What governors cannot do, heads of local administrations can do. Don't believe me? The history of three Russian regions visited by a Forbes correspondent confirms this

In 1991–2004, Russia received $36 billion in foreign direct investment—$257 for every resident of the country. A little. But there are places on the map of the country where investors are attracted like a magnet. The “average per capita” contribution of foreigners to the industry of the Borsky district (Nizhny Novgorod region) is $2,000, in the Vsevolozhsky district (Leningrad region) this figure reached $5,400, and in the Stupinsky district near Moscow - $7,200. There are no oil deposits (gas, diamonds, coal, etc.) on the territory of these municipalities; in Soviet times they were not even considered large industrial centers. However, over the past ten years, the influx of external money to these points on the map has amounted to more than $2 billion. What is the secret?

Stupinsky district

Moscow region

POPULATION 111,000 people

DISTRICT HEAD Pavel Chelpan

VOLUME OF FOREIGN INVESTMENTS $800 million

LARGEST INVESTORS Mars Inc., Campina, Marazzi Gruppo Ceramiche

FEATURES OF THE AREA Refusal to locate alcohol production. An unspoken ban on the activities of Moscow retail chains

The photographer and I covered the distance of 106 kilometers from Moscow to Stupino by car in about forty minutes. On the Don highway (the best in the Moscow region) there is not a single traffic light or traffic police post. At the entrance to the city we stop at the side of the road. The panoramic view of the production complex of the American corporation Mars just begs to be photographed.

Before we have time to uncover the equipment, a brand new Ford Focus parks nearby. Behind the wheel is a satisfied Mars security guard. “No permission, no photograph,” he throws up his hands. “There must be order in everything.” If only he knew how things were here more than ten years ago.

Construction of the Mars factory began in May 1994 in an open field. The Americans invested $150 million in new production without yet having a land allotment, general plan, approved project or other permitting documentation. They built it on agricultural land, on the word of honor of the local administration - but they built it in record time, within a year. “Of course, the Americans took risks,” Pavel Chelpan, head of the Stupinsky district administration, says in an interview with Forbes. “But they actually took a big risk when they were the first to come to Russia with industrial investments.”

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Chelpan has been leading the district since 1986. He fully corresponds to the image of the stern business executive of Soviet times - large, domineering, capable of solving any problem with a strong blow of his fist on the table. This is exactly what foreigners needed. Mars management examined several dozen sites in other areas of the region, but still chose Stupino. Why?

“The company in Stupino was satisfied with the distance from Moscow and the accessibility of the capital with the existing transport infrastructure, but the main thing, of course, was Chelpan and his attitude to business,” explains a former high-ranking Mars employee who took part in the organization of the new plant.

During the Soviet years, Stupino was a closed area for foreigners; several enterprises focused on the aviation industry operated here. By 1993 the situation had changed. “Investment or death, that was the question for us then,” admits Pavel Chelpan. “Our city-forming enterprises were standing still, they needed to be supported, carried on the shoulders of an investor through difficult years.” The Stupino administration has outlined a plan to annually attract about $100 million into the region’s economy. How? According to Chelpan, at first the administration had no idea about this. They declared their readiness to accept investors in regional and federal departments, and began to participate in all competitions and shows at which foreign companies chose sites for the construction of future factories.

In those years, foreigners demanded from their Russian partners, above all, safety and reliability. “The only thing the owners of Mars were afraid of was crime,” says Chelpan. “We guaranteed their safety.” They knew what to promise: there was no crime in the “regime” Stupino. It turned out to be more difficult to fulfill the obligations to document the project “retrospectively”.

“I come to one regional minister to sign documents, and he tells me: what kind of project is this, why don’t I know? “I won’t sign anything,” he says, recalls Stupinsky’s head. “Try not to sign from me, we already have a factory.” I look at the frowning Chelpan and understand: that official had no chance of not signing.

During that period, Chelpan formulated for himself the basic principle of working with foreigners. Regional officials throughout Russia were confident that any major project must begin with the financing of social programs - repairing schools, roads, equipping local administrations with office equipment, etc. “We’ll ask later, when the plant is built,” smiles the head of Stupin. . He has far-reaching plans for investors.

Here's an example. Next to the Mars plant is the Dutch Campina dairy production facility, built in 1998 with the active support of the district administration. “We desperately needed dairy production,” says Chelpan. “There was advanced livestock farming in the area, but Moscow was on powder, they didn’t take our milk, and it was simply poured onto the landscape, the livestock was slaughtered. We bombarded all the embassies and trade missions with our proposals, and in the end we got Campina.” The Dutch now take 47% of all the milk produced in the area. Of course, it was not possible to save all the cows in the area with the help of Campina, but definitely half. In Soviet times, 100,000 tons of milk per year were produced here, now - 50,000 tons. But, as the Dutch company reports, “through the joint efforts of Campina and the EBRD, the district’s dairy herd... has undergone serious modernization... the quality of milk has improved significantly.”

Mars also fulfilled its purpose. It is not known whether this was a condition of the administration, but Mars ordered non-standard equipment for its first Russian enterprise from the Stupino factories. The support is small, but in years of complete absence of orders for aviation equipment, it is very important psychologically.

Over the past ten years, the area has attracted $1 billion in investment, $800 million of which is foreign. First of all, thanks to the first investor - Mars has already invested about $600 million in the Stupino land. In total, there are ten industrial enterprises in the area, built from scratch (production of metal structures, chemical products, packaging materials, etc.). Five more are under construction - for example, factories for the production of ceramic tiles from the Italian companies Marazzi and Concorde. In Stupino, they do not distinguish between foreign and domestic investors; entry conditions are approximately the same for everyone. There are exceptions, however. The Stupino administration refused to build a distillery and brewery. Another unofficial ban applies to retail chains—third-party investors will not be allowed into Stupino’s trade. According to Pavel Chelpan, local retail should make money from the income of industrial enterprises.

The range of services provided by the local administration to external investors cannot be called unique. The applicant is offered a database of land plots that the district can allocate for construction right now. To support each project, the administration forms a working group that is ready to communicate with the investor around the clock and help him with the preparation of documents. If a foreigner is looking for subcontractors, for example, for geological survey of a site or construction of buildings, the region can offer a whole list of independent companies - choose from several candidates (but no one will be offended if the investor brings his own contractors).

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For large projects (from $10 million), a preferential tax regime applies - the investor is exempt from property tax and land tax. The arithmetic is simple - 1 ruble benefit, according to Pavel Chelpan, results in an increase in tax revenues by 1.26 rubles. Tested by practice.

In Soviet times, the Stupinsky district ranked 14th–16th in the Moscow region in terms of industrial production, now it is first. The volume of industrial output by large and medium-sized enterprises in the region last year amounted to 22.3 billion rubles, 23% more than in 2003. The revenue side of the district budget in the early 1990s did not exceed 16 million rubles, last year - more than 1 billion rubles. Not bad for a municipality with a population of 111,000 people. Stupino resembles a wealthy gentleman from the Moscow region who leisurely spends his income on improvement and reconstruction. There doesn’t seem to be any active work in sight, but the roads are clean, the parks are well-groomed, the fences are painted. The machine for filling the revenue side of Stupin’s budget is running and working properly, can I take a break?

“I was already thinking, maybe all this is enough? Already 85% of the region’s industrial enterprises, at the expense of third-party investors, have managed to get through the eye of the needle and are now ready to compete even within the WTO,” says Chelpan. And he immediately shares his plans for the next three five-year plans. According to his forecasts, the district’s income in 2010 will be 2.5 billion rubles, in 2015 - 4 billion rubles, in 2020 - 7.5–8 billion rubles. It is clear that Chelpan does not intend to stop. The previous plan is $100 million of investment per year. The main task is to evenly distribute production capacity throughout the region; near the administrative center of the industrial district it is already a bit crowded.

Does the area have enough labor resources to support industrial growth? Pavel Chelpan doesn’t even think about it. 100 kilometers from Stupino is Moscow, where there is an abundance of qualified personnel. “There will be a salary, there will be people,” the head of the Stupin administration is sure. “Our average salary in industry is 15,000 rubles, at foreign enterprises it is twice as high.”

About 10 foreign companies are under the administration, as Chelpan says, “in development.” Among them are British enterprises, Italian and, of course, German Volkswagen, which has already received 300 hectares of land across the road from the Mars and Campina factories. The German automaker, if it decides, plans to invest $250 million in Russian production at the first stage, and the same amount at the second. Volkswagen is still choosing. “I think that, like Toyota, sites are also flocking to St. Petersburg to look at them,” predicts Pavel Chelpan. “But they will still come back to us.”

“It’s a shame we lost Toyota,” Chelpan laments. “They liked it with us too.”

Borsky district

Nizhny Novgorod Region

POPULATION 130,000 people

DISTRICT HEAD Vladimir Ivanov*

VOLUME OF FOREIGN INVESTMENTS $250 million

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LARGEST INVESTORS Glaverbel, Europe Foods, Tubor

FEATURES OF THE DISTRICT Work with medium-sized foreign investors. Each project in the administration receives a curator to overcome bureaucratic obstacles

* At the time of delivery of this issue, he was appointed vice-governor of the Nizhny Novgorod region

On November 1 last year, representatives of the Toyota Motor Corporation were unable to enjoy the beauty of the Boldino autumn. It started to rain in the morning, and we had to cancel the helicopter ride with Nizhny Novgorod administration employees. And time was running out. In one day, a group of 25 Japanese specialists had to thoroughly study an industrial site in the Borsky district of the Nizhny Novgorod region for the construction of an automobile plant.

We got to the place by ground transport. From Nizhny Novgorod to Bor it is only 34 kilometers, but part of the route passes over a long double-row bridge across the Volga. The highway is federal, and sometimes there are five-kilometer traffic jams in front of the bridge. This time there were no traffic jams, but the Japanese definitely appreciated the crossing capacity.

It took five hours to inspect the site and talk with officials in tents pitched in a green clearing. The local administration's offers looked tempting. The district allocated 250 hectares of land for the future plant with all the necessary utilities provided at the expense of the municipality (which, by the way, is about $1 million). The local authorities promised a gentle tax regime. However, the Japanese chose St. Petersburg as the homeland of the Russian president.

The official explanation is: “This is an extremely difficult decision... the location we have chosen compares favorably with others due to its developed infrastructure, proximity to the port, the city and the road to Moscow.”

“Politics,” the investor hunters from Bor shrug their shoulders. “We didn’t have a chance.”

The head of the administration of the Borsky district of the Nizhny Novgorod region, Vladimir Ivanov, with the help of Toyota, dreamed of creating a “Russian Detroit” in the territory under his jurisdiction. Toyota is gone, there will be no Detroit?

Yes, in some ways it already exists. At the Bor Glass Plant, the Belgian company Glaverbel (part of the Japanese concern Asahi Glass) produces automotive glass, which is purchased by GM-AvtoVAZ and the Russian Ford plant. The German Troplast also produces plastic film for the automotive and construction industries here, and the Spanish Tubor makes car batteries. Negotiations are currently underway to locate a steel cord production plant of the Belgian company Bekaert worth €75 million in the area.

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By the time of our meeting in August of this year, Ivanov had been leading the district for 15 years - impressive experience. But the secret of the success of the Borsky district is approximately the same as in Stupino. Some difference is that in the Bor region they deal mainly with small investors whose projects cost millions and tens of millions of dollars. Help in overcoming bureaucratic barriers is especially important for such partners. To begin construction of an industrial enterprise, a foreigner must collect an average of 50 permitting signatures. The administration assigns a curator to each project - he is the first to look at the answers coming from the SES, firefighters, environmentalists, etc.: are the officials finding fault? At the local level, the administration can resolve these issues with one call.

Federal officials begin to respect projects if their cost exceeds $100 million. Curators have to go to the capital and solve the problems of regional investors there. It's difficult, but it works.

Since 1998, 14 new industries have been created in the region, 12 of them with money from foreigners. External investors produce food products in the Bor region (Gallina Blanca of the Spanish Europe Foods), plastic cork (German company Bericap), glassware (Turkish Pasabahce). The Borsky district has already accumulated $250 million in foreign direct investment; last year, the revenue side of the Borsky district budget amounted to about 1 billion rubles.

“Now it’s easier for us to work with investors, the established image and accumulated investments work for us,” Vladimir Ivanov said in an interview with Forbes in August. “It is enough for a region to attract at least one relatively large investor and make the appropriate PR, and then the reputation mechanism kicks in,” confirms Dmitry Levchenkov, Deputy Director of the Department for Investment Policy of the Ministry of Economic Development and Trade of the Russian Federation. “In addition, investors are drawn to each other for purely practical reasons, because they can join forces in solving problems such as, for example, creating the necessary infrastructure.”

Vsevolozhsk district

Leningrad region

POPULATION 125,000 people

DISTRICT HEAD Igor Samokhin

VOLUME OF FOREIGN INVESTMENTS $720 million

LARGEST INVESTORS Nokian Tires, Ford Motor, Russian Aluminum

FEATURES OF THE AREA Refusal to locate environmentally hazardous industries. District authorities are supported by regional and federal authorities

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In 1994, Mars signed an agreement on the construction of a factory (initial investment volume - $150 million) with the administration of the Stupinsky district. In 1999, the Ford Corporation signed a similar document on its own production in Vsevolozhsk (initial investment volume - $150 million) with the government of the country. The Vsevolozhsk district is an example of a new form of work by Russian officials with a foreign investor, when an investor is “brought down from above” into a particular region. Chairman of the Board of the National Direct Investment Agency Igor Vdovin argues that the main player in attracting foreign investment now is the constituent entities of the federation: “The heads of district administrations were actively involved in this until the regions and territories formed their own investment policies.”

The head of the administration of the Vsevolozhsk region, Igor Samokhin, is forced to supplement this statement: “In any case, the vertical “government - region - district” should work without failures. If one of the levels behaves incorrectly, this will scare away the investor and the project will not happen.”

The Vsevolozhsk “level” was ready to receive high-profile American investors. The first foreign industrialist to locate production in the area was the Swedish AssiDoman. The factory for the production of corrugated cardboard packaging of this concern began work in July 1998 in Vsevolozhsk.

In 2001, after transformation into the semi-state AssiDoman, ownership of the factory passed to the Swedish Kappa Group. Kappa has increased its investment in Russian production to $40 million and now produces 5% of all Russian cardboard packaging.

“Over the past eight years, we have proven that it is possible to work here,” says Patrick Strom, financial and administrative director of Kappa St. Petersburg, in an interview with Forbes. “The factory meets the expectations of Swedish shareholders.”

Why was Vsevolozhsk chosen? Strom said investors believed the area had a skilled workforce, market prospects and "good relationships with local government." Ernst & Young partner Alexander Ivlev adds that Vsevolozhsk is attractive to investors due to its proximity to St. Petersburg, a huge market for products. Finally, Ford Russia PR manager Ekaterina Kulinenko draws attention to the fact that Vsevolozhsk had a better site and infrastructure (the company considered seven sites in total), an ice-free seaport was located nearby, and the regional authorities demonstrated an impressive willingness to cooperate. “We really know what an investor needs, how to provide him with personnel, the right amount of electricity, heat and water,” confirms Igor Samokhin.

Kappa is located in the so-called Small industrial zone of Vsevolozhsk, “new” investors have chosen the Bolshaya, a few kilometers from Kappa. Ford cars have been produced here for three years now, ROSTAR aluminum cans (Russian Aluminum company) have been produced here for a year; The Italian Merloni TermoSanitari began producing Ariston water heaters this year, and nearby the Finnish Nokian Tires is finishing the construction of a tire plant worth €300 million.

Here, by the way, is a small example of cooperation between local authorities and investors. In the place where the Nokian Tires plant stands, there used to be a real northern swamp, with cranberries and frogs. The district authorities drained the swamp at their own expense, as long as the investor was satisfied. The result of this policy is that the Vsevolozhsk region has accumulated $900 million in investments (80% of them are foreign), budget revenues this year will exceed 1 billion rubles (last year - 995 million rubles).

Investors dote on their curators. The head of the investment department of the Vsevolozhsk region, Artem Garibyan, with me in a matter of minutes over the phone, arranged for a Forbes correspondent and photographer to visit all foreign production facilities in the region. We visited them. In my opinion, there is already an abundance of enterprises in Vsevolozhsk.

The conclusion is confirmed by the intensified struggle for personnel. The presence of a qualified workforce is no longer an advantage of Vsevolozhsk. In February last year, Rusal launched a plant for the production of aluminum cans in the Big Industrial Zone; employees were given an average salary at the level of the Ford plant - 16,000 rubles. This year, Ford began to increase production capacity and raised wages for its workers two to three times. “A not very beautiful struggle for people has begun,” Vladimir Cherednichenko, head of ROSTAR, a Rusal enterprise, comments on Ford’s actions.

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The Vsevolozhsk district labor exchange offers 3,000 vacancies, and there are 300 officially unemployed people. The head of the district administration, Igor Samokhin, believes that enterprises in the district should not have problems with labor resources. According to him, about 30% of employees of Vsevolozhsk industrial enterprises come to work from St. Petersburg. The province's dream has come true - residents of megacities now travel to the region to work. From St. Petersburg to Vsevolozhsk it is only a quarter of an hour by car, but by train it takes more than an hour. Igor Samokhin, a former border guard officer, zealously guards the cleanliness and peace of the area entrusted to him. This is what he reports to journalists about - clearly, in a military style. Here is our parting conversation:

— What enterprises do you not need?

- Environmentally dirty.

—Have you been offered these?

— Construction of a metallurgical plant was refused.

Personnel reserve

In the Ministry of Economic Development and Trade of the Russian Federation, the factors of investment attractiveness of a particular site are divided into two groups: exogenous (“objective”) and endogenous. The first is a favorable geographical location, human resources, and the necessary transport and production infrastructure. The second is the efforts made by regional and municipal authorities to attract investment. “In the case of Stupin, Vsevolozhsk and Borsky district, subjective factors determined probably 70% of success,” says ministry representative Dmitry Levchenkov.

Simply put, the success stories we described are the result of the efforts of specific government “middle managers” - Pavel Chelpan, Igor Samokhin and Vladimir Ivanov. “Everyone welcomes you with open arms, but you won’t get real help from anyone,” explains the head of the Vsevolozhsk enterprise ROSTAR, Vladimir Cherednichenko, one of Samokhin’s “clients.”

It seems that management values the business qualities of these managers. When this article was already being prepared for publication, the new governor of the Nizhny Novgorod region, Valery Shantsev, introduced his deputy for socio-economic planning and investment policy, Vladimir Ivanov, to the regional legislative assembly. Can we expect new industrial projects to emerge? The first news is already there. Vladimir Ivanov said that this fall the construction of the Nizhny Novgorod - Borsky district cable car with a capacity of 1,500 people per hour will begin. This structure should partially solve the problem of crossing the Volga, which we wrote about above. The construction of the road will be carried out, of course, using funds from private investors.

Regional-scale joint venture