Russian Federation: Stimulus measures for the automobile sector for partial coverage of energy usage expenses

ANNOUNCEMENT 15 Jan 2014

In January 2014, the government of the Russian Federation announced a change in private-sector financial support.

NUMBER OF INTERVENTIONS

1 harmful
0 neutral
0 liberalising

SOURCE

The Russian Government (2014). ПОСТАНОВЛЕНИЕ ПРАВИТЕЛЬСТВА РФ ОТ 15 ЯНВАРЯ 2014 Г. N 30 "ОБ УТВЕРЖДЕНИИ ПРАВИЛ ПРЕДОСТАВЛЕНИЯ СУБСИДИЙ ИЗ ФЕДЕРАЛЬНОГО БЮДЖЕТА РОССИЙСКИМ ПРОИЗВОДИТЕЛЯМ КОЛЕСНЫХ ТРАНСПОРТНЫХ СРЕДСТВ НА КОМПЕНСАЦИЮ ЧАСТИ ЗАТРАТ НА ИСПОЛЬЗОВАНИЕ ЭНЕРГОРЕСУРСОВ ЭНЕРГОЕМКИМИ ПРЕДПРИЯТИЯМИ АВТОМОБИЛЬНОЙ ПРОМЫШЛЕННОСТИ". (Resolution of the Government of the Russian Federation of January 15, 2014 No. 30 "On approval of the rules for granting subsidies from the federal budget to Russian manufacturers of wheeled vehicles for the partial reimbursement of costs for using energy resources by energy-intensive enterprises of the automotive industry."). Available at http://government.ru/docs/9795/

Inception date: 15 Jan 2014 | Removal date: open ended

Financial grant

With Decree 30 of 15 January 2014, the Russian government approved the allocation from the federal budget of 5.9 billion Roubles (USD 165 million) in 2014; 6.3 billion (USD 177 million) in 2015; and 6.8 billion (USD 191 million) in 2016 for partial coverage of the energy usage expenses of Russian car makers with energy-intensive production process.

The announced official state goals to be achieved with this state subsidy are:

to raise the competitiveness of the local automobile industry;
to achieve a share of Russian-made motor vehicles on the domestic market of 80% for cars, 90% for commercial minivans; 85% for trucks; and 99% for buses;
to stimulate automotive manufacturing in the Russian regions, including Siberia and the Russian Far East.
to increase the value added in the sector to 48% (2.2 trillion roubles).

Indirectly, this state initiative aims to compensate the Russian manufacturers of motor vehicles for the loss of competitiveness provoked by the introduction of waste disposal (scrappage) fee (see related GTA measure below).

AFFECTED SECTORS

441 444 491 499

AFFECTED PRODUCTS