MOSCOW INVESTMENT DIGEST. August 2020
The Moscow Department of Investment and Industrial Policy in cooperation with the Moscow City Investment Agency presents you the next digest of the main investment events in the capital.
Investments in Fixed Capital in Moscow Exceeded RUR 1 Tn
The investments in fixed capital in Moscow in H1 2020 exceeded RUR 1 tn. This is 8.2% more than in the same period in 2019. The Record volume of investments in Moscow stabilize the all-Russian indicators, which decreased by 4% at the end of the half year.
According to Vladimir Efimov, Deputy Mayor of Moscow for Economic Policy and Property and Land Relations, Moscow retained key parameters for development through a diversified economic structure and a wide range of business support programs. He also noted that the share of extrabudgetary investments in the development of enterprises and urban infrastructure was about 77%. Over the past nine years, the investments in fixed capital in Moscow have more than doubled in comparable prices.
Moscow now accounts for 15% of all Russian investments in fixed capital and about half of direct foreign investments in Russia. The Russian capital is now the largest market, the most important production and logistics hub, and a major customer as well. These factors allow the city to stimulate investment growth throughout the country.
Moscow Manufacturing Industry Grew by 3.5% in 2020
The industrial production index of Moscow manufacturing companies from January to July 2020 was 103.5% compared to the same period last year. In the first seven months of 2020, these companies shipped goods, performed work and provided services for almost RUR 3 tn.
The manufacturing industry provides for 16.2% of the gross regional product. As for industrial production volumes, there was a 15.6% growth in July compared to June, and a 3.5% growth for the first seven months of the year.
The significant increase in production volumes compared to the same period last year was demonstrated by such industries as chemicals and chemical products (by 172.1%), machinery and equipment (by 135.6%), medicines (by 23.8%) and food (by 9.8%).
Technopolis Moscow Residents Invested in Production RUR 3.2 Bn within 6 Months
The Technopolis Moscow residents invested RUR 3.2 bn in production development in six months of 2020. This is 23% more than in H2 2019.
Favorable conditions created for SEZ residents let their revenue grow. In H1 2020, it was RUR 10 bn, what is a third more than in the same period last year.
Benefits of SEZ residents allow them to save up to 47% of mandatory payments. In H1t 2020, the savings were almost RUR 170 m. These funds enabled technopolis residents to retain all staff during the pandemic, and were used to develop production and improve facilities.
Council for Strategic Development and Implementation of National Projects Will Be Established in Moscow
This was announced by the Deputy Mayor of Moscow for Economic Policy and Property and Land Relations Vladimir Efimov at the meeting of the economy support office. The Council will include representatives of real economy sectors, the Moscow Government, business and industry associations, public institutions. The main task of the council is to develop new approaches to the future economy shaping and to coordinate actions of business and government.
"The new format of dialogue between business and government set up by the economy support office during the pandemic has proved to be effective and demanded by the business community. Four packages of anti-crisis measures to help entrepreneurs were jointly developed and adopted; this business support set was recognized as the best among the world's largest megacities. Today, the Moscow economy has almost recovered and there is no need for this office to in operation any more. However, in the new realities we need new approaches to shape a challenge-resistant economy. Then, we plan to continue working in the Council for Strategic Development and Implementation of National Projects, which will allow to maintain a dialogue between the authorities, business and the expert community for joint solutions to build a new long-term concept of Moscow economic development," - Vladimir Efimov said.
Project of Rudnevo Industrial Zone Re-Development Approved
A 7.09-hectare land plot site has been allocated to construct new production sites in the Rudnevo industrial zone. The project was approved by the Moscow Commission of Urban Planning and Land Use. In the future, industrial zones to be re-developed may obtain the status of a special economic zone.
The industrial zone is located in Kosino-Ukhtomsky subdistrict, five minutes away from the Moscow Circle Road. In the coming years, the territory will undergo a large-scale re-development. The commission decision will allow to start construction work on one of the land plots. In total, the development plans cover about 40 hectares and the project is being implemented step by step. At present, the allocation of 7.09 hectares has been approved. According to the results of the project implementation it is planned to create more than 9,000 new jobs in the industrial zone, the planned investments will amount to RUR 24 bn, and the expected annual budget effect will be about RUR 1 bn.
It was decided earlier to build an industrial technopark, which will be the core of the Rudnevo industrial zone. Its residents will be high-tech small and medium-sized companies in construction, aviation and electronics. The construction will already start this year.
Industrial zones in Korovino and Kapotnya Await Re-Development
Three sites of industrial zones in North and South-East Moscow are awaiting re-development. Within the integrated area development projects, the investor will invest RUR 15.7 bn in the re-development of two industrial areas of 8.5 and 4.9 hectares in Korovino and RUR 8.9 bn in the development of an 8.4-hectare site in Kapotnya,
Infrastructure for work and rest will be organized in these industrial zones. According to the Head of the Moscow Department of Investment and Industrial Policy Alexander Prokhorov, 350,000+ square meters of public facilities will appear here, including business centers and business spaces, shopping areas, catering units. The projects will create 7,000 new jobs.
Moscow Digital Technologies Presented Online at Trade Fair in China
Moscow energy-efficient solutions for logistic centers, uninterruptible power supplies, microelectronic products and innovative lighting systems were presented online at Power China 2020 international trade fair. Foreign partners were shown in online format the opportunities of Moscow companies: products, service offers, technical documents. They also could do online production tours.
At the Moscow booth, visitors could use virtual reality glasses to get acquainted with the products of three capital high-tech companies and to schedule talks with employees of companies located in Moscow. After that, the negotiation participants in Guangzhou and their Russian partners used VR helmets and headsets to find themselves in a common virtual conference hall, negotiated, discussed deal terms and looked through virtual presentation materials. For every meeting participant the organizers created not only an online meeting room, but also a portable human model, which transmitted gestures and emotions.
12 Business Missions Will Be Organized for Moscow Exporters till Year’s End
The Moscow Export Center (MEC) will organize 12 business missions for export-oriented small and medium-sized enterprises until the end of this year. They will be held online, as business activity around the world is still suspended because of closed borders.
Moscow companies from different industries will be able to take part in online business missions with partners from Germany, Turkey, Korea, China, Israel, Vietnam, Indonesia, Morocco and other countries as well. Moscow entrepreneurs will present their products and hold business meetings with potential foreign buyers.
In its turn, the Mosprom Center has prepared eight more pre-sale events with foreign buyers for medium-sized and large industrial manufacturers and agricultural producers. They'll be held remote as well.
Hotline for Property Payment Grant Recipients Is in Operation in Moscow
The Moscow Economic Support Center hotline for owners of retail, catering, consumer services facilities and hotels continues its operation and accepts applications for grants to compensate for property and land payments.
Applications from owners of retail, catering, consumer services facilities and hotels for compensation of property and land payments are to be submitted by December 31 on www.investmoscow.ru. In total, 6,500 organizations can apply for these grants. The city plans to allocate RUR 15.6 bn for this purpose.
Moscow Government Expanded List of Business Subsidy Recipients
The right to budget subsidies was granted to enterprises and individual entrepreneurs in pre-school, general and additional education, culture, leisure and entertainment, fitness and sports, art galleries and art auctions. These industries in Moscow have about 28,000 small and medium-sized businesses.
As of today, companies and individual entrepreneurs can receive 13 types of subsidies from the Moscow budget. Reimbursable expenses include expenses for the purchase or lease of equipment, utility payments, loan interest, payments to the right holder for the franchise purchase, engineering, export of products (so-called export cash-back), participation in trade fairs, online product promotion, payment for food delivery services, training of employees, etc.
In addition, the Moscow Government has increased opportunities for Moscow export-oriented companies to receive subsidies and grants. Companies will now be able to use the subsidy to cover their expenses on creating a marketing strategy when launching export sales, translating educational and training materials into foreign language, developing and translating an advertising for product promotion.
113 Moscow Commercial Units to Be Rented to Entrepreneurs at Discounted Rate
Representatives of small and medium-sized businesses will be able to rent 113 non-residential premises on preferential terms. The largest number of non-residential premises at a reduced rate is rented out in South Moscow - 26 offers, 16 premises are available for rent in North and East Moscow, another 13 lots are to be rented out in South-East Moscow. Nine lots are available for rent in South-West Moscow and in Zelenograd, 10 lots are available in West Moscow, 7 are available for rent in North-West Moscow, four are available in North-East Moscow and three are available in the center.
The preferential program of commercial units rent allows Moscow entrepreneurs to create and develop their business on transparent and favorable terms.
Moscow Put up for Sale 100+ Car Parking Spaces
The auction is organized by the Moscow Department of Competition Policy.
Most parking spaces for sale are in South-West Moscow, in Cheryomushki. 74 parking spaces are for sale in Perekopskaya Street 34k3. 20 lots are put for sale in East Moscow, in Ivanovkoye and Golyanovo, 6 - in North Moscow, in Khoroshevsky subdistrict in Khodynsky Boulevard 17, one lot is available in West Moscow.
The initial price of parking spaces put up for sale by the Moscow Government varies from RUR 496,000 to RUR 1.04 m. In addition, four lots will be available for purchase at a reduced price in the public offering format, and over 30 parking spaces will be put up for sale without a price announcement. The area of available lots is from 10.6 to 64.3 square meters.
Investors Were Offered to Build Medical Center in South-West Moscow
Moscow announced an auction to rent a 0.21-hectare land plot in North Butovo. The auction winner will be able to build a medical center there.
The land plot will be rented out for two years and eight months. During this time, the investor will have to build the facility and put it into operation, then the total space of the erected facility will be transferred into the ownership of the land plot tenant.
The initial annual rent rate is RUR 8.2 m. The winner will be entitled to build an out-patient care center, a nurse station, a mother and child center, a diagnostic center, an infant feeding center, a blood donation station or a clinical laboratory. The facility will also include retail space, but only in addition to a medical center. The building area will be 4,300 square meters.
Applications are to be submitted by September 28. The auction will be held on October 1.
4,000+ items for city property sale and rent auctions are presented on the Moscow Investment Portal www.investmoscow.ru.