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6 April '18

YIEF 2018 to discuss proposals from Russia’s CCI on developing Crimea’s economy

YIEF 2018 to discuss proposals from Russia’s CCI on developing Crimea’s economy

Experts at the Chamber of Commerce and Industry (CCI) of Russia believe that measures to protect beneficiaries working on the peninsula, distance financing of Crimea’s enterprises, acceleration of property and land lease agreement registration under the Russian legislation will boost Crimea’s economic development.

At the Chamber of Commerce and Industry of Russia, experts discussed economic aspects of the development of Crimea and Sevastopol: investment and financial policies, availability of loans, entrepreneurship in industry and tourism. Anton Danilov-Danilyan, Chairman of the CCI of Russia’s Council for Investment Policy, moderated the meeting.

Maksim Fateev, Vice-President of the CCI of Russia, noted that the Republic’s infrastructure and equipment had been greatly depreciated; 40% of investment in core assets comes from the treasury, while local entrepreneurs complain of having no access to loans. Most local entrepreneurs complain of the high cost of financing: the interest rate can be as high as 20%.

The participants also noted that the shadow economy in the region was still at a high level. The Federal Statistics Agency’s latest data put the share of the informal sector in Russia at 22.34% on average, while it is 37.1% in Crimea and 28.4% in Sevastopol. Mr. Fateev believes that the small and medium-sized business sector is mostly plagued by such problems as property and land lease agreement re-registration under the Russian legislation and the procedure for siting mobile retail facilities.

To remedy the situation in Crimea’s economic development, the CCI of Russia believes the free economic zone should be expanded to cover the entire peninsula, thereby making entrepreneurs from Crimea and Sevastopol its residents by default.

An interface permitting out-of-Crimea lending institutions to provide distance project financing could compensate for the absence of Russian banks on the peninsula. This function could be exercised by a financial lending agency that would prepare the paperwork for Crimea’s enterprises to obtain loans from banks outside the peninsula. That is the opinion of Vladimir Gamza, Chairman of the CCI of Russia’s Committee for Financial Markets and Lending Institutions.

Georgy Muradov, Crimea’s Deputy Prime Minister, Permanent Presidential Envoy to the Republic of Crimea, believes that, in order to protect businesses from the impact of western sanctions, measures to protect beneficiaries working in Crimea should be developed and applied on the peninsula.

Georgy Muradov believes that the idea of major banks’ consolidated “entrance” into Crimea, including those that are partially government-owned, is feasible. To develop Crimea’s economy, efforts must be channelled into opening Crimea’s seaports to develop the peninsula’s export capacities, into developing tourism more actively, into creating a state-of-the-art infrastructure and into applying blockchain technology.

The meeting’s participants included Alexey Konyushkov, Deputy Head of the Federal Agency for Tourism; Yuri Barzykin, Chairman of the CCI of Russia’s Committee for Entrepreneurship in Tourism; Victor Kruzhalin, President of the Institute for Development of Tourism and Resort Business (IDTaRB); Andrey Shirokov, Chairman of the CCI of Russia’s Committee for Entrepreneurship in Housing Maintenance and Utilities; Alexey Vyalkin, Director of the Department of Investment and Innovation Promotion at the CCI of Russia; heads of the CCI of Moscow, the CCI of the Rostov Region, the CCI of the Lipetsk Region, the Ministry of Resorts and Tourism of the Republic of Crimea, private investors and entrepreneurs.

The final document adopted by the joint meeting recorded the decision to summarise the proposals put forward for further discussion at the Yalta International Economic Forum.

Materials may be used only if accompanied by a live link to the YIEF official website forumyalta.com.

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