Government to abolish customs duties on construction machinery.
The government is going to abolish import duties on construction machinery and construction materials production equipment if Russia does not manufacture equivalent products, Prime Minister Vladimir Putin said. The government is confident that this measure will ultimately make housing more affordable.
"By 2016, we will need to be building 100 million square metres of housing per year, and by 2020 we will have to build more than 140 million square metres per year," the prime minister said at a meeting on construction sector development held at the ZhBI-6 concrete plant, member of the LSR Group.
Meanwhile, these figures only include housing. Russia is also engaged in three massive construction projects, in Vladivostok, Kazan and Sochi, as well as preparations for the FIFA World Cup. These projects require state-of-the-art technology. But the builders do not seem to be very enthusiastic about the idea of modernisation. So far, energy-efficient homes have been more talked about than built. Typical high-rise apartment blocks are springing up all across Russia using last century's technology and materials, which account for up to 40% of the price of housing. The prime minister pointed out that modern building technology is only used in a quarter of houses, and only in luxury housing.
Most facilities producing cement and bricks are 30 or 40 years old and use technology from the 1970s. Almost all of Russia's cement is produced by the so-called "wet" method that is considered obsolete abroad.
"This situation does not suit us. We must drastically change our approach," the prime minister said.
What will they do? First, the entire sector needs be re-equipped. Putin suggested abolishing import duties on unique construction machinery, but with the provision that Russia will be creating conditions to incentivise the transfer of production to Russia with a gradual increase in local production.
Second, Russia needs to create comprehensive plans for the development of the construction industry in each individual region. According to Putin, all elements need to be taken into account, including goals of regional housing construction programmes, development plans for industrial facilities, transport infrastructure and social and cultural facilities. The Ministry of Regional Development, along with the Ministry of Economic Development and the Ministry of Industry and Trade, will be overseeing this work. The government envisions subsidies for regions that will actively embark on housing construction. The subsidies will total 21.6 billion roubles, of which 40 regions will each receive 3.5 billion roubles in 2011.
Anastasia Savinykh