Zelenograd special economic zone: chips for Troika cards and biometric passports

The Zelenograd SEZ was established in 2005. The main goal was to develop high-tech production to ensure import substitution and create another backbone industry for the municipal economy.

High-tech industry’s growth point

Back in Soviet times, Zelenograd was one of the main research-and-production centres for electronics and microelectronics. It was often compared with America’s high-tech Silicon Valley and even called the Soviet Silicon Valley. Zelenograd started producing semiconductors, diodes and other microelectronics in the 1960s.

The technology and experience accumulated in the Soviet years are still in demand. Zelenograd’s companies have become growth points for Moscow’s high-tech industry. Today the SEZ has 41 residents that have created about 5,000 new jobs, mostly for the residents of Zelenograd. By 2021, its workforce will exceed 7,500 people.

Over 11 billion roubles have been invested in the development of high-tech companies. The Department for Science, Industrial Policy and Entrepreneurship predicts that in the future this investment level could grow to almost 24 billion roubles.

Liquid crystals for Troika card and foreign travel passports

SEZ resident companies are engaged in microelectronics, instrument production, information and telecommunications technology, as well as pharmaceuticals and medical know-how. They are developing methods for cryptographic protection of information and cutting-edge medical equipment. They also produce microchips for the Troika card and other travel passes, and produce smart  stuff for biometric passports and bank cards.

Not a single metro passenger can get by without a Mikron product. Every month Mikron produces over 30 million contactless tickets for the metro, the Moscow Central Circle, buses, trolley buses and trams.

The company developed the entire range of electronic upgrades for travel documents – from chips to final products – way back in 2007. Mikron has been producing the Troika contactless card since 2013. It is one of the largest transport applications in Europe. The more sophisticated liquid crystal technology was developed by the company to allow users to top up the card and to maintain a record of the tickets used for the city transport system and season tickets for commuters.

Mikron’s technology is used for chip modules in biometrical foreign travel passports and the protected chips for the national Mir payment card system.

The products of another SEZ resident – Elta – are equally widespread. Elta manufactures devices that are in high demand in medicine, including the first domestic express glucose metre, glycohemoglobin analysers, individual onco testers and the like.

Development infrastructure

SEZ has increased to 200 hectares since being created in Moscow. Now residents are working in five areas. In Zelenograd, these are Alabushevo (142.1 hectares), MIET (4.47 hectares), Mikron (13.33 hectares), and Angstrem (15.15 hectares) and in Pechatniki – Technopolis Moskva (32.44 hectares), which is not far from the Tekstilshchiki metro station.

Engineering and transport infrastructure has been developed over the past few years. A modern data processing centre for the cloud infrastructure was launched in Alabushevo in 2016. The total area of the business incubator complex for start-up projects is about 4,000 square metres.

Preparations are underway for the opening of an administrative and business centre in the same place. A nine-storey building with an area of over 17,000 square metres will accommodate laboratories, industrial premises, office rooms and exhibition halls. Centre specialists will work with the production at all stages – from developing materials and technology to manufacturing and selling end products.

Benefits and advantages

SEZ residents enjoy special terms – tax breaks and other advantages.

New benefits aimed at encouraging investment in production and innovation technology have been initiated. The Moscow City Duma has adopted amendments to city legislation. Now zero rate taxes for the land and for permanent property tax will be valid for ten rather than five years as before. Residents of SEZ will not pay land tax for up to ten years either.

Reduced city profit taxes have been established for SEZ management companies: zero tax from 1 January, 2018, five percent from 1 January 2028 and 12.5 percent from 1 January 2033.

The transfer of SEZ administration authority from the federal centre to the city has made it even more efficient. The management reform simplified the process and reduced the time for launching investment projects. The authorities streamlined the approval process for capital construction projects, including utility connections which are usually a daunting hurdle.

Efficient conditions for Moscow’s SEZ investors and residents are a major factor for localising new high-tech production in the capital. Moscow’s conditions for entrepreneurs are now competitive compared to other Russian regions and foreign countries with rapidly developing industries.