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Tourism development prospects in the Arkhangelsk Region: investment potential

Open North: Investing in Arkhangelsk Region's Tourism FEDC session

2 december 2023

The Arkhangelsk region significantly influences the tourism development in the AZRF. In the last three years, over 114 tourist infrastructure facilities have been established, with a total turnover of about RUB 14 billion in 2022. According to Viktor Ikonnikov, Deputy Chairman of the Government of the Arkhangelsk Region, the total investment in building tourist facilities has reached RUB 1.7 billion to date. Some of these facilities are already operational, while others are under active construction. However, these are just preliminary figures — the tourism industry's development in the Russian Arctic and specifically in the Arkhangelsk Region is just starting to reach its planned trajectory. The strategies for achieving this were discussed at the Open North: Investing in Arkhangelsk Region's Tourism FEDC session.

Maksim Dankin, Director of the Department for the Development of the Arctic Zone of the Russian Federation and Implementation of Infrastructure Projects of the Russian Ministry for Eastern Development, stated that since 2019, the Arkhangelsk Region has been a leader in implementing preferential regimes for AZRF residents. These mostly include various tax and land benefits aimed at boosting entrepreneurial activity in the region. The Arkhangelsk Region also offers a Unified Presidential Subsidy, which enables quick construction of necessary infrastructure for project implementation. In 2023, plans were announced to establish a second territory of advanced socio-economic development in the Arctic (the first being ASEZ 'Stolitsa Arktiki' in the Murmansk region), and to include three settlements in the list of 16 key cities. These cities are Arkhangelsk, Severodvinsk and Novodvinsk. Master plans and long-term development strategies will be developed for these cities, providing an additional boost, including one for the entrepreneurial community.

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Maria Badmatsyrenova, Deputy Director of the FEDC Investment Department, noted during the session that they are working on creating a seamless path for businesses, with many procedures now digitized and available in electronic format, simplifying the process of applying for AZRF resident status.

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Overall, the Arkhangelsk Region is showing strong growth rates, hosting nearly a third of all investment projects implemented in the AZRF. Out of 220 businesses, approximately a third are in the tourism sector.

The Arkhangelsk Region's appeal for domestic tourism development is due to three main factors: extensive transportation infrastructure, numerous historical and natural attractions and an active business community. According to Oksana Svetlova, the Minister of Culture of the Arkhangelsk Region, up to one million tourists visit the region every year. The increase in visitor numbers is partly due to the launch of the Road to the Russian North car route, which connects the region with central Russia, and the Arkhangelsk: Here the Arctic Begins national route. Direct access to the White Sea also helps solve several logistical issues. According to Tutu.ru, the main attractions in the Arkhangelsk region are the Solovetsky Islands, followed by the Russian Arctic national park, and the Malye Karely museum. 72% of respondents cited beautiful nature as the main reason for visiting the historical heart of the Russian Polar region, 56% were interested in unique sites and 46% were attracted by the region's excellent ecology.

At the FEDC session, potential investors were introduced to several projects set to launch in the near future. These include the creation of a tourist cluster near the Novodvinsk fortress, with plans to build campsites, glamping sites, guest houses, a family hotel, a food court, docks for water transport and a creative residence. Onega ski resort will soon be built on the White Sea coast, and entrepreneurs are being offered opportunities to create tourist accommodations in the Pyankovs' house in Solvychegodsk, merchant Vager's house in Kargopol and merchant Vorobyov's house in Onega, while preserving historical heritage. An agreement between the Intellect Group and the Regional Development Agency on restoring several historical and cultural landmarks in the region serves as an example of balancing care for history with tourism development. The overall investment in the project will amount to about RUB 500 million.

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