Republic of Tatarstan: General Overview, State System, Economy
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Republic of Tatarstan: General Overview, State System, Economy Republic of Tatarstan: General Overview, State System, Economy Document Transcript

  •  Republic of Tatarstan: General Overview, State System, Economy ТАТА РС ТАН Republic of Tatarstan: General Overview, State System, Economy
  • Republic of Tatarstan: General Overview, State System, Economy Kazan 2010
  • 1 1. BASIC FACTS ABOUT THE REPUBLIC OF TATARSTAN Republic of Tatarstan: General Overview, State System, EconomyRepublic of Tatarstan: General Overview, State System, Economy 1.1. STATE SYMBOLS National Flag of the Republic of Tatarstan National Emblem of the Republic of Tatarstan National Anthem of the Republic of Tatarstan (Music by composer Rustem Yakhin) 1.2. STATE SYSTEM 1.2.1. Leadership of the Republic of Tatarstan PRESIDENT OF THE REPUBLIC OF TATARSTAN President of the Republic of Tatarstan is the supreme official of the Re- public of Tatarstan. President of the Republic of Tatarstan acts as a guarantor of protection of rights and freedoms of person and citizen in the Republic of Tatarstan, observance of the Constitution and laws of the Republic of Tatarstan, inter- national agreements of the Republic of Tatarstan, the Treaty between the Russian Federation and the Republic of Tatarstan“On Delimitation of Juris- dictional Subjects and Powers between Bodies of Public Authority of the Russian Federation and Bodies of Public Authority of the Republic of Tatar- stan”, and agreements between the Republic of Tatarstan and constituent entities of the Russian Federation. Since March 25, 2010 the President of the Republic ofTatarstan is Rustam Nurgalievich Minnikhanov. 1.2.2. Cabinet of Ministers of the Republic of Tatarstan The Cabinet of Ministers of the Repub- lic of Tatarstan (the Government of the Republic of Tatarstan) is an executive and administrative body of the Government of the Republic of Tatarstan. The Cabinet of Ministers is formed by the President of the Republic of Tatarstan and is accountable to him. The nominee for Prime Minister is ap- proved by the State Council (Parliament) of Tatarstan at the suggestion by the President. Since April 22, 2010 the Prime Minis- ter of the Republic of Tatarstan is Ildar Shafkatovich Khalikov. 1. BASIC FACTS ABOUT THE REPUBLIC OF TATARSTAN First President of Tatarstan Mintimer Shaimiev President of Tatarstan Rustam Minnikhanov Under the editorship of Ravil Zaripov, Minister of Industry and Trade of the Republic of Tatarstan Editorial board: Vladimir Solovyev, Gulnara Akhmadeyeva, Farid Tuktarov, Artur Fatykhov, Oleg Vlasov This publication was prepared with participation of: Rustem Akhmetgarayev, Denis Klimin, Sergei Mezentsev, Engil Ismagilov, Timur Mindubaev © Ministry of Industry and Trade of the Republic of Tatarstan, compilation, 2010 4, Ostrovsky St., Kazan 420111 Phone: +7 (843) 299 10 07 Fax: +7 (843) 292 16 45 e-mail: mpt@tatar.ru http://mpt.tatar.ru © Publishing house“Foliant”, design and layout, 2010
  • 2 1. BASIC FACTS ABOUT THE REPUBLIC OF TATARSTAN Republic of Tatarstan: General Overview, State System, Economy 3 1. BASIC FACTS ABOUT THE REPUBLIC OF TATARSTAN Republic of Tatarstan: General Overview, State System, Economy area is 4,400 square kilometres, or 6.4% of the territory of the Republic of Tatarstan. There are four reservoirs in the republic, Kuybyshevskoye, Nizh- nekamskoye, Zainskoye, and Karabashskoye. The Europe’s largest storage basin, Kuybyshevskoye Reservoir, with the volume of 57.3 cubic kilometres, is located for the most part in the territory of the Republic of Tatarstan. Its widest span in the mouth of the Kama is nearly 30 kilometres. A total of 4,098 water streams flow across Tatarstan with a total length of 19,632.5 kilometres. The republic is fully provided with potential ground water re- sources totalling 5.46 million cubic metres per day. The available land of the Republic of Tatarstan is 6,783,700 hectares. The major part, some 68%, are agricultural lands (4,630,100 hectares); for- est lands constitute 18% (1,217,700 hectares); water resource lands, 6.5% (436.1 hectares); lands of inhabited localities, 5.7% (386,700 hectares); lands of specially protected areas, 0.5% (31,600 hectares); and industry lands, 0.1% (79,000). 1.6. POPULATION The population of the Republic ofTatarstan numbers 3,772,900 and com- prises representatives of 115 ethnic groups; these include Tatars (52.9%), Russians (39.5%), Chuvashes (3.4%), Ukrainians, Udmurts, Mari, Bashkirs, Jews, and others. Russian population prevails in large cities and adjacent regions, while Tatar population dominates in rural areas. 1.7. RELIGION Over thousand religious societies have been registered in the territory of the Republic of Tatarstan. The most widely-spread religions are Islam and Orthodox Christianity. The Sunni Islam was adopted as official religion in the Volga Boulgaria as early as in 922. At present, it is professed by a majority of Tatars and Bash- kirs. The supreme body of Muslims is the Religious Muslim Board of the Republic of Tatarstan. The Orthodox Christianity ap- peared in the mid-16th century after the annexation of the Kazan Khanate by the Russian State. The followers of this religion supported in the territory of the republic by the Kazan Eparchy of the Russian Ortho- dox Church are Russians, Chuvashes, Mari, Mordvinians, Udmurts, and a part of Tatars (kryasheny). There are small communities of other Christian confessions: Old Believers, Catholics, Lutherans, Baptists, Seventh–Day Adventists, as well as small communities of other confessions, such as Krishnaists and Bahá'í Faith. 1.8. STATE LANGUAGES According to the Constitution of the Republic of Tatarstan, the Tatar and the Russian languages are recognised as equal in rights throughout the ter- ritory of the Republic of Tatarstan. The Tatar language belongs to the Turkic group of the Altai family of lan- guages alongside with Kazakh, Uzbek, Turkish, etc. The Russian language, together with Ukrainian and Byelorussian, consti- tutes Eastern-Slavic subgroup of Slavic group of the Indo-European family of languages. 1.9. HISTORY The Republic of Tatarstan boasts a rich history. The first state in the re- gion was the Volga Boul- garia created by Turkic tribes, whose ancestors have already had a state- hood experience within the frames of the Turkic Kaghanate and Hunnish Power, as early as in the 8th–9th centuries. In 922, it adopted Islam as official religion, which meant its international recognition and falling under the influence of the Arab Caliphate. Boulgaria was the most politically and economically developed state in the region and played an important role in life of peo- ples that inhabited the region. The country pioneered in smelting cast-iron in Europe. In addition to metallurgy, quite developed were the art of jewellery, tanning industry, culture, science, and education. Unity of the country, its regular armed forces and well-organised reconnaissance allowed it to withstand the Mongolian aggressors. Only with the fourth attempt in 1236, their superior forces succeeded in breaking down the resistance of the Boulgars, but even after that the Mongols had to maintain a huge garrison to keep the rebellious land pacified. Boulgaria became an ulus of the Golden Horde, with the local dynasty remaining in power, in the same way as in Russian principalities. However, centrifugal tendencies began to appear, and the country broke into semi- dependent emirates, with Kazan among them, and actually got out of the 1.3. GEOGRAPHY The Republic of Tatarstan is situated in the European part of the Rus- sian Federation at the confluence of the Volga and the Kama rivers. The territory of the republic stretches some 460 kilometres west to east and 290 kilometres north to south. The total area of the republic is 67,836.2 square kilometres, which is approximately equal to the area of Sri Lanka or that of Belgium and the Netherlands taken together. Tatarstan borders on eight regions of the Russian Federation: the Republic of Bashkortostan, the Udmurt Republic, the Republic of Mari El, the Chuvash Republic, the Kirov, Orenburg, Ulyanovsk, and Samara regions. 1.4. CLIMATE The climate of Tatarstan is mild continental with long, warm and some- times hot and droughty summer and moderately cold winter. Snowy period is almost 5 months (from mid-November to early April). The average temperature in January is -14°C, and in July the average tem- perature is +19°C. The range of monthly average temperatures is 32°C to 34°C, and the range of absolute temperatures is 86°C. Annual precipitation ranges from 430 millimetres to 500 millimetres. 1.5. NATURAL RESOURCES The Republic of Tatarstan is rich in mineral resources, with crude oil rep- resenting its main source of wealth. The first commercial oil deposit was discovered as early as in 1943. The main oil reserves, some 0.8 billion tonnes, are concentrated in medi- um-size and small deposits. Along with crude oil, petroleum gas is also pro- duced. Other mineral resources extract- ed in the republic's territory are gypsum (total reserves are 72 million tonnes), oil bitumen (explored reserves are 7 billion tonnes), peat (800 peat deposits with a total area of over 35,000 hectares), construction stone (56.7 million cubic metres), brick clay (158.3 million cubic metres), limestone and dolomite (92 million tonnes). Production of black coal is complicated due to its deep oc- currence. Exploitation of combustible shale deposits in south-west Tatarstan is also promising. The Republic of Tatarstan has large water resources, which are character- ised by a branched river system with such large rivers as the Volga, Kama, their tributaries, such as Vyatka, Belaya, Sviyaga, and others. Total water surface russian federation The Republic of Tatarstan
  • 4 1. BASIC FACTS ABOUT THE REPUBLIC OF TATARSTAN Republic of Tatarstan: General Overview, State System, Economy 5 1. BASIC FACTS ABOUT THE REPUBLIC OF TATARSTAN Republic of Tatarstan: General Overview, State System, Economy its age is about one thousand years. Once a Boulgar frontier fortress, Kazan in the Golden Horde period became the capital of an actually independent emirate (principality) and of the Kazan Khanate in 1438. As a result of seizure of the city by troops of Ivan the Terrible in 1552, it was vir- tually razed to the ground. In 1708, Kazan became a province centre. Since 1920, Kazan was the capital of the Tatar Autonomous Soviet Socialist Republic, and since 1992, of the Republic of Tatarstan. Kazan is the centre of culture and education in Tatarstan. It has 30 higher educational institu- tions, including the world-known Ulyanov-Lenin Kazan State Uni- versity. Development of science is also supported by the Academy of Sciences of Tatarstan, the Kazan Scientific Centre of the Russian Academy of Sciences, the National Library of the Republic of Tatar- stan (2.8 million books), and the Scientific Library of Kazan Univer- sity (4.8 million books). In Kazan, there are the Russia's second larg- est Concert Hall, 7 professional theatres, 4 state orchestras, the Ensemble of Singing and Danc- ing of the Republic of Tatarstan, 13 museums, 5 exhibition halls and galleries, 7 Creative Unions, 7 higher and secondary institutions for culture and arts, and over 50 schools of art and music. This list can be extended with 3 recreation centres, 300 libraries of different systems and departments, 7 cinema theatres, over 50 creative troupes, the circus, different cultural societies, funds, associations, etc. Kazan is the city where the republic's large enterprises are located. The products of OAO Kazanorgsintez, OAO Kazan Motor-Building Production Association, OAO  Kazan Helicopter Plant, OAO  Gorbunov Kazan Aircraft Association, OAO Kazankompressormash, and OAO Kazan Medical Instru- ments Plant are well-known and in demand far outside of the republic. On August 30, 2005 an outstanding event took place in the life of the capital of Tatarstan: Kazan celebrated its millennium anniversary. Within these celebrations, Kazan hosted the World Congress of Tatars, the Sum- mit of Heads of the CIS Countries, a meeting of the State Council of the Russian Federation. In the pre-anniversary period and during the event the republic was visited by more than 80 delegations of foreign states and Russian regions. At the same time, some 30 delegations from Tatarstan vis- ited the CIS and non-CIS countries to exchange experience on vital issues related to economic development. Large scale presentations of the eco- nomic and investment potential of Tatarstan were held in China, Belgium, France, Singapore, Vietnam, India, Czech Republic, Kazakhstan, as well as in the Ministry of Foreign Affairs and the Federation Council of the Russian Federation, in the Republic of Karelia, Karachayevo-Cherkess Republic and in Yaroslavl. Enterprises of the republic took part in 55 international and in- terregional exhibitions. The celebration programme comprised the open- ing ceremonies for five stations within first line of the Kazan underground, reconstructed Kul-Sharif Mosque and restored Annunciation Cathedral, business terminal of the Kazan International Airport, Tatar State Humani- tarian Pedagogical University, Hermitage Centre in Kazan Kremlin, etc. The city completed the restoration of the Opera and Ballet Theatre and the City Hall and the construction of a bridge across the Kazanka, which connects two parts of the city. Horde. The exit was formalised in 1438 with the formation of the Kazan Khanate. Relations between the Kazan Khanate and Moscow were rather uneasy. Continued wars, robber raids and interference of the neighbouring Russia weakened the country. Having gained strength, the Russian State became able to capture Kazan in 1552, though it took tens of years to break down the people's resistance. Kazan became one of the major cities of Russia and the centre of a huge province in 1708. After the October Revolution, in accordance with a new state national policy, the Tatar Autonomous Soviet Socialist Republic (TASSR) was established in 1920. Virtually since 1922, the Tatar elite had been making efforts to achieve the status of a union republic for Tatarstan. In this or that form, the issue was discussed before the adoption of 1937 Constitution, in the years of “Khrushchev Thaw”, while in the process of elaborating the 1977 Constitu- tion the proposals had even been prepared to upgradeTatarstan to a union republic. The complicated interior situation in the Soviet Union and the processes of change has a direct impact on the status of the republic: on 30 August 1990, the Declaration of State Sovereignty of the Republic of Tatarstan was adopted. On 12 June 1991, the first President of Tatarstan, Mintimer Shaimiev, was elected. On 6 November 1992, the Constitution of the Re- public of Tatarstan was adopted following the Referendum where 61.4 per- cent of citizens supported the idea of sovereignty. This resulted in a key provision of the state administrative status of the Republic of Tatarstan as a sovereign state associated with the Russian Federation on the basis of the Treaty on Delimitation of Jurisdictional Subjects and Powers between Bodies of Public Authority of the Russian Federation and Bodies of Public Authority of the Republic of Tatarstan signed on February 15, 1994 in Mos- cow. The Treaty became an important landmark on the path to building a new democratic federation. The newTreaty on Delimitation of Jurisdictional Subjects and Powers be- tween Bodies of Public Authority of the Russian Federation and Bodies of Public Authority of the Republic of Tatarstan was signed on June 26, 2007. Holidays in the Republic of Tatarstan New Year's Holiday January 1, 2, 3, 4, and 5 Christmas January 7 Defender of the Motherland Day February 23 International Women's Day March 8 Spring and Labour Holiday May 1 Victory Day May 9 Day of Russia June 12 Tatarstan Foundation Day August 30 People’s Unity Day November 4 Tatarstan Constitution Day November 6 Kurban Bairam The date is determined according to lunar calendar and is established annually by Decree of the President of the Republic of Tatarstan three months prior to its commencement Sabantui (finishing the spring agricultural field works) The date is established annually by Decree of the President of the Republic of Tatarstan 1.10. CAPITAL The capital of the Republic of Tatarstan, the city of Kazan, is situated on the left bank of the Volga River in the estuary of the Kazanka River and has the largest population and economic potential among the cities of the republic. The area of Kazan is 425.3 square kilometres, and its population is 1.11 million. Young people at the age of up to 30 constitute 40.7 per cent of the city population. Citizens of Kazan represent over 100 ethnic groups. Kazan is home to 22 national-cultural societies. Administratively, Kazan is divided into 7 districts. Kazan is a city with rich history. Recent archaeological findings show that
  • 6 1. BASIC FACTS ABOUT THE REPUBLIC OF TATARSTAN Republic of Tatarstan: General Overview, State System, Economy 7 1. BASIC FACTS ABOUT THE REPUBLIC OF TATARSTAN Republic of Tatarstan: General Overview, State System, Economy Museums There are 100 state-run and over 300 departmental museums in Tatar- stan, which help learn the history and culture of this land. The National Museum of the Republic of Tatarstan was founded in 1894. Its exposition was based on the materials of 1890 Scientific and Industrial Exhibition and the collection of historian Andrei Likhachev. The museum provides information about the nature of the land and its history from an- cient times. The Fine Arts Museum founded in 1959 on the basis of the State Museum Picture Gallery displays over 21,000 pieces of painting, graphics, sculpture, and applied art. Among them are the works of Rembrandt, Dürer, Bryullov, Aivazovsky, Perov, Kramskoy, Savrasov, Shishkin, Kuindzhi, Levitan, Repin, Vereshchagin, Serov, Roerich, Fechin, Urmanche, and many others. The Museum of Geology under Kazan State University displays a rich col- lection of meteorites, minerals, and crystalline soils of the Urals and Siberia. The Museum of Ethnography under Kazan State University provides in- formation about life of peoples in different corners of the world. It also con- tains materials collected by Ivan Simonov during the Antarctic expedition of Bellinshauzen and Lazarev. Also of interest for visitors to Tatarstan can be memorial flats of Musa Jalil and Nazib Zhiganov, museums of Yevgeny Baratynsky, Maxim Gorky, Baki Urmanche, Salikh Saidashev in Kazan, Jaroslav Hašek in Bugulma, Ivan Shishkin, Marina Tsvetayeva and cavalry maiden Natalya Durova in Yelabu- ga. 1.13. EDUCATION AND SCIENCE Tatarstan is a region boasting huge educational and scientific potential. 135,000 people are engaged in the sphere of education. The preschool education in the Republic of Tatarstan is represented by 1,903 preschool educational institutions where 162,200 children are raised and educated; 99.5% of them are municipal establishments. In addition, there are 2 state-run and 6 private kindergartens. The coverage of pre- school education in the republic is 72%. General secondary (complete) education is compulsory and free. There are 2,298 comprehensive schools in the republic; the number of students attending them is some 386,000. The republic has 243 comprehensive es- tablishments implementing advanced programmes for 111,700 students, which represents 29% of the total number of students. The schools in the republic host over 100 federal-level experimental platforms. After completing their compulsory education, over 90% of students continue in comprehensive schools or in the establishments of secondary special education. At present, the demand for personnel and experts in various sectors of the republic’s economy is met for over 70% through the local system of basic and secondary vocational training which is represented by 43 basic vocational establishments and 103 secondary vocational establishments where over 70,000 students are trained. There are 93 institutions of higher vocational education in the Republic of Tatarstan (including 23 state-run, 14 non-state and 56 branch establish- ments), mostly in Kazan, and some 100 scientific research institutes and design offices. Based on the Ulyanov-Lenin Kazan State University, the Kazan (Volga Re- gion) Federal University was founded by the Decree of Russian President Dmitry Medvedev. The strategic mission of the University is the arrangement and coordina- tion of the work on providing balanced support to large-scale programmes of social and economic development of territories and regions compris- ing the Volga Federal District with highly-skilled personnel and scientific, technical and technological solutions, including the same by bringing the results of intellectual activities to practical application. 1.11. MAJOR CITIES Tatarstan is a highly urbanised region with 74 percent of the population living in urban areas. The Republic is divided into 43 districts, 21 cities (of which 14 are subordinate to the republic), 21 urban settlements, and 910 village councils. The major cities are Kazan, Naberezhnye Chelny, Nizh- nekamsk, Almetyevsk, and Zelenodolsk. Naberezhnye Chelny is located in northeast Tatarstan on the bank of the Kama River. The city is mono-industrial, nearly its entire population being somehow associated with the city-forming company, Kamsky Motor Works (OAO KamAZ), manufacturer of heavy-duty trucks and their components. The Nizhnekamsk Hydroelectric Power Station supplies electric power to the city and the whole economic region. The services of Begishevo International Airport cover the north-east of the republic. Nizhnekamsk originated during the construction of the petrochemical plant in 1961. The city is one of the largest centres of petrochemical in- dustry in Russia. Major manufacturers are OAO  Nizhnekamskneftekhim, OAO Nizhnekamskshina, and Elastik Plant. Almetyevsk is the largest centre of crude oil production in Tatarstan. Here starts Druzhba oil pipeline, through which Tatarstan exports its crude oil. The largest company in the region is OAO Tatneft (production of crude oil and petroleum gas).The Almetyevsk Petroleum Institute plays an impor- tant role in training personnel for the main industry of the republic. Zelenodolsk is an important transport junction in the west of the repub- lic. The products of the Shipbuilding Plant and Sergo Plant located in the city are in demand far outside of Tatarstan. 1.12. CULTURE Due to historical and geographical factors, Tatarstan is located on the junction of two large civilisations, the Orient and the Occident, and this to a large extent accounts for its diversity and cultural wealth. The Tatars keep centuries-old traditions of their ancestors, the Boul- gars, who managed to achieve high level of cultural development, hav- ing combined their Turkic roots with Arabic influence due to adoption of Islam in the 10th century. It became the basis for further development of the Tatar culture at large. Specific place in life of the Boulgars and the modern Tatars is given to literature. Traditions established by poet Koul Gali in the 13th century were maintained by Mahmud Gali, Saif Sarai, and Muhamedyar. Among the outstanding personalities of the Tatar culture in the 19th and 20th centuries, one cannot but mention Gabdullah Tukay, Kayum Nasyri, Shigabutdin Marjani, Galiaskar Kamal, Fatikh Amirkhan, Rudolf Nuriev, Baki Urmanche, Galimjan Ibragimov, Gayaz Iskhaki, and Musa Jalil. There are 7 historical complexes in the territory of the republic: Bulgar, Bilyar, city complexes of Kazan, Yelabuga, Chistopol, Sviyazhsk, and the Raifa Monastery. Of the greatest interest for visitors to Tatarstan is the capi- tal of the republic, Kazan, a city with a millennial history. All architectural buildings of this city date back to the second half of the 16th century up to the 20th century. More ancient history can be judged from archaeologi- cal excavations. The main sightseeing attraction in Kazan is the Kremlin, the current residence of the Tatarstan President. It boasts a harmonious combination of the Annunciation Cathedral, the Syuyumbike Tower (the architectural emblem of the city) and the Kul-Sharif Mosque (the recon- structed relic of the Tatar people). Other places of interest in Kazan include the main building of the Kazan State University (1825), the Azimov Mosque (mid-19th century), the St. Peter's and Paul's Cathedral (1723-26), and the Marjani Mosque (1766). Theatres At present, there are 12 professional theatres in Tatarstan, 7 of them in Kazan. Most popular in and outside of the republic is the Musa Jalil Tatar State Opera and Ballet Theatre functioning since 1939. It hosts annual in- ternational opera festivals named after Fyodor Chaliapin and classic ballet festivals named after Rudolf Nuriev with participation of well-known per- sonalities of the world stage. Its traditional tours in European countries have brought international fame and popularity to the theatre's troupe. The Galiaskar Kamal Tatar State Academic Theatre is known by staging the works of Tatar dramatic art classics, such as Naki Isanbet, Galiaskar Kamal, Farid Yarullin, Tufan Minnullin, etc. Its tours to Moscow and coun- tries with large Tatar communities have also become a tradition. The Vasily Kachalov Kazan Academic Russian Great Drama Theatre is a constant participant of international drama festivals and enjoys wide pop- ularity among Kazan residents and visitors.
  • 8 1. BASIC FACTS ABOUT THE REPUBLIC OF TATARSTAN Republic of Tatarstan: General Overview, State System, Economy 9 2. ECONOMY Republic of Tatarstan: General Overview, State System, Economy pions (1998, 2006, 2009, 2010), European Cup winners (2007), and Conti- nental Cup winners (2008). The KamAZ Master team (entirely composed of KamAZ-employed sportsmen), which has become a thunderbolt for all participants of the legendary Dakar Rally, is the only works team in Russia. In 2010, KamAZ team won the prize for the ninth time. Zenith-Kazan volley- ball team, then Dinamo Tattransgaz, became the champion of Russia and the winner of the Russian Cup for the first time in 2007. In 2008, the team won the European Champions Cup and became the bronze prize-winner of the Russian Volleyball Super League; in 2009, the team again became the champion of Russia. The year of 2010 went down in history of the club with a golden double: the Russian Cup and the gold in the national champion- ship. UNICS Kazan Basketball Club became the silver finalist of the 2007 Russian Basketball Cup, and in February 2009 it won the Russian Cup. The 2009-2010 season was resulted for Kazan basketball players in the bronze medals of the Russian Championship. Sintez water polo team became in 2007 the Champion of Russia and the winner of the LEN Trophy, the Eu- rope’s second club trophy. The next year Tatarstan water polo players won silver medals of the Russian Championship; in 2009 they complemented their collection with bronze medals, and repeatedly became silver prize- winners in 2010, having also added the Russian Cup to their awards. Since 2003, the Dinamo Kazan grass hockey team, consisting for the most part of students from Dinamo Republic’s Special Junior Sports School of Olympic Reserve, seven times became the Cham- pion of Russia. In 2013, Kazan will host the 27th World Summer Universiade. Its successful holding would enable Kazan to make a considerable breakthrough both in sports, including student’s sports, and in the develop- ment of business, tourism, and mass media as well. 2.1. ECONOMIC OVERVIEW The Republic of Tatarstan is located in the centre of the Russian Fed- eration on the East European Plain, at the confluence of the two largest European rivers, the Volga and the Kama. The total area of the republic is 67,800 square kilometres (0.4% of the total area of the Russian Federa- tion). Tatarstan is among the group of Russian regions with high level of social and economic development. In 2009, the Republic of Tatarstan ranked 5th among the constituent en- tities of the Russian Federation in the industrial output (1st in the Volga Federal District), 6th in the volume of construction jobs (1st in the VFD), 6th in the housing construction (2nd in the VFD), and 9th in the retail turnover (2nd in the VFD). Furthermore, the republic is among the regions with the lowest prices. In 2009, the gross regional product (GRP) of the Republic of Tatarstan was estimated at RUR 878.0 billion (in basis prices), which is a decrease of 4.2% in the economic growth of the republic in comparable prices of the figure for previous year. GRP of the Republic of Tatarstan Over a period of 2000 to 2009, the gross regional product increased by 1.8 times in comparable prices. The basis of the gross regional product in the Republic of Tatarstan is formed by the industrial production. The Republic of Tatarstan holds leading positions in the Russian Federa- In 2009, the Tupolev Kazan State Technical University was awarded the status of a “national research university”. In 2010, the “national university” status was awarded to the Kazan State University of Technology. Tatarstan has been famous for its high level of academic, higher educa- tion and industrial science. Many discoveries of universal importance, such as non-Euclidian geom- etry, fundamentals of organic chemistry, electron paramagnetic resonance which has become a basis for present-day magnetic resonance imagers, have been made in the Kazan State University, one of the oldest Russia’s high schools. Active work is currently underway in Kazan in the forefront of science and technology: nanotechnologies, medicine, supramolecular chemistry, metal complex catalysis, petroleum chemistry and biotechnology, chemis- try and technology of high-molecular compounds, combined physical and mathematical simulation and design, energy and resource saving tech- nologies. The Decree of the President of the Republic of Tatarstan dated Septem- ber 30, 1991 established the Academy of Sciences of the Republic of Tatar- stan, which comprises 10 academic institutions. At present, it unites 40 full members, 79 correspondent members, 24 honorary members, and 4 foreign members. The scientists in the Academy have good ties and cooperation agreements with scientific institutions of over 40 foreign countries and scientific organisations in the majority of Rus- sian regions. The Republic ofTatarstan has instituted and annually awards state prizes in science and technology, alongside with 12 personal awards of the Acad- emy of Sciences of the Republic of Tatarstan, including two international ones. There are also 15 grants to students in the institutions of higher vo- cational education. 1.14 TATARSTAN: THE SPORTS REPUBLIC Some 20.6 percent of population in Tatarstan (775,000) go in for physi- cal and sporting activities on a regular basis. Follow- ing the results of 2009, which was declared the Year of Sports and Healthy Lifestyle in Tatarstan, Ka- zan was recognised by an all-Russia poll as a sports capital of Russia. Further- more, a total of 150 sports facilities were put into op- eration, including 5 indoor arenas with artificial ice, 5 indoor swimming pools, and a trap shooting facility. Beginning in 2002, the capital of Tatarstan be- comes a regular place of holding major national and international competi- tions with participation of representatives of all Rus- sian regions and athletes from various countries. Kazan hosted the First Summer Spartakiade of Russia (2003, over 6,500 participants), International Znamensky Brothers Memorial in track and field athletics (2004, 2005); Bandy World Champion- ship (2005), finals of the 1st Russian Summer Universiade (2008), Olympic Qualifying Grass Hockey Tournament for Women (2008), Ice Hockey World Junior Championship (2008), etc. In 2009, Kazan became a venue for holding the First National Sports Fo- rum: Russia the Sports Power attended by President of the Russian Fed- eration Dmitry Medvedev. Within the event, five major Russian and inter- national sports competitions were held with participation of over 1,600 athletes in rhythmic gymnastics, belt wrestling, rugby sevens, track and field athletics, and wheelchair basketball. Good results are shown by Tatarstan athletes in team sports. Rubin Foot- ball Club is the two-time champion of Russia, holder of the CIS Cup, par- ticipant of the UEFA Champions League where it recorded a win in group stage over Spanish Barcelona, the best club of the world. Ak Bars Hockey Club became the 2009 winner of the Russian Open Championship and the champion of the Kontinental Hockey League, having won the first Gagarin Cup and repeating its success in 2010.The“Barses”are now four-time cham- 2. ECONOMY
  • 10 2. ECONOMY Republic of Tatarstan: General Overview, State System, Economy 11 2. ECONOMY Republic of Tatarstan: General Overview, State System, Economy production and distribution of electric energy, gas, and water, RUR 77 bil- lion (IPI of 90.5%). In 2009, the crude oil production totalled 32.4 million tonnes; some 27,900 trucks, 5,400 cars, 6.1 million car tyres, 3.1 million truck tyres and some 407,300 tonnes of synthetic rubbers were manufactured. Production value of shipped goods in manufacturing industry 2.3. FUEL AND ENERGY SECTOR One of the most important factors contributing to the sustainable eco- nomic development of the Republic ofTatarstan is its reliable provision with natural gas.This mainly became possible due to the longstanding coopera- tion with OAO Gazprom on the basis of the Cooperation Agreement and programmes for economic and R&D interaction between OAO Gazprom and the Government of the Republic of Tatarstan. The Republic of Tatarstan is one of the largest consumers of natural gas in the Volga region of Russia. Gas consumption in the republic in 2009 to- talled 13.5 billion cubic metres. The Republic of Tatarstan is high on the list of Russian regions in the installation of gas services. As of the early 2009, the gas supply coverage in the Republic of Tatarstan was 98%. Electric power industry Power industry of the Republic of Tatarstan is a fundamental sector for the development of virtually all branches of the economy in the region. It completely meets the demand in the republic for electrical and heat en- ergy. The energy system of the Republic ofTatarstan incorporates two cogen- eration companies producing heat and electrical energy, OAO Generiruy- ushchaya Kompaniya and ZAO TGK Urussinskaya GRES; grid companies including OAO Setevaya Kompaniya, the largest one both in the length of electric grids and composition of basic equipment and in the amount of electrical energy (power) transmitted; heat network enterprises render- ing heat transfer services; and one provider of last resort in the republic, OAO Tatenergosbyt. 2.4. OIL, GAS, AND CHEMICAL INDUSTRIES Oil production According to the Territorial Board of the Federal Statistics Service in the Republic of Tatarstan, the production of fossil fuels is represented by OAO Tatneft oil company and 34 small oil-production companies carrying out their activities in the territory of 21 municipalities of the republic. With a view of implementing the Programme for Development of Fuel and Energy Complex of the Republic of Tatarstan for 2006-2020 and ration- al use of oil and gas resources, the Resolution of the Cabinet of Ministers of the Republic of Tatarstan No. 531-r of April 28, 2009 was adopted on the volumes of oil production by oil companies in the republic in 2009. In 2009, a total of 32.4 tonnes of crude oil were produced in the Republic of Tatarstan (including OAO Bashneft), which is a 0.7% increase compared to 2008. OAO Tatneft produced some 25.6 million tonnes and small oil-pro- duction companies, 6.6 million tonnes. The contribution of the small oil companies to the total oil production is increasingly growing, in good compliance with the development strategy, and reached 20.5% in 2009. Last year this figure was 20%. In 2009, the Resolution of the Cabinet of Ministers of the Republic of Tatarstan No. 1049-r of August 21, 2009 specified the scope of develop- ment and exploratory drilling by oil-production companies of the republic for 2009. Oil companies in 2009 drilled a total of 601,800 metres, which is by 3.7% more than planned. In 2009, the exploratory metreage drilled was below than that planned in the programme for development of fuel and energy sector. Despite the adjustments in its current plans due to the world economic crisis and great drop in oil prices, Tatneft continues the implementation of the Programme adopted in 2008 for enhancing its corporate perform- ance management and strengthening the financial and economic stand- ing of the company. The priorities of this programme are to maintain tion in the production of a number of key industrial goods. The Republic manufactures (in percent of the total Russian output): • over 40% of styrene; • some 30% of centrifugal electric pumps for oil production; • some 60% of diesel trucks with fully loaded weight of 14-40 tonnes; • 100% of polycarbonate; • over 50% of polyethylene; • some 30% of automotive tyres; • over 40% of synthetic rubbers; • some 6.5% of crude oil. GRP structure (2009) Contribution of products manufactured by Tatarstan enterprises to the total Russia’s production output (2009) 2.2. BASIC FIGURES OF MANUFACTURING INDUSTRY The Republic ofTatarstan is one of the main industrial regions of the Rus- sian Federation with strong industrial base in the field of chemistry and mechanical engineering concentrating largest enterprises, the products of which are known far outside of Russia. The main budget-forming sector of the Tatarstan economy is its oil, gas, and chemical industries. Companies of Tatarstan produce crude oil, manu- facture tyres, synthetic rubbers, polyethylene, and a wide range of oil refin- ing products; also underway is the construction project of a largest plant for deep processing of heavy high-sulphur oil. Leading industries of mechanical engineering in Tatarstan are automo- tive and aircraft engineering manufacturing helicopters, airplanes, aircraft engines, heavy-duty trucks, compressors, oil and gas pumping equipment. Tatarstan is a home for unique plants of shipbuilding, compressor engi- neering, electric and radio instrument-making industries, enterprises of defence industry and many others. Structure of manufacturing industry in 2009 In the structure of industry, manufacturing activities were the largest contributor accounting for 57.9%. Mining operations accounted for 33.1%, and production and distribution of electric energy, gas and water, for 9.0%. In manufacturing activities, the largest contribution was made by ve- hicles and equipment with 12.3%, followed by chemical products with 11.9%, oil products with 9.4%, and foodstuffs with 7.1%. In 2009, the value of shipped goods of own manufacture, works per- formed and services rendered by own forces reached RUR 859.0 billion.The industrial production index (IPI) recalculated with allowance for small busi- nesses and informal economy constituted 92.3% as compared to 2008 (for reference: 89.2% in the Russian Federation). Broken down by kinds of economic activities, the production value of shipped goods was as follows: in mining operations, RUR 284.6 billion (IPI of 100.6%); in manufacturing activities, RUR 497.4 billion (IPI of 86.8%); in Production of crude oil in the Republic of Tatarstan, ‘000 MT
  • 12 2. ECONOMY Republic of Tatarstan: General Overview, State System, Economy 13 2. ECONOMY Republic of Tatarstan: General Overview, State System, Economy Plants which would make it possible to carry out deep processing of the crude oil produced in the Republic of Tatarstan and to make oil products and petrochemicals. In 2010, OAO Tatneft plans to put into operation a start-up complex of the oil refining plant with capacity of 7 million tonnes of crude oil a year. Chemical and petrochemical industry Petrochemical enterprises account for about 17% of the republic’s indus- trial output and some 12% of the national output of petrochemicals. Today, the republic’s enterprises manufactured some 60% of the Russia’s polystyrene, over 40% of synthetic rubbers, over 30% of polypropylene and tyres, and over 50% of polyethylene. In 2009, petrochemical enterprises of Tatarstan manufactured and shipped over RUR 142 billion worth of goods. Industrial production index in the chemical branch constituted 107.5%, while in the production of rub- ber and plastic products it was 77.4%. Even under the conditions of limited financial resources, key enterprises continue the implementation of their large-scale investment projects. Polyethylene production with capacity of 230,000 tonnes a year was put into operation in OAO Nizhnekamskneftekhim. The construction of the all-steel tyre plant with capacity of 1.2 million tyres a year has been completed in the city of Nizhnekamsk with invest- ments from Tatneft. The production of non-woven Spanbond with capacity of over 10,000 tonnes a year has been launched in SEZ Alabuga (ZAO Polimatiz). The Industrial Park Kamskiye Polyany hosted the lines for the multifila- ment polypropylene yarn production with capacity of up to 2,000 tonnes a year and the stretch film production with capacity of over 8,000 tonnes a year. Nefis Cosmetics has expanded its production of consumer goods up to the international standards. OAO Kvart has launched the production of products from dynamic ther- moplastic elastomers for the needs of automotive industry. Small businesses in the industry focused on the production of chemicals begin to play an increasingly important role in the republic. A number of them produce goods with an economic output well comparable with that of a medium-sized enterprise. For example, Safplast, Danaflex, Polimatiz are the enterprises with a billion turnovers. Also vigorously developing are chemical businesses in Kamskiye Polyany and in the territory of Khimgrad. This complies favourably with the decisions of the republic’s leadership about the deeper processing of raw chemicals to the converted products with high added value. 2.5. MECHANICAL ENGINEERING AND METALWORKING In 2009, the mechanical engineering enterprises manufactured com- modities to a total of RUR 177.2 billion, the industrial production index in this sector constituted 69.4%; this accounted for 20.6% of the total com- modities produced in the manufacturing industry. A year elapsed since the onset of the financial crisis had a drastic impact on the priorities and environment of economies in the Russian Federation and the world community in general. This resulted in the falling consumer demand for investment-oriented products, and primarily, for mechanical engineering products. The greatest decline in the production in this sector was due to a re- source-intensive pattern of the mechanical engineering enterprises and rather low labour productivity, which entailed low competitiveness of eco- nomic entities and their products. To overcome the consequences of the crisis, virtually all large and me- dium-sized enterprises of mechanical engineering and instrument making industries worked out their anti-crisis programmes, the implementation of which, along with the continuous work on the mastering of new kinds of competitive products, largely promoted the stabilisation of the situation in these industries. Within the framework of its programme, OAO KamAZ is performing the work on optimising the expenditures (purchases of completing parts, wage fund, administrative expenses), increasing labour productivity, selling non- core assets, and on a number of other areas. This enables the company, even under conditions of the crisis, to expand its consumer market sales niche in virtually all segments of the manufactured vehicles: dump-body trucks, platform vehicles, and specialised machinery. For increasing the competitiveness of its truck line, OAO KamAZ was par- ticipating in the creation and successful development of the joint venture companies with world’s leading automotive component manufacturers, such as OOO Knorr-Bremse Kama (drum-type and disk brakes), ZAO Cum- mins Kama (engines), Federal Mogul Naberezhnye Chelny (piston rings and sleeve assemblies), OOO ZF Kama (automatic transmissions). Strengthening the market positions of the republic’s automotive indus- try was promoted by an efficient state support rendered at the levels of the Government of the Russian Federation and the Cabinet of Ministers the the profitable level of oil and gas production, to ensure full replenishment and improvement in the structure of reserves, to expand the resource base, to further develop oil refining, and to build up retail business. In accordance with the programme for the development of fuel and en- ergy sector of Tatarstan, the achieved level of crude oil production in the republic should be supported through exploiting the deposits of natural bitumens. OAO Tatneft is currently performing pilot operations at Ashalchinskoe bitumen deposit. The company has mastered the technology of drilling wells with parallel horizontal wellbores and developed its own technol- ogy of steam-assisted gravity drainage for heavy oil deposits. In 2009, it extracted 18,400 tonnes of extra-viscous oil. In 2009, OAO Tatneft continued the work on implementing its strategic task of increasing the stock of hydrocarbons, including those outside of theRepublicofTatarstanandtheRussianFederation.Atotalof16newde- posits, including 10 in the Republic ofTatarstan, 3 in Samara Region and 2 in Orenburg Region have been discovered. A new oilfield was discovered in Syria and 4 exploratory wells were drilled identifying the oil productive horizon with crude oil flowing at the rate up to 150 cubic metres per day. Two exploratory wells were drilled in Libya; when testing the first one a crude oil inflow was obtained in the amount of 103 cubic metres per day, while the development of a second well yielded 130 cubic metres per day. Oil refining According to State statistics, the value of shipped goods of own manu- facture, works performed and services rendered by own forces in the pro- duction of oil products totalled RUR 80.5 billion in 2009. Industrial produc- tion index constituted 104.7%. In 2009, OAO TAIF-NK produced RUR 75 billion worth of oil products. OAO  TAIF-NK is implementing an anti-crisis programme for 2009-2012, which includes measures for optimising the logistics structure and com- mercial expenses, technological measures of aimed at cutting processing costs, organisational measures aimed at decreasing the administrative ex- penses. For the purpose of making products with higher added value, OAO TAIF- NK is implementing a number of investment projects. In 2010, underway is the implementation of the projects for increasing the capacity of catalytic cracking installation in the gasoline plant up to 1 million tonnes of crude oil and building the facilities for processing of the heavy oil residue (bring- ing the oil refining depth to 98%). At present, a feasibility study has been completed and contracts for base design are scheduled for signing.The im- plementation of this project would allow the company to increase its profit up to US$ 500 million a year. Another major trend of oil refining development in the republic is the ongoing construction of the Complex of Oil Refining and Petrochemical Production of some oil products, % Metreage of development drilling in the Republic of Tatarstan,‘000 metres
  • 14 2. ECONOMY Republic of Tatarstan: General Overview, State System, Economy 15 2. ECONOMY Republic of Tatarstan: General Overview, State System, Economy mechanical engineering industries of the Republic of Tatarstan. Experts of OAO Tatneftekhiminvest-Holding, jointly with the Ministry of Industry and Trade of the Republic of Tatarstan, elaborated the Concept of Developing the Cooperation in Oil, Gas, Chemical, and Mechanical Engineering Indus- tries of the Republic of Tatarstan. Defence industry enterprises The Republic ofTatarstan is a home for 13 large and medium-sized enter- prises and over 10 scientific research institutions and design bureaus being a part of the Russia’s defence industry and engaged in the sphere of am- munition production, special chemistry, aircraft engineering, shipbuilding, production of control systems and conventional arms. In 2009, large and medium-sized enterprises of defence industry ac- counted for 7% of the total production in the economy the Republic of Tatarstan; these enterprises produced RUR  38.6 billion worth of goods, which constituted 102.2% of the figure for 2008. The substantial growth in the production was recorded by the following enterprises: OAO Gorky Zelenodolsk Plant (119.7%), OAO Kazan Helicop- ter Plant (111.2%), OAO Gorbunov Kazan Aircraft Production Association (105.8%), and OAO Kazan Electrotechnical Plant (134.6%). 2.6. LIGHT, FOOD-PROCESSING, AND TIMBER INDUSTRIES Light industry The light industry in the Republic ofTatarstan is represented by 567 busi- ness entities, of which 24 are large and medium-sized enterprises. Some 90% of the companies are private. The light industry’share of the total production of goods and services in the Republic of Tatarstan was 0.4%. In 2009, the industry shipped RUR 3.1 billion worth of goods. The indus- trial production index in textile and sewing branches was 99.6%, in leather, leather products and footwear, 86.5%. In 2009, a new enterprise, ZAO Polimatiz, was established in the Free Economic Zone Alabuga focused on the production of a wide range of hi- tech polymeric materials and products used in various industries (such as Spanbond and Meltblown). The production facilities of the enterprise are capable of releasing up to 10,000 tonnes of nonwoven cloth a year, to a total of RUR 700.0 million. Similar production is launched in Nizhnekamsk in OOO Elastik. Since the beginning of the year, enterprises recorded RUR 1,086.4 million of investments into fixed capitals. For the purpose of creating the conditions to attract investment to light industry and to set up competitive, high-technology productions in the republic, the Concept of Light Industry Development in the Republic of Tatarstan for 2007-2010 has been adopted. Food-processing industry In 2009, the enterprises making foodstuffs shipped RUR  61.3 million worth of goods; the corresponding industrial production index reached 106.7%. Growth of production volumes in this industry was achieved owing to the development of productive forces, first of all, through investing into up-to- date technologies and equipment, which make it possible both to raise the output per worker and to enhance the competitiveness of products. Timber industry Timber industry of the Republic of Tatarstan is presented by two kinds of economic activities: Republic of Tatarstan. In 2009, about 8,300 vehicles were sold under the government programmes for procurement of KamAZ vehicles (to federal enforcement authorities, constituent entities of the Russian Federation, OAO State Transport Leasing Company, OAO Rosagrolizing). In addition, the Government of the Russian Federation rendered state support to OAO KamAZ by granting governmental guarantees for raising credits of commercial banks in the total amount of RUR 3.6 billion. OAO KamAZ has plans to increase in 2010 its output and sales by 8% compared to 2009. In the areas being vacated due to implementation of the anti-crisis programme, several projects of Daimler Corporation will con- tinue, including the Mercedes-Benz Trucks Vostok joint venture company and joint activities with world’s leading manufacturers of automotive com- ponents, which would make it possible to gradually increase the competi- tiveness of automotive vehicles. Inclusive of federal and republic’s state- managed resources, the work will be continued on raising up to RUR 10 billion for the implementation of a number of investment projects. The 2009 results for the factories of OAO Sollers located in the Repub- lic of Tatarstan were as follows: OAO  Sollers-Naberezhnye Chelny deliv- ered 5,900 vehicles worth RUR 3.4 billion; OOO Sollers-Yelabuga delivered 4,500 trucks, 535 cars and over 2,000 minibuses to a total of RUR 5.8 billion; OAO Severstal-Isuzu delivered 732 trucks worth RUR 615 million. Business development prospects of Sollers in the Republic of Tatar- stan are associated with the Agreement signed between FIAT S.p.A. and OAO Sollers on the establishment of new facilities in the territory of the republic to manufacture up to 500,000 cars a year, and arrangement of a pool of suppliers to provide components for their assembly. The availabil- ity of such pool for supplying automotive components (including stamped parts) in the same location with car assembly facilities will allow Sollers en- terprises to ensure high degree of localisation of FIAT Ducato and ISUZU vehicles manufactured in the territory of SEZ Alabuga. In summer 2009, the Ministry of Industry and Trade of the Republic of Tatarstan and OOO Sollers-Yelabuga have signed the Protocol on Collabo- ration regarding the production of components for assembly of Fiat Duca- to vehicles. Within the automotive component development programme, the production of seats was launched jointly with Eisrenhausen и Daewoo; production of plastic interior and exterior parts, jointly with Ergom and OOO Khiton-Plast; and production of exhaust systems, jointly with Mag- netti Marelli. State support is being rendered to small businesses located on the premises of OAO Kama Industrial Park Master. This programme includes granting rent holidays for the permanent part of the rent subject to timely and full payment of the variable part of the rent, debt offsets for the lessees supplying their products to OAO KamAZ through the mechanism of assign- ing the rights, and deferral of rent payments until the end of 2009. As of January 2010, KIP Master hosted 134 enterprises and organisations with a total number of 1,362 employees. Its 2009 production valued at RUR 4,306 million. In 2009, OAO PO YelAZ introduced new modifications of special machin- ery for oil and gas industry, including hoist unit APRS-50 on KamAZ-65115 chassis, hoist unit APR-60/80, hoist unit APR-80, and cementing unit ATs-32. In 2009, Design Bureau for Road Equipment was established under this enterprise.ElevenmultifunctionalroadvehiclesUDM-80ЕonKamAZ-65115 chassis were manufactured, pilot models of road master vehicles MDM-A, MDM-E on Fiat-Ducato and ISUZU bases were designed and released to- gether with OOO Sollers-Yelabuga. Active work is underway for seeking new orders for the production of non-standardised equipment and mechanical facilities for equipping new all-steel tyre plant of Nizhnekamsk Tyre Factory and building metal struc- tures for OAO TANECO Oil Refining and Petrochemical Complex. Agricul- tural modification of MK-10E on MTZ-82.1 tractor base was introduced. Increase in the competitiveness of the company is promoted by introduc- ing the measures envisaged by the Lean Production methodology. For some time past, these organisational and technical measures resulted in lowering the expenses by RUR 80.8 million, including those for materials (RUR 32.4 million), for power resources (RUR 14.5 million); through the sales of unmarketable products, RUR 5.0 million, etc. The anti-crisis programme for 2009-2011 adopted in February is being implemented in OAO Kazankompressormash.The programme’s actions are grouped in three lines: aggressive marketing, optimisation of resource us- age, and efficient management. Economic benefit of their introduction in 2009 totalled some RUR 100 million. This work largely promotes the successful participation of the repub- lic’s compressor manufacturers in the tenders conducted by largest Rus- sian and foreign companies. In 2009, OAO Kazankompressormash won a RUR 1.08 billion tender for supply of products to OAO Lukoil. Delivery of compressors for Angara missile complex in the amount of some RUR 400 million, for OAO SIBUR Holding in the amount of RUR 2 billion, a number of other already signed contracts – all this allow the enterprise to safely look ahead estimating a 16% production growth in 2010. In pursuance of the resolutions of the Cabinet of Ministers of the Re- public of Tatarstan No.1506-r of 16.11.2009 and No.778-r of 26.06.2009, a structure has been created as a part of OAO Tatneftekhiminvest-Holding to coordinate the interaction between enterprises of oil, gas, chemical, and
  • 16 2. ECONOMY Republic of Tatarstan: General Overview, State System, Economy 17 2. ECONOMY Republic of Tatarstan: General Overview, State System, Economy 564 616 618 1056 1137 1173 0 200 400 600 800 1000 1200 1400 2007 2008 2009 Wood processing and manufacture of wood products, except for furniture Pulp and paper production • wood processing and manufacture of wood products, except for furniture; • pulp-and-paper production. In 2009, the timber industry generated RUR 11.5 billion in total econom- ic output, with the industrial production index of 80.7%. The value of production in the wood processing and manufacture of wood products was RUR 3.7 billion, with the industrial production index of 57%. The value of production in the pulp and paper production was RUR 7.8 billion, with the industrial production index of 104%. The drop in the production output of wood processing and manufacture of wood products was due to the decrease in consumption in foreign mar- kets and discontinuation of some construction projects in 2009. A major task of the timber industry for 2010 is the re-equipment of the enterprises in the industry, introduction of energy and resource saving technologies, and salvaging the waste by these enterprises as energy re- sources. The Resolution of the Cabinet of Ministers of the Republic of Tatarstan No.61 of 10.02.2010 approved the“Strategy of Forestry Development in the Republic of Tatarstan until 2018“. This strategy provides for the creation of timber processing facilities in the locations with unused softwood aspen and birch forests for the production of high-quality wood particle and MDF boards. 2.7. INTRODUCTION OF QUALITY MANAGEMENT SYSTEM Once the Programme for Improving the Quality of Products and Services in the Republic of Tatarstan for 2004-2006 (Programme“Quality”) was com- pleted in Tatarstan, this implied the end of the stage of evaluating the ap- proaches to the use of ISO 9000 standards in the systems of management of the republic’s economic entities. As a result, more than 350 republic’s enterprises and organisations of different form of ownership and lines of business have confirmed the compliance of their quality management sys- tems to ISO 9001 standard. Number of enterprises that certified their QMS in compliance with ISO 9001 Environmental management systems were certified in compliance with ISO 14001 standard by 16 organisations of the republic. Five enterprises have safety management systems certified in compliance with OHSAS 18001. IPI in timber industry sectors in 2007–2009, in percent Authority for certification of goods and services: ZAO Republic’s Certification Methodical Centre - Test Tatarstan Authority for certification of quality management systems: ZAO Republic’s Certification Methodical Centre - Test Tatarstan Authority for certification of integrated management systems: ZAO Republic’s Certification Methodical Centre - Test Tatarstan 49, Kosmonavtov St., Kazan 420061, Republic of Tatarstan Head: Sergey Gogin Tel.: (843) 2952302 / (843) 2796281 E-mail: test-tatarstan@rsmc.ru Authority for certification of quality management systems: Representative Office of Certification Association Russkiy Registr, OOO Russkiy Registr – Povolzhye 26, Vishnevsky St. (Central Depository bldg.), Kazan 420043, Republic of Tatarstan Head: Andrei Yashin Tel./Fax: (843) 236-44-73, 236-41-73 E-mail: kazan@rusregister.ru, jashin@tatcsm.ru Authority for certification of quality management systems: ROSSERT, OOO Volga Region Certification Training Methodical Centre Bldg. 2, 34, Subirsky Trakt St., Kazan 420029, Republic of Tatarstan Head: Gennady Sidorov Tel.: (843) 5109822, 5109823 / (843) 5109822, 5109823 E-mail: gisid@mail.ru Authority for certification of integrated management systems: OOO Tsentr Kachestva Office 409, bldg. 2, 34, Subirsky Trakt St., Kazan 420029, Republic of Tatarstan Head: Ilfat Khabibullin Tel.: (843) 2581772 / (843) 5109999 E-mail: tatgm@km.ru Authority for certification of quality management systems: OAO Tsentr ROSSERTIFIKO Authority for certification of radio electronic products and household electric appliances: OAO Russian Centre of Tests and Certification of Petrochemical Products Authority for certification of chemical, petrochemical and oil refining products: OAO Russian Centre of Tests and Certification of Petrochemical Products P.O.B. 102, bldg. 2а, 100, Vosstaniya St., Kazan 420095, Republic of Tatarstan Head: Davyd Gelman Tel.: (843) 5422868 / (843) 5425140, 5425112 E-mail: ros@kgts.ru Authority for certification of medical tools and equipment: ANO Centre for Certification of Medical Tools and Equipment 12, Saidashev St., Kazan, 420021, Republic of Tatarstan Head: Natalia Novikova Tel.: (843) 2933264 / (843) 2933264 E-mail: medsert@mail.ru Authority for certification of automotive products: Chamber of Commerce and Industry of Naberezhnye Chelny and Trans-Kama Region 122, Usmanov St., Naberezhnye Chelny 423826, Republic of Tatarstan Head: Irekzhan Bakirov Tel.: (8552) 562345, 724513 / (8552) 562345, 724513 E-mail: tpp@016.ru Authority for certification of electric equipment: АNО Test Centre Soyuz 5, Chistopolskaya St., Kazan 420066, Republic of Tatarstan Head: Nikolai Petryakov Tel.: (843) 5713242 / (843) 5454598 Authority for certification of chemical and petrochemical products: Khimprom, OOO Interregional Centre for Tests and Certification of Technologies, Products, and Goods 1, Vasilchenko St., Kazan 420095, Republic of Tatarstan Head: Yulia Safina Tel.: (843) 5121538 / (843) 5121538 E-mail: himpromsert@mail.ru Authority for certification of foods: FGU Federal Centre of Toxicological and Radiation Safety of Animals Nauchny Gorodok-2, Kazan 420075, Republic of Tatarstan Head: Albert Chernov Tel.: (843) 2395329, 2395342 / (843) 2395329 E-mail: vnivi@mail.ru Authority for certification of foods: FGU Russian Agricultural Centre (branch in the Republic of Tatarstan) 14, Daurskaya St., Kazan 420059, Republic of Tatarstan Head: Takhir Khadeyev Tel.: (843) 2778209 / (843) 2778209 E-mail: rscrt@mail.ru For the certification of goods, services and management systems, corresponding infrastructure has been created In the republic. Number of organisations engaged in wood processing and manufacture of wood products, pulp-and-paper production in 2007-2009
  • 18 2. ECONOMY Republic of Tatarstan: General Overview, State System, Economy 19 3. AGRICULTURE Republic of Tatarstan: General Overview, State System, Economy The total ground area of the republic is 6.8 million hectares, including farmland of 4.5 million hectares, of which 3.5 million hectares are arable land. Total population living in rural areas is 943,500. The agrarian sector is a large sphere of the national economy playing an important role in the life of the Republic of Tatarstan. The development of the agro-industrial complex remains one of the eco- nomic priorities of the Tatarstan leadership; the sector enjoys a consider- able governmental support. Since 2000, there is a stable growth in the crop and livestock production. The republic is ranked among top three leading regions of Russia in the total output of agricultural products and completely satisfies the demand of its residents for staple foodstuffs. Tatarstan boasts the cheapest minimum subsistence basket both in the Volga Federal District and in the country in general. In 2009, the volume of agricultural output of all agricultural organisa- tions and farming enterprises generated revenue of RUR  119.1 billion (101.5% compared to 2008).The gross yield of grains was 4.8 million tonnes (that is, some 1.3 tonnes of grains per Republic’s resident thus exceeding the internationally accepted standards). A total of 1.9 million tonnes of po- tatoes, 1.5 million tonnes of sugar beet, and 305,000 tonnes of vegetables were harvested in 2009. The developed and steady agriculture forms a basis for efficient and high-grade livestock husbandry.Tatarstan distinguishes itself by a substan- tial livestock potential. With its high density of cattle and poultry stock, the republic is increasing its contribution towards ensuring the food security of the country. The cattle stock of all agricultural producers was estimated at 1,122,000, including 424,000 cows; other livestock includes 701,000 pigs, 393,000 sheep and goats, and 13.1 million poultry. In 2009, the production of milk by all agricultural producers totalled 1,911,000 tonnes (104.9% to the level of 2008); the republic is a contributor of over 5.9% of the total milk produced in Russia. The production of live- stock and poultry for slaughter was 413,000 tonnes on a live weight basis (105.6 % of the figure for 2008). In general, with its 2.3 % of the country’s farmland, the republic accounts for 4.8% of the country’s agricultural produce. Implementing active social policies, using, as much as possible, the in- ternal reserves, and ensuring the growth of rural economy are largely pro- moted by the consistent implementation of the Programme for Agriculture Development in the Republic of Tatarstan for 2008-2012. Tatarstan has formed a really diversified economy. Its own strategic investors and private companies hold a half of the republic’s arable land and livestock, advanced technologies and machinery. They invested over RUR 90 billion into the agricultural business development. Tatarstan’s large investors are OAO VAMIN Tatarstan, ZAO HK Zolotoy Kolos, ZAO Agrosila Group, OAO Krasny Vostok-Agro, and OAO HK Ak Bars-Agro. Critical factors determining the vector of agricultural development are the efficient utilisation of available arable land, livestock and poultry; opti- misation of expenditures through introduction of resource saving and in- novative technologies; increase in the business activities of rural residents; and support of small businesses in rural areas. Due to the systematic up- grading and renovation of the enterprises in this sector, Tatarstan succeed- ed in stabilising and later increasing the production outputs, in effecting a further development as a country’s most successful agrarian region. Since the outset of the agrarian project, an opportunity has emerged to better develop the family commercial farming with governmental support. Over these years, some 45,000 credits to a total of more than RUR 9.0 billion were granted under the Plan of Promoting the Development of Small Farm Patterns. Some RUR 825 million were paid towards easing of the credits received. Some 5,600 young professionals and young families were subsidised for housing acquisition or construction in rural settlements for a total amount of RUR  3.9 billion under the Plan of Providing Young Professionals and Young Families with Affordable Housing in Rural Areas. The present-day agricultural industry with its mixed pattern of owner- ship imposes heavy demands on the professional level of managers and specialists. The educational cluster of the agro-industrial complex is a mu- tually beneficial cooperation of agricultural educational establishments and such employers as large investors and agro-industrial firms, with a view of enhancing the quality of experts’ training for their agricultural produc- tion work. The educational cluster of the agro-industrial complex comprises the Kazan State Agricultural University, the Kazan State Academy of Veterinary Medicine, the Tatar Institute for Agribusiness Personnel Retraining, 7 agri- cultural secondary schools, 40 vocational schools, 6 agrarian colleges, and comprehensive schools. Social infrastructure is also being intensively developed in rural areas. For instance, the provision of gas supply to houses and apartments in rural areas has almost been completed; up to 200 kilometres of paved roads and over hundred schools, kindergartens, community clubs and a number of other social support facilities are put into service or reconstructed each year. Over 90% of the republic’s territory is covered with cellular communications of major Russian operators. All 43 rural districts are connected to the govern- mental integrated telecommunications system of the Republic of Tatarstan. Production subcontracting Under current conditions, an actual prob- lem of the industrial enterprises of the Repub- lic of Tatarstan is an active work on enhancing the competitiveness through re-equipment, introduction of new industrial areas of focus, implementation of anti-crisis development programmes. Of great significance in achieving these tasks is the work on reducing internal process costs by introducing mechanisms of subcon- tracting, i.e. production cooperation, and by restructuring enterprises on an outsourcing basis. The essence of this approach can be described as fol- lows: “While keeping to myself the things that I can do better than others, I out-task to other performers the things they can do better than others”. With an aim of implementing the said approaches, a State non-profit fund, Production Subcontracting Centre of the Republic of Tatarstan, was created in the republic which allows solving many problems arising in the process, such as seeking the suppliers, ensuring the affordable procure- ment prices for component parts, and maintaining the quality objectives. As requested by the Ministry of Industry and Trade of the Republic of Tatar- stan, the Production Subcontracting Centre has worked out and is support- ing the automated Internet project at www.cps-rt.ru “Integrated Informa- tion Support System for Commodity Producers”. Its mission is to create and develop the infrastructure for production cooperation. The portal www.cps-rt.ru incorporates the following sections: Science and Production, Subcontracting, Goods and Services, and All Tatarstan. 1. Science and production: contains innovation projects of current inter- est; research and engineering issues of industrial enterprises which should be solved by involving research and design organisations, inventor teams, in- vestors; R&D solutions offered for the introduction by universities and secto- ral research, design and industrial organisations of the Republic of Tatarstan. 2. Subcontracting: provides for the deployment of production and tech- nology capabilities of industrial enterprises in Tatarstan for the market of subcontracting services and receipt of additional orders from other enter- prises, making it possible to organise the controlled restructuring of enter- prises on an outsourcing basis. 3. Goods and Services: renders advertising support to commodity pro- ducers, including small and medium-sized businesses, for promoting their products and services to the markets of the Republic ofTatarstan and other regions of the Russian Federations. 4. All Tatarstan: a reference system with brief contact information of en- terprises, organisations and agencies in the Republic of Tatarstan. Production Subcontracting Centre of the Republic of Tatarstan is a participant of the National Partnership of Subcontracting Development, a non-profit partnership in the Russian Federation, and cooperates with republic’s ministries and agencies. Its partners include ROR Association of Enterprises and Entrepreneurs of the Republic of Tatarstan, Association of Small and Medium-Sized Businesses of the Republic of Tatarstan, Commit- tee for Small and Medium-Sized Business Development of the Republic of Tatarstan, and Chamber of Commerce and Industry of the Republic of Tatarstan. By making use of the Integrated Information Support System for Com- modity Producers at www.cps-rt.ru, any businessman, scientist, or manu- facturer would be able to implement his project on an outsourcing basis in real time by involving experts in the corresponding field of activities to the project implementation. 3. AGRICULTURE
  • 20 4. SUMMARY OF TATARSTAN LAND MARKET Republic of Tatarstan: General Overview, State System, Economy 21 5. TRANSPORT Republic of Tatarstan: General Overview, State System, Economy The Republic of Tatarstan enjoys the unique transport geographical po- sition in the European part of Russia, its territory is crossed by key railways and waterways, highways and air routes providing transportation of goods and passengers in all directions. Such position is unique due to four available factors: • The shortest transcontinental railway in the West-East direction and the railway connecting large industrial cities of the Volga region in the Northwest-South direction; • Navigable waterways of the Russia’s main European rivers: the Volga and Kama, and the Belaya andVyatka rivers, which provides water con- nection not only with the north-western and southern, but also with north-eastern and Urals industrial regions; • Federal motorways leading in three directions: West-East, West-South- east, and Northwest-South; • Air routes to many destinations. The junction point of the said major transport routes is the Kazan trans- portation hub. The Kazan railway junction is connected with river cargo port which allows intermodal transports. The transportation system of the Republic of Tatarstan is composed of six types of transport (automotive, urban electric, inland water, air, pipeline, and railway) and road facilities. In 2009, freight-carrying vehicles of the republic’s enterprises of all kinds of activities (with allowance for small haulage contractors and en- trepreneurs engaged in commercial cargo transportation), transported 26,462,300 tonnes of cargo on a commercial basis (89.6% to the level of 2008), with cargo turnover amounting to 2,366.8 million tonne-kilometres (89.8%). During 2009 navigation, shipping enterprises transported 4,384,367 tonnes of cargo, which is a 24.1% decrease y-o-y. In 2009, air freight enterprises transported 885 tonnes of cargo, includ- ing international ones, which is a 29.9% decrease y-o-y. In 2009, railway enterprises transported 86,981,300 tonnes of cargo, which is a 17.3% decrease y-o-y. In 2009, the enterprises (including small businesses) performing the au- tomotive carriage of passengers along the general use routes transported some 183.6 million passengers on a commercial basis (94% of the figure for 2008). The passenger turnover was 1,967.5 million passenger kilometres, a decrease by 17.3% y-o-y. As of January 1, 2009 there are 3,081 settlements in Tatarstan, of which 1,638 have access roads with asphalt concrete pavement; 483 have inter- mediate type of pavement; and 960 settlements have earth access roads. A total of 11,700 kilometres of asphalt-paved roads, 2,000 kilometres of macadam roads, and 1,000 kilometres of earth roads are operated in the republic. In 2008, RUR 2.5 billion was allocated to the provision of rural settlements with access roads. In 2009, some RUR 2 billion was allocated to this end. Transportation infrastructure improvements are stimulated by the de- velopment of Kama Industrial Hub, Complex of Refining and Petrochemical Plants under construction in Nizhnekamsk, and the Special Economic Zone Alabuga. The following projects are currently underway in the roads and transport system of the Republic of Tatarstan: • Investment projects within the Western Europe-Western China inter- national transport corridor: –– Sviyaga Interregional Multimodal Logistics Centre; –– Construction of Shali (М7) - Bavly (М5) toll highway for the devel- opment of new route for the Kazan-Orenburg federal motorway in the Republic of Tatarstan, with the length of 294 kilometres, to form a part of the St. Petersburg-Vologda-Kazan-Orenburg-Kaza- khstan border expressway. The highway will be a section of the Europe-Western China international transport corridor in the terri- tory of the Russian Federation. • Investment projects also being implemented: –– Biek Tau Industrial Park; In 2009, the crisis also affected the land market; the land plot sales dropped year over year. In expectation of lower land prices, buyers limited their activities. The wave of investment purchases of land plots for resale has faded away. As to the trend of the land prices, it is somewhat different than that of the real estate prices. Land prices decreased, but a specific character of this decrease is dictated by the land market rules: maximum discount reaches 10-20%, and it is rather difficult to have a discount for good land plots. No decrease at all was observed for the most demanded areas, because sellers prefer to keep the prices steady. The republic’s average land market prices decreased by 15% in 2009. The highest prices were still recorded for land plots in Kazan, ranging from RUR 8,000 to RUR 25,000 per square metre for land plots in the central city area and up to RUR 35,000 per square metre in the historic centre. The prices for the land plots located along major traffic arteries of the city are somewhat lower, ranging from RUR 6,000 to RUR 15,000 per square metre; in massive housing development areas they range from RUR 2,500 to RUR 12,000 per square metre. Prices for land lots in the industrial zone of Kazan are much lower, from RUR 1,500 to RUR 3,500 per square metre. Lands do not expand in area, but the number of land plots intended for individual housing construction is increasingly growing. Transfer of the ag- ricultural lands to the category of lands for individual housing construc- tion is one of the governmental measures of providing incentives to the housing market; the process of including the agricultural land plots into the boundaries of inhabited localities is also underway. This land transfer is most intensive in Laishevsky and Zelenodolsky districts. The land adjacent to Kazan will be in demand at all times, since this is an extensively develop- ing direction in terms of access to transportation and infrastructure. The average price of a land plot for individual construction in the boundaries of Kazan ranges from RUR 600,000 to RUR 1 million. Apart from the proximity to the city, some locations are more prestigious than others, which is due to the deficiency of vacant land plots in these areas and good environmental image. 4.1. Monitoring of undeveloped land plots (lands of inhabited localities) The review of prices for undeveloped land plots is compiled based on prices of the offers published in real estate periodicals and from real estate appraisers. RUR ’000 per square metre City (district) Location Minimum value Maximum value Kazan Historic centre 8.0 35.0 Traffic arteries 6.0 15.0 Massive housing development areas 2.5 12.0 Industrial zone 1.5 3.5 Almetyevsk Central city area 1.4 12.0 Massive housing development areas 1.2 8.0 Industrial zone 0.5 3.0 Naberezhnye Chelny, Nizhnekamsk Central city area 1.5 8.0 Massive housing development areas 1.1 6.0 Industrial zone 0.2 0.5 Verhneuslonsky District 0.3 2.3 Vysokogorsky District 0.3 1.5 Zelenodolsky District 0.4 3.5 Laishevsky District 0.3 3.2 Pestrechinsky District 0.3 2.0 Rybno-Slobodsky District 0.25 0.8 In pursuance to the Resolution of the Cabinet of Ministers of the Repub- lic of Tatarstan No.951 of December 31, 2008, the results of the new State cadastral valuation of the land plots in the lands of inhabited localities (ex- cept for Kazan) have been effective from January 01, 2009. 4. SUMMARY OF TATARSTAN LAND MARKET 5. TRANSPORT
  • 22 6. INFORMATION AND COMMUNICATIONS Republic of Tatarstan: General Overview, State System, Economy 23 6. INFORMATION AND COMMUNICATIONS Republic of Tatarstan: General Overview, State System, Economy aspect in the wide application of innovations in the sphere of information and managerial technologies in the activities of the republic’s authorities. The e-Government of Tatarstan has been created with an aim of enhancing the effectiveness of public authorities, ensuring the disclosure of informa- tion about the activities of the Government and granting to citizens, busi- nesses, public and other structures a continuous convenient access to the State services and government information resources. The following key achievements testify to the successful implementa- tion of the e-Tatarstan programme: • Based on the republic’s digital communication infrastructure, the State Integrated System of Telecommunications (GIST) has been established thus making it possible to create a unified information space in the ter- ritory of the Republic of Tatarstan. • Beginning from 2006, the official Portal of the Government of the Re- public of Tatarstan has been functioning successfully, incorporating standard sub-portals of ministries and agencies and websites of Tatar- stan municipalities, including virtual reception desks; • For people and businesses, State-to-Business and State-to-People por- tals have been created to provide full information about public services. • The interdepartmental system of electronic document circulation for public authorities with the use of digital signature technology pro- vides the centralised record management for the authorities of the Republic of Tatarstan; • The e-Commerce Information System and e-Store Centralized Govern- ment Procurement Information System have been created and are op- erated effectively; • No less effective is the video conferencing system operated for the needs of the Government of the Republic of Tatarstan, ministries and departments, local governments of the republic; • The information analysis system for monitoring the activities of budg- et-funded entities have been deployed; • The registry information system has been introduced to automate the activities of the offices of vital records. The current primary objective facing the e-Government of the Republic of Tatarstan is the development of the State services system in the elec- tronic format. The issue of creating electronic services is also a key one in the Strategy and Programme of Information and Communication Technologies Devel- opment in the Republic of Tatarstan (Intellectual Tatarstan 2020) being developed currently. Its mission: “Development of competitive and highly intellectual Republic of Tatarstan at the international level through the effective implementation of State policies of introducing infocomm tech- nologies (i-Tatarstan)”. Its objective: “Development of social and economic lead of the Republic of Tatarstan and improvement of the quality of life of people through effective introduction of infocomm and innovative tech- nologies (i-Lead)”. Priority problems in the short term: 1. Development of a highly intellectual society (i-Society); 2. Creation of effective government system (i-Government); 3. Effective economy and business sector (i-Economy); 4. Development of effective IT sector and industry (i-Industry); 5. Creation of effective education system and training of highly-skilled workforce (i-Learning). In pursuance of the Decree of the President of the Republic of Tatarstan No.UP-320 of July 10, 2008, a cluster in the sphere of information technolo- gies (IT cluster) is under development based on the republic’s enterprises and IT companies. This should promote the increase in revenues from IT sector to the republic’s budget, expand the range and improve the quality of IT services, and ensure the competitiveness of hi-tech and information technologies in the Republic of Tatarstan. The advantages of the cluster model are considered to be the consolida- tion of human resources and accumulated technology potential of partici- pants, opportunities of exchanging technology-related expertise and in- formation inside the cluster, development of partnership relations among participants, and the opportunity of utilising important elements of each other’s infrastructure by the participants. It is planned to use an outsourc- ing model in the work of the IT cluster. The technopark in the sphere of high technologies founded in the Re- public of Tatarstan (IT Park) is intended to promote the development of the IT sector and IT industry of both the republic and the Russian Federation and to serve as a basis for the development of scientific and technology potential of Russia. The objective of the IT Park is to ensure the most favourable conditions for newly created or developing IT companies at the stages of develop- ment and introduction of new software products into the market. This should encourage the development of domestic software industry in the republic and become a catalyst of hi-tech developments and their inten- sive introduction into key industries of the economy with a view of enhanc- ing the competitiveness of the republic in general. The IT Park project is designed to raise the investment appeal of Tatar- stan, attract large investors and partners for increasing the global competi- tiveness of local commodity producers. 6.2. TELEVISION AND RADIO BROADCASTING The work on the development of television and radio broadcasting sys- tem in the Republic of Tatarstan sustained through 2009, its primary tasks being the expansion ofTV broadcasting in predominantly rural areas, reno- vation of the existing broadcasting network, and creation of preconditions for the development of digital broadcast TV in the Republic of Tatarstan. In accordance with the federal concept and federal target programme, the work was continued on the Long-TermTarget Programme for Organisa- tion of Digital Television and Radio Broadcasting in the Republic of Tatar- stan for 2009-2015. Since the corresponding federal target programme was approved at the end of the year, the work on the Programme and system project was not finalised and has been deferred to 2010. As of January 1, 2010 the installed capacity of cable TV networks was 1,194,500 points. Community antenna and cableTV networks have been built in 15 cities of the republic. The total number of cable TV subscribers in the re- public was 468,500 households in 2009, which is 39% of the installed capacity. –– Q-Park Kazan Logistics Centre. • Innovation projects being implemented jointly with enterprises of oil, gas, and chemical industries: –– Dorocell stabilising additive based on grass cellulose for the pro- duction of stone mastic asphalt concretes; –– SNPKh-DS-1 Bozsyz Yul liquid environmentally sound agent for winter de-icing of the republic’s highways. • Jointly with DuPont and Consolid AG, a work is underway on intro- ducing advanced technologies for the modification of road bitumens with Elvaloy copolymers and Consolid system for strengthening local grounds when making transition pavements of access roads to rural settlements. Within the framework of preparations to the 27thWorld Summer Univer- siade 2013 in Kazan it is planned: • To create a network of state-of-the-art bus service stations and bus ter- minals in Kazan for ensuring adequate passenger transportation over intercity and suburban bus routes, removing the routes of 190 intercity and suburban buses from city limits, and relieving pressure on streets and roads by 3%. The construction is projected in the Orenburgsky Trakt Street (near the Republic’s Clinical Hospital), Gorkovskoye Shosse Street (near Frunze Street), and Mamadyshsky Trakt Street (near Kos- monavtov Street); • To complete the construction of the first underground line in Kazan consisting of three sections and to acquire a rolling stock of 125 trams (including 66 high-speed trams) and 250 trolleybuses; • To carry out the reconstruction of flatworks, light-signal and energy saving facilities, and the passenger terminal of Kazan International Airport. 6. INFORMATION AND COMMUNICATIONS The intensive and fruitful work of the infocomm sector of the Repub- lic of Tatarstan over the last 5 years allowed the companies in this sector to maintain their operational performance, financial stability, investment attractiveness, to continue the development of the telecommunication infrastructure, and to introduce information technologies into all spheres of life even in 2009, under the conditions of financial crisis. This is largely promoted by the high-quality digital infrastructure of communications cre- ated in Republic of Tatarstan. In 2009, the total gross income of RUR 28.749 billion was generated in the sector, which is 111.0% of the figure for 2008.The largest contributor to the sector’s gross income was cellular communications (48%). 6.1. INFORMATION SUPPORT The Law of Republic of Tatarstan No. 133-ZRT of December 27, 2005 has approved the “Programme for Social and Economic Development of the Republic of Tatarstan for 2005-2010”. This Programme comprises the Integrated Programme for Information Development in the Republic of Tatarstan (e-Tatarstan 2005-2010), in the framework of which a consider- able amount of work has been done in recent years for the development of infocomm infrastructure in the republic. Based on the results achieved by this pro- gramme, its new version was approved, the Republic’s Tar- get Programme for Develop- ment and Use of information and Communications Tech- nologies in the Republic of Tatarstan (e-Tatarstan 2008- 2010).The main objectives of this Programme are, through the large-scale application of infocomm technologies, to improve the quality of life in the Republic of Tatarstan, to enhance the effectiveness of the State and municipal administration in the Republic of Tatarstan, to improve the ac- cessibility and quality of government services for people and businesses, to increase the openness of authorities, to ensure the economic growth and competitiveness of the Republic of Tatarstan, and to raise the living standards and budget revenues. The integrated project of the e-Government of Tatarstan became a key
  • 24 6. INFORMATION AND COMMUNICATIONS Republic of Tatarstan: General Overview, State System, Economy 25 7. TOURISM Republic of Tatarstan: General Overview, State System, Economy Gigabit Ethernet (GE) interfaces from 1 to 10 Gbps have been run to each city and district centre of the republic. Based on the multiservice data back- bones, the corporate networks of public authorities, economic entities and financial business organisations are developing and a unified scientific and educational network of the Republic of Tatarstan is being formed. The total number of subscribers in the Republic of Tatarstan having ac- cess to the Internet using all wire and wireless technologies is 1,617,000. The number of broadband Internet subscribers reached 653,000; the number of GPRS/EDGE users increased to 892,000 and 3G users, increased to 103,000. In the last three years, the market of Internet services is undergoing a de- monopolisation. While in 2007 the majority of residents and organisations in the Republic ofTatarstan had dial-up access to the Internet, now the sub- scribers prefer high-speed access, dedicated lines, and use unlimited tariff plans of service providers. 6.6. POSTAL SERVICE In 2009, postal service continues to implement new ICT-based projects: within the framework of the KiberPocht@ project, 73 shared access points to the Internet (a total of 120 workstations) were created; within the frame- work of the PochtaBank project jointly with Ak Bars Bank, a total of 450 postal bank ATMs were installed to receive and dispense cash, to pay subsi- dies; a new project,“Remittances through Western Union”, was introduced; etc. In 2010, some new projects are scheduled for the introduction, such as provision of residents with public electronic services based on the mul- tipurpose centres and post offices using elements of e-Government of Tatarstan, provision of people with medicines and further extension of the range of new infocomm services. In recent years, the invest- ment climate has essentially improved in the sphere of tourism, with the number of tourist attractions tending to rise and the flows of tourists and number of jobs in this in- dustry growing increasingly. In Tatarstan, the Republic’s Target Programme for Tour- ism Sphere Development for 2009-2011 is being imple- mented. As to the development of the tourist industry in Rus- sia, the Republic of Tatarstan holds a lead in this field: over the last 5 years, the annual av- erage growth rates of domes- tic tourist flows were 12%, and even in the crisis year of 2009 the domestic tourism grew by over 5%. In 2009, the tourist flow to the republic reached 977,000, with the value of tourist and health resort services (including hotel services) having in- creased to RUR 4,885 million. Tourist services in the republic are rendered by over 500 travel companies, including some 300 in Kazan. Building of hotels continues at a high pace. The republic currently has 154 hotels with a total of 5,400 rooms, including 4-star and 5-star hotels. For tourists, Tatarstan is not only “the third capital of Russia” - the city of Kazan with the Kazan Kremlin, a UNESCO World Heritage site and a symbol of combination of Muslim and Orthodox cultural traditions. This is also the site of Boulgar known in the Islamic world as a “North Mecca”, Khuzhalar Tavy pilgrimage destination in Bilyarsk, the Virgin Monastery of Raifa, the Sviyazhsk island town founded under the decree of Tsar Ivan Grozny, the millennial town of Yelabuga associated with life and work of Ivan Shishkin, Marina Tsvetaeva and Nadezhda Durova, and the city of Chistopol con- nected with the name of Boris Pasternak. With a view of creating conditions for the development and employment of new tourist resources, effective development of the territory, the Decree of President of the Republic of Tatarstan Mintimer Shaimiev No.UP-408 of July 25, 2008 established the Tourist-Recreation Park Kamskiye Polyany uniting five districts of the republic. This area is located in the geographical centre of Tatarstan and is characterised by favourable climatic and natural conditions and significant historic and cultural potential. In 2009, networks of antenna TV reception were being reconstructed, which includes the upgrading of their infrastructure by installing mul- tiservice cable networks with larger number of rendered services. The number of satellite TV users is estimated at 12% of the total number of households. In 2009, the republic began the trial operation of IP-TV service (interac- tive digital TV) for subscribers connected to Internet via Ethernet Home Network. After completion of the trial operation stage, it is planned to expand the scope of IP-TV services to up to 100 TV channels, nVoD, VoD, Karaoke, Radio, and Time Shifted TV. The coverage by community antenna networks is 67% households. 6.3. COMMUNICATIONS Tatarstan was the first in Russia to completely switch over to 100% digital infrastructure and to the networks of the following generation (NGN). A number of important social and economic tasks have been solved in the republic: • Provision of the republic’s residents with tel- ecommunications; • Elimination of “digital inequality” between urban and rural areas as regards the provi- sion of communications and access to the Internet; • Provision of 100% access to universal tel- ecomm services in each settlement of the Republic of Tatarstan; • 3G and 4G standards have been introduced and are being developed; • Internet coverage continues to grow, already reaching 50%; • The sector is completely de-monopolised with operations being based on the public-private partnership. The subscribers’ base in the republic grew up to 7.161 million in 2009, including 1.116 million fixed-line subscribers and 6.043 million mobile sub- scribers. The average rate of the fixed-line telephone penetration in the republic is 31.3 phones per 100 persons, including 35.8 phones in urban areas (40.3 phones in Kazan, which corresponds to the European level of develop- ment) and 18.3 phones in rural areas. The coverage with home telephones is 99.6%, while the mobile penetration increased to 160.5%. The major areas in the development of new services are as follows: • Providing every household with access to the broadband Internet at up to 1 Gbps; • Enhancing the throughput of the backbone data transmission net- work, including the same for rendering HDTV services and servicing the traffic of data processing centres; • Introduction of LTE technology (4.5G high-speed wireless access). • Development of mobile WiMAX, a 4G network technology; • Further work on the development of the digital infrastructure of In- ternet broadband access with the use of high-speed wire and wireless technologies, development of 3G and 4G technologies, implementa- tion of the projects on the introduction of Triple Play (IP-TV) services and“optic-fibre-to-home”projects; 6.4. LOCAL, LONG-DISTANCE, AND INTERNATIONAL TELEPHONE COMMUNICATIONS The length of the local fibre-optical communication lines totalled over 3900 kilometres. The Republic of Tatarstan boasts a strong, flexible tel- ecommunication digital transport network, which allows it to ensure the introduction of the newest information technologies and all kinds of present-day telecommunication services, as well as to provide high-quality services of international, long-distance and local telephony via automatic or recording application systems. In the territory of the Republic of Tatarstan, services of local telephony are provided to subscribers by three operators, OAO Tattelecom, OOO Tel- eset, and OAO TatAisNeft. Individuals, enterprises and organisations of Tatarstan make use of long- distance and international telephony either in the“pre-select”or in the“hot choice” modes. The residents of the republic is widely using long-distance and international connections via IP-telephony that allows long-distance and international calls at low rates and with high quality. 6.5. DATA TRANSMISSION NETWORKS, THE INTERNET AND NEW SERVICES The main achievement in 2009 was the growth in providing people with Internet broadband access to 50%. In Tatarstan, unique multiservice networks of data transmission have been created and are operated which cover all regional centres and allow corporate users to implement their infocomm projects of any degree of complexity and with maximum efficiency. High-capacity data links with 7. TOURISM
  • 26 8. BUDGETARY POLICY Republic of Tatarstan: General Overview, State System, Economy 27 9. BANKING SYSTEM, ACTIVITIES OF CREDIT INSTITUTIONS Republic of Tatarstan: General Overview, State System, Economy Own funds of the banks continue to be used as a mechanism for pro- tecting the interests of creditors and investors, and even in such an uneasy situation Tatarstan banks persisted in increasing their capitals. The aggre- gate amount of own funds of the credit organisations in the republic grew almost to RUR 68 billion; over half of them (RUR 36.4 billion) is accounted for by Ak Bars Bank ranking 15th among the Russia’s largest banks in this indicator. The primary factor for growth in own funds of the banks in the republic was the increase in their authorised capitals by RUR 11.6 billion, with the highest growth recorded by Ak Bars Bank (by RUR 9.0 billion), In- tekhbank (by RUR 1.4 billion), and Akibank (by RUR 1.0 billion). As to the total number of large banks with registered capital of over RUR 150 million, Tatarstan yields to Moscow only, sharing the 2nd place with St.-Petersburg. As of today, there are 19 such banks in the republic out of 26 independent credit institutions, including 12 banks with registered capital in the amount of no less than RUR 300 million (of which 7 banks have own capital over RUR 1.0 billion). In the total number of credit institutions, the republic still ranked 4th in Russia, yielding only to Moscow, St.-Petersburg and the Republic of Dag- estan. Indicatively, the number of independent credit institutions in Tatar- stan did not change over 10 years, whereas in other regions of the Russian Federation the number of credit institutions reduced by 67 since Septem- ber 1, 2008 alone, including 8 credit institutions in the regions within the Volga Federal District. Local banks still prevail in the structure of Tatarstan banking sector (57%), considerably exceeding the average figure in the regions of the Volga Federal District (21%). At the same time, Tatarstan remains an attractive region for banking business: in 2009, another 2 branches of large Moscow banks started their operations in republic, the general number of branches of the banks from other regions totalling 20 at January 1, 2010. It is much higher than ten years earlier when only 9 such branches were operated in the republic. According to the Bank of Russia, Tatarstan ranks among regions with rather high level of payment system development. In the total number of banking establishments (1,621 at January 1, 2010) Tatarstan ranks 2nd in Russia, yielding to Moscow only. The bank density ratio in the republic is higher than in other regions: in Tatarstan, there is an average of 2,400 persons per bank office (2,200 per- sons a year earlier), while in the regions of Russia (without Tatarstan) this ratio is 3,400 persons per bank office. The operations of the banking sector of Tatarstan are not limited to the boundaries of the region; at present there are 143 branches of republic’s credit institutions in different cities of Russia. According to a study conducted by the Bank of Russia, 81.3% of enter- prises and organisations of the Republic of Tatarstan consider banking services in the region freely available, and 80% of the enterprises prefer to use services of the local banks. The activities of Tatarstan banks can be judged by the fact that virtually all of them (except for one) have closed the year with profits and, though its aggregate amount is lesser than in the last year, Tatarstan still ranks 2nd in Russia in this figure, yielding to Moscow only. While the instability of economy has made its adjustments in the activi- ties of the credit institutions working in Tatarstan, 2009 basic figures ex- ceeded the pre-crisis level. The republic still holds a lead keeps both in the Volga Federal District and in Russia in the aggregate amounts of own and borrowed funds, deposits, assets, and credit investments into economy. The resources raised by credit institutions totalled RUR  452.7 billion, having exceeded the 2008 figure by RUR 50.8 billion or 12.7%. Household deposits in the credit institutions totalled RUR 151.9 billion, an increase of RUR 34.5 billion (up 29.3%) versus last year. Funds at legal entity accounts in the credit institutions was RUR 201.7 billion, an increase by RUR 29.8 billion or 17.3% versus last year. A total of RUR 437.7 billion of credits and other loans have been granted, which represents a growth by RUR 8.8 billion (up 2.0%) over the last year. Long-term credits are still the largest contributor to the total amount of credits (64%); they grew in the preceding year by 7.8% to RUR 279.9 billion. Credits to economy totalled RUR 330.1 billion (75.4% of the total amount), which is higher by RUR 12.3 billion (up 3.9%) over the last year. Credits to households totalled RUR 67.8 billion (15.5% of the total amount), which is lower by RUR 17.4 billion (down 20.4%) compared to 2008. The banks of Tatarstan are at all times on the list of the Russia’s largest banks in the aggregate amount of their own funds (capital) and also in the amount of assets (Ak Bars Bank, Tatfondbank, Devon-Credit, Energobank, Spurt, BTA-Kazan, Kazansky, Akibank). Moreover, Ak Bars Bank is repeatedly found on the list of top 30 banks in the amounts of earned profit, deposits received from natural persons, interbank credits, credits to non-state or- ganisations and private persons, as well as on the list of top 30 investor banks.Three banks in the republic (Tatfondbank, Devon-Credit, and Ak Bars Bank) were among the Russia’s 100 most reliable large banks. The republic was one of the first to connect to the Bank of Russia Re- al-Time Gross Settlement System (BESP System) which supports the real time payments. In the accounting year, new participants connected to the System, which resulted in 1632 electronic payments in the amount of RUR 410.2 billion (compared to 215 payments to a total of RUR 59.8 billion during the previous year). Once the newest banking technologies develop, the sphere of services rendered by republic’s banks to their clients also expands. For instance, the number of remote accounts grew over the year by 1.4 times representing today 13.5% of the total number of accounts (compared to 10.6% in the previous year). Services granting access to accounts through the Internet or mobile phones are also increasingly in demand; the number of such ac- counts grew over the year by the same 1.4 times. The majority of payment transactions in 2009 were made through electronic payments systems, with their contribution having grown during the year from 88.9% to 90.8%. In summary, Tatarstan boasts a developed financial system being for any region a visiting card for potential investors and one of the factors for successful social and economic development. The 2009 consolidated budget of the Republic of Tatarstan totalled RUR 140.6 billion in revenue, which constitutes 104.2% of the approved allocations. The budget of the Republic of Tatarstan mobilised a total of RUR 117.1 billion, of which 67.9 billion were tax and non-tax revenue. The implementation of projected allocations of the revenue side of the Tatar- stan budget was 104.7%. Local budgets mobilised RUR  23.5 billion or 101.9% from the approved allocations. The consolidated budget revenue, as in former years, was primarily based on individual income tax, profits tax, and corporate property tax. The individual income tax was collected in the consolidated budget of the Republic of Tatarstan in the amount of RUR 31.7 billion. The corpo- rate profits tax amounting to RUR 24.6 billion was predominantly gen- erated by oil production sector, power industry, transport and financial organisations. The corporate property tax was RUR 8.7 billion in total, its increase being largely due to the acquisition and renovation of produc- tion assets in such spheres of economic activities as mining operations, construction, and production and distribution of electric energy, gas, and water. Transport tax totalled RUR 1.3 billion. The land tax, as one of the basic sources of revenue for local budgets, was collected in the consolidated budget of the Republic ofTatarstan in the amount of RUR 3.9 billion. The lump-sum taxes payable by small and medium-sized businesses to the consolidated budget of the republic totalled RUR 3.6 billion. With a view of expanding the sphere of SME activities in the Republic of Tatarstan, increasing the interest of local governments in its development, a major proportion of lump-sum taxes is received by local budgets. In 2009, local budgets received 64% of lump-sum taxes. Planned expenses of the consolidated budget and the budget of the Re- public of Tatarstan, as well as local budgets, were drawn down to 98% in 2009; cash disbursements of the consolidated budget totalled RUR 152.7 billion; of the republic’s budget, RUR 123.7 billion; and of local budgets, RUR 29.0 billion.Within the year, inter-budget transfers were allocated from the budget of the Republic of Tatarstan to local budgets in due time and in full to a total of RUR 26.1 billion. The year of 2009 was critical in overcoming the negative trends arisen as a result of the world financial crisis. Despite difficult condi- tions, the banking sector of the Republic of Tatarstan succeeded in meeting the challenges of the crisis situation in the economy and main- taining the positions attained earlier in the mar- ket of banking services both in theVolga Federal District and in the Russian Federation. This was promoted by adequately scaled and timely actions undertaken by the Russian Government, the Central Bank of Russia and the National Bank of the Republic of Tatarstan. According to the estimate of the Russian Minis- try of Regional Development, Tatarstan ranked among top eight regions of Russia that have developed the most efficient anti-crisis pro- grammes. The banking community of the republic, jointly with State government bodies, has worked out a package of proposals aimed at preventing the consequences of the crisis and supporting the enterprises and their produc- tion plans, continuing lending, maintaining the workforce at large enterprises, and preserving small and medium-sized businesses. 8. BUDGETARY POLICY 9. BANKING SYSTEM, ACTIVITIES OF CREDIT INSTITUTIONS
  • 28 10. TARIFFS Republic of Tatarstan: General Overview, State System, Economy 29 11. EMPLOYMENT Republic of Tatarstan: General Overview, State System, Economy The workforce potential of the Republic of Tatarstan in 2009 was es- timated at 1,995,710 on the average (53% of the total population in the republic), of which 1,826,710 (91.5%) of economically active population was employed in the economy and 169,010 (8.5%) were without work but actively seeking employment (in accordance with the methodol- ogy of the International Labour Organisation they are treated as unem- ployed). In January to December 2009, a total of 1,346,300 people were working by hire in all kinds of enterprises and organisations. Over 510,000 were em- ployed in small businesses; of these, 294,100 were employees of small and micro enterprises, 14,600 were employed in peasants’ (farmers’) establish- ments. Over 264,500 people were working in private households produc- ing goods and services for sales without being registered with enterprises (organisations). The Republic of Tatarstan is one of the most investment favourable re- gions of the Russian Federation, which is ensured by optimum combina- tion of high investment potential and low investment risk.This is confirmed by international rating agencies. In 2010, Fitch confirmed the long-term and short-term credit rating of Tatarstan in foreign currency at BBB- and F3 (stable outlook), respectively; the short-term rating at the national scale was confirmed at the level of AA+ (rus). According to Expert RA, a Russian rating agency, Tatarstan in 2008-2009 has been one of the “supporter regional leaders” in the general rating of Russian regions holding the 11th position among the 83 constituent enti- ties of the Russian Federation and ranking 2nd in the Volga Federal District in this indicator yielding to the Republic of Bashkortostan. In 2008-2009, Tatarstan ranked 12th in the Russian Federation in the in- vestment risk and 7th in the investment potential. Within the Volga Federal District, the republic is one of the most “safe” regions for foreign investors. This is largely promoted by the creation of the investor-friendly regulatory and legal environment, political stability, and economic growth. The economy of the Republic of Tatarstan received a total of US$2,240.3 million of foreign investment in 2009, with direct investment accounting for 5.1% (US$113.3 million) of the total amount of investment received, and other investment accounting for 94.9% (US$2,126.9 million). The percent- age of portfolio foreign investment was insignificant. The structure of foreign investment received in the republic in 2009 broken down by economic activities was as follows: 77.79% (US$1,742.3 million) in real estate activities, 18.36% (US$411.3 million) in mining op- erations, 3.31% (US$74.2 million) in manufacturing activities, and 0.54% (US$12.2 million) in other activities. In 2009, the main investment contributors were Luxembourg (51.1% of the total raised foreign capital), France (24.2%), Germany (12.9%), Nether- lands (6.7%), Cyprus (2.0%), Panama (1.3%), United Kingdom (0.8%), USA (0.5%), and Bulgaria (0.4%). Investments were also raised from Sweden, Switzerland,Turkey, Italy, Estonia, Hungary, Belarus, UAE, China, Azerbaijan, Kazakhstan, and Lithuania. In general, the economy of Tatarstan accumulated US$5,843.1 million of foreign investment as of 1 January 2010. INTERNATIONAL CREDIT RATINGS OF THE REPUBLIC OF TATARSTAN IN 2003-2009 2003 2004 2005 2006 2007 2008 2009 Moody’s Ba3 Ba1 Ba1 Ba1 Ba1 Ba1 - Standard & Poor’s B- stable B- positive B positive BB- stable BB- positive BB positive BB stable* Fitch - - BB BB BB+ BBB- BBB- * Rating withdrawn from 01.06.2009 Power supply Rates for the electric energy supplied by OAO Tatenergosbyt to consumers of the Republic of Tatarstan in 2010 Indicator (customer groups broken down by tariff rates and differentiated by time zones) Unit of measurement Voltage ranges HV MV-I MV-II LV Other customers (tariffs indicated are without VAT) Single-rate tariff differentiated by a number of hours of using the contracted power  from 7,001 hours and higher RUR /MWh 1,557.90 1,816.20 2,766.20 3,852.60 from 6,001 to 7,000 hours RUR /MWh 1,674.90 1,968.70 3,053.70 4,102.80 from 5,001 to 6,000 hours RUR /MWh 1,834.30 2,176.60 3,157.20 4,106.40 less than 5,000 hours RUR /MWh 1,834.80 2,382.00 3,160.80 4,110.00 Double-rate tariff - incl. demand charge RUR / MWmonth х х х х - incl. energy rate RUR /MWh х х х х Tariffs differentiated by three time zones - night zone RUR /MWh 1,301.89 1,594.29 2,830.69 3,115.09 Tariffs differentiated by two time zones - night zone RUR /MWh 1,301.89 1,594.29 2,830.69 3,115.09 - day zone RUR /MWh 1,641.00 1,933.40 3,169.80 3,454.20 Organisations rendering electric power transmission services which purchase energy to compensate for the process consumption (losses) in electricity grids (tariffs indicated are without VAT) Single-rate tariff RUR /MWh 1,044.02 1,044.02 1,044.02 1,044.02 When establishing own generating facilities, the enterprises should have an approval of the kind of fuel to be used. Gas supply Natural gas to consumers in the Republic of Tatarstan is supplied by ZAO Tatgazinvest, a regional specialised gas selling enterprise carrying out the functions of an authorised operator of the Government of the Republic of Tatarstan, and OOO Mezhregiongaz (OAO Gazprom) purchasing natural gas, selling it to consumers based on contracts, and ensuring the payment discipline. Gas supply rates: RUR /’000 cubic metres (without VAT) Water supply Water to the republic’s inhabited localities is supplied through central- ised and decentralised systems operated by state-run enterprises GP Vo- dokanal, GUP RPO Tatselzhilkomkhoz, municipal unitary enterprises (MUP Vodokanal Kazan, ZAO Chelny-Vodokanal) and eligible large city-forming enterprises, such as OAO Tatneft, OAO Kazanorgsintez, OOO Tattransgaz, etc. The centralised water supply systems are operated in the cities and towns of Kazan, Naberezhnye Chelny, Yelabuga, Chistopol, Aznakayevo, Zelenodolsk, Almetyevsk, Leninogorsk, Bugulma and several rural settle- ments. Public utility companies supplying water: MUP Vodokanal Kazan, ZAO  Chelny-Vodokanal; ZAO  Voda Prikamiya; OAO  Zelenodolsk-Vodokanal; OAO  Urussu-Vodokanal; OAO  Almetyevsk- Vodokanal; OAO  Bugulma-Vodokanal; OAO  Buinsk-Vodokanal; OOO  Za- insk-Vodokanal; OAO  Tetuyshi-Vodokanal; OOO  Vodokanal Leninogorsk; OAO Nurlat-Vodokanal; OAO Chistopol-Vodokanal; OAO Alekseyevsk-Vo- dokanal; OAO MamadyshskyVodokanal; GP Mendeleyevsk-Vodokanal; and OAO Bavly-Vodokanal. 10. TARIFFS 11. EMPLOYMENT 12. ATTRACTION OF INVESTMENT Effective date Wholesale price for customers in Tatarstan End price for gas (by consumer groups) over 500 million cubic metres from 100 to 500 inclusive from 10 to 100 inclusive from 1 to 10 inclusive from 0.1 to 1 inclusive from 0.01 inclusive to 0.01 inclusive Orders of the Federal Tariff Service: No. 440-e/21 of December 18, 2009; No. 540-e/19 of December 24, 2009. Resolution of the Tatarstan Committee for Tariffs No. 4-3/e of December 4, 2009 starting from January 1, 2010 2,364.0 2,676.45 2,750.33 2,912.11 3,187.39 3,189.21 3,264.6 3,272.08
  • 30 13. SPECIAL ECONOMIC ZONE IN YELABUGA Republic of Tatarstan: General Overview, State System, Economy 31 14. INNOVATION ACTIVITIES Republic of Tatarstan: General Overview, State System, Economy The key aspect in the creation of the competitive national economy is the innovation approach, that is, the changes in the economy manage- ment formats and methods, introduction of new, innovative technologies into production, and the creation of the system of innovation education. Starting in 2005, the Republic is implementing a Programme for Social and Economic Development which is aimed at the transition from the raw material-based economy to the economy of innovation. The Republic of Tatarstan concentrates a considerable industrial and scientific potential in over 90 institutions of higher education and some 100 scientific research institutions and design bureaus, the Academy of Sci- ences of the Republic of Tatarstan, and the Kazan Scientific Centre of the Russian Academy of Sciences uniting a number of academic institutions of national importance. The proportion of active innovation enterprises in Tatarstan is higher than the Russia’s average (12.5% in Tatarstan versus 9.0% of Russia’s aver- age), and the republic is quite high in this list, ranking fourth among the constituent entities of the Russian Federation. Within the framework of the Programme for Innovation Activity Devel- opment in the Republic ofTatarstan, a network of technoparks is being cre- ated in the republic in 2 basic areas: commercialisation of scientific devel- opments and innovation development of industrial production. To date, Tatarstan has created a Special Economic Zone, technoparks, industrial parks, a technopolis, and business incubators. In 2009, a technopark in the sphere of high technologies was opened – the IT-Park, with a mission of ensuring the accelerated innovation develop- ment of high-tech sectors of economy and production of new knowledge- intensive products based on the scientific, educational, and industrial potential of the republic. With an aim of accumulating investment resources and focusing them on the implementation of inno- vative projects, the republic established a state-run non- commercial organisation, Investment & Venture Fund of the Republic of Tatarstan. For attracting long term in- vestments to major projects in Tatarstan by means of in- vestment risks mitigation, a state-run non-commercial Stabilisation Pledge & Insur- ance Fund of the Republic of Tatarstan was established in the republic. Active integration of sci- ence and business, introduc- tion of the newest scientific achievements into the indus- trial production is an indica- tor of efficient national inno- vation system, which means the successful economic development. In this respect, Tatarstan is a good strategic location to create and introduce high-tech manufacturing facili- ties, including those with the participation of foreign capital. The Special Economic Zone of Industrial Pro- duction Type Alabuga is located in the territory of the Yelabuzhsky District of the Republic of Tatarstan, 25 kilometres away from Naberezhnye Chelny and 40 kilometres away from Nizhnekamsk. There are two SEZs of industrial pro- duction type in Russia, the SEZIPT Alabuga being the largest with an area of 20 square kilometres. The territory of SEZIPT Alabuga is divided into a certain number of land plots, or modules.The area of the module can be 5, 10, 20 or more hectares. All necessary communica- tions are brought to each module: motorways, electricity, heating network, gas, water, sewage, high-speed communication lines, etc., and a resident receives the junctions of these utilities near its land plot. One of the best advantages of the SEZIPT is that the residents are guar- anteed considerable tax privileges and steady rules of business for the en- tire period of existence of the Zone, i.e. for 20 years. Residents are granted a number of preferences: • Free customs area treatment, which means that foreign equipment is installed and used within the SEZIPT without payment of customs duties and VAT. • They shall not pay export duties for their prod- ucts. • They shall be exempted from the property and land taxes. In order to ensure the most favourable treat- ment and to cut bureaucratic expenses, the SEZIPT Alabuga employs a “single window” approach. The customer service area located in the SEZIPT busi- ness centre hosts offices of 16 State regulatory authorities. Residents of the SEZIPT Alabuga enjoy the opportunity of solving all routine problems of interaction with governmental authorities within SEZIPT borders. For the first time in Russia this kind of system is being arranged in the territory of an in- dustrial site. As of today, residents registered in the SEZIPT Al- abuga are implementing large-scale projects in the fields of automotive industry, petrochemical sector, construction industry, and engineering equipment. In addition to the already registered residents, there are a number of companies engaged in the production of automotive com- ponents, mechanical engineering, woodworking, chemistry and other sec- tors who have plans to place their production facilities in this territory in the near future. As of January 1, 2010, the following residents have been registered in the SEZIPT Alabuga: • OOO Sollers-Yelabuga (launching the Fiat Ducato vans production); • ZAO Severstal Auto-Isuzu (production of trucks); • ZAO Polimatiz (production of nonwoven Spanbond and Spanmelt ma- terials); • OOO Rockwool-Volga (production of mineral wool); • ZAO Engineering Equipment Plant (production of heat pumps and ele- ments of climatic control systems); • OOO Septal (production of equipment for local and small sewage sys- tems); • OOO P-D Tatneft-Alabuga Steklovolokno (production of fibreglass); • OOO Air Liquide Alabuga (production of technical gases: liquid oxygen, liquid nitrogen, gaseous oxygen); • OOO Akulchev-Alabuga (launching the confectionery and bakery pro- duction); • Kastamonu Entegre (launching the MDF and particle board production); • ZAO Trakaya Glass Rus (building the plant for production of float glass, automotive glass and mirrors); At December 1, 2009, capital investments of the SEZIPT residents to- talled RUR 1.18 billion (some US$ 37 million). 13. SPECIAL ECONOMIC ZONE IN YELABUGA 14. INNOVATION ACTIVITIES SEZIPT iz located nearYelabuga,Yelabuga District of the Republic ofTatarstan, 25 km away from Naberezhnye Chelny, 40 km away from Nizhnekamsk, and 215 km away from Kazan (the capital of the Republic ofTatarstan) Total SEZIPT area is 20 square km
  • 32 15. FOREIGN ECONOMIC AND INTERREGIONAL ACTIVITIES Republic of Tatarstan: General Overview, State System, Economy 33 15. FOREIGN ECONOMIC AND INTERREGIONAL ACTIVITIES Republic of Tatarstan: General Overview, State System, Economy The contribution of wood and wood products remained constant with 0.2%, as well as that of non-ferrous metals with 0.1%, while the contribu- tion of machines and equipment dropped to 6.2% (from 6.6%) and cyclic hydrocarbons, to 0.3% (from 0.9%). In 2009, the value of exports from the Republic ofTatarstan totalled some US$ 11.8 billion, representing a 36.3% decrease versus last year. Exports to the CIS countries decreased by 26.7% amounting to over US$ 1.7 billion; to the non-CIS countries, they dropped by 37.7% amounting to US$ 10 billion. The contribution of the CIS countries to the republic’s exports was 14.8% in 2009 (12.9% in 2008), of the non-CIS countries, 85.2% (87.1% in 2008). Major countries consuming republic’s exports in 2009 were Italy (13.5%), Turkey (13.1%), Poland (11.5%), the Netherlands (8.1%), Belarus (5.9%), and Ukraine (4.5%). In the last three years, the Republic of Tatarstan is still among top five Russia’s regions in the volumes of exports and currently holds the lead in the Volga Federal District. Imports to Tatarstan play a considerably smaller role in the foreign trade of the republic than exports from it. At the same time, a persistent growth of the republic’s imports was recorded in recent years (before 2009). Under the conditions of the global economic crisis, imports in 2009 decreased by US$ 1,221.5 million compared to 2008 (down 41.7%) amounting to US$ 1.7 billion. Imports from the non-CIS countries dropped by 41.8% to the amount of US$ 1,407.8 million; imports from the CIS countries decreased by 34% to the amount of US$ 335.3 million. The contribution of the CIS countries to imports increased to 19.2% (compared to 17.3% in 2008), while imports from the non-CIS countries decreased to 80.8% (from 82.7%). 15.1. BASIC INDICATORS OF FOREIGN ECONOMIC ACTIVITIES Trade and economic relations of Tatarstan with foreign countries and regions of the Russian Federation are of great importance for its economy. Noteworthy is a wide range of republic’s international ties. Their scope is considerably widened, geography expanded, and content became richer. Over the recent years (before the global financial and economic crisis), the foreign trade turnover of the Republic ofTatarstan developed at a rapid pace, with the annual average growth rates of some 35% in 2005-2008. In 2009, against the background of adverse external factors – slowdown of the world economy and the global market slump – the foreign trade of the Republic of Tatarstan recorded a decrease of its basic figures. Accord- ing to the Tatarstan Committee for Statistics, the foreign trade turnover of the Republic of Tatarstan in 2009 totalled US$ 13.45 billion (with exports of some US$ 11.8 billion and imports of US$ 1.7 billion), which is lower by 37% than the 2008 FTT. In 2010, owing to the forecasted gradual recovery from the global crisis, the basic indicators of the economic development of the Republic of Tatar- stan (including the indicators of foreign trade activities) are expected to grow as a result a number of anti-crisis measures, global economic revival, and implementation of local companies’investment programmes. The balance of Tatarstan foreign trade was traditionally positive with US$ 10 billion (a decrease by 35.3% or US$ 5.5 billion y-o-y). The export/import coverage ratio was 8.4 (for reference: in 2008 it was 6.3). BASIC INDICATORS OF FOREIGN TRADE TURNOVER OF THE REPUBLIC OF TATARSTAN, US$ million 2002 2003 2004 2005 2006 2007 2008 2009 FTT 3,649.4 4,709.9 6,452.5 10,083.4 12,465.9 15,279.2 21,373.4 13,491.6 Exports from Tatarstan 3,274.4 4,220.4 5,871.7 9,373.2 11,367.0 13,502.9 18,445.8 11,748.6 Percent of exports to FTT 89.7% 89.6% 91.0% 93.0% 91.2% 88.4% 86.3% 87.1% Imports to Tatarstan 375.0 489.5 580.8 710.2 1,098.9 1,776.3 2927.6 1,743.0 Percent of imports to FTT 10.3% 10.4% 9.0% 7.0% 8.8% 11.6% 13.7% 12.9% Balance 2,899.4 3730.9 5,290.9 8,663.0 10,268.1 11,726.6 15,518.2 10,005.6 Percent of balance to FTT 79.4% 79.2% 82.0% 85.9% 82.4% 76.7% 72.6% 74.2% Export/import coverage ratio 8.7 8.6 10.1 13.2 10.3 7.6 6.3 6.7 Over the last eight years, the contribution of exports to the foreign trade turnover of the Republic of Tatarstan constituted 90±3% (in 2009, some 87.1%), while of imports it was 10±3% (in 2009, some 12.9%). Despite the decrease in the monetary value of crude oil, its contribution to the republic’s exports remains rather high. In the 2009 structure of ex- ports, crude oil accounted for 64.6% (compared to 66% in 2008). In 2009, the contribution of oil products grew to 15% (compared to 14.8% in 2008); plastics and plastic products, to 3.3% (1.7%); tyres, to 1.2% (0.9%); and synthetic rubber, to 5.6% (5.4%). 15. FOREIGN ECONOMIC AND INTERREGIONAL ACTIVITIES Foreign trade turnover of the Republic of Tatarstan Exports from the Republic of Tatarstan IMPORTS TO THE REPUBLIC OF TATARSTAN Structure of Tatarstan exports in 2009 Tatarstan exports by countries in 2009 Tatarstan imports by countries in 2009
  • 34 15. FOREIGN ECONOMIC AND INTERREGIONAL ACTIVITIES Republic of Tatarstan: General Overview, State System, Economy 35 15. FOREIGN ECONOMIC AND INTERREGIONAL ACTIVITIES Republic of Tatarstan: General Overview, State System, Economy The foreign trade turnover with major trading partners ofTatarstan is tra- ditionally being formed for the most part by deliveries of republic’s crude oil, oil products, organic chemistry compounds, trucks, and imports of ma- chines and equipment. 15.3. INTERREGIONAL AND INTERNATIONAL COOPERATION Interregional activities Interregional activities play a growing role in the economic develop- ment of Tatarstan and become increasingly diversified. The Government of the republic seek to create favourable conditions for ensuring access of the republic’s manufacturers to Russian markets and strengthening their positions there. In 2008, the interregional turnover of the Republic of Tatarstan totalled some RUR 315.1 billion (with exports of RUR 193.8 billion and imports of RUR 121.3 billion), recording a growth by a factor of 1.25 year-on-year. Top ten regions intensively cooperating with Tatarstan are Moscow, Moscow Region, Samara Region, Republic of Bashkortostan, Chelyabinsk Region, Sverdlovsk Region, St.-Petersburg, Nizhny Novgorod Region, Tyu- men Region, and Perm Krai. These regions account together for 56% of the interregional turnover of the Republic of Tatarstan (RUR 167 billion in the aggregate). In general, the republic maintains cooperation ties with 81 con- stituent entities of the Russian Federation. International cooperation One of the priority tasks of the Government of the Republic of Tatarstan is the development of foreign trade activities and promotion of products manufactured by Tatarstan enterprises to the markets of foreign countries. The Republic of Tatarstan is high on the list of constituent entities of the Russian Federation in the amounts of investments raised and in invest- ment attractiveness. Large-scale international events held in 2009 testify to the unflagging interest of the international business community to our republic. The Republic of Tatarstan is regularly visited by high-ranking officials from the CIS and non-CIS countries and foreign business missions; visits of the ambassadors of foreign states are organised during which business events are held. Following the results of the visits, intergovernmental and interdepart- mental agreements, memorandums and protocols are signed, in the frame- works of which Tatarstan enterprises carried out trade and economic inter- action with foreign partners. Close attention is paid to the cooperation with business partners from countries of Europe, North and South America, Asian-Pacific region with an aim of renovatingTatarstan enterprises, developing import-substituting productions, implementing innovation projects, and promptly introducing the goods manufactured in Tatarstan to new points of demand. The projects implemented by Tatarstan enterprises jointly with business partners from the CIS countries, Middle East and Europe in the fields of au- tomotive, aircraft and mechanical engineering, chemical and petrochemi- cal industries, science and education, as well as advanced energy-saving and nanotechnologies under development in Tatarstan testify to the effec- tiveness of these international events and visits. Cooperation with the CIS countries With a view of strengthening the positions of the leading republic’s com- panies in the markets of the CIS countries, the work is underway within the signed intergovernmental agreements and created working groups on the development of trade, economic and investment cooperation between the Republic of Tatarstan and the CIS countries, in particular, with Turkmeni- stan, Belarus, Kazakhstan, and Azerbaijan. For instance, the working visit of the delegation from the Republic of Tatarstan to the Republic of Belarus resulted in signing the Intergovern- mental Protocol of Measures for Cooperation Development in 2009-2010. OAO Tatneft is working out an issue of building gasoline stations in large settlements and highways of Belarus. OAO PO YelAZ is carrying out the ac- tions for localisation of components for Belarus-82.1 wheel tractors jointly with RUP MTZ. In the second quarter of 2009, OAO NPO Tatelektromash ar- ranged the production of KZS-812 combine harvesters at its production fa- cilities from vehicle sets of PO Gomselmash. OAO Nizhnekamskneftekhim is effecting mutual deliveries with Polyworld plant of OAO Naftan. Examples of successful cooperation also include the opening in Kazan of an office of Ukraine-based OAO Frunze Plant being one of the largest manufacturers of the punched metal products in the countries of Eastern Europe and the CIS and the successful operation of Kazakhstan-based KamAZ-Engineering plant releasing nearly every second KamAZ truck of foreign manufacture. Cooperation with the non-CIS countries The practice of direct contacts with “locomotive” regions of foreign countries is continued, including the developing cooperation between the Republic of Tatarstan and the Free State of Saxony (Germany), Shandong Province (China), and East Azerbaijan Province (Iran). With an aim of attracting advanced technologies to the republic, a Ger- man-Russian Competence Centre for Mechanical Engineering / Production Technology is being created in the Republic of Tatarstan. A joint venture project is underway between OAO Kazan Electrotechnical Plant and Sax- on-based CARNET GmbH to develop the automated control systems and methodology of their introduction for the enterprises with 150 to 1500 employees; it is supposed to create an educational centre for training spe- cialists. A joint construction project of fibre glass production facilities of OAO Tatneft and Saxon-based Preiss-Daimler Group is now in its comple- tion stage. On May 4, 2010 the construction of two new factories of Turkish com- panies was launched in the territory of SEZIPT Alabuga, a wood particle board and MDF production facility by Kastamonu Entegre (a member Five major countries importing goods to the Republic of Tatarstan ac- counted for over half of the imports (Germany, 23.4% of the republic’s im- ports; Italy, 11.3%; Ukraine, 7.2%; Belarus, 7.1%; and Belgium, 6.6%). The commodity structure of imports to the republic was dominated by machines and equipment (75.1%). Petrochemical products (plastics, prod- ucts of organic chemistry) held the second place with 6.4%. Metals and metal products come third with 1.8%. In terms of imports, the Republic of Tatarstan ranks 15th among the re- gions of the Russian Federation and 2nd among the regions of the Volga Federal District yielding to Nizhny Novgorod Region. Export promotion One of the major areas in the implementation of the state policies in the sphere of foreign trade activities is the support of export-oriented manu- facturers which make products with high degree of processing that are competitive not only in the domestic Russian market, but outside of Russia as well. Since 2005, the Republic of Tatarstan takes an active part in the federal programmes of financial support to exporting enterprises. For instance, in pursuance of the Resolution of the Government of the Russian Federation No.357 of June 6, 2005 “On Approving the Rules of Reimbursement from Federal Budget to Russian Exporters of Industrial Products of a Part of Ex- penses Towards Payment of Interests on Credits Received in Russian Credit Organisations” the republic’s export-oriented enterprises were paid over RUR 256 million in 2009. At the regional level, a support is also rendered to republic’s export- oriented manufacturers through involvement of the republic’s enterprises in the events held with an aim of developing trade and economic coop- eration (trade and economic missions, business forums, round table dis- cussions, international conferences, visits of Tatarstan delegations to the CIS and non-CIS countries). Furthermore, the enterprises participate in the exhibitions and fairs which are partially funded from budgetary resources. For the purpose of promoting the republic’s products to foreign markets, catalogues of the Export Products Manufactured by Enterprises of the Re- public of Tatarstan and the Investor’s Guide are published which, together with presentations and information materials about the republic and its commodity producers are distributed during the visits of delegations from the Republic of Tatarstan abroad. With a view of encouraging the republic’s enterprises supplying their products for exports, the participation of companies from Tatarstan is ar- ranged in the annual Russia’s exporters competition, “The Best Exporter of the Russian Federation”. Many republic’s enterprises, such as OAO KAMAZ, OAO Nizhnekamskneftekhim, OAO Kazanorgsintez, OAO Kazan Elektropri- bor Plant and others became the winners of The Best Exporter of the Rus- sian Federation award for many times. In 2009, the following organisations from the Republic of Tatarstan be- came its winners: OAO KAMAZ (as The Best Russian Exporter in Its Sector). FGUP Production Association Sergo Plant (as The Best Russian Exporter to CIS Countries in Its Sector). OOO Trade House Kama (as The Most Intensively Developing Russian Exporter in its Sector). 15.2. FOREIGN TRADE PARTNERS OF TATARSTAN In the geographical structure of foreign trade, the non-CIS countries still hold the priority over the CIS countries despite the growth of trade turno- ver with the latter: in 2009, the turnover with the CIS countries was 15.4% of the total foreign trade turnover of the Republic of Tatarstan, while the non-CIS countries accounted for 84.6% Tatarstan exports by countries in 2009 Structure of Tatarstan imports in 2009
  • 36 15. FOREIGN ECONOMIC AND INTERREGIONAL ACTIVITIES Republic of Tatarstan: General Overview, State System, Economy 37 15. FOREIGN ECONOMIC AND INTERREGIONAL ACTIVITIES Republic of Tatarstan: General Overview, State System, Economy Cooperation with the European Bank for Reconstruction and Develop- ment In 2009, the European Bank for Reconstruction and Development was providing financing of a joint project with MUP Vodokanal on the renova- tion of water supply in Kazan; also continuing is the cooperation on grant- ing credit lines with Kazan-based AKB Spurt and OAO Bank Kazansky. Cooperation with the Islamic Development Bank Group In 2009, the First International Islamic Business and Finance Summit (KA- ZANSUMMIT 2009) was held in Kazan under the auspices the Islamic Devel- opment Bank. The event was attended by some 250 people from over 30 countries worldwide. Following the Resolution adopted at the Summit, this event was decided to be held on an annual basis. In 2010, the Tatarstan International Investment Company was founded in Kazan with support of the Government of the Republic of Tatarstan, the Islamic Development Bank Group and investors from the Kingdom of Saudi Arabia, Bahrain, United Arab Emirates, Malaysia, andYemen. Priority lines of TIIC investment cooperation will be as follows: • Infrastructural projects (participation in toll highway construction); • Construction of real estate projects (international centre for exhibi- tions and conferences); • Small-scale power generation projects in the Republic of Tatarstan; • Islamic financial services (leasing company, investment funds, etc.); • Projects in the field of telecommunications, agriculture, finance, min- ing and processing industries, power sector, and services. Financial and credit cooperation with the IDB Group in the field of waqfs in the Republic of Tatarstan also continues successfully. With a view of strengthening the cooperation between the Republic of Tatarstan and the Islamic Development Bank Group, it is planned to arrange seminars with the IDB Group for representatives of Tatarstan banks, invest- ment financial companies, and enterprises in order to study the promising areas of cooperation as regards to the attraction of investments to projects in the territory of the Republic of Tatarstan and to projects in the territories of member countries of the Organisation of the Islamic Conference, provi- sion of loans for export-import transactions with OIC countries, etc. Improvement of investment climate, creditors’protection and expansion of common financial services With a view of improving the investment climate in the Republic ofTatar- stan and establishing relations with the Great Duchy of Luxembourg, the seminar “Financial Structures of Luxembourg” was held in October 2009. Studying the experience in the field of financial structures and instruments of Luxembourg has contributed to the increase in the economic awareness of seminar participants, representatives of banking, financial, and legal structures. As regards the use of alternative financing vehicles, a work is underway with the Islamic Development Bank on the opening of so-called “Islamic windows” in Tatarstan banks to carry out investment, commodity credit and leasing transactions based on Islamic principles. 15.4. INTERGOVERNMENTAL AGREEMENTS The development of close ties with Russian regions is largely promoted by creating a strong legal basis for cooperation. As of April 15, 2010 the Republic of Tatarstan has signed treaties and agreements with 68 regions of the Russian Federation, of which 22 have implementation protocols. For more information about these documents, please visit the official site of the Ministry of Industry and Trade of the Republic of Tatarstan at http://mpt.tatar.ru/rus/documents.htm (in Russian). 15.5. ACTIVITIES OF REPRESENTATIVE OFFICES AND TRADING HOUSES OF TATARSTAN Representative offices Representative offices and trading houses of the Republic of Tatarstan are an important tool of foreign economic activities. Today, the Republic of Tatarstan maintains a system of representative offices being instrumental in developing governmental, trade and economic cooperation at regional and international levels, attracting foreign investment to the Republic of Tatarstan, and rendering assistance to diasporas abroad. A total of 20 pleni- potentiary, permanent and trade and economic representative offices of Tatarstan has been established in Russian regions and foreign states. Of them, 13 offices are located abroad and 7 in the Russian Federation. In 2009, representative offices of the Republic of Tatarstan took part in preparing and arranging visits of official delegations of the Republic of Tatarstan to regions of the Russian Federations and foreign states, provided of Hayat Holding) and a flat glass production facility by Trakya Cam Sanayii (a division of Sisеcam). Investments into the Kastamonu Entegre project will make US$ 385 mil- lion. At the first stage, some US$ 100 million will be invested in the produc- tion of MDF boards; the particle board production will be worth US$ 135 million; at the third stage, the company will invest another US$ 150 million in the production development. Trakya Cam Sanayii has plans to start the flat glass production before the end of 2012. Sisecam investments into the projects in the territory of SEZ Alabuga will total US$ 325 million. On May 20, 2010 a new malt house of Krasny Vostok-Solodovpivo (Turk- ish-based EFES Group) was opened.Total investment into the renovation of malt facilities started in 2006 totalled US$ $28.5 million. A Russian-Turkish Business Forum entitled “Development Prospects of Automotive Component Production in the Republic of Tatarstan” is also planned to be held in Kazan in October 2010, jointly with interested as- sociations of the Turkish business community. Following the results of reciprocal visits of the delegations of the Islamic Republic of Iran and the Republic of Tatarstan, projects are being studied on constructing a juice packing plant. In April 2009, the Memorandum of Intents on the Establishment of Friendship Relations was signed between the city of Naberezhnye Chelny and the city of Liaocheng (Shandong Province of China). In September 2009, following the results of the visit of the delegation from the Republic of Tatarstan to China, the Memorandum of Cooperation was signed be- tween the Republic of Tatarstan and the Mayor’s Office of Meizhou on the joint implementation of several investment projects, in particular, projects in the field on nanoindustry. Furthermore, China-based Weihua intends to create a production of wood fibre board in the Republic of Tatarstan, with investment estimated at some US$ 80 million. Development priorities and major trends of foreign economic relations In accordance with provisions of the Concept of Foreign Trade Activities of the Republic ofTatarstan, the work with the CIS countries becomes more intense, especially that with Belarus and Kazakhstan within the framework of the Customs Union, and with Turkmenistan. A significant direction in the work is the attraction of foreign investors and technologies to the industrial and investment sites of our republic to implement projects in the field of industrial production. The work with the Islamic Development Bank is also increasingly active. With assistance of the Government of the Republic of Tatarstan and IFC Linova, the Tatarstan International Investment Company (TIIC) working in compliance with Shari’ah was established in the 1st quarter of 2010.The es- tablishment of TIIC will promote the development of cooperation between the Republic of Tatarstan and the Gulf countries in the field of investment in several sectors of the economy, including development of infrastructure, telecommunications, agriculture, finance, mining and processing indus- tries, and power sector. Work in the structure of intergovernmental commissions With a view of implementing the tasks in the field of Tatarstan’s foreign economic activities specified in its intergovernmental agreements, the work was conducted in 2009 to ensure the participation of representatives from the Republic of Tatarstan at the meetings of the intergovernmental commissions on economic cooperation, namely: the Russian-Ecuadorian Intergovernmental Commission, the Intergovernmental Russian-Bulgarian Commission, the Standing Russian-Iranian Commission for Trade and Eco- nomic Cooperation, the Mixed Russian-Austrian Commission, the Inter- governmental Russian-Colombian Commission for Trade and Economic, Scientific and Technology Cooperation, the Mixed Intergovernmental Commission for Trade and Economic Cooperation between the Russian Federation and the Swiss Confederation, etc. Cooperation of Tatarstan with international financial institutions An effective tool of raising investment and financial resources towards the development of economy of the Republic of Tatarstan is the expansion of cooperation with international financial institutions. Cooperation with the United Nations Industrial Development Organisa- tion In December 2009, the Memorandum of Cooperation was signed in Vi- enna between the Government of the Republic of Tatarstan and UNIDO. The implementation of the Memorandum suggests the cooperation in the field of energy efficiency and energy saving, protection of the environment and rational use of water resources, industrial development, attraction to Tatarstan of advanced technologies for disposal, treatment and recycling of waste with the use of secondary raw materials, etc. A UNIDO centre for efficient resource management is planned to be opened in Kazan. Cooperation with the World Bank Group Cooperation between the Republic of Tatarstan and the World Bank Group follows the line of promoting infrastructure development and eco- nomic reform through implementing the projects of the latter in the terri- tory of the republic within the framework of the Memorandum on Strategic Partnership between the Republic of Tatarstan and the International Bank for Reconstruction and Development until 2015. The republic is implementing the WB project “Prevention, Diagnostics and Treatment of TB and AIDS” and continues cooperation on the pro- grammes “Studying Innovation Potential of Tatarstan” and “Building High Education System in Kazan”. The World Bank is considering a possibility of participation in some promising investment projects in the Republic of Tatarstan aimed at the reconstruction and development of social and transport infrastructure, power sector, municipal facilities, development and upgrading of water supply, sewage and heat supply systems, and increase in the energy and resource efficiency.
  • 38 15. FOREIGN ECONOMIC AND INTERREGIONAL ACTIVITIES Republic of Tatarstan: General Overview, State System, Economy 39 16. CONSUMER MARKET Republic of Tatarstan: General Overview, State System, Economy In the sectoral structure of the Gross Regional Product of Tatarstan, the wholesale and retail trade is the second largest contributor (14.6%) after manufacturing industry. The Statistical Register of Economic Entities in the Sphere of Consumer Market recorded over 30,000 entities, which represents some 30% of the total number of enterprises in all sectors of the economy. Consumer mar- ket enterprises of the republic employ some 19% of the total workforce of Tatarstan, or over 335,000 people. The robust growth of consumer market and its infrastructure develop- ment observed in recent years gave way to a noticeable decrease in this year due to external factors. While in the pre-crisis period the retail turnover in the Republic of Tatar- stan was growing increasingly with annual rates of 15% to 20%, then in 2009 this figure dropped by 2% to the amount of RUR 394 billion. The public catering turnover totalled RUR 19.2 billion in 2009, record- ing a 14.7% decrease compared to 2008. Tatarstan residents were rendered consumer services in the total amount of RUR 20 billion, which is an in- crease by 0.3% versus last year. advisory, presentation support to enterprises from Tatarstan, rendered aid to Tatarstan commodity producers in introducing their products to exter- nal markets, sought investors for the implementation of important invest- ment projects of republic’s manufacturers. Trading houses Trading houses of the Republic of Tatarstan established in the regions of the Russian Federation and abroad are engaged in the promotion of indus- trial products and consumer goods manufactured in Tatarstan to external markets, delivery of products from Russian regions and foreign countries to the markets of Tatarstan, and seeking of investments for the Republic of Tatarstan. A total of 33 Tatarstan trading houses are currently active, of them 24 are located in regions of the Russian Federation and 9 abroad. The aggregate turnover of Tatarstan trading houses was over US$ 175.2 million in 2009, the main contributor being the Tatarstan Trade House in Turkey which sold products from the Republic of Tatarstan to Turkey for the year in the amount of US$ 174 million.TheTatarstanTrade House is one of the biggest exporters of petrochemical products from Russia and rep- resents such largest enterprises as OAO Nizhnekamskneftekhim, OAO Ka- zanorgsintez, and Tatneft-Nizhnekamskneftekhim-Oil. Its clients include Pirelli, Bridgestone, Goodyear, Henkel, Cognis, etc. With an aim of devel- oping external activities, representative offices have been established in Moscow, Iran, Switzerland, Italy, Kazakhstan, and Turkmenistan. As of April 15, 2010 there are 7 representative offices of the Republic of Tatarstan in Russian regions. With assistance of the Trade and Economic Representative Office of the Republic of Tatarstan in Saratov Region, contracts were signed in 2009 in the interests of Tatarstan manufacturers to a total of over RUR 1.5 billion. Through ZAO NaratTrade House, some RUR 35 million worth of goods were sold to the construction organisations of the Republic of Tatarstan. In 2009, the Permanent Representative Office of the Republic of Tatarstan in Sverd- lovsk Region held a Symposium on Development of Interregional Interac- tion as Factor in Overcoming Economic Crisis: Role and Place of Institute of Representative Offices. In 2009, the aggregate turnover ofTatarstan trading houses in the regions of the Russian Federation was RUR $959.6 million. A lead in the turnover was held by trading houses in Saratov Region, cities of Moscow and Tolyatti. Alongside with the activities in the field of trade and economic coop- eration, trading houses render support to the development of cooperation with representatives of national and cultural Tatar autonomies and diaspo- ras in regions of the Russian Federation and foreign countries. With an aim of preserving and developing the Tatar national culture in the regions of the Russian Federation and abroad, trading houses finance the opening of Sunday schools, construction of mosques, take part in celebrations of national holidays, arrange tours of Tatar artistic groups, and take part in educational projects. For the list of representative offices and trading houses of the Repub- lic of Tatarstan, please visit the official site of the Ministry of Industry and Trade of the Republic of Tatarstan at http://mpt.tatar.ru/rus/repr_list.htm (in Russian). 15.6. CHAMBER OF COMMERCE AND INDUSTRY OF THE REPUBLIC OF TATARSTAN The Chamber of Commerce and Industry of the Republic of Tatarstan was founded in 1992 and is one of the leading establishments of this kind in the Russian Federation. Today it has branches and offices in all cities of the republic. The Chamber of Commerce and Industry of the Republic of Tatarstan is a non-profit non-governmental organisation. Closely interacting with public authorities, the Chamber assists organi- sations and enterprises in their foreign economic operations. The Chamber of Commerce and Industry of the Republic ofTatarstan has a rich expertise in the support of small and medium-sized businesses as regards the introduction of their products to external markets. Its principal activities are: information support, accounting and legal consulting services, personnel training, exhibition and fair activities, attrac- tion of investment to the republic, preparation and support of investment projects, assistance in the development of foreign economic relations. With an aim of prompt and high-quality search of business partners, the Chamber of Commerce and Industry of the Republic of Tatarstan keeps a register of entrepreneurial structures participating in foreign economic ac- tivities in the territory of the Republic of Tatarstan. The member base of the Chamber comprises over 1200 organisations. 16. CONSUMER MARKET Structure of Gross Regional Product of TatarSTan, in percent Retail turnover and growth rate in Tatarstan, 2005-2009 Public catering turnover and growth rate Retail trade turnover of the Volga Federal District in 2009 in RUR billion and percent
  • 40 16. CONSUMER MARKET Republic of Tatarstan: General Overview, State System, Economy 41 16. CONSUMER MARKET Republic of Tatarstan: General Overview, State System, Economy The consumer market infrastructure of the Republic of Tatarstan cur- rently comprises over 14,000 trade enterprises, 4,316 public catering estab- lishments, 3,247 consumer services establishments, over 5,000 small-scale retailers, and 95 markets. Despite the growing share of markets in goods turnover on the average in Russia (from 13.4% to 14.2%), in the Republic of Tatarstan it remains at the same level of 8.2%. An important factor in the consumer market development is the provi- sion of competitive conditions for trading activities. With a view of protect- ing free trade and fair competition in the consumer market and improving the competitiveness of the republic’s manufacturers, a group of actions aimed at competition development is being carried out jointly with min- istries and departments. (The action plan for the development of competi- tion in the food market of the Republic of Tatarstan was approved by the Resolution of the Cabinet of Ministers of the Republic of Tatarstan No.466-r of March 28, 2008.) These include improving the competitiveness of agri- cultural produce and ensuring food security in the Republic of Tatarstan through increasing the efficiency of agricultural production, meeting the demand of the republic’s residents for goods and services through ensur- ing their accessibility and affordability, and improving the staffing of agri- cultural and trading establishments. When analysing commodity resources in the republic’s food market, it should be noted that the sources for their formation are the deliveries of the local manufacturers (65%), manufacturers of the Russian Federation (30.3%), and imports (4.7%). Meanwhile, the share of products of local manufacture in the republic is over 70% in the sales of bread and bakery products; potatoes; cabbages; carrots; beets; beef; pork; eggs; curds; sour cream; butter; milk and sour- milk products; sugar; sausages; and wheat flour. As compared with the indicators both in Russia in general and in the re- gions of the Volga Federal District, somewhat higher figures were recorded in Tatarstan (94.3% in the Russian Federation vs. 97.5% in the Republic of Tatarstan in 10 months 2009). The situation in the consumer market in 2009 showed that the consumer confidence level fell sharply due to the uncertainty of consumers about prospects of employment, state of their personal finances and readiness to buy new goods. As a result, people began to buy more foods and the proportion of non-food sales dropped considerably from 54.4% in 2008 to 50.7% in 2009г. Owing to the systematic work of the Ministry of Industry and Trade of the Republic of Tatarstan, jointly with the Ministry of Agriculture and Foods of the Republic ofTatarstan, executive committees of the republic’s munici- palities, manufacturers, and outlet chains, it became possible to prevent a leap in prices for socially sensitive goods. For instance, prices for bread and bakery products in the Republic of Tatarstan remained virtually unchanged during the year, with retail mar- gins not exceeding 15%. Prices for dairy produce were kept unchanged till October 2009, when producers raised wholesale prices by 3% for milk to 8% for butter. This re- sulted in the increased retail prices; however, the retail margin for dairy pro- duce remains the same, from 5% to 15%. The republic is currently implementing the Programme for Creation and Development of “Walking Distance” Convenience Shops, Public Catering and Consumer Services Establishments for 2007-2009 (adopted in July 2007). Since the beginning of 2009, 37 such establishments were opened in Tatarstan (a total of 78 establishments since the launching of the pro- gramme). Foods and non-foods in the structure of commodity turnover, in percent Consumer services turnover and growth rate Number of“walking distance“ convenience shops, consumer services and catering establishments commissioned In Tatarstan Foods in retail turnover by source of production, in percent Share of markets in retail turnover Tatarstan's average prices for bakery and dairy products, RUR per kg
  • Republic of Tatarstan: General Overview, State System, Economy 17. SOCIAL SPHERE Republic of Tatarstan: General Overview, State System, Economy In 2009, the per capita income grew by 9.5% compared to the previous year, to RUR 15,522.7 in nominal terms. In 2009, monthly average wages of employees (including small busi- nesses) was RUR 15,208.0, an increase by 2.4% compared to the previous year. Real wages constituted 93.2%. Total workforce potential in the Republic of Tatarstan in 2009 was 2,452,000. Number of employed persons was 1,827,000. Some 510,000 were employed in small businesses. The positive trends in demographic situation survived throughout 2009. Increase in birth rates and decrease in death rates resulted in positive changes in natural losses; they reduced by 30% compared to 2008. 17. SOCIAL SPHERE 7383 9369 11577 14181 15523 16980 137,90 126,9 123,6 122,50 109,5 109,4 0 20 40 60 80 100 120 140 160 0 2000 4000 6000 8000 10000 12000 14000 16000 18000 2005 2006 2007 2008 2009 2010 (estimate) Monthly average income, RUR In percent to previous year 7068 8850 11469 14904 15208 16273 129,60 125,2 129,6 130,00 102,4 107 0 20 40 60 80 100 120 140 0 2000 4000 6000 8000 10000 12000 14000 16000 18000 2005 2006 2007 2008 2009 2010 (estimate) Monthly average wages (on an annual average), RUR In percent to previous year 1. BASIC FACTS ABOUT THE REPUBLIC OF TATARSTAN . . . . . . . . . . . .1 1.1. STATE SYMBOLS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 1.2. STATE SYSTEM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 1.2.1. Leadership of the Republic of Tatarstan . . . . . . . . . . . . 1 1.2.2. Cabinet of Ministers of the Republic of Tatarstan . 1 1.3. GEOGRAPHY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 1.4. CLIMATE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 1.5. NATURAL RESOURCES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 1.6. POPULATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 1.7. RELIGION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 1.8. STATE LANGUAGES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 1.9. HISTORY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 1.10. CAPITAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 1.11. MAJOR CITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 1.12. CULTURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 1.13. EDUCATION AND SCIENCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 1.14. TATARSTAN: THE SPORTS REPUBLIC . . . . . . . . . . . . . . . . . . . . . . . . . . 8 2. ECONOMY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 2.1. ECONOMIC OVERVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 2.2. BASIC FIGURES OF MANUFACTURING INDUSTRY . . . . . . . . . . . . . 10 2.3. FUEL AND ENERGY SECTOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 2.4. OIL, GAS, AND CHEMICAL INDUSTRIES . . . . . . . . . . . . . . . . . . . . . . . 11 2.5. MECHANICAL ENGINEERING AND METALWORKING . . . . . . . . . . 13 2.6. LIGHT, FOOD-PROCESSING, AND TIMBER INDUSTRIES . . . . . . . . 15 2.7. INTRODUCTION OF QUALITY MANAGEMENT SYSTEM . . . . . . . . 16 3. AGRICULTURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 4. SUMMARY OF TATARSTAN LAND MARKET . . . . . . . . . . . . . . . . . . . . . 20 4.1. Monitoring of undeveloped land plots (lands of inhabited localities) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 5. TRANSPORT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 6. INFORMATION AND COMMUNICATIONS . . . . . . . . . . . . . . . . . . . . . . 22 6.1. INFORMATION SUPPORT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 6.2. TELEVISION AND RADIO BROADCASTING . . . . . . . . . . . . . . . . . . . . . 23 6.3. COMMUNICATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 6.4. LOCAL, LONG-DISTANCE, AND INTERNATIONAL TELEPHONE COMMUNICATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 6.5. DATA TRANSMISSION NETWORKS, THE INTERNET AND NEW SERVICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 6.6. POSTAL SERVICE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 7. TOURISM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 8. BUDGETARY POLICY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 9. BANKING SYSTEM, ACTIVITIES OF CREDIT INSTITUTIONS . . . . . . 26 10. TARIFFS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 11. EMPLOYMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 12. ATTRACTION OF INVESTMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 13. SPECIAL ECONOMIC ZONE IN YELABUGA . . . . . . . . . . . . . . . . . . . . 30 14. INNOVATION ACTIVITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 15. FOREIGN ECONOMIC AND INTERREGIONAL ACTIVITIES . . . . . . 32 15.1. BASIC INDICATORS OF FOREIGN ECONOMIC ACTIVITIES . . . . . 32 15.2. FOREIGN TRADE PARTNERS OF TATARSTAN . . . . . . . . . . . . . . . . . . 34 15.3. INTERREGIONAL AND INTERNATIONAL COOPERATION . . . . . . 35 15.4. INTERGOVERNMENTAL AGREEMENTS . . . . . . . . . . . . . . . . . . . . . . . 37 15.5. ACTIVITIES OF REPRESENTATIVE OFFICES AND TRADING HOUSES OF TATARSTAN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 15.6. CHAMBER OF COMMERCE AND INDUSTRY OF THE REPUBLIC OF TATARSTAN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 16. CONSUMER MARKET . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 17. SOCIAL SPHERE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42 Contents
  • 44 17. SOCIAL SPHERE 45 17. SOCIAL SPHERE Republic of Tatarstan: General Overview, State System, Economy
  • 46 17. SOCIAL SPHERE 47 17. SOCIAL SPHERE Republic of Tatarstan: General Overview, State System, Economy Republic of Tatarstan: General Overview, State System, Economy Ministry of Industry and Trade of the Republic of Tatarstan