of the National Economy Select 1/3

Central target market $158 B

promising $78,4 B investments

ready investment >1400 projects

% IRR SelectCR.ru 11-37 CONTENTS

02 Central Russia 26 Locations for Your Business? 02 Central Russia Holds ⅓ of the National Economy 27 Existing Platforms to Localize 04 Central Russia Leads the Economic Growth Projects in Central Russia 05 Current Partners of Central Russia 06 The easiest and most reliable way to the market 28 What We Do for Investors of 5 countries of the Eurasian Customs Union (EACU) 29 End-to-End Investment Project Assistance 07 Main tax and customs preferences in Central Russia 30 Digital One-Stop-Shop of Central Russia – SelectCR.ru 08 Private Investment Sourcing as a State Priority 31 Central Russia Investment Council. 09 Central Russia Investment Council Contacts is a One-Stop-Shop for Investors

10 Business Opportunities in Central Russia 11 Investment Priorities in Central Russia 12 12 Investment-Appealing Sectors in Central Russia 14 Transportation and Logistics 15 Chemical Industry 16 Agriculture and Food Production 17 Construction Materials and Mining 18 Metallurgy 19 Wood Processing 20 Consumer Goods Manufacturing 21 Tourism 22 Automotive Industry & Car Parts 23 Pharmaceutics 24 Electronics and Mechanical Engineering 25 Composite Materials Central Russia Holds ⅓ of the National Economy

London New Delhi 2,500 km 4,341 km Seoul 3:50 5:30 6,606 km 8:45

New York 7,510 km Tokyo 9:30 7,479 km 9:00 Berlin 1,608 km 2:45 Beijing 5,793 km 8:00 Abu Dhabi : 3,738 km and 17 regions 4:40 39 million people $400B GRP $158B target market

02 $365B trade turnover share in the national economy

Russia CFD MONEY 73% of financial investments 53% of accumulated direct Kostroma foreign investment Yaroslavl 29% of equity investments Ivanovo

Moscow Vladimir PRODUCTION Smolensk 35% of GRP 35% of processing industry Ryazan Tula 28% of agricultural production Oryol Lipetsk MARKET Tambov 54% of foreign trade of retail 35%

03 Central Russia Leads the Economic Growth

Central Russia Russia

Industry +7.5% +2.4%

Investments Growth rate, +6.9% +1.7% 2019 Agriculture +6.4% +4.0%

Retail +2.2% +1.6%

04 Current Partners of Central Russia

$309B Direct Foreign Investments 05 The Easiest and Most Reliable Way to the Market of 5 Countries of the Eurasian Customs Union (EACU)

$30B $24B

Kazakhstan $518B Belarus

$5B $3B

Russia

Kyrgyzstan Armenia

$580B total market volume 06 Main Tax and Customs Preferences in Central Russia

Preferential-taxation Special economic zones territories Minimum investment amount $1,6M $34K

Profit tax 2% 7% 15.5% 0% 12% up to 5 yr up to 10 yr after 10 yr up to 5 yr up to 10 yr

Property tax 0% 0% 1.1% 1.5% up to 10 yr up to 5 yr up to 7 yr up to 10 yr

Land tax 0% 0% up to 5 yr up to 10 yr

Сustoms preferences free customs area

Insurance premiums 7.6 % up to 10 yr 07 Private Investment Sourcing as a State Priority

Vladimir “I would like to ask the heads Putin President of the regions and the presidential of the Russian envoys to these federal districts Federation to step up their work to attract private capital.”

St. Petersburg International Economic Forum June 7, 2019

Artur Niyazmetov Investment Central Russia appointed the Investment KPI set investment council Ombudsman to the CFD for governors founded

April 4, 2019 April 25, 2019 May 17, 2019

08 Central Russia Investment Council is a One-Stop-Shop for Investors

Artur Sergei COUNCIL FUNCTIONS: Niyazmetov Kachayev Preparing specific Chair of the Council, Co-Chair proposals to investors Investment of the Council, Ombudsman Advisor Supporting realization to the CFD, to the Presidential of investment projects Deputy Presidential Plenipotentiary Controlling governors' KPI Plenipotentiary Envoy to the Central Envoy Federal District, and authorities coordination to the Central Managing Partner to implement investment Federal District at Key Partner projects in Central Russia

18 deputy Central Russian governors responsible for investments

MINISTRY MINISTRY FEDERAL FEDERAL OF ECONOMIC OF INDUSTRY ANTI-MONOPOLY TAXATION DEVELOPMENT AND TRADE SERVICE SERVICE

18 business ombudsmen

Development institutions 09 Business Opportunities in Central Russia

SelectCR.ru Investment Priorities in Central Russia 12 sectors 971 projects

$54.4B investments 11–37% IRR 11 12 Investment-Appealing Sectors in Central Russia

Transportation Agriculture Chemical Industry and Logistics and Food Production

7B tons of cargo – $72.7B market volume $34.8B market volume market volume $7.3B investments $16.9B investments $10.4B investments 15-29% IRR 11-35% IRR 11-20% IRR 68 projects 421 projects 104 projects

Construction Metallurgy Wood Processing Materials and Mining

$25.8B market volume $104.5B market volume $13.6B market volume $4.1B investments $5.0B investments $1.6B investments 17-25% IRR 11-18% IRR 15-37% IRR 67 projects 43 projects 33 projects

12 Consumer Goods Automotive Tourism Manufacturing Industry & Car Parts

$18.2B market volume 538,000 rooms $60.6B market volume $498.4M investments market volume $339.5M investments 12-16% IRR $1.9B investments 14-23% IRR 20 projects 18-24% IRR 7 projects 54 projects

Pharmaceutics Electronics and Composite Materials Mechanical Engineering

$24.2B market volume $53B market volume $984M market volume $1.6B investments $4.6B investments $128.1M investments 15-35% IRR 11–19% IRR 15-30% IRR 45 projects 104 projects 5 projects

13 Invest in Transportation $10.4B and Logistics in Central Russia 104 projects

Viable Fields: Logistics Hubs Kostroma Airports Yaroslavl Tver Public-Use Land Transportation

Ivanovo

Moscow Vladimir Smolensk

Kaluga Market: 7B tons of cargo 11-20% Tula Ryazan IRR: Bryansk Investment Appeal Factors: Oryol Truck Shipment Growth 52% of passenger tra c goes Lipetsk through Central Russia’s airports Tambov in Central Russia Kursk (M tons) 25% of Russia’s truck shipment Available infrastructure-ready Belgorod Voronezh platforms 481 457

389

14 2016 2017 2018 Invest in Chemical Industry $7.3B in Central Russia 68 projects

Viable Fields: Petrochemistry Kostroma Fertilizers Yaroslavl Tver

Ivanovo

Moscow Vladimir Smolensk

Kaluga Market: $72.7B 15-29% Tula Ryazan IRR: Bryansk Investment Appeal Factors: Oryol Chemical Production Volume $66.7B domestic consumption Lipetsk in Russia Tambov in Russia Kursk ($B) $8B organic and inorganic chemicals imported Well-qualified workforce Belgorod Voronezh 65.2 (39% of sta have higher education) 56.1 Established investment base 48.5 Leading national research institutions 2016 2017 2018 15 Invest in Agriculture and Food Production $16.9B in Central Russia 421 projects

Viable Fields: Market Volume: Milk processing 5,748,000 tons (18%)* Kostroma Grain processing 2,307,000 tons Yaroslavl (biotechnologies) Tver Greenhouse vegetable 229,000 tons (27%) Ivanovo farming Moscow Product storage 1,820,000 tons (19%) Vladimir Smolensk Pig husbandry 1,894,000 tons (19%) Cattle husbandry 302,000 tons (19%) Kaluga Ryazan Poultry husbandry 1,837,000 tons (37%) Tula Bryansk Linen processing 9,500 tons (45%)

Oryol * % share in the Russian economy Lipetsk Tambov Resources: 2.2M hectares of agricultural land Kursk to be provided to investors IRR: 11-35% Voronezh Belgorod Investment Appeal Factors: 106.4% agricultural production index (104.0% national average) 115.8% agriculture producer price index 16 (112.9% national average) Invest in Construction Materials $4.1B and Mining in Central Russia 67 projects

Viable Fields: Concrete Kostroma Insulation Materials Yaroslavl Tver Glass

Ivanovo Market: $25.8B

Moscow Resource: raw materials for investors: Vladimir Smolensk - 759M m3 of sands - 504M m3 of limestone 3 Kaluga - 452M m of clay - 347M m3 of structural stones Tula Ryazan Bryansk IRR: 17-25% Building Material Oryol Investment Appeal Factors: Production Volume Lipetsk $2.9B building materials imported Tambov in Russia Kursk ($B) 104.2% building material production index 25% Central Federal District’s share Belgorod Voronezh 22.7 in Russia’s total construction volume 19.7 18.2 Available infrastructure-ready platforms

2016 2017 2018 17 Invest in Metallurgy $5.0B in Central Russia 43 projects

Viable Fields: Steel Kostroma Aluminum Yaroslavl Tver Metalworking

Ivanovo

Moscow Market: $104.5B Vladimir Smolensk IRR: 11-18% Investment Appeal Factors: Kaluga $13.3B metals and metal Ryazan Tula products imported Bryansk 132M tons domestic consumption Metallurgy Oryol in Russia Production Volume Lipetsk Tambov in Russia 101.6% metallurgy production Kursk ($B) index

Belgorod Voronezh 90.9 7 7. 3 68.2

18 2016 2017 2018 Invest in Wood Processing $1.6B in Central Russia 33 projects

Viable Fields: Sheet Materials (MDF, chipboard, OSB) Kostroma Planed Products (Beams) Yaroslavl Tver

Ivanovo Market: $13.6B Moscow Vladimir Smolensk Resource: 5.2M m3 of rated wood cutting areas available for investors Kaluga IRR: 15-37% Ryazan Tula Investment Appeal Factors: Bryansk $3.9B wood processing Oryol Wood Processing Production Volume products imported Lipetsk Tambov in Russia 104.3% wood processing Kursk ($B) production index 2 global companies have localized Belgorod Voronezh 9.7 production in the Central Federal District 8.3 7.9 1.5 million m3 growth potential in MDF production (considering domestic consumption and exports) 2016 2017 2018 19 Invest in Consumer Goods $498.4M Manufacturing in Central Russia 20 projects

Viable Fields: Kostroma Textiles Yaroslavl Tver Polymer Processing Packaging Materials Ivanovo Moscow Vladimir Market: $18.2B Smolensk IRR: 12-16% Kaluga Investment Appeal Factors: Ryazan Tula $11.2B consumer goods imported Bryansk 35% Central Federal District’s share Oryol in the Russian consumer market Lipetsk Consumer Goods $818 average personal income Tambov Kursk Manufacturing per month Output in Russia 103.6% consumer goods ($B) manufacturing index Belgorod Voronezh Available infrastructure-ready 7 platforms 6.9 6.7

20 2016 2017 2018 Invest in Tourism $1.9B in Central Russia 54 projects

Viable Fields: Kostroma Hotel Complexes Yaroslavl Tver Recreation Areas (SPA)

Ivanovo

Moscow Vladimir Market: 538,000 rooms Smolensk IRR: 18-24% 46,8

Kaluga 42,7 Tourist Investment Appeal Factors: 37,8 Tula Ryazan Flow Growth 47M tourists (millions) Bryansk 250,000 rooms to be in demand Oryol by 2024 foreigners 5,4 5,9 6,9 36,000 architectural landmarks, Lipetsk Tambov Kursk 20 UNESCO World Heritage sites 2017 2016 2018

Belgorod Voronezh 5,065 538 Available Room Capacity 4,569 488 +26% Accommodation +22% Growth

4,008 Growth 441 (thousands) (Units)

2016 2017 2018 2016 2017 2018 21 Invest in Automotive Industry $339.5M in Central Russia 7 projects

Viable Fields: Car Production Kostroma Car Parts Yaroslavl Tver Special Vehicles

Ivanovo

Moscow Vladimir Smolensk Market: $60.6B Kaluga IRR: 14-23% Tula Ryazan Bryansk Automotive Investment Appeal Factors: Oryol Industry Production $23.8B automotive and car Lipetsk Volume in Russia parts imported Tambov Kursk ($B) 7 global automotive manufacturers have localized production in the Central Federal District Belgorod Voronezh 2 7. 3 102.9% automotive production index 22.7 Well-qualified workforce 19.7 (39% of sta have higher education)

22 2016 2017 2018 Invest in Pharmaceutics and Medical $1.6B Industry in Central Russia 45 projects

Viable Fields: Pharmaceutical Products Kostroma and Solutions Yaroslavl Medical Equipment Tver and Consumables

Ivanovo Moscow Vladimir Smolensk

$24.2B Kaluga Market:

Ryazan IRR: 15-35% Tula Bryansk Pharmaceutics Investment Appeal Factors: Oryol and Medical Industry $105.8B pharmaceuticals and medical Lipetsk Production Volume products imported Tambov Kursk in Russia 121.6% pharmaceutics and medical ($B) industry production index 4 pharmaceutic clusters in the Central Belgorod Voronezh 5.6 Federal District 5.3 Leading national research institutions 5.1 Well-qualified workforce (39% of sta have higher education) 2016 2017 2018 23 Invest in Electronics and $4.6B Mechanical Engineering in Central Russia 104 projects

Viable Fields: Electronics for industrial Kostroma equipment Yaroslavl Tver

Ivanovo Moscow Vladimir Smolensk

Kaluga Market: $53B Ryazan Tula IRR: 11-19% Bryansk Electronics Oryol Production Volume Investment Appeal Factors: Lipetsk in Russia $30B electronics imported Tambov ($M) Kursk 105.8% electronics production index 35% Central Federal District’s share 454.5 in the Russian consumer market Belgorod Voronezh 409.1 333.3 3 global companies have localized production in the Central Federal District

24 2016 2017 2018 Invest in Composite Materials $128.1M in Central Russia 5 projects

Viable Fields: Glass Fiber Kostroma Carbon Fiber Yaroslavl Polymer Composites Tver

Ivanovo

Moscow Vladimir Smolensk

Kaluga Market: $984.8M Ryazan Tula IRR: 15-30% Bryansk Composite Oryol Materials Production Investment Appeal Factors: Lipetsk Volume in Russia 10-20% annual market growth Tambov Kursk ($M) rate in composite materials Up to 20x growth potential 984.8 Growth in main composite-using Belgorod Voronezh 909.1 818.2 industries

2016 2017 2018 25 Locations for Your Business

SelectCR.ru Existing Platforms to Localize 15,000 hectares Projects in Central Russia (infrastructure-ready)

Kostroma Yaroslavl Tver 11 special economic zones Ivanovo Moscow 16 preferential-taxation territories Smolensk Vladimir 136 industrial parks Kaluga 193 separate sites with infrastructure Tula Ryazan Bryansk

Oryol Lipetsk Well-qualified workforce Tambov Kursk

Convenient fees Belgorod Voronezh Power: $0.06–0.08/kWh Water: $0.3–1.1/m3 Sewage: $0.4–1.1/m3 Gas: $63.5–66.2/1.000m3 Cross-Region Average Salary: 27

440 468 515 560 750 1,275 $440–1,275/month What We Do for Investors

SelectCR.ru End-to-End Investment Project Assistance

Preferences & Special Land Plot Conditions Selection & Reservation

INVESTMENT Financial Support COUNCIL Infrastructure (includes federal- Development level funding) ONE-STOP-SHOP FOR INVESTORS

Sta Training & Social Market & Resource Infrastructure Access

EVERY INVESTOR IS PERSONALLY AND PROPERLY TREATED 29 Digital One-Stop-Shop of Central Russia – SelectCR.ru

Investment project marketplace

One-stop-shop for communications between investors and authorities

Access to all state support measures and development institutions

30 Central Russia Investment Council. Contacts

Chair of the Council, Co-Chair of the Council, Investment Ombudsman Advisor to the Presidential to the CFD, Plenipotentiary Deputy Presidential Envoy to the Central Plenipotentiary Federal District, Envoy to the Central Managing Partner Federal District at Key Partner

Artur Niyazmetov Sergei Kachayev

[email protected] SelectCR.ru

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