP projects with the opportunity to conclude such agreements without additional competitive procedures.

Evgenia Kryuchkova