Sverdlovsk Region, for the first time in seven years, ranks among the top 20 regions with the best investment climate.
Sverdlovsk Region Cracks Top 10 Investment Climate Rankings in Russia
For the first time since 2018, Sverdlovsk Region has broken into the top 10 groups of regions in Russia's National Investment Climate Ranking. The region snagged the 20th spot in the ranking, a significant improvement from past years.
Sverdlovsk Region's Investment Climate Ranking Over the Last 8 Years:
- 2018: 20th place;
- 2019: 38th place;
- 2020: 35th place;
- 2021: 15th group (34th-36th places);
- 2022: 16th group (45th place);
- 2023: 20th group (35th place);
- 2024: 11th group (23rd place);
- 2025: 10th group (20th place).
An investment-friendly climate in the region is a key governor's KPI. The ranking is calculated based on eight categories:
- Real Estate;
- Engineering Networks;
- Business Protection;
- Business Support Measures;
- Export Activities;
- Infrastructure and Technologies;
- Human Resources and Labor Resources;
- Market Development and Competition.
Efforts to improve the low investment attractiveness of the region began eight years ago when the region saw a significant drop in its performance indicators. For this purpose, the Corporation for Development of the Middle Urals signed a contract with "Publicity Consultation Group" to develop a specialized strategy. However, significantly improving the region's position proved unsuccessful.
In 2024, a working group was created in the region to improve its ranking. The plan was to be overseen by Deputy Governor Dmitry Ioнин.
Dissatisfaction with the Ministry of Investment and Development was publicly expressed this year by acting governor Denis Pasler. Following this, the resignation of the proficient minister, Vadim Treshchyakov, occurred. His position was filled by Dmitry Ioнин.
"Our priority will be to focus on working with external investors and attracting them to the region. We are currently working with the investment committee's team on this strategy. A concrete plan of action is ready, we are polishing it up and will present it in July during the government meeting. At the moment, we are getting business associations involved for external evaluation", Ioнин announced his initial decisions after his appointment.
To attract business to Sverdlovsk Region, various tax incentives are in place for residents of the Special Economic Zone "Titanium Valley," territories of Accelerated Development, participants in Priority Investment Projects, and the agreement on the protection and encouragement of capital investment. Currently, the ratio of Urals and Non-Urals residents of "Titanium Valley" stands at 70% to 30%, according to "RBK Yekaterinburg".
Eugene Kuyvashev's Team Failed to Execute the Plan for Increasing Investment Attractiveness
In the broader context of the Russian economy and investment trends, the regional strategy likely includes the following elements:
- Focus on Import Substitution and Industrial Development: The regional strategy aligns with the national trend toward supporting industries focused on import substitution, particularly in mechanical engineering and electronics production. This supports domestic manufacturing resilience amid challenges such as foreign investor withdrawal and supply chain adjustments[3].
- Infrastructure and Transport Link Enhancement: Investment is directed toward projects that develop transport routes toward friendly countries such as Kazakhstan and China. These initiatives enhance trade flows and logistical connections, compensating for the suspension of projects linked to European transport connections[5].
- Adjustments to Current Economic Conditions: The strategy accounts for increased costs of equipment, construction materials, and higher key interest rates, which complicate investment attraction. Hence, the focus is also on sustaining current and overhaul projects rather than only launching new developments[5].
- Adoption of Domestic or Friendly-Country Equipment: To adapt to disrupted supply chains and terminated foreign contracts, construction and industrial projects are adjusted to utilize domestic or friendly-country sourced equipment, supporting local industry and ensuring project continuity[5].
- Leveraging Regional Breakthrough Status: The oblast capitalizes on its recognition as a breakthrough region by federal leadership, using this position to attract investment through demonstrating effective governance and promising conditions for investors[3].
In summary, Sverdlovsk Region's 2024 investment strategy to improve its investment climate ranking is to strengthen its industrial base with a focus on import substitution, enhance regional transport links with non-European partners, adapt to economic constraints through strategic project adjustments, and leverage its breakthrough region status to attract and sustain investment amid a challenging national economic environment[3][5].
- The acting governor, Denis Pasler, expressed his dissatisfaction with the current investment climate in the Sverdlovsk Region, particularly in terms of its ranking, and announced a new strategy to focus on working with external investors and attracting them, which includes a focus on import substitution, infrastructure development, and adapting to economic constraints.
- In an effort to improve the region's investment climate ranking and attract external investors, Dmitry Ioнин, the newly appointed Minister of Investment and Development, revealed that they are working on a new strategy that includes a focus on import substitution, enhancing regional transport links, adapting to economic constraints, and leveraging the region's breakthrough status, as well as plans to present a concrete plan of action in July during the government meeting.
