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Social and Economic development of the Republic of Karelia in 2009


  Economic Policy

    Industrial Policy

    Agroindustrial Complex


    Natural Resources
    and Ecology


  Results of 2009

Social and Economic Situation in the Republic of Karelia
on results of 2009

In 2009 cost of goods shipped in metallurgical production and ready metalware articles has made 5098 million roubles, that is 40% less than the parameter of 2008 in established prices exceeds. Thus, the index of production regarding this kind of activity has made 78.6%, that is basically related to aluminum and wire products production loss .

Aluminium production volume by NAZ-SUAL branch from the beginning of the year has made 70.2% to the level of 2008. Activity of the enterprise in 2009 was influenced by electricity rates increase as well as negative tendencies in the market of aluminium which reflected advancing rates of growth of production in relation to consumption of metal in the world, sharp reduction of demand and large-scale metal price cutting.

Thanks to active marketing policy and duly modernization of production Wärtsilä Hardware Plant Joint-Stock Company, despite of deterioration of conjuncture in the hardware market in 2009 has increased production up to 96,400 tons (104% to the level of 2008).

In Petrozavodskmash Foundry, Ltd., volume of production of foundry goods in 2009 in established prices has made 615,9 million rbl. (75.5%). The enterprise in 2009 has continued cooperation with the Czech company ČKD Blansko producing machine casting. One of the basic results of 2009 was mastering the unique technology of alloying Hadfield steel.

Now the stock of orders of the enterprise is formed, that will allow to load capacities of Petrozavodskmash Foundry, Ltd., up to 100%.

In structure of industrial complex of the republic in 2009 relative density of machinery and equipment production has made 2.5% (3.7% in 2008). Thus, the index of machinery and equipment production by the end of the year has decreased to 43.4% that is related to curtailment of production at Onego Tractor Plant, Ltd., Petrozavodskmash JSC and insufficient provision of Stankozavod-Deko, Ltd., with orders.

At the largest machine-building enterprise of the republic Petrozavodskmash JSC in 2009 the volume of products shipped in established prices has made 66% to the level of 2008. Within the year machine-assembling manufacture remained almost idle. However, despite of problems arising, the enterprise managed to master new kinds of large-capacity production: for the first high pressure drums for thermal power stations, unique equipment for wood chips sorting, cylindrical valves for water conduit within the scope of the state order for reconstruction of the White Sea-Baltic Canal were made and shipped. Equipment produced for constructed Novovoronezhsky atomic power station and Leningradskaya atomic power station-2 were rated high.

On results of 2009 Onego Tractor Plant, Ltd., has assembled only 10 units of equipment (4% to the level of 2008). The Tractor Factories concern has worked out a business-plan for Onego Tractor Plant, Ltd., development for 2010.

Production index for production of transport facilities and equipment activity has made 130.4%.

Onego Ship-Building Factory, Ltd., in 2009 has performed contractual obligations on construction and shipment of one dry-cargo ship of Karelia type according to the program of the Russian fleet modernization and two sea vessels of the DCV-33 project with deadweight capacity of 4500 tons (in 2008 it was delivered three ships). Currently at the enterprise there are four ships at different stages of construction.

Cost of production of Avangard Ship-Building Factory, Inc., (performed work and rendered services) has made 13.4% to the level of 2008, ythat is related to decrease of the State defence order and the order to repir railroad equipment, as well as absence of circulating assets.

By the decision of the Arbitration Court of the Republic of Karelia external control procedure is introduced at Avangard Ship-Building Factory, Inc., since September 1, 2009.

In 2008 in production index of electric equipment, electronic and optical equipment has made 42.5%, and there occurred 1.5 times decrease in price volumes due to adverse financial conditions caused by development of the world financial crisis.

The most important enterprises of this branch are AEK, Ltd., producing electric wiring for Scania and Volvo heavy haulers and Electrokos, Ltd., producing electronic equipment for cars.

Cost of production on the chemical production form of activity shipped in 2009 has made 976,6 million rbl. (76.3% to the level of 2008). The index of production has developed at the level of 86.6%.

Significant part of production of this kind of activity accounts for Sibirit-3 Joint-Stock Company where production of emulsion explosive has made 63.9% to the level of 2008. Decrease in industrial parameters is caused by the fact that the basic customer of the enterprise is Karelsky Okatysh, Inc., and stone-processing enterprises whereat shipment of production reduced in comparison with 2008.

In textile and clothing manufacture cost of shipped goods produced by the enterprise has made 98,6 million roubles, the index of production of this kind of activity has made 59.2% that is caused by insufficient ordering.

Physical volumes of production on the generation and distribution of electric power, gas and water form of activity have decreased by 3.6% in comparison with 2008 that is caused by reduction of electric power generation by 3.1% to 5124,7 million kilowatt-hours. At that, cost of own-manufactured production shipped has made 14,7 billion rbl., or 121% to the level of 2008 in established prices.

On results of 2009 consumption of electric energy in territory of the Republic of Kareliya has decreased by 10%, that is caused by setback in production related to the crisis phenomena in economy. However, consumption of electric energy by population has grown by 1.9%.

The structure of electric energy demand within a number of years remains quite stable. In total volume of electric energy demand the basic part was consumed by industrial enterprises 67.2%, on the share of other consumers there falls 19.7%, population consumed 12.2%, agricultural producers consumed 0.9%.

Generation of electric energy by Karelian branch of TGK-1, Inc., in 2009 has decreased by 3%, by block-stations of the Republic of Karelia - has increased by 0.7%.

Shipment of own-produced goods (foodstuff, including drinks) in 2009 has increased by 3% in established prices and has made 4215,9 million rbl. At that. production index on this kind of activity has developed at the level of 91.8%, that is basically caused by decrease in production of cooked and semifinished meats, animal oils, confectionery products, vodka and distillery products, bread and bakery products, flour and mixed fodders. At the same time, production of fish and whole-milk products has increased.

In the meat-processing branch there has been made 55.9% to the level of 2008, Karelian Meat-Packing Plant, Inc., has produced 94.6% od semifinished meats. to production of semifinished meat, and presence of the wide range of similar imported producs. Growth of production of semifinished meat by 16.6% is caused, basically, by processing of poutry received from Korm, Inc. Work at the enterprise is accomplished on expansion of assortment of production, introduction of modern packaging materials for semifinished meat. The reason for еhis situation is increase of prices for imported basic and auxiliary raw materials, presence of lots of imported products at a lower price in the distribution network, and also decrease in consumer ability of the population.

Production of whole-milk products has grown by 4.2% up to 47,500 tons, production of animal oil has decreased by 9.3% up to 389 tons. Milk plants continue to expand assortment of their production. In 2009 Medvezhiegorsk Dairy Factory Joint-Stock Company and Olonets Dairy Factory Joint-Stock Company worked successfully.

Baking enterprises have increased volume of production of confectionery products - is has been made 1545 tons or 108.3% to the level of 2008. Confectionery production increased in Kondopoga Center of Grain Production, Inc., Pitkäranta Center of Grain Production, Inc., Sampo Center of Grain Production of Petrozavodsk, Inc.,Petrozavodsk Bread-Baking Complex, Inc.

Alcohol production by enterprises of liquor enterprises was reduced in comparison with 2008 by 12.5% due to cease of industrial activity of branch of Rosspirtprom FSUE Petrovsky distillery of Petrozavodsk since April 24, 2008 related to protracted reorganization of the parent organization.

In the observed period production of bread and bakery products during the year has grown 5.2% less up to 30.3 tons. Decline in production of bread and bakery products is related to saturation of the market, decrease in the consumer demand and great volume of products imported to the republic.

On results of 2009 in the republic it has been produced 35,100 tons of flour (77% to 2008), 27,600 tons of mixed fodders (66%). Flour production decline is related to preventive repair of the mill and appearance of competitive production at lower prices in the market, the reason for mixed fodders production decline is insolvency of agricultural organizations of the republic and product degeneration.

Production of commodity fish, including canned fish, in 2009 has made 66.700 tons (113% to the level of 2008).

Volumes of fish production increased at Karelryba production and trade company , Ltd., Kuzema, Ltd., Virma, Ltd., Akvarius, Ltd., Karelian Seafood, Ltd., Trawler Fleet Base, Ltd., The White sea Fishing agricultural production company of the RK, Pobeda agricultural production company of the RK, Zarya Severa agricultural production company of the RK, Grumant agricultural production company of the RK.

Production of chilled fish (without herring) has grown 4.9 times, production od frozen fish has grown 1.2 times (26,200 tons), production of frozen filets has grown 2.2 times (3,100 tons), production of herring of all kinds of processing has grown 1.2 times (17,900 tons). Production of canned food, semipreserved foods has decreased by 24% up to 609 roubles.

Price index of industrial producers on the republic for 2009 (to December of 2008) has made 97.1%, including: 82.5% on extraction of minerals, 98.9% on manufacturing activities, 121% on generation and distribution of electric power, gas and water.

Price have reduced considerably in manufacturing activities: by 15% on products of chemical inductry, by 10.4% on other nonmetallic mineral products, by 9.5% on products of tomber processing and production of wooden articles (except for furniture).

As a result of price growth which has renewed from October, 2009 concerning production of forestry, wood harvesting and granting of services in these areas the price index as a whole on this branch for 2009 has made 102.8% (to December, 2008).

The package of investment and anti-recessionary measures implemented in the sphere of investments of the republic in 2009 promoted restraint of further development of negative dynamics of the index of physical volume of investments and relative stabilization of the situation. However, it was not possible to reduce depth of investment recession in the republic considerably and to overcome instability of stabilization process in the sphere of investments.

Volume of investments into the fixed capital of the Republic of Karelia in 2009 has made 18,7 billion roubles, or 68.1% to the level of 2008. At that, the share of investments into the sphere of production in total amount of investments into a fixed capital makes about 50%, mainly due to preservation of significant volume of investments in genetation and distribution of electric power, gas and water. Volume of investments into a fixed capital (except for budgetary funds) counting per capita has decreased from 31,600 roubles in 2008 to 22,500 roubles in 2009.

At the same time the volume of foreign investments in 2009 has 2.2 times xceeded the level of 2008 having made $238 million. High rates of growth of foreign capital investments are caused by substantial growth of investment in wood harvesting and manufacturing activities.

In 2009 it has been completed 14 large investment projects in power engineering, mining, forestry and agroindustrial complexes of the republic, including reconstruction of Läskelä 220-kilovolt substation N92 for needs of external electrosupply of the island of Valaam (branch of Karelian Grid Company, branch of the Federal Grid Company of the Unified Energy System of Russia, Inc.), construction of the second road-metal quarry on Chevzhavara site of bowels (Prionezhsky Mining Company, Ltd.), construction of the grinding-sorting complex on Rasialampi granite deposit (Petro-Granite, Ltd.), and the mining enterprise producing road-metal on Ramrucheiskoye deposit (The White Sea Quarry Ltd.), the second turn of the project on creation modern wood-working complex (Setles, Ltd.), the next stage of the program of production reconstruction and modernization (Segezha Pulp and Paper Plant, Inc.), construction of incubation-farming factory for Kala-Ranta Joint-Stock, etc.

As a result of implementation of investment projects there have been established more than 2,000 new workplaces, or 87.6% of the scheduled quantity stipulated by the program of creation of workplaces. The largest number of new workplaces was established in mining industry (621).

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Created: April 26, 2010. Last updated: June 15, 2010.
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