Economic development is impossible without domestic and foreign investments. Favourable investment climate, assistance to enterprises in attracting investors will remain a priority objective for the Vologda Oblast Government over the coming years.
Stable economy, certainty of legal system and tax code, an adequate banking system and succession of political power are key factors for stepping up investments.
The progressive development of the investment climate contributes to the increase of investment activity, economic growth in the region, improving efficiency of production, and elimination of the deficit of investment resources.
Prospects for the development of investment activity in the Vologda Region are associated with two main sources: state resources (budget and extra-budgetary funds) and private capital (resources of enterprises and organizations, funds of the population, credit resources of banks, foreign investments).
Within the last few years there has remained a steady tendency of surpassing growth of investments into the fixed capital on the territory of the Vologda Region. For 9 months of 2019, the volume of investments in fixed assets from all sources amounted to RUR 121.536 billion (138.4% compared to last year), the volume of investments into fixed assets without small businesses amounted to RUR 98.01 billion (139.3% compared to last year).
In terms of growth of investments into fixed assets, the Vologda Region occupies the 1st place in Russia's North-West, the 6th place in Russia.
According to the results of 9 months of 2019, the region ranked 13th among the regions of Russia and 4th in Russia's North-West in terms of investment into fixed assets per capita (RUR 103.67 thousand).
The main areas of investment activity in the region are manufacturing (production of steel and chemical products), transport, agriculture and forestry, real estate operations, rental and provision of services, production and distribution of electricity, gas and water.
Main factors providing investment attractiveness of the Vologda Oblast are as follows:
- industrial potential characterized by highly-developed machine building and metalworking, chemical industry, light industry and timber industry;
- perfect natural conditions - water resources (numerous rivers and lakes), forests covering some 80% of the total land of the region and a number of perspective exploitations of minerals;
- presence of highly skilled scientific and technical potential;
- favorable geographical location and advanced network of communications - the oblast is one of the most important junctions of railways, automobile roads and airways in the North of Russia;
- stable political situation;
- availability of a developed legal basis of the State support of domestic and foreign investors, including issues of providing taxation and other privileges.
The Vologda Oblast Government has worked out a number of measures for increasing investment inflow in the regional economy:
- governmental support of investment activities (including tax privileges);
- establishment of transparent investment procedure;
- development of tools for dealing with regional investment projects.
The main objective of the investment policy of the Vologda Oblast is to increase the competitiveness of the region due to creation of favourable conditions for conducting effective business and, consequently, to increase the tax basis and to create new jobs.
In 2019 researchers of the EXPERT-RA rating agency indicated that the region represents a ‘3В1’ rating (lowered potential – moderate risk).