Now that the projects are being implemented, it is necessary to pay their dues to the Government, the Ministry of Construction, personally Vladimir Vladimirovich [Yakushev, – Ed.] and his team for the fact that a lot of projects have been started. Within the framework of national projects, the project "Clean Water" is underway. In the Republic of Buryatia, this is RUB 4.7 billion. We are moving the stratum of issues that we did not even know how to approach or when. And we are significantly improving the quality of water for the people. <...> Those projects and programmes that have already been launched at the federal level as part of national projects and additional assignments, already allow us to significantly improve the current situation — Alexey Tsedenov, Head of the Republic of Buryatia.
We have given priority to 100 cities based on population numbers. This, of course, is a large volume. Cities of the first wave are 45 cities in which we already have 107 projects or project initiatives. The focus of our attention is on such sectors as housing and communal services, in particular, water discharge, water treatment, heat, lighting. Naturally, modernization of urban transport covers both a single transport types and an integrated approach to transport in the city. These are medical projects and individual social projects — Alexey Sorokin, Deputy Chair, State Development Corporation "VEB.RF".
Our bank is experienced in constructing urban infrastructure. Projects such as Pulkovo Airport, West Siberian High-Speed Diameter, bridges across the Kama and Bui rivers, Russian Post facilities, new logistics centres. We are investing in these projects, but these projects should have a monetization potential. When this is the case, then we are launching full cycle projects: we design, find financing, possibly in the Western markets as well. The most important thing is that we organize these projects and see them through to the end. We operate these facilities and, accordingly, recoup the investments that have been made there — Anatoly Pechatnikov, Deputy President – Chairman of the Management Board, VTB Bank.
The most striking and yet traditional example of economically feasible improvement and private investment in this area is the housing sector. It happens when the developer goes beyond their project and improves the adjacent park, garden, or street. The company does it in their commercial interests in order to increase the value of the square meter and increase sales. And this model is equally efficient in the capital regions, and in the small cities — Daria Bondareva, Managing Partner, UrbanMAF.
About business in the Far East. Today we are working with Sibur. We are working on one USD 1.5 million contract, and we are continuing our efforts to implement other programmes within the chemical complex and chemical production fields. We understand that the Far East region has great potential, which is linked to the national strategy and is a top-priority project for the whole country, for the whole of Russia — Zongyi Xin, Regional President for Russia, CIS Countries, Central and Eastern Europe, China Gezhouba Group International Engineering Co..
Currently, thanks to the cooperation and support of the Federal Government of Russia and regional Russian administrations, projects are being implemented to test the system of smart traffic lights and wind energy. Both projects are included in the eight-point plan of cooperation proposed by Prime Minister Abe for the development of Japan–Russia economic cooperation — Hiroaki Ishizuka, Chairman, New Energy and Industrial Technology Development Organization (NEDO).
Today, the tariff regulation that exists in the Russian Federation. <...> is the main problem why business stay away from investment in housing and communal services. We are constantly looking for a middle ground. Somewhere it is possible, in some territories of the Russian Federation, it goes better, in some it goes worse. <...> We are talking about small towns. We are talking about rural areas, that include a low tariff base, a rather troublesome economy, and a small amount of financial resources in this system. Of course, this does not attract business there. Therefore, the position of the Ministry in this regard, <...> when we talk about small towns and, of course, when we talk about rural areas, under today's system of tariff regulation, we should rely on budget support — Vladimir Yakushev, Minister of Construction, Housing, and Utilities of the Russian Federation.
In the Far East, there has always been a problem with attracting investors. Investors always look at how they can return their investments. In the Far East, it is absolutely or practically impossible to return the investments made in case of 100% tariff regulation. The investment component of the tariff, which is absolutely small and limited by the maximum growth of the tariff or the maximum growth of citizens' fees, does not allow investing — Nikolay Shulginov, Vice President for Service Platform, Rostelecom.
We organize visiting committees in the Far Eastern Federal District. In almost all the territories except Chukotka, we got acquainted with the peculiarities of housing conditions in each region. And the issue of dilapidated housing is particularly acute. <...> Its share is 2.5–3 times higher than the Russian average, only 70% of the housing stock is supplied with water, only 68% has sewerage, only 74% has heating — Nikolay Kharitonov, Chairman of the Committee for Regional Policy and Issues of the North and Far East, State Duma of the Federal Assembly of the Russian Federation.
Currently, the Ministry is working on a housing and utilities sector strategy. We want this document to be as public as possible, so that as many representatives of the expert community as possible take part in the discussion of this project. At the same time, given that we are engaged in both construction, and housing and utilities – and these are the two sectors that go hand in hand – there are a lot of intersections. Therefore, we now have an important task of intersecting these strategies with each other. <...> In the near future, we must finish our work on this programme and introduce the first draft to the Government. I think there will be a serious discussion — Vladimir Yakushev, Minister of Construction, Housing, and Utilities of the Russian Federation.
Today, one of the main deterrents to housing construction is the lack of sufficient land plots provided with engineering infrastructure. <...> In 2018, the amount of housing built in the Far East was twice as low per thousand people as in Russia on the whole. Therefore, it is necessary to expand the practice of complex development of the territory. The corresponding standard is already being implemented in Vladivostok and Svobodny. The federal budget provides RUB 183 billion for co-financing the development of territories within the boundaries of settlements for the period of 19–24 years — Nikolay Kharitonov, Chairman of the Committee for Regional Policy and Issues of the North and Far East, State Duma of the Federal Assembly of the Russian Federation.
Much depends on the regional authorities. Among other things, they create such prerequisites as regional and local tax benefits, additional support incentives, and business subsidies. Public-private partnership brings about good practices, when the economy is updated, business brings new interesting technological solutions, uses new materials, and after a certain period of time we see that the system of public utilities is fundamentally changing — Vladimir Yakushev, Minister of Construction, Housing, and Utilities of the Russian Federation.
The concession mechanism shows its efficiency on the territory with good tariff base and investment potential. Yet, it is not applicable to a large number of cities and rural settlements in the Far East. Today, according to the committee, concessions in the Far East require additional motivation and a compensation mechanism. For example, it is possible to create a VAT exemption for resource supply companies in the Far East, which operate on the basis of concession agreements and apply a simplified taxation system — Nikolay Kharitonov, Chairman of the Committee for Regional Policy and Issues of the North and Far East, State Duma of the Federal Assembly of the Russian Federation.
In a small town of Svobodny, together with our partners and with the support of the Ministry headed by Vladimir Vladimirovich [Yakushev, – Ed.], we worked out a system that actually allows us to implement the concession. I am talking about the public-private cooperation, where the funds of the investor go directly into this concession to replace all water supply and drainage pipes. In Svobodnoye, 65% come from us, and by 35% are, respectively, from the public funds. <...> Our holding, a local investor and the local authorities are currently using the concession to build such an opportunity, which will allow 80% of worn-out networks in parts of the districts of Svobodnoye to be replaced by polymer solutions and ensure the economic life of all these networks for another 25–30 years after the end of the concession — Mikhail Karisalov, Chairman of the Management Board, Chief Executive Officer, SIBUR .
The private sector has a strong influence on technology, on computerization and on the processing of the entire knowledge base. This is how it participates in the market — Thani bin Ahmed Al Zeyoudi, Minister of Climate Change and Environment United Arab Emirates.
In fact, there are no expenses in the tariff today that cover the proper operations, cleaning, chemicals required for cleaning, or personnel. Therefore, it is certainly incorrect to say that today's tariff should be an example and a basis for the implementation of projects. It seems to us that the idea of a technological benchmark would be the most fitting in this case, because each system is special. Here, counting the technological processes that are taking place inside, we could talk about the transition to the really proper tariff for the territory — Lev Gorilovskiy, President, Polyplastic Group; President, Polyplastic Group; Member of the General Council, Delovaya Rossiya (Business Russia) .
Probably there is no other way, other than applying an alternative boiling method for heat supply systems. It allows both us and pretty much any investor, to invest in the development of heat supply systems, or heat transmission systems, or loss reduction, as long as they clearly understand that the regulator does not intervene anymore, setting the tariff below the limit once with a reduction factor. Further on, this is the concern of the unified heat supply organization, which is us in most regions, and this is the real area that we support today — Nikolay Shulginov, Vice President for Service Platform, Rostelecom.
We took the first step. We have already concluded 11 concessions today and, breaking the world speed record, signed an altboiler agreement with the city of Ulyanovsk just a month ago. This is the first European city in Russia, with which an agreement was signed. <...> Thus, even in the smaller Russian city, such as Ulyanovsk, about 650–700 thousand residents have 12 different heat tariffs to choose from. <...> And now we are preparing them en masse and want to sign in the next two years either a concession or an alternative boiler system in about 30 or so cities — Andrey Vagner, Chairman of the Board, General Director, T Plus.