Investment Portal of the Arctic Zone of the Russian Federation

Proven tools

The government will fund the development of social infrastructure in Arctic cities

7 october 2022

The Single Subsidy and Far Eastern Concession programmes, which have proved effective in the Far East, will come on stream in the Arctic. They are already helping to build schools and kindergartens, hospitals and sports complexes, so that living in eastern Russia is as comfortable as in its central part. And now these effective tools for social infrastructure development will also be available to the Arctic regions.

The Single Subsidy Programme, which has been used to support the economic growth centres of the Far Eastern regions, will be extended to the Arctic zone of the Russian Federation. A decree to this effect was signed by Prime Minister Mikhail Mishustin.

The Single Subsidy programme has been running since 2018. The Russian government allocates funds from the federal budget to modernise and build social infrastructure and upgrade the transport system. Between 2018 and 2023, more than RUB 120 bn have been allocated to 11 regions in the Far East for this purpose.

Thanks to the Single Subsidy, more than 550 new hospitals, schools, kindergartens, sports complexes and playgrounds, etc. have already been built in the Far East regions with federal funds. It is also used to overhaul and technologically upgrade hundreds of social infrastructure facilities. And about two thousand more projects are planned before 2024.

How effective the programme is can be seen from the example of Yakutia. The republic has built the most modern cardiology centre in the entire Far East, a school in Yakutsk, a grammar school in the Khandyga settlement, a kindergarten school in the Kangalassy neighbourhood, a sports complex in Srednekolymsk and infrastructure under the Far Eastern Hectare programme using funds from the Single Subsidy. A water utility was reconstructed and a children's polyclinic in Neryungri was overhauled. Equipment has been purchased for six vocational secondary schools, and heavy and water trucks have been purchased to fight forest fires. The construction of the year-round children's camp Polar Star continues. Federal funds will be allocated for the construction of a multifunctional centre, the Atamai Leisure Centre, in the Bas-Kyuyel settlement in Gorny Ulus.

To speed up the creation of infrastructure for new businesses and the social sphere, the Far East is also using a tool such as the Far Eastern Concession. This is a public-private partnership mechanism in which the state compensates investors for up to 100% of the estimated cost of an infrastructure facility within 10–20 years of its commissioning.

The Far East Concession programme was launched in the Far East last September. The Far Eastern Concession has already been used to build schools and sports complexes, with a total investment of RUB 12.3 bn. Support will soon be considered for another 10 social facilities with a total investment of more than RUB 20 bn.

The Far Eastern Concession mechanism will also be extended to the Arctic. This was stated by Aleksey Chekunkov, Minister for the Development of the Far East and Arctic, at a meeting of the State Duma Committee on the Development of the Far East and the Arctic on 6 October.

'There is a federal budget line for the social development of the Arctic zone, and there are provisions for extending the terms of the Far Eastern Concession to the Arctic as well. We will be able to support the creation of new social development facilities in our Arctic regions through extra-budgetary sources,' Chekunkov said.

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