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Krasnoyarsk Territory - Overview

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Updated: 15.10.2003

Krasnoyarsk Territory is one of the key regions of Russia. Rich with natural resources, possessing highly developed industries playing leading roles in the economy of Russia, and having industry-oriented scientific and intellectual potential, Krasnoyarsk Territory is one of the most attractive regions for foreign investment.

Geographical location and climate

Located in the central part of Siberia, Krasnoyarsk Territory covers 2.34 million sq km, or 13.6 percent of entire Russia. To the north the Territory extends to the Taimyr Peninsula on the Arctic Ocean; to the east, Irkutsk Region and Yakutia Republic; to the south, Tuva Republic; and to the west, Tyumen Region.

The Territory spans several climatic zones, from arctic to continental, and has arctic deserts, tundra and tundra forest - in the north, the taiga - in the central part, and the steppe and forest-steppe - in the south. The south has productive agricultural soils.

Population of Krasnoyarsk Territory is only 3.5 million, which is about 2 percent of the population of Russia. Three fourth of the population is urban. The capital, and the largest city, Krasnoyarsk, located in the south, has about 900,000 residents. Other large cities are Norilsk, Yeniseysk, Achinsk, Igarka, and Dudinka.

Economic system

Economically, Krasnoyarsk Territory is included in the East-Siberian Economic Region. Other subjects of the economical region are Irkutsk and Chita Regions, Tuva, Khakasia, Buryatia, Taimyr and Evenkia Republics, Ust-Ordynsk Buryat Autonomous District.

The Territory is constantly ranked among the ten regions with the highest GDP in Russia.

Energy Industry

The energy industry is one of the Territory's largest industrial sectors. Total power capacity of power stations is 14,349 billion kWatt. Two large hydroelectric power stations, such as Krasnoyarsk and Sayano-Shushenskaya, are built on the Yenisey river. Three hydroelectric power stations are built on the Angara river, and the fourth dam is being built near the city of Boguchany.

Energy production in the Territory is highly monopolised. The main suppliers of electric power are: RAO-UES (23.8 percent of all the energy in the Territory), Krasnoyarskenergo (61.2 percent), and Norilskenergo JSC (15 percent).

Natural Resources and Mining Industry

Krasnoyarsk Territory is one of Russia's richest areas with natural resources. The most important resources are natural gas, oil, hydroelectric power, timber, manganese, copper, mercury, rare earth metals, ferrous and non-ferrous metals, coal, gold, platinum, high-quality marbles, and precious and semiprecious stones.

The fact that these natural resources are often closely located to each other, and can be developed simultaneously, gives more advantages to the region.

Mining industry is one of the key industrial sectors of the Territory's economy. Many kinds of mineral products make the Territory one of the leading mineral-producing regions in Russia.

Major enterprises, such as the Norilsk Mining-Metallurgical plant, the Achinsk Bauxite Plant, the Borodinski, Beryozovski and Nazarovski open-pit coal mines, etc., are leaders in the mining industry. Krasnokamensk and Irba ore mines were the pioneers in the development of large ferrous-ore deposits in the South of the Territory.

Borodino, Berezovsk and Nasarovo coal open-pit mines produce 30 million tons of energy brown coals per year. They are unique for the power-energy complex of the Territory.

The authorities responsible for licensing in the mining industry are the Territory Administration and the Committee for Geology and Utilisation of Mineral Wealth in the Krasnoyarsk Territory. Granting mining rights is conducted through tenders and auctions.

Russian legislation provides the opportunity for Russian and foreign investors to prospect and mine mineral products.

Metallurgical Industry

The metallurgical industry is closely tied with the mining industry, as many metallurgical enterprises are either involved in mining (the most characteristic example is the Norilsk Mining-Metallurgical Plant that produces 80 percent of all nickel and 98 percent of all platinum in Russia) or establishing joint ventures with various mining enterprises (the financial industrial group, consisting of the Krasnoyarsk Aluminium Smelter, the Krasnoyarsk Metallurgical Plant, and the Achinsk Bauxite Plant, is an example).

All in all, the Territory produces more than 30 heavy, light, alloyed and precious metals and elements. The most important of these are aluminium, nickel, cobalt, copper, platinum and gold. The Krasnoyarsk Non-Ferrous Metals Plant and the "Sibstal" joint stock company are the major metallurgical enterprises in the Territory except for those mentioned above.

In total, non-ferrous and ferrous metallurgy make up about 50 percent of the industrial output of the Territory. These sectors of industry play a leading role in the Territory's foreign economic activity.

Chemical and Pharmaceutical Industry

The main products of the chemical enterprises are petroleum products, synthetic rubber products, synthetic fibre, tires, varnishes and paints, medicines, antibiotics, and blood substitutes. Chemical industry products are ranked the third in exports of the Territory.

Krasnoyarsk Territory is one of the leading producers for some of the products. In particular, 17.3 percent of Russia's chemical fibre and thread is being produced in the Territory. For several years the share of the chemical industry in the Territory's industrial output has remained at 6-7 percent.

Chemical enterprises are mainly located in the central part of the Territory, particularly in Krasnoyarsk, Kansk, Achinsk, and Zelenogorsk. The largest are the ones in Krasnoyarsk (plants producing tires, synthetic rubber products, chemical fibre, medicines, varnishes and paints), Kansky Biochemical Plant producing spirits, Sibvolokno plant in Zelenogorsk, and Zheleznogorsky Mining and Chemical Plant that processes radioactive materials.

Oil-processing industry of the Territory is represented by the Achinsk Oil-Processing Plant that produces gasoline, and other products.

Machine Building Industry

The Territory's machine building industry satisfies domestic needs for machines and equipment and represents a diversified system of enterprises located in different cities throughout the Territory. The majority of them (80 percent) are located in the city of Krasnoyarsk. The major enterprises are:

  • Scientific-production Enterprise of Applied Mechanics, the largest producer of space apparatuses in Russia;
  • JSC "Snowcap", the largest manufacturer of residential refrigerators (6 percent of refrigerators produced in Russia in 1996). The plant exports its production to 40 countries throughout the world.
  • "SibTyazhMash" plant (the Siberian Heavy Engineering Plant), the only producer in Russia of heavy, electric mobile cranes with a lifting capacity from 80 to 1200 tons.
  • "The Krasnoyarsk Harvesting Machines Plant" joint stock company, produces about 20 percent of Russia's agricultural harvesting machinery.
  • The "Sosnovoborsk Trailers Plant" joint stock company, producer of trailers and semi-trailers, refrigerator vans, and spare parts.

Wood Processing Industry

Krasnoyarsk Territory has one of the largest timber reserves in Russia. Woodlands occupy 168.1 million hectares, or 45 percent of the Territory. Siberian larch, cedar, pine, aspen, and birch are widely represented among the species found in the Territory's forests.

In general the total annual capacity of timber logged in the Territory is up to 55 million cubic meters. Only high quality coniferous wood is logged.

Logging, wood processing, and pulp-and-paper industries play an important role in the Russian economy. The Territory produces 6.0 percent of Russian commercial timber and 7.5 percent of saw-timber.

The wood sector is represented by more than two hundred enterprises.

Of great importance for the Territory is stimulating the development of the wood industry and development of its export capabilities. Exports via the Northern Sea Route and Igarka are important for the Territory. The enterprises engaged in wood production, protection of forests, and their recovery are granted special tax privileges.

Food Industry

Six meat-packing plants, 36 diary plants, a cannery, three confectioneries, one pasta factory, four distilleries, one spirit plant, 6 breweries, and one tobacco factory are operating in the Territory.

However, the above mentioned facilities are insufficient to satisfy the population's demand in high-quality food products. Therefore, the Territory's authorities pay special attention to the development of the food industry. In particular, various investment programs for the construction of enterprises for full processing of agricultural products are financed from the Territory's budget.

Agriculture

The Krasnoyarsk Territory is considered the largest agricultural region in the Central and Eastern Siberia.

Agriculture is developed in the central and southern regions of the Territory. Grain and fodder, potatoes, milk and meat production are the basis of the Territory's agriculture.

The Territory's agricultural sector fully satisfies demand of the population for main food products. Approximately 426 farms of various types of ownership (private, state, etc.) and 4,797 of communal farms are currently operating in the Territory. The structure of farming is gradually changing. The output of main farm products is increasing, while the livestock industry has been declining.

Output of many agricultural products in the Territory is higher than in other Russian regions, and it provides the opportunity to export its production to other territories of Russia. The Territory produces 42 percent of grain, potatoes, and vegetables, 41 percent of milk, and 36 percent of meat and eggs in Eastern Siberia.

The Krasnoyarsk Territory is one of the country's important fur producing region. On the average, about 15 thousand white foxes, more than 50 thousand sables, 400 thousand squirrels are used in the fur industry per year. Due to fur breeding, a wide variety of furs, including blue fox, silver fox, mink, and sable, is available in the Territory.

Transportation system

Krasnoyarsk's inland position makes interregional and international travel difficult. The large Territory, dense forests, and arctic climate in the north further inhibit travel by land. Railways and highways are found only in the southern part of the region. The northern part of the Territory is only served by river and air transportation systems.

Railway and Automobile Transportation

Railway transportation traditionally dominates in the Territory, and even increasing its role in the transportation market. Railway transportation system of the Territory is diverse. Two main railways, the Trans-Siberian Railway and the South-Siberian Railway, cross the Territory from the west to the east.

In the north, the city of Norilsk is connected with a sea port of Dudinka. Large and small cities are located along the Trans-Siberian Railway, or connected with it via branch lines. The total length of the railway transportation system of the Territory is about 3,200 km.

In terms of load turnover, automobile transportation holds the second position after railway system. The total length of automobile roads is 10,010.

Inland Water and Sea Transportation

Sea and river transportation systems are also critical. The world's third largest river by volume, the Yenisey, is an important route because it flows from the south to the Arctic Ocean, a distance of several thousand kilometres.

Krasnoyarsk and Lesosibirsk are two large ports located in the middle part of the Yenisey and can accommodate vessels for sea-river operations with carrying capacity of 5000 tons.

Two other major Siberian river/seaports - Igarka and Dudinka - are located on the northern delta of Yenisey and have access to the Arctic Ocean. Shipping line to Murmansk, a distance of 2,500 kilometres, is established from the port Dudinka, and it takes about five days to ship either way.

Ice continuously covers these seas for 9 months, but two atomic ice-breakers keeps the area clear so that convoys of ships can navigate the northern waterway all year round.

The passage through the Arctic Ocean provides the least expensive access to the outside world. All inland water transportation is based on the Yenisey river which provides the transportation of goods to the north of the Territory. The total length of waterways in the Territory exceeds 7,000 kilometres. The period of navigation in the north lasts approximately from May, 15 to October, 10.

Air Transportation

Though air transportation makes up only a small share of total freight carried, it is of great importance in the north, especially in winter when the river is frozen, and this is the only way to reach Norilsk. All in all, there are more than 68 local airports, with air service provided by four airlines. Airports in Krasnoyarsk, Norilsk, and Khatanga are of national significance and can accommodate TU-154, IL-62, and IL-86 aircrafts.

Krasnoyarsk has air connection with all large Russia's cities and the capitals of many countries in the CIS. The busiest is the Krasnoyarsk-Moscow route with up to 5 flights daily.

The majority of flights are flown by the Krasnoyarsk Air Lines joint stock company that now serves not only domestic routes within the CIS but also to many foreign countries on 14 routes. The company has modern cargo and passenger aeroplanes, and helicopters. The Krasnoyarsk booking offices are included in Russian and international computer networks allowing the booking of tickets for Russian and international air companies.

Foreign economic activity

Liberalisation of foreign economic activity and reconstruction of the economy in Russia dramatically changed foreign economic relations of the region. Considering the fact that before 1989 the Krasnoyarsk Territory was a closed region with no access for foreigners, foreign trade is currently actively developing.

Foreign Investment

Krasnoyarsk Territory is the region that can be characterised as a region of high investment potential and law risk, compared to many other Russian regions. At the end of 1997 the Territory received Ba2 investment rate by Moody' Investment Service.

In terms of investments volume in 1997, Krasnoyarsk Territory is ranked the third among Russian regions. About 3.5 percent of investments in Russian economy were made in Krasnoyarsk Territory (City of Moscow - 67.4 percent, Tatarstan Republic - 6.6 percent).

More than 200 joint ventures with foreign companies have been established in Krasnoyarsk Territory, mainly with American, European and Chinese capital (USA - 10 percent, countries of Western Europe - 25 percent, China - 9 percent).

German companies are the most active among European firms in establishing joint ventures - 14 enterprises, British capital holds the second position - 7, and the third one, Switzerland - 5. Other European countries active in establishing joint ventures: Spain, Austria - 4, The Netherlands, Finland, Liechtenstein - 3, Italy, Sweden, Belgium -1.

The largest projects with direct investment are construction of a Coca-Cola plant in Krasnoyarsk - US$20 million, and construction of a wood-processing plant in Boguchany with participation of the Swedish company IKEA - about US$10 million.

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