Ministry of Economic Development urges Arctic businesses to create unified infrastructure

Russian Deputy Minister of Economic Development Alexander Tsybulsky has called on companies working in the Arctic region to create unified infrastructure and use it collectively, TASS news agency reports.

The Ministry of Economic Development has analysed how existing companies working in the Arctic have built their businesses and concluded that companies need to duplicate each other in terms of creating conditions for work, Tsybulsky said.

“Even the simple analysis that we managed to conduct in the region revealed the enormous costs incurred by the main stakeholders, which are spent on the construction of mirroring infrastructure. Any major and reputable company that comes to the Arctic zone with major projects has to build all the infrastructure itself, from a port or airport to the things required for operational activities”, he said.

Tsybulsky also noted that maps show that such new airports are often built at a distance of less than 100 km from each other.

“It seems to us that companies implementing these projects should above all be interested in jointly utilizing such infrastructure facilities. On the one hand, this would increase the capitalization of profit at existing infrastructure facilities while reducing their payback period. On the other hand, this should drastically reduce the costs of companies joining the projects”, he said.

The Ministry has proposed conducting a comprehensive analysis of the Arctic zone in order to eliminate infrastructural constraints in the region.

Tsybulsky added that the ministry has proposed developing the Arctic zone through a system of ‘support zones’, i.e. by building a framework of economically active projects that could become a catalyst for developing the rest of the territory.

“This approach will make it possible to minimize the business costs that are currently being incurred on the Arctic territory”, the Minister said.