Tax Breaks Offered to Key Businesses

City Hall on Tuesday gave initial approval to a plan to double Moscow's gross regional product by 2009 by offering tax and customs incentives to innovative businesses and boosting professional education.

Mayor Yury Luzhkov ordered that the plan, which will be sent to various city departments for further development, be amended to include investment into energy and water conservation technologies, support for the manufacturing sector and increased availability of banking services in the capital's outlying districts.

The additional points were raised mainly by university students, who were sitting in for city officials as a part of Luzhkov's three-week effort to educate young people about city government. Tuesday's meeting was the third and last in which students took part.

Luzhkov stressed the importance of innovation in all sectors and said the city should lend a hand to businesses involved in developing cutting-edge technologies by sharing the investment risks.

The author of the plan, Marina Ogloblina, said special emphasis needed to be placed on the training of future professionals. Ogloblina, head of the city's department of economic policy and development, said business owners named the shortage of qualified candidates for employment as a major obstacle to expansion. Students at Tuesday's meeting also called for greater support of domestic producers, noting that 93 percent of Moscow's revenues were generated by the service industry.

Luzhkov agreed, saying that all industries outside the natural resources sector would be affected negatively upon Russian accession to the World Trade Organization.

Another proposal, presented by Tatyana Vasilyeva of the city's public relations committee, called for measures to help local teenagers and university students find seasonal and part-time jobs.

Luzhkov shelved the proposal after students pointed out that it duplicated existing city regulations.

The student government also approved a revised plan for the city's youth program, amended by Oleg Pilshchikov, chairman of the city's family and youth committee, following the first student government meeting on Aug. 1.

Luzhkov then congratulated the student officials, saying many of their suggestions had been fresh and unusual, and had made the city's real officials envious. He also said Moscow officials had already identified students whom they planned to recruit after graduation.