Crimea is at present one of the most attractive regions of Ukraine in terms of investments.

And what mean investments for any country? They are the driving force of economy. They provide the possibility to improve the life of the people, ameliorate the region, give hope for the break-through into future and open new horizons. Therefore, the leadership of the Autonomous Republic of Crimea gives considerable attention to the investment policy.

There are no doubts the Autonomous Republic of Crimea will experience an investment boom in the coming decade. Virtually all the prerequisites for this are available. Perhaps only two things are deficient political stability in relations between individual institutes of the state power and several laws protecting external investments. Yet I am sure these painful problems will be eliminated in the immediate future.

An estimated investment potential of the autonomous republic is today more $300 billion. In our opinion the most prospective sectors for investments are traditionally tourism and recreation; at the same time, very prospective is efficacious development of the sea ports, airports, roads, light and processing industry, winemaking and agriculture. These sectors are leading in the Crimean economy. Therefore, when we are asked what the authorities have already done and what they plan to do in order to create favourable conditions for inflow of the foreign capital into Crimea, we answer – we establish the favourable investment climate. Another matter is we are just at the beginning of the road. We have a lot of things to offer to foreign investors and we are determined to do everything possible to enable the investors to feel in Crimea at home and to view us as respectable and honest partners.

Today we have to define our own strategy of the sustainable development of the peninsula; the core of this strategy should be an efficient use of regional opportunities granted to us by the nature and history. And the natural conditions of the peninsula are truly unique. And not only at the south coast of Crimea.

When we came to the understanding of the fact that an economic joint-stock company should be established on the territory of Western Crimea which in addition to the sun, sea and mild climate is rich in natural and mineral resources, we put forward one main goal – integration of the land resources of Saki, Chernomorskoye, Razdolnoye regions and Yevpatoria Municipal Council, in order to stop chaotic allocation of small land plots for doubtful investment projects. It yields no profit to the local budgets. All these mini-hotels, private boarding-houses and cottages work only for themselves, spoil the landscape and generate no real funds for regional development. At the same time, all these regions have plenty of social problems – with water supply, communications and capital construction. New comprehensive approach will dramatically change the situation.

The attraction of serious investments, balanced development of the coastal areas and resort infrastructure would allow to create a resort oasis at the Western Coast and will work for the profit of local councils involving their immediate participation. The program of comprehensive development of the territories will help fill local budgets with funds and resolve important social and economical issues of the region and, what is very important, it would stop the emerging tendency of shadow, irrational and inefficient use of the resort-type land and natural resources in coastal areas of Crimea.

Speaking about new approaches to the creation of the Western Crimea development concept, I would note it is a pilot project not just for Crimea but for Ukraine in general. There has not been a similar project associated with the development of a recreational area where the length of coastal line is 227 km and where 273 000 hectares of land are being rented for the period of 50 to 90 years and traded.

On April 18, 2007, the members of the Supreme Council (parliament) of the Crimea have adopted a draft resolution “On Establishment of Economic Society with the Purpose to Implement Measures Aimed at Steady Development of Western Crimea”. The resolution envisages the creation of economic joint stock company which will render assistance in the planned development of Yevpatoria urban and Saki, Chernomorskoye and partly Rasdolnoye rural districts, with overall area of 252 000 hectares. The main activity of the company will be directed at establishing in the Western Crimea a territory of sustainable ecological and social development, with predominance of recreation.

The main goal of the establishment of the company under the umbrella of state bodies (in this case, it is the Property Fund of Crimea) is to ensure at the state level, during negotiations with investors, the interests of the region. It is very important there is a comprehension that the Western Crimea could be developed solely as a territory of sustainable ecological and social development.

At present, the corporate charter of the closed JSC “Western Crimea” is being finalized; this company will secure the region’s steady development.

- What will be priority duties and goals of JSC “Western Crimea”?

- First of all, the inventory of the land plots and determination of their status will be conducted. Without this stage, neither a system approach nor transparent investment tenders will be possible.

The company “Western Crimea” will also provide the management of European level when resolving investment issues. In the practice, negotiations between an investor and a rural council, without participation of experienced experts, sometimes lead to a reversal result for the community – instead of benefits, there are losses.

In order to draft an investment project which would not only satisfy the investor but also assist in resolving urgent needs of the local community, a desire to do this is not enough. This job should be executed by experts in financial and investment management who have knowledge and expertise corresponding to world standards.

Therefore, several reputable companies are involved in establishing JSC “Western Crimea”, in particular, the Investment and Privatization Assistance Fund which has an experience in drafting investment projects in compliance with UNIDO methodology, the legal department of the Ukraine-UAE Business Council, experts of Ukraine Trade Center in the countries of the Arab Gulf, of Ukrainian Chamber of Commerce and Industry and Ukrainian Union of Industrialists and Entrepreneurs.

A separate goal is a formulation of an approach which could help integrate the investment projects with interests of local communities. It is impossible to invent new schemes every day. It seems that one of the priority goals of the new company should be elaboration of the approach mentioned, establishment of mutually rewarding business partnership. Neither Crimea nor Ukraine as a whole has such an experience.

Since several years, the scholars of the Crimean Academy of Sciences, under the direction of its President, V.S. Tarasenko, actively work on the creation of the integrated concept of region’s development. It is being planned to create an Internet site where every one – from a representative of a public society to a school teacher – could find the information regarding the concept of the Western Crimea’s development and take part in this job, by means of so-called public expert evaluation of the projects. It is very important to secure for the public at large an access to information when taking relevant decisions; the involvement of mass media, scientific experts should be an indispensable condition when working over investment projects.

It is the involvement of the Crimean scientific experts, a group of consultants representing the Academy of Sciences of Ukraine headed by academician Yaroslav Yatskiv that will enable to include into the concept of the Western Crimea’s development issues connected with rational use of recreational and land resources. Indeed, the ecological, social and economical problems could be resolved only when proper attention is given to the protection of nature. For instance, construction of new hotels of European level in the Western Crimea should be complemented with the establishment of a National Natural Park and natural reserves.

At present, the Crimean authorities study the possibility of the implementation of 32 investment projects in the resort and recreational area, with the aggregate value exceeding $3 billion. These projects envisage the reconstruction of resort and spa facilities at the peninsula and construction of 5-star hotels with European level service, development of the entertaining industry; the project involving the construction of the highway Simferopol-Bakhchisaray-Yalta is also being discussed. This project is related to the fact that one of the basic conditions from the part of investors is – tourists and holidaymakers should reach their destination a hotel or a spa – within not more than 40 minutes after their arrival to the airport or railway station. Under active participation of Ukraine’s State Tourism Department, the concept of developing yacht tourism is being worked out, the yacht club of the Black Sea Navy in Sevastopol being renovated; soon preparation for the realization of the project will start which involves construction of the yacht marina in Belyaus; the harbor will go 11 km deep into the mainland, with the waterway’s depth between 8 to 18 m. The project of creating in Crimea a network of some 10 yacht harbors along the whole coast will open new prospects for the yacht tourism which is now very fashionable.

It is quite possible there will be soon in Crimea new residential communities and hotels in Arabian style resembling world-famous Dubai Marina and Madinat Jumeirah in Dubai. The investors from the United Arab Emirates (Abu Dhabi, Dubai) such as Emaar, Dubai World and others display interest in the Autonomous Republic of Crimea and plan to conduct negotiations on joint construction and investment with such partners as, for instance, the governments of Moscow, St. Petersburg, Kazakhstan and Austria.

According to Sergei Pachkovsky, Director General of Ukraine Trade Center who has initiated a visit of Emirates’ sheikhs to Ukraine, the Arabian investors look only for the large-scale projects, starting from $100-200 million and more. Thus, the UAE’s companies Emaar, Rustar, Limitless are ready to study possible financing of one of Crimea’s priority projects like “Western Crimea” or “Eastern Crimea” which can become Ukrainian Las Vegas and Monte Carlo. The implementation of this project will enable the construction of more than 20000 hotel rooms.

It is being supposed that some 11 million tourists will visit Crimea annually by 2010; at the same time Dubai (UAE) with its 1,2 million permanent residents, is being visited annually by 6 million visitors.

Until now, Crimea has not yet elaborated a universal investment strategy; hence, the local authorities make serious efforts to work out the best possible option. In such a way, the Council of Ministers of Crimea has passed a resolution with a definition of a mechanism of the investment projects’ implementation, at the competitive basis; the opportunities of the stock market will also be used and the experts are being trained who will be able to draft the investment projects in compliance with the EU requirements.

The Crimean parliament, from its part, also undertakes important steps. In March 2007, the Supreme Council of the Autonomous Republic of Crimea has approved the “Program of Investment Activities” until 2010, the basic purpose of it being the creation of favorable investment climate at the peninsula and successful filling of its investment map. Crimea can and should create such a business environment enabling to open a “green corridor” for inflow of a sound foreign capital. The said Program envisages that the volume of capital investments will reach by 2010 some UAH 9,1 billion and the volume of foreign direct investments during 2007-2010 will exceed $1 billion. The leadership of the autonomous republic is ready to provide all the necessary guarantees to the investors – their business in Crimea will be secured and they will receive in the leaders of the republic reliable friends and allies.

Very important is the idea of an integrated development of territories. At present, the resort and recreational sector of the Crimean economy makes up only 7 % of the budget’s revenues. At the same time, there are many regions in the world which successfully develop and thrive exclusively at the expense of leisure and tourism spheres. A unique example could be Dubai (the United Arab Emirates). Here, at the barren lands is a tourist paradise. Why could not we try to use this positive international experience? Why could not we try, under conditions of a hard competition, to concentrate all our resources and channel the region’s development into the civilized course and ensure for Crimea an adequate place in the global recreational and tourist industry?

To put is more specifically, I suppose Crimea needs today a large exhibition centre. Having such a centre, we would be able to conduct in the off-season time events on international level: exhibitions, symposia, conferences, festivals; there participants could be accommodated in sanatoria and holiday-centres which are empty over the winter. The integrated approach envisages also the construction and reconstruction of the up-to-date road-junctions. Therefore, it is necessary to build a bridge over the Kerch Strait, several state-of-the-art airports and highways along the coast.

There are world standards – if a person has to travel more than half an hour from the airport to a resort, it means he or she would not come to the same place for the second time. Thus, to invest into Crimea means not only investing into the high-grade rest and entertainment for our guests, bit also into the high standards of the future life of Crimea’s residents.

The peninsula of Crimea has been, since the ancient times, an important gateway and crossroad of international trade and economic links. Today, not only has not this favorable geographic location lost its significance, but it considerably grows, given the increasing trend of globalization of the world economy. This factor should be used as the basis for the successful implementation of the project “Western Crimea”. There is no other way except to develop what has been granted by the God.