Arctic Zone Residents May Generate 20 Billion Rubles by 2031

Maxim Dankin, director of the Project Office for Arctic Development (POAR), commented on the recent news that the number of subsidized districts has decreased in Yakutia.

‘For the past 10 years, the Arctic economy has been growing at rates exceeding the all-Russian average, generating over 25% of the federal budget, and for every ruble invested, it produces more than 4 rubles in added value,’ said Maxim Dankin.

According to him, to maintain high rates of economic development, it is necessary to create a new landscape of financial instruments for the Arctic at the legislative level, systematically transitioning from a policy of resource redistribution to a policy of increasing the competitiveness of Arctic regions.

‘International practice and our own experience indicate the significant untapped potential of instruments such as funds for current and future tax revenues, territorial target capitals, regional and municipal derivatives, and cooperatives,’ added Maxim Dankin.

He also reminded that the Arctic Fund mechanism, established at the federal level in 2022, which involves financing development projects from tax revenues of Arctic Zone residents, has not been applied to date. According to the expert«s forecast, the Fund»s volume by 2031 could amount to about 20 billion rubles (approximately $200 million at current rates)—funds that could be invested in the development of key settlements.

For comparison: this is equivalent to the funds annually targeted for the development of the Far East from the Sakhalin-1 and Sakhalin-2 projects under the Production Sharing Agreement, noted the general director of POAR.