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All news / Free land program gathers pace in Russia's Far East

  • 15 Sep 2016, 10:27

More than 6,000 people have taken advantage of a new government initiative to help develop the economy in Russia's Far East by applying for a free hectare of land in region, according to Far East Development Deputy Minister Kirill Stepanov.

According to Stepanov, who made the announcement at the Eastern Economic Forum in Russia’s Pacific city of Vladivostok in early September, over 120 plots of land have already been transferred for use, and residents will receive another 250 plots in the near future.

"The law gives people a new degree of freedom," said Stepanov. "It is important that it has straightened all the bureaucratic corridors. A citizen gets land without coming into contact with the officials."

According to him, the time limit for the transfer of plots is around 16 to 25 days. This is sufficient to validate the application, make a decision on the transfer of a plot and determine that no one else has claims on the land.

However, all the procedures for allocation of land have to be developed from scratch; meaning the process is not quick. The relevant law only came into force in Russia on June 1, 2016.

Build a hotel, open an eco-village… or keep bees

Under the new law, the residents of the Far East may apply for a free hectare of land until February 2017, and thereafter the practice will spread to all the inhabitants of Russia.

Any citizen of the country will be able to get free land in the Far East, as long as the new plot is developed within five years. It is enough to open a company, to build a house or a hotel – then the land will be transferred to the ownership. If the plot remains undeveloped, then it will need to be returned to the state.

According to Stepanov, the owners of the first plots mainly plan to engage in agriculture, including beekeeping, but there are several projects to create ecovillages for the development of eco-tourism.

The new program involves almost all plots of land with the exception of protected areas, even forests. As Alexander Levinthal, governor of the Jewish Autonomous Region, a small region on the border with China, told RBTH, 640,000 hectares of land has been allocated for free distribution in this region alone.

For potential investors, the Far East Development Ministry has developed model business plans. For example, one of these plans involves investment of about 1 million rubles ($15,350) in the establishment of a strawberry-growing facility, with a payback period of less than a year.

According to Dmitry Afanasiev, chairman of the partner committee of the law firm Egorov, Puginsky, Afanasiev & Partners, Russia's Far East today has one of the most favorable tax conditions in the Asia-Pacific region. Profit tax in the Russian Far East is zero, whereas it is 10 percent in South Korea, 15 percent in China and 26.4 percent in Japan.

New towns

In the near future, it is hoped that new villages and towns will emerge on the allocated land, in an echo of the settlement of the region in the early Soviet period, when many idealistic young communists headed to the Far East to build new cities.

"Since the construction of the Baikal-Amur Mainline in the 1930s and 1940s [a northern branch of the Trans-Siberian line, from Central Siberia to the Far East], virtually no new settlements have been created, it is necessary to revive this practice," said Sergei Gabestro, deputy chairman of the Commission on the Development of Institutions of Public-Private Cooperation at the Russian Far East Development Ministry.

According to Gabestro, the commission has already received five collective applications from those who want to create settlements.

Those interested in obtaining land in Russia's Far East even include American mixed martial arts fighter Jeff Monson. The law prohibits foreign nationals from obtaining land for free, but Monson became a Russian citizen in late 2015 and will qualify for a free hectare in 2017.

In a video posted on YouTube, he said that he plans to open a sports village on a free plot of land to teach young people "men's qualities and sports."

"Join me as I get ready to go develop the Far East! Are you with me? Let's go!" Monson said in his video.