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7 May, 2008 02:47

Russia looks to boost economic zones

The Russian Government is slowly narrowing down applications for the special economic zones, designed to drive growth through low taxes and government investment.

“In Russia special zones will help the weak players in the industry. They are likely to expand the transport of goods, but they can't change their unfavourable geographical position. Stronger players would have been able to get a better outcome with these privileges,” believes Aleksey Bezborodov, Director of InfraNews transportation research agency.

The Economic Development Ministry has considered the first 20 port applications and dismissed three, including Sheremetyevo, because of incomplete applications.

Russia’s top 3 sea ports – Novorossiysk, Primorsk and St. Petersburg that account for over 200 million tonnes of trade per year – or half the country’s total port turnover – don’t appear to want or need the new status.

In June the Ministry will announce which, if any, projects qualify as special economic zones. However the ministry reserves the right not to make the award at all – if no regions demonstrate a compelling case.