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| General Information |
Geography
The Krasnodar Territory is situated on the Kubano-Azov lowland and the western part of the Caucasus mountain range, and covers a total area of 76,000 square kilometers. To the north and north-east, the Territory borders the Rostov Region, to the east – the Stavropol Territory, to the south – Georgia and the Republic of Karachayevo-Cherkessia, and to the south the Territory is washed by the Azov and the Black Seas.
Population
According to preliminary 2002 census results, the Territory’s total population is 5,124,000 people. The average population density is 67.4 people per square km. The economically active population amounts to 2,052,000 people. While 2002 official unemployment stood at 0.7%, the actual rate is 10.7%.
Demographically speaking, some 58% are of working age, 19% are below the statutory working age, and 23% are beyond the statutory working age.
As of 2002, the Krasnodar Territory’s major urban centers were Krasnodar with 644,800 inhabitants, Sochi with 328,800 inhabitants, Novorossiysk with 231,900 inhabitants, Armavir with 193,900 inhabitants, Yeisk with 84,600 inhabitants, and Kropotkin with 81,300 inhabitants.
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| Population |
|
| |
1992 |
1997 |
1998 |
1999 |
2000 |
2001 |
2002 |
|
| Total population, '000 |
4,737 |
5,011 |
5,015 |
5,010 |
5,007 |
4,999 |
5,124 |
|
| Economically active population, '000 |
2,27 |
2,154 |
2,088 |
2,334 |
2,335 |
2,29 |
2,052 |
| Economic Potential |
1997–2002 Gross regional product (GRP). Industry breakdown
The Krasnodar Territory accounts for 2.1% of Russia’s total GDP. The 2002 gross regional product exceeded $7,246.2 million, which constitutes 13.7% growth year-on-year.
The positive GRP trend was the result of an increase in output of goods and services in the main sectors of the economy. Agriculture accounts for the lion’s share of GRP at 17.3%.
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| GRP trends in 1997–2002 |
* Estimates of the Krasnodar Territory Administration |
| |
1997 |
1998 |
1999 |
2000 |
2001 * |
2002 * |
|
| GRP in current prices, million $ |
7,872.2 |
5,558.9 |
4,299.8 |
5,382.3 |
6,370.3 |
7,246.2 |
| GRP industry breakdown in 1997–2002, % of total |
* Estimates of the Krasnodar Territory Administration |
| |
1997 |
1998 |
1999 |
2000 |
2001 * |
2002 * |
|
| GRP |
100.0 |
100.0 |
100.0 |
100.0 |
100.0 |
100.0 |
|
| Industry |
15.1 |
17.9 |
16.4 |
15.7 |
15.6 |
15.6 |
|
| Agriculture and forestry |
14.4 |
11.4 |
11.6 |
17.7 |
18.6 |
17.3 |
|
| Construction |
9.9 |
10.0 |
16.0 |
16.1 |
15.5 |
17.4 |
|
| Transport and communications |
15.4 |
19.0 |
18.0 |
16.3 |
15.1 |
17.0 |
|
| Trade and public catering |
11.6 |
10.9 |
10.9 |
10.8 |
11.6 |
11.4 |
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| Other |
n/a |
n/a |
n/a |
16.9 |
17.7 |
15.3 |
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| Net taxes on output |
n/a |
n/a |
n/a |
6.5 |
5.9 |
6.0 |
Industrial output in 1997–2002 for major sectors of economy
The leading industrial sectors, represented by some 700 large and medium size companies and over 4,000 small enterprises, are food and beverages, energy, fuel, machine engineering and metal processing, and construction materials. These account for over 80% of total industrial output.
Food and beverages. The food and food processing sectors hold the leading position, accounting for 43.1% of total industrial output.
The Territory has 16 sugar refineries, ten vegetable and fruit canning plants, seven fish canning plants, 42 dairy and 23 meat processing plants, seven butter and fat plants, two tea and two tobacco processing plants, 48 vineyards, eleven wine plants, four distillers, and 25 bakeries.
Major companies within the sector are: OAO Krasnodar Butter and Fat Plant, OAO Armavir Butter and Fat Plant, OAO Abrau-Durso, OAO Krasnodar Meat Plant, ZAO Krasnodar Fish Plant, Municipal Unitary Company Krasnodarptitsa, ZAO Anit Ltd., and Subsidiary No. 1 of ZAO Moscow Brewery and Soft Drink Plant Ochakovo.
Energy. This sector accounts for 13.5% of total industrial output. OAO Kubanenergo is the main energy generator and supplier. The energy system comprises the Krasnodar Power Station, three hydroelectric power stations, high-voltage transmission lines and transformer substations.
Fuel. This sector accounts for 9.6% of total industrial output. The Territory is home to three oil refineries, the largest being ZAO Krasnodareconeft Refinery and OAO Krasnodarneftegeofizika.
Machine engineering and metal processing. The sector accounts for 8.7% of total industrial output. Over 100 companies produce a wide range of machinery, including metal-cutting and lumber machines, automation tools, agricultural vehicles, electrical engines, compressors, pumps, refrigerators, and oil exploration and extraction equipment. Major companies within the sector are OAO AvtoKuban, OAO Krasnodar ZIP, OAO Molot, OAO Krasny Dvigatel, OOO Electro, and ZAO Agrostroimash.
Construction materials. The sector accounts for 7.3% of total industrial output. The Territory’s four construction materials manufacturers – OAO Kuban Gypsum-Knauf, OAO Novokuban Ceramic Wall Materials Plant, ZAO Reinforced Concrete Goods Plant, and OAO Ceramic Goods Plant – are among Russia’s top construction materials companies.
Timber and furniture. The sector accounts for 5.5% of total industrial output and is represented by 35 large and medium companies producing lumber, chipboard, parquet flooring, and home and office furniture. Industrial timber export amounts to 100,000 cubic meters per year. Major companies include OAO Krasnodar Furniture Firm, OAO Kuban Furniture, and OOO SBS-Furniture Company.
Agriculture accounts for some 17.3% of gross regional product and over 5% of Russia’s gross agricultural product, including 10% of grain output, 19% of sugar beet output, and 15% of sunflower seeds output. The Territory has 4.4 million hectares of arable land, including 3.9 million hectares of ploughed fields, 77,000 hectares of orchards, and 35,000 hectares of vineyards.
Resorts and recreation. Over 1,300 recreation and tourism enterprises, which can accept some 220,000 people at a time, generate an estimated $333.5 million per year in the Krasnodar Territory. The Territory is home to all of Russia’s major seaside resorts, including Sochi, Anapa, Gelendzhik, Tuapse, and Yeisk.
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| Industry breakdown of industrial output in 1997–2002, % of total |
* Estimates of the Krasnodar Territory Administration |
| |
1997 |
1998 |
1999 |
2000 |
2001 |
2002 * |
|
| Industry |
100.0 |
100.0 |
100.0 |
100.0 |
100.0 |
100.0 |
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| Food and beverages |
37.7 |
43.3 |
48.8 |
42.8 |
45.2 |
43.1 |
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| Fuel |
7.0 |
6.2 |
9.2 |
10.5 |
8.8 |
9.6 |
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| Machine engineering and metal processing |
10.3 |
8.0 |
8.1 |
9.4 |
11.2 |
8.7 |
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| Construction materials |
7.1 |
7.2 |
6.4 |
7.9 |
8.5 |
7.3 |
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| Forestry, timber, and pulp and paper |
4.6 |
4.0 |
3.2 |
3.8 |
3.6 |
5.5 |
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| Flour, cereals, and mixed fodder |
5.9 |
6.4 |
4.8 |
5.1 |
4.9 |
3.9 |
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| Chemicals and petrochemicals |
1.8 |
3.0 |
3.6 |
3.3 |
2.3 |
2.1 |
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| Light industry |
1.8 |
1.3 |
1.0 |
1.3 |
1.6 |
2.0 |
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| Glass and porcelain |
0.5 |
0.5 |
0.5 |
0.6 |
0.6 |
0.5 |
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| Ferrous metals |
0.2 |
0.3 |
0.3 |
0.2 |
0.2 |
0.1 |
Transport infrastructure
The transport sector accounts for 17% of the Territory’s GRP.
Roads. The Territory has 10,400 kilometers of roads, including the following: Krasnodar – Novo-rossiysk, Krymsk-Port – Caucasus, and federal roads Krasnodar – Baku and Don (Moscow – Voronezh – Rostov-on-Don – Krasnodar – Novorossiysk).
Railroads. The Krasnodar Territory has 2,200 kilometers of railroads. The main route going through the Territory is the Krasnodar section of the North-Caucasus railroad. The main freight flow goes in the direction of the seaports. Freight is dominated by oil, oil products, timber, lumber, grain, sugar, construction materials, and equipment.
Airports. The Krasnodar Territory has international airports at Krasnodar, Sochi, Anapa, and Gelendzhik.
Seaports. There are eight seaports in the Territory: Novorossiysk, Tuapse, Sochi, Anapa, Gelendzhik, Yeisk, Temryuk, Caucasus, and the Krasnodar river port. These account for up to 40% of the Russian Federation’s ports freight turnover. Major shipping companies are OAO Novorossiysk Sea Ship Line, OAO Novoship, and OOO Barwel Novorossiysk.
Oil and gas pipelines. Sections of such major oil pipelines as Makhachkala – Grozny – Tuapse, oil pipelines of OAO Transneft, OAO Chernomortransneft, ZAO Caspian Pipeline Consortium, and the Lazarevskoe – Tuapse – Nebug gas pipeline, all pass through the Territory. Plans are afoot to lay a gas pipeline from Tyumen to Turkey through the Territory.
Main natural resources: reserves and extraction in 2002
The Territory is rich in over 60 types of mineral resources, including oil, natural gas, iodide-bromine waters, marble, lime, sandstone, iron and apatite ores.
Oil and gas. The Krasnodar Territory is the birthplace of Russia’s oil sector. Some 68 oil fields currently provide 1.5-1.7 million tons of oil and up to 2 billion cubic meters of natural gas every year. Most of the fields are located in the western and central foothills (Abinsk, Seversk, and Apsheron districts).
Recreational resources. Its Mediterranean-type climate, warm seas, unique mineral water springs, and therapeutic mud make the Territory one of the most ecologically pure and popular recreational and tourism regions of the country.
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| Trade Opportunities |
Main goods produced in the region
Food and beverages. The Territory’s enterprises supply over one third of Russia’s output of granulated sugar (2 million tons), some 40% of concentrated fruit juice output, 100% of canned meat for infants, and 6% of cheeses and canned dairy products. Other products include vegetable oil (320,000 tons) and canned fruit and vegetables (376 million conventional cans).
Wine, liquor, and tobacco. The Territory produces 10 million decaliters of wine per year (including 2.5 million decaliters of sparkling wine and 4.8 million decaliters of grape wine). A favorite of the Russian market, the classic sparkling wine Abrau-Durso, is produced at the Abrau-Durso Plant. All in all, the Territory produces over 120 brands of alcoholic beverages. 2002 tobacco output amounted to 37.1 billion items.
Agriculture. The 2002 gross grain yield totaled 8,481,200 tons, sunflower seed – 732,400 tons, sugar-beet – 4.2 million tons, dairy products – 436,000 tons, and meat (including by-products) – 88,800 tons.
Industry. In 2002, the Territory’s enterprises produced 6,300 tons of paints and varnish, 105,300 tons of mineral fertilizers, 7,000 electric mixers, 31,000 cubic meters of lumber, 33,300 tons of cardboard, 2.4 million tons of cement, 580 million conventional bricks of wall construction materials, 3 million square meters of fabric, and 9,757,000 pairs of footwear.
Exports, including extra-cis
The Territory’s foreign trade turnover amounted to $2 billion in 2002 (extra-CIS trade accounted for 91% and CIS trade for 9%). Major trade partners include Turkey, Bulgaria, Italy, Greece, the Netherlands, Germany, Spain, and the USA. The Territory maintains close links with Ukraine, Kazakhstan, and Uzbekistan.
Exports to extra-CIS countries amounted to $944.9 million in 2000, with exports to CIS countries totaling $50.8 million. The respective figures for 2001 were $912.6 million and $79 million, and $986.9 million and $96.3 million for 2002. The main goods exported by the Territory are crude oil, sunflower seeds, sugar, tobacco products, raw timber, and grain.
Imports, including extra-cis
2000 imports from extra-CIS countries amounted to $501.4 million, while imports from CIS countries totaled $70.3 million. The respective figures for 2001 were $558 million and $69.2 million, and $872.7 million and $82.1 million for 2001. Imports from CIS accounted for 12% of total imports, and imports from extra-CIS, for 88%. The main goods imported by the Territory are raw sugar, fertilizers and pesticides, agricultural equipment, citrus plants, oil products, and medicine. The main exporters to the region are Ukraine, Germany, Italy, France, Turkey, China, Cuba, Greece, and the USA.
Major regional export and import entities
Due to the specific features of trade in the Krasnodar Territory, export and import operations are performed mainly by industrial companies.
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| Investment Opportunities |
Capital investment
Transport accounts for the biggest share of capital investment at 89.1%, followed by food and beverages at 5.3%, and services (retail and public catering) at 4.5%.
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| Capital investment by industry sector, $ million |
| |
1997 |
1998 |
1999 |
2000 |
2001 |
2002 |
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Total capital investment
Including major industries (% of total) |
1,716.4 |
1,225.0 |
1,064.2 |
1,945.8 |
2,172.5 |
2,140.0 |
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| Industry |
21.5 |
24.1 |
13.8 |
9.2 |
9.6 |
11.1 |
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| Agriculture and forestry |
7.0 |
5.5 |
5.5 |
4.3 |
5.2 |
5.8 |
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| Construction |
9.1 |
3.6 |
2.3 |
2.4 |
4.0 |
4.5 |
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| Transport and communications |
15.2 |
25.0 |
24.0 |
22.5 |
19.2 |
25.4 |
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| Trade and public catering |
1.1 |
1.1 |
0.5 |
1.5 |
1.9 |
2.1 |
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| Other |
46.1 |
40.7 |
53.9 |
60.1 |
60.1 |
51.1 |
| Foreign investment trends in 1992–2002 |
* Estimates of the Krasnodar Territory Administration |
| |
1992-1997 |
1998 |
1999 |
2000 |
2001 |
2002 * |
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| Foreign investments, $ million |
108.8 |
69.5 |
304.4 |
617.8 |
583.3 |
185.1 |
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| Including the construction of the Caspian oil pipeline, $
million |
- |
- |
268.3 |
567.8 |
450.6 |
27.7 |
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| Including FDI, $ million |
86.7 |
49.4 |
295.4 |
597.8 |
476.2 |
72.6< |
Major enterprises (including enterprises with foreign investment)
The Krasnodar Territory is home to 781 companies with foreign investment from 60 countries. Major companies are OAO Krasnodartabakprom, ZAO Sochi Pepsi-Cola Soft Drinks Plant, OAO Kuban Gypsum-Knauf, and JV Tetra-Pak Kuban. Investors from the USA account for 47.3% of total investment, the Netherlands – 29%, Cyprus – 14.4%, and the UK – 6.5%.
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| Largest enterprises of the Krasnodar Territory |
| Company |
Sector |
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| OAO Rosneft-Krasnodarneftegaz |
Oil |
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| OAO Philip Morris Kuban |
Tobacco |
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| OAO Kubanenergo |
Energy |
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| OAO Novorossiysk Commercial Seaport |
Water transport |
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| OOO Kubangazprom |
Pipeline transport |
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| OAO Tuapse Trade Seaport |
Water transport |
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| OOO SBS Firm |
Timber |
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| OOO Yugneftegaz |
Fuel |
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| OAO Kuban Airlines |
Aviation |
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| OAO Novoroscement |
Construction materials |
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