Prospects Raised For Finnish-Russian Cross-Border Special Economic Zone

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The Finnish Mayor of Savonlinna, Janne Laine has suggested the creation of a Special Economic Zone to include southeastern Finland, in addition to the Vyborg and Priozersky districts of the Leningrad region in Western Russia.

Quoted in Sputnik Laine’s idea is to create a special economic zone that will allow free movement for funds, goods, services, as well as residents of Finland, the Leningrad Region and St. Petersburg.

Dmitry Yalov, the Russian Deputy Chairman of the Regional Government for Economics and Investment, has welcomed the proposal, stating that “The project initiated by our foreign neighbours is certainly interesting, and if implemented, will facilitate the development of the two counties’ border territories, in particular, the Vyborg and Priozersky districts of the Leningrad region. The SEZ project with Finland can give regional enterprises certain advantages for entering foreign markets.”

He emphasized that the regional Leningrad administration pays special attention to the development of export supplies of regional manufacturers, including small companies.

Enacting the SEZ will require legislative changes. A special economic zone is, first of all, a special legal status providing its residents with tax and customs benefits, and providing this requires careful consideration in line with the two countries’ legislation.

Laine suggested that in his opinion, the new SEZ will strengthen tourist exchange, capital flows, and will also positively impact the services sector. As part of this concept, he also proposed to abolish the visa regime with Finland for St. Petersburg residents.

Creating SEZs in southeastern Finland has been proposed before. In 2012, a proposal was made to create a SEZ in Finland to attract Russian and Chinese investments; however, the project was not implemented.

Russia and Finland share a 1,340 km border.

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