According to data Spread out in 2022, more than half of Russian regions increased the volume of investments. It reached almost 28 trillion rubles. This year there is an increase in financial injections composed 13.5 percent. A historical record was shown by commercial real estate, in which only in the first half of 2023 invested 291 billion rubles. About which regions and projects are developing the economy in the crisis, we talked with Mykola Bragin, the founder of the investment company Bragin \u0026 Co, which invests in the real sector in the regions.
In 2023, investment in fixed capital grew up compared to last year. Businesses and the state spend funds on development projects: they buy equipment and transport, invest in the construction and renovation of buildings, counting on future growth in production and profits.
Investments help the economy of regions to develop, as a result, the population’s well-being, level and quality of life increases. For example, investing in infrastructure not only makes the region more convenient, but also attracts business: good road coverage promotes business activity.
Investments in industry increase the number of jobs, reduce unemployment. Both the incomes of the population and the regional budget are growing due to tax deductions. People do not leave happy regions. On the contrary, residents of less promising areas are moving there – the population is growing.
How were investments distributed by region?
The top 10 regions for investment attractiveness have practically not changed over the past few years. It is headed by metropolitan regions, territories with a developed economy, and leaders of the raw materials industry (which produce regions).
yes according to the data research company ID-Marketing, the largest volume of investment in fixed capital was recorded in Moscow – 16.3% of the total volume (in nominal terms). 33.8 percent of them fell on machines and equipment. 29.1% – share of investments in non-residential construction; 15, 4% – in the construction of residential buildings. These indicators are lower than the data for the same period last year, as well as in many regions that entered the top.
Top 10 regions for investments
| Region | The volume of investments in billion rubles. | Increase in comparable prices, % |
| Moscow | 756 | -11.9 |
| Tyumen region with districts | 633 | -10.2 |
| Khanty-Mansiysk Autonomous District | 317 | +5.7 |
| Yamal-Nenets Autonomous District | 262 | -25 |
| Moscow region | 224 | -12.6 |
| Krasnoyarsk Territory | 172 | +23.6 |
| St. Petersburg | 161 | +5.1 |
| Republic of Tatarstan | 156 | +9.8 |
| Irkutsk region | 127 | +18.2 |
| Krasnodar Territory | 122 | +5.5 |
An even more interesting picture is observed in the regions that did not enter the top 10. They showed explosive growth in investment. Thus, the volume of investments in the Amur Oblast increased by 55.3% compared to last year, and in the Rostov Oblast by 74%. In 2011, the “100 Governor’s Investment Projects” program was launched for the region. At the beginning of May 2023, the amount of investments under it was 534530000000 rubles. The main areas here are agriculture and the fuel and energy complex.
Another example: investments in the Republic of Buryatia increased by 2.5 times – by 96.2%. Most of the investments fell on non-residential buildings (56.6 percent), machinery and equipment (37.2 percent), the transport sector, the energy sector, and mining. In Buryatia, the largest investment projects are being developed, such as the Ozerny HAC.
| Region | The volume of investments in billion rubles. | Investment growth in comparable prices,% |
| Republic of Buryatia | 22 | +96.2 |
| Rostov region | 118 | +74 |
| Republic of Altai | 24 | +64.2 |
| Kamchatka Territory | 14 | +59.9 |
| Kaliningrad region | 31 | +58.4 |
| Volgograd region | 46 | +57.3 |
| Amur region | 121 | +55.3 |
| Republic of Mordovia | 11 | +47.7 |
| Khabarovsk Territory | 72 | +45.6 |
| Chechen Republic | 17 | +44.1 |
In which regions did investment fall the most?
Several regions set an anti-record for a decrease in investment in fixed capital.
| Region | The volume of unreceived investments in billion rubles, compared to the 1st quarter of 2022 | Decrease in investment in comparable prices, % |
| Karachay-Charka Republic | 3 | -43.1 |
| Bran region | 9 | -42.4 |
| Sevastopol | 7 | -38 |
| Oryol region | 8 | -32.1 |
| Republic of Karelia | 10 | -32 |
| Sakhalin region | 36 | -31.2 |
| Ulyanovsk region | 16 | -28.4 |
| Kaluga region | 18 | -27.6 |
| Murmansk region | 34 | -26.7 |
| Novosibirsk region | 47 | -25.5 |
What do funders consider when choosing a region?
When investing in a long-term project, investors consider:
- Demographic characteristics of the region: population education, age, population growth or decline, number of people leaving and coming to the entity. The standard of living of the population, social stability of the region is also important.
- Established supply chains. Investors are more willing to invest in regions with closely connected urban centers that facilitate production and trade.
- Availability of government programs and benefits for the subject. Partial financing from the state budget, subsidies, preferential loans, tax holidays, discounts on the payment of communal services, etc. — all this increases the investment attractiveness of the region.
- Scales of urban agglomerations. Abundant labor resources, developed logistics, and the presence of airports are important for investors.
- Availability of city-building enterprises, industrial clusters, commercial real estate objects. Investors are attracted by the presence of the largest companies in leading industries in the region.
- Regional management policy. If the authorities actively develop the region, then cultural, art and leisure facilities are built in it: business centers, museums, parks, sports complexes, entertainment centers. This makes cities attractive for investment.
Investment attractive industries
In connection with the sanctions, many companies had to rebuild their logistical and technological processes, change their sales markets. Therefore, in 2022-2023, businessmen invested 5 trillion rubles in transportation and storage.
The construction industry also remains at the peak of investment attractiveness thanks to national projects and measures of state support, for example: preferential lending, mortgages, partial reimbursement of capital construction costs, state financing of infrastructure construction. Thanks to them, the construction sector “added” 16% to the volume of investments. The production of raw materials and the extraction of minerals also do not lose investment, despite the sanctions.
The most anticipated regional investment projects in 2023
The largest projects that attract the attention of business and the state:
- Manzherak resort and Altay Wellness Village hotel complex in the Altai Territory. Ashchad invested in the project. Several large projects are being developed in the region at once, which has led to a real investment boom.
- “Amur Minerals” LLC is launching a mining and beneficiation plant (GOC) on the basis of a copper deposit in the Khabarovsk Territory.
- The complex of deep processing of petroleum raw materials and middle distillates, the complex for the production of automobile gasoline JSC “Novashakhtinsky Zavod Naftproduktov”, the residential area “Suvoravsky” of the VKB Group, and the complex for the deep processing of wheat grain and the production of amino acids JSC “DonBioTech” are being developed in Russia.
- Mining and metallurgical plant “Udakan” in Transbaikalia. The enterprise plans to process 12 million tons of copper ore per year.
- Railway section Nadym – Pangody in Yanao. In 2022, the project collected investments in the amount of 43 billion rubles. Gazprom is among the investors. The 109 km long railway line will become part of the Northern Latitudinal Course and will help connect the Sverdlovsk and Northern railways.
- In 2023, it is planned to launch the second phase of GOK at the Pavlik field. The Teutejak mine plans to put a gold extraction factory into operation. Both projects are being developed in the Magadan region.
- A railway in Yakutia and a port in Khabarovsk Krai. In 2022, the project collected 97.1 billion rubles of investment. The “Elgavugal” company is engaged in the construction of a railway branch for the export of coal from the Elgin coal deposit to the coast of the Sea of Okhotsk. The company is also building a port that will start to accept the first trials already in 2024.
- Highland Gold Mining plans to launch a ZIF in Chukotka to extract 800,000 tons of ore per year.
- Electric steel smelting complex in the Nizhny Novgorod region. The project of the “Ecalant” company collected investments in the amount of 150 billion rubles. According to the team’s plans, environmental the plant in Vyksa will be operational in 2025 and will produce 1,800,000 tons of steel per year.
- The Coalstar company plans to start coal mining in the Volat section in the Novosibirsk region. The enterprise is significant for the coal industry: it plans to process 10 million tons of anthracite per year.
- Lake Mining Company is building a beneficiation factory in Buryatia on the basis of a polymetallic deposit.
The Krasnoyarsk region also attracted special interest from investors. Major metallurgical projects are being developed here, most of which are planned to be implemented by 2028. In total, there are more than 100 investment projects in the region, so the authorities expect an increase in investments in the economy by the end of the year at the level of 22.6%.
The role of the state in the sphere of investment
The share of budget investments in 2022 increased from 18.3% to 20.2% and amounted to slightly more than 4 trillion rubles. And in 2023, she should to achieve 29.7 trillion. rubles. For many regions, public investment is the main source of financing. Here is what is known about the state’s plans:
- It is planned to allocate a trillion rubles for infrastructural budget lending. This money will be used for the construction and modernization of infrastructure, roads and other objects of social and engineering infrastructure in 83 subjects of the Russian Federation.
- Regions will receive 180 billion rubles for more prompt commissioning of strategically important facilities.
- More than 300 billion will be allocated for the infrastructure of the regions. Also through budget loans.
Let’s summarize the results
In 2022, more than half of Russia’s regions will see positive investment dynamics. This year, this trend continues. The share of budget infusions also increased, which helps mitigate the effects of the crisis.
In some areas, such as commercial real estate, investor activity has increased several times. Experts predict the growth of investments in regions with stable economic development, as well as areas from which foreign competitors have come: agriculture, light industry, tourism, transport and logistics. Business does not plan to curtail investment projects in these areas. Export-oriented production may suffer today.