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Economic development of the Republic of Karelia in 2005

  Results of 2005

  Economic Policy

  Productive Industry

    Timber Industry Complex

    Mining Complex


    The Agroindustrial Complex

    Transportation Industry

    Communication and



  Inter-Regional Cooperation

  Natural Resources
  and Ecology


Status of Productive Industry
Transportation Industry

The Republic of Karelia has a developed transport network, the main automobile, water, trunk-railways run through its territory connecting the republic with the center and the east of Russia. Effective functioning of economics of the republic in many respects depends on steady work and further development of the transport complex and its infrastructure, optimization of transport communications and reduction of transport costs.

With a view of perfection of the legislative base in the field of organization of transport service of the population of the republic the Law of the Republic of Karelia On Rendering the Population Automobile, Railway, Internal Water, and Air Transport Services is developed and passed in 2005.

In total amount of production of key economic branches of economics of the republic transportation makes 14%. Number of people occupied in transport industry makes more than 24 thousand people, including 14,2 thousand people working in the sphere of railway transport, 3,9 thousand people working in the sphere of automobile transport, 3,1 thousand people working in the sphere of internal water transport and 0,2 thousand people working in the sphere of air transport. Extent of highways in the republic makes 13 331 km, including: 7 888 km of roads of the general using (including Kola federal road), and 5 442 km of departmental roads. Of the general extent of highways roads with hard surface make 7 908 km. Extent of railways of the republic makes 2 226 km, and internal water navigable ways make 3 744 km.

In comparison with 2001 total amount of annual turnover of goods of all types of transport has increased by 15%, and in 2005 has made 25,7 billion ton-kilometer. Growth of turnover of goods and demand for transport services was formed against a background of positive dynamics of economic growth, increase in industrial production and foreign trade turnover. First of all, it was promoted by increase in volumes of preparation and deep processing of wood resources, production of iron-ore pellets, more intensive development of stone-extractive manufactures and, certainly, development of transport logistics. The number of transported passengers within the last four years has made 344 million persons. It became a result measures taken by the Government of Karelia on expansion of the itinerary network both in suburban, and interurban traffic, coordination of activity of institutions of local governments of the republic on organization of intracity passenger traffic.

As a result of work done transport began to work more steadily, has not become a deterrent of economic growth and has almost completely provided solvent demand of economics and population of the republic in transport services. Growth of investments allotted for reconstruction, development and modernization of the transport complex and its infrastructure which in 2002-2005 made over 12 billion roubles has played a large part.

Railway Transport

In economics of the Republic of Karelia among all types of transport the greatest role in volumes of transportation falls on railway transportation by which annually it is transported about of 93% of all cargoes and 7.7% of passengers.

In order to improve passenger and freight traffic in the republic, annually since 1998 the Government of Karelia concludes Agreements with Octyabrskaya Railway, providing mutual obligations on improvement of transport service rendered to the population and enterprises. Within the framework of Agreements within the past 4 years electrification of railways of Karelia has been proceeding. In 2004 works on Sumposad-Malenga piece of line were over, in 2005 electrification of Idel-Svir piece of line has been completed. A railway station in the town Segezha is under construction. Tasks of preservation of volumes of suburban passenger traffic, coordination of tariffs for conveyance of passengers in suburban traffic, rendering state support to railway transport have been solved.

For purchasing head cars for electric trains with a view of maintenance of conveyance of passengers by again created suburban company Karelprigorod Open Society from the budget of the Republic of Karelia it has been allotted 25 million rbl. in 2004, and 10 million roubles in 2005. Electric train traffic on electrified sites is organized. In 2006-2007 the Government of Karelia plans to allot no less than 85 million roubles for electric train purchasing.

The Government of the republic, together with institutions of local government, solved tasks of coordination of closing stations for some kinds of operations, work of ineffective lines, delivery of cars for enterprises of the republic. This work was conducted in view of interests of the population and enterprises which consume railway services.

In order to decrease idle time of the cargo operating rolling-stock, enterprises held meetings where railway management participated and mutual claims of the parties were considered.

In December of 2005 the Agreement between Russian Railways Open Society and the Government of the RK on cooperation and in 2006 was signed.

Motor Transport

About 4 % of cargoes and 92% passengers (with electrotransport taken into account) are transported by motor transport of the republic. The total amount of annual turnover of goods of motor transport in Karelia within the past 4 years was increased by 39%, volume of passenger traffic achieved 3% gowth.

The Government of the republic has taken measures for further development of motor transport, monitoring work of cargo and passenger traffic was conducted. Tasks on organization and financing of conveyance of passengers by public motor transport were solved on-the-fly, for both intermunicipal (within the borders of the Republic of Karelia), and suburban, and intercity (Petrozavodsk) traffic. Measures were taken for updating passenger bus fleet, organization and expansion of a network of intermunicipal and suburban bus routes.

Granting passenger services in suburban and intermunicipal (within the borders of the Republic of Karelia) the traffic is carried out on 59 bus routes, and also 2 inter-regional routes (St.-Petersburg, Vologda region) and 2 international routes (Sortavala-Finland, Kostomuksha-Finland).

From 2002 to 2005 the bus fleet for conveyance of passengers has increased qualitatively and quantitatively. Due to means of federal, republican, and local budgets and autoenterprises of the republic 109 buses of various capacity have been purchased. In 2005 the Government of the Republic of Karelia allocated 37,5 million roubles from the republican budget for Karelavtotrans State Unitary Enterprise of the RK for purchasing of 15 buses of the increased capacity and comfort for conveyance of passengers on intermunicipal and suburban trafic itineraries.

All these measures allowed to improve quality of service rendered to passengers, to provide transportation of schoolchildren from remote settlements to schools, and, in addition, to organize intermunicipal itineraries: Petrozavodsk-Pudozh, Petrozavodsk-Segezha, Kostomuksha-Byelomorsk, Kalevala-Kostomuksha, Petrozavodsk-Olonets, Petrozavodsk-Kalevala, Kostomuksha-Segezha. In 2006 due to the budgetary credit it is planned to buy 2 buses of increased capacity and comfort for conveyance of tourists and passengers.

The Government of Karelia develops the Order of organization of bus routes of suburban and intermunicipal traffic and the Order of stating bus traffic schedule on specified itineraries. The admission of autocarriers to perform conveyance of passengers on routes of the general use in intermunicipal and suburban traffic will be carried out on a competitive basis with use of motor transport of carriers of various capacity.

Air Transport

Due to expansion of economic and cultural relations of the Republic of Karelia with Finland and other countries of the Northern and Western Europe, and also in view of importance of Petrozavodsk as a capital of the frontier region of Russia, within the past years work on preservation and further development of Petrozavodsk airport which has the status the international airport since 1990 was conducted.

At present the following regular flights arrive and departure from the airport: Petrozavodsk-Moscow-Petrozavodsk, Cherepovets-Petrozavodsk-Helsinki-Cherepovets. In summer period flights to southern regions of Russia are carried out, volumes of charters to the cities of Archangelsks, Yakutsk, Naryan-Mar increase.

In order to preserve the international status of the airport, improve conditions of rendering services to the population and work of maintenance staff, in 2003-2004 the Government of the Republic of Karelia put up 21 million roubles for construction of a passenger terminal. According to the order of the Ministry of Transport of Russia N18 of March 17, 2005 On Reconstruction of a Check Point through the Border of the Russian Federation at the International Airport of Petrozavodsk (Besovets), works on reconstruction of the airport proceed.

In 2005 the Northwest Base of Aviation Protection of Woods, Petrozavodsk Airport Joint-Stock Company have conveyed more than 11 thousand passengers, the annual increase in number of conveyed passengers to the level of previous years makes more than 10%. Allocation of means from the budget of the Republic of Karelia for the state support of aviatransportations on local lines has allowed to keep the Petrozavodsk-Sennaya Guba flight. In total within the period from 2002 to 2005 by air transport it has been conveyed more than 45 thousand passengers.

Water Transport

Water transport enterprises of the republic have provided stable transportation of goods and conveyance of passengers. Problems on navigation opening were solved in proper time, transfer of budgetary funds for the state support of water transport was carried out in full.

Conveyance of passengers on all routes in Pudozh and Medvezhiegorsk districts was kept: on a high-speed excursion route Petrozavodsk-Kizhi, transport high-speed route Petrozavodsk-Shala (Sennaya Guba, Kizhi, Velikaya Guba), an intercity route Petrozavodsk-Baraniy Bereg, a ferry in Shala. Work concerning transportation of goods and conveyance of passengers, modernizations of fleet was cunducted in close cooperation with the White Sea-Onego Shipping Company, Inc.

Within the framework of the Internal Water Transport sub-program of the Modernization of the Transport System of Russia (2002-2010) Federal Traget Program and according to own program of development of the White Sea-Onego Shipping Company, Inc., six vessels of Karelia type are being constructed. As for now 4 vessels has been constructed and floated. Cost of construction of the Rossiyanin (Russian) steam-ship has made $9,5 million (a head vessel of this project). The total sum of vessels' construction investments makes more than $50 million.

Important for Russia and Karelia investment project implemented due to means of the federal budget is reconstruction of the White Sea-Baltic channel which structure includes 121 hydraulic works. To provide navigation safety of the channel design and contract organizations have been defined which now carry out detail planning and building and assembly jobs accordingly. In 2005 for reconstruction of the channel it has been allotted 64,45 million roubles.

Even today the channel plays an important part in the economics of Karelia and Russia as a whole. Redistribution of freight traffics in northern direction will unload the Volga-Baltic waterway, will enable creation of the new industrial enterprises. Today the channel promotes development of boating, passenger boats follow up and down the channel.

Transportation on the route Petrozavodsk-Shala-Velikaya Guba, on intercity route Petrozavodsk-Baraniy Bereg were carried out by Onega Stevedoring ompany, Ltd. In 2004 - 2005 the company has in addition organized traffic on Belomorsk-Solovki route. In 2005 the shipping company purchased a 10-place hovercraft to provide traffic on the route Petrozavodsk-Zimnik-Baraniy Bereg. Purchase of a boat carrying 50 passengers is planned.

Technical support
Created: April 12, 2006. Last updated: April 24, 2006.
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