Ministry wants to focus state support on localizing carmakers

MOSCOW, Dec 5 (PRIME) -- The Industry and Trade Ministry wants to adjust state support for the car industry to on the companies that localize their production in Russia, Deputy Minister Alexander Morozov told reporters on Thursday.

Earlier in the day, AvtoVAZ Vice President Sergei Gromak said at a government meeting that conditions of special investment contracts are not equal for all car producers, and that companies that undertook less obligations under the contracts had advantages compared to AvtoVAZ and other highly-localized companies as they spend less on car production.

“The inequality of conditions means the industry loses the incentive for localization. Obligations under the contracts differ, while access to state support measures is almost identical…If we speak about the way to motivate and promote localization of car producers, we think that measures of state support should be tied to the level of localization,” Gromak said.

Morozov said that the ministry supports the position. “In general, the system of state support measures is being formed now. I think it will be designed until the end of the year. This is not an issue of differentiating the block of industrial subsidies, it is about the companies that invest more getting more in return,” he said.

“The logic is that the one who invests more has more added value, and they will receive more state support in general. It is not just about money.”

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