Successes and Difficulties of Small Innovative Firms in Russian Nuclear Cities Proceedings of a Russian-American Workshop (2002) / Chapter Skim
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Support for Innovation Activites by the City Administration: Review of Innovative Firms in Zheleznogorsk
Support for Innovation Activites by the City Administration: Review of Innovative Firms in Zheleznogorsk
Pages 114-138
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From page 114... ...
How can we turn the innovative technologies we have developed into successful businesses and provide jobs for highly qualified personnel displaced from the nuclear weapons complex because of cuts in defense orders and the diversification of the defense enterprises around which our cities are based? I think this is a mutual problem, a mutual headache for us, the city authorities, and the management of these enterprises.
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From page 115... ...
Its core activities involve reactor production, spent fuel storage, mechanics, and environmental radiation monitoring. · the Research and Production Association of Applied Mechanics (NPO PM)
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From page 116... ...
The city's enterprises have accumulated great scientific and technical potential due to their highly qualified personnel and well-organized production base. In addition to their core activities, the enterprises have conducted scientific research in related and completely new areas.
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From page 117... ...
Residents of the city have never encountered problems with shutdowns of the local water and power supply systems. Thus, to my mind, the task of the city administration and the enterprises is to use this potential and create successful businesses on the basis of innovative technologies and products.
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From page 118... ...
The present core activities of the enterprise are as follows: · MCC carries out radiochemical reprocessing of irradiated fuel from the ADE-2 reactor. The extracted plutonium is stored at the enterprise and, in accordance with the intergovernmental agreement, is not used for weapons production.
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From page 119... ...
storage facility for spent nuclear fuel with a capacity of 30 tons · a demonstration center for the extraction of liquid radioactive wastes and the decommissioning of storage tanks for such wastes · demonstration of a remote-controlled system for monitoring leaks of salt solutions from tanks of highly radioactive waste pulps · a center for the chemical analysis and assessment of problems connected with various liquid wastes, including vitrification · a demonstration center for decontamination and recycling of metals · technically advanced facilities for the temporary storage of plutonium dioxide All of these projects are undoubtedly interesting and promising. However, all of them are directly related to the former core activities of MCC and cannot be implemented as independent projects.
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From page 120... ...
Using funds from the federal targeted program for the development of the closed city of Zheleznogorsk, the city administration allocated about 6 million rubles in 2000 to create a manufacturing unit (automated assembly line) to produce thermoelectric modules.
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From page 121... ...
MRP ensures the safe operation of the main technological equipment involved in nuclear power production at MCC. With the cutbacks in core activities at MCC, a decision was made to start producing aluminum electrodes for the aluminum plants of the Krasnoyarsk region.
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From page 122... ...
On the other hand, the Russian economic crisis limited opportunities for MCC to develop its various conversion projects because of a lack of funding and the primary need to maintain its core activities. Lack of stable targeted sources of funding for innovation projects and conversion activities.
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From page 123... ...
Low level of the technologies used; equipment used in industries nationwide is worn out and obsolete. To initiate even pilot production units, many of the above-mentioned projects required unique, highly reliable, and highly efficient industrial and laboratory equipment.
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From page 124... ...
However, I also think that insufficient attention is being paid to conversion projects that are not on the scale of the silicon plant but could still become very successful businesses based on cuttingedge technologies developed at MCC. Thus, in conclusion, I would suggest that Minatom and MCC join forces to achieve the following goals: · A well-considered program must be developed to support and fund "small" conversion projects.
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From page 125... ...
RESHETNYOV RESEARCH AND PRODUCTION ASSOCIATION OF APPLIED MECHANICS (NPO PM) There is another unique enterprise in the city that also has vast innovation potential and practically no analogues in Russia.
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From page 126... ...
It was established by NPO PM for the purpose of spinning off an entire business unit involving the land-based elements of data reception and transmission, from system design to the completion of working systems for clients on a turnkey basis, along with subsequent technical service as required. The core activities of the enterprise are as follows: · production of large-diameter antennas for broadcasting and satellite use, as well as other equipment for satellite stations · production of transceiving centers and systems for multiple television signal reception · production of cable television systems Over the past 18 months, television systems produced by the enterprise have been installed in Zheleznogorsk, Achinsk, Nazarovo, and Minusinsk in Krasnoyarsk Territory and the city of Chernogorsk in the Republic of Khakassia.
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From page 127... ...
In 1999-2000 the enterprise received two loans on preferential terms from the nonbudget City Fund to install cable television networks in cities of nearby regions. Both loans have now been repaid by the enterprise.
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From page 128... ...
This occurred thanks to the increase in tax revenues owing to activities in the investment zone. The investment zone provides for a special 100 80 60 ILL 40 20 o 0% 0% 60% 40% 55% 45% 0% 30% 27% 73% 38% 32% 1997 1998 1999 2000 HI City Development Program 1~1 Subsidies and Subventions from Federal Budget 1~ Internal Incomes FIGURE 3 Structure of budget revenues for the closed city of Zheleznogorsk.
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From page 129... ...
Moreover, the establishment of the investment zone has energized the business environment in the city and attracted new enterprises and plants. Revenues from investment zone participants made it possible to establish an internal source of support for investment projects, the nonbudgetary City Fund, which provides funds on preferential terms to top-priority investment projects.
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From page 130... ...
: 112 million rubles · MCC conversion projects: 70.7 million rubles · city projects aimed at developing and creating new manufacturing facilities and repairing and reconstructing the heating and water supply systems: 284.7 million rubles Among the conversion projects carried out by MCC, I have already mentioned the following innovation-oriented activities: · creation of a complex of facilities for manufacturing medical supplies, gel-based bandages and dressings, and isotopic materials and providing radiation-based materials processing services · development of a machine-building complex to produce equipment and spare parts for the aluminum industry · creation of a facility that manufactures automated security and fire alarm systems and development of technologies for producing new fire protection equipment · creation of a plant for manufacturing thermoelectric materials and modules, developing and improving TEMO automated assembly technologies, and manufacturing a wide variety of TEMO-based refrigeration and heating units One city project that merits special mention is entitled Creation and Development of a Request-Response Data Transmission System for the Needs of Airlines. The project is of national significance and is intended to integrate Russia into the global Aircraft Communications and Reporting System (ACARS)
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From page 131... ...
· arrange activities in the area of social programs · coordinate activities within the framework of the Technopark project The city administration and the Mining and Chemical Combine have recently developed a project to create a technological incubator (the Technopark project) within the framework of the NCI program, which will make it possible to provide office and industrial space for MCC innovation projects.
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From page 132... ...
As you have probably noticed, the majority of investment projects supported by the administration cannot be considered as innovative. The initial policy of the administration was aimed at supporting the undertakings that could provide the quickest returns to the budget in the form of increased tax revenues (as with the distillery)
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From page 133... ...
From its founding, Prima Telecom has pursued two main areas of activity: finance and investments and manufacturing. As a production entity, Prima Telecom specializes in providing equipment for professional satellite television reception, manufacturing and supplying antennas, feeder devices, and equipment for television and radio broadcasting and communications, and creating and operating cable television networks that meet all modern requirements.
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From page 134... ...
The company has also upgraded receiving stations of the Moscow and Ekran systems for the All-Russia State Television and Radio Company. In 1997 Prima Telecom successfully fulfilled a prestigious order for installing a satellite TV receiving system at the Sosna presidential residence in Udachny, Krasnoyarsk Territory.
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From page 135... ...
As of August 1, 2001, Prima Telecom and its five affiliates had 29,924 cable subscribers. Cross-polar Flight Development Project The next enterprise I would like to cover is the Northern Air Bridge Management Company, an open joint-stock company.
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From page 136... ...
The first part of the project, Creation and Subsequent Operation of the Russian Network for the Global ACARS System, began with the allocation of 15 million rubles from the Program for the Development of the Closed Administrative-Territorial Zone of Zheleznogorsk, which I mentioned earlier. Northern Air Bridge has recently entered into contracts with the American company ARINC, which operates the global system.
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From page 137... ...
· access to investments in the necessary amounts and for the necessary length of time (for the overwhelming majority of the innovation projects) · the unstable economic and political situation in Russia and its regions · the unstable nature of laws and regulations, especially with regard to taxation, and the frequently changing tax rates and collection procedures, which make it difficult to forecast expenses · the extremely unfavorable conditions for obtaining loans for innovation projects in the Russian banking system: high interest rates ~ lack of a system of investment bank lending on a long-term lowcollateral basis ~ impossible collateral requirements for loans · unattractiveness of Russia and its regions from an investment standpoint, which makes foreign investors extremely unwilling to invest in new spheres of activity, especially in the regions · bureaucratization of the economy and resulting duplication and confusion regarding the authorities of the federal and regional executivebranch agencies, as well as the frequent changes that are made in their organizational structures.
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From page 138... ...
. As a start, Minatom could propose that specialists from the city-forming enterprises develop their ideas and mechanisms by spinning off innovative projects into separate independent businesses that could then form the basis for the appropriate legal acts and targeted programs.
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