Chelyabinsk Region banks on boosting of business

10.08.2013 — Analysis

The Ministry of Economic Development of the Chelyabinsk Region is examining applications for allocation of subsidies to small businesses.

The regional governor Mikhail Yurevich believes that the harmonious development of the region needs more active support of entrepreneurs who ventured on starting their business. Consequently, it will prompt solution of such important problems as employment of the population and improvement of the local and regional budget funds. In 2012, tax revenues from small business taking advantage of special tax treatments increased more than by 27.7%, making up quite a significant part of the consolidated budget of the Chelyabinsk Region as the press office of the Southern Ural plant informed RusBusinessNews. Part of the credit for this increase should be given to the regional government.

Special emphasis in the policy of business encouragement is placed on support of young entrepreneurs; the future of the regional economy depends on them. The South Ural authorities have a long-term special program aimed to attracting of young people into business.

The Youth School of Business was opened in 2008, and a few years later, in 2011 the regional government adopted the target program for small business development for 2012-2014; the project known as Start Your Business was launched in 2012. More than 600 students from 8 cities of the region were enrolled in the course of entrepreneurship fundamentals and studied the subtleties of business plan making. As a result, 200 trainees took the plunge and started their own business.

The enthusiasm of young people was noticed at the federal level. In 2012, the Chelyabinsk Region was named the best region in development of youth entrepreneurship. In June, 2013 the RF Economic Development Ministry contest committee for selection of RF constituent entities for allocation of subsidies to regions, following the policy of government support of small and medium-sized businesses, adopted the decision on allocation of 411 million rubles for three target programs, including 6 million rubles earmarked for support of youth business. In 2012, 100 million rubles were allocated from different budgets for assistance to entrepreneurs.

The region is providing assistance to small businesses in several areas: it is opening business incubators, organizing different seminars, training or educational courses, allocating subsidies and grants. Lump-sum subsidies up to 200 thousand rubles are given to compensate part of expenses on implementation of projects. Financial support funds that cannot be spent on payment of salaries help entrepreneurs to add up their production capacities or to increase their product output.

The Chelyabinsk Region also offers non-material forms of business support. One of them is the contest "Young Entrepreneur of the Year". According to Natalia Podkorytova, the executive director of the Delovaya Rossia (Business Russia) regional organization, due to the contest, initiative young people can win public recognition, complete an internship or take part in an international forum. For beginning entrepreneurs, such assistance sometimes is much more important than subsidies.

Vladimir Panfilov, head of the FireShot kicker club based in the Urals, finished the Youth School of Business four years ago and went through the business incubator system. He says that the simplified taxation system can develop successfully without financial backup from the budget. There is a much more urgent task of reducing bureaucratic obstacles that have been created in Russia in excessive numbers over the past 20 years.

At the closing ceremony of the contest "2013 Young Entrepreneur of the Year", which took place in June, Konstantin Golovin, a resident of Magnitogorsk, said that risks are inherent in business and a businessman can encounter so many problems that he is ready to throw in the towel. Therefore, young people need communication with like-minded people to understand that they are not alone.

"I am happy that the Chelyabinsk Region holds the contest of young entrepreneurs," the businessman shared his opinion. “I can meet here people with sparkling eyes; I can see how they overcome difficulties and I receive energy from them: If they could make it, then I will be able to make it too."

The opinions of the young entrepreneurs resonate with the viewpoint of the regional head Mikhail Yurevich. By and large, the governor is satisfied with development of small business in the region; however, at the recent meeting of municipality administrators, he pointed out that too much is demanded from entrepreneurs; therefore, they are unable to receive government support when they most need it.

"Beginning entrepreneurs should feel the shoulder lent by the government,” Yurevich said. "That is why public authorities at all levels should work with small business uninterruptedly. New jobs and better well-being of the South Ural population depend on this".

Vladimir STEPANOV