According to the list approved by the Russian Government, Russia currently has 319 single-industry towns, including 94 that face the most challenging social and economic circumstances and are included into Category 1 that requires government support in
In 2014, the working group prepared proposals for the draft Federal Law ‘On Accelerated Social and Economic Development Territories’ (ADT) regarding the expansion of special legal entrepreneurship treatment to organisations that implement investment projects in single-industry towns facing the most challenging social and economic situation. The Federal Law capturing these proposals was enacted on 30 March 2015. This will help build the prerequisites for economic growth in crisis-facing single-industry towns, primarily by making them more attractive for investors.
The creation of the Foundation for Development of Single-Industry Towns by Vnesheconombank in 2014 became an important step toward stabilising the social and economic situation in Category 1 single-industry towns. The Foundation will act as a project office for implementing investment projects that aim to diversify the economy and add new jobs in crisis-facing single-industry towns.
The federal budget provides for RUB 29.1 bn of subsidies to be allocated to the Foundation until 2018. The Foundation is planned to support 50 single-industry towns over that period. As at the end of 2014, a RUB 3 bn subsidy was already transferred to the Foundation’s account, while Vnesheconombank made a property injection for RUB 16.4 mn.
Foundation for Development of Single-Industry Towns: Priorities and Outlooks
Developing single-industry towns is among our investment priorities. The Bank’s portfolio includes 37 projects aimed at financial recovery and modernisation of backbone businesses of these towns and their economic diversification. As at the end of 2014, 29 of these projects with a total value of RUB 595.07 bn and the Bank’s commitment of RUB 351.18 bn were already fully financed, at the stage of financing or approved by the Bank’s governing bodies. Another 8 projects with a total value of RUB 46.32 bn and the Bank’s potential commitment of RUB 32.25 bn are at the review stage.