KARELIA A PERFECT FIT FOR YOUR INVESTMENT 2019 KARELIAINVEST.RU INVEST IN RUSSIA CONTENT Infrastructure for business. Development indicators ............................. 4 Key industries: Forestry .......................................................................................................... 24 Fishery ........................................................................................................... 28 Mining ............................................................................................................ 34 Tourism and recreation ............................................................................... 38 Success stories. Foreign investors in Karelia .......................................... 44 Support of investment activities ................................................................ 54 INFRASTRUCTURE FOR BUSINESS. I DEVELOPMENT INDICATORS GEOGRAPHIC LOCATION Murmansk region SWEDEN Kostomuksha Stockholm 1300 km FINLAND Republic Kem of Karelia Belomorsk Segezha The Baltic Sea Helsinki 740 km Sortavala Kondopoga Tallinn 800 km Petrozavodsk Saint-Petersburg 412 km Riga ESTONIA 990 km Leningrad region LITHANIA LATVIA Vologda region Pskov Novgorod 710 km 510 km Vologda Vilnius Novgorod km 990 km 930 region Pskov Tver region Yaroslavl region region BELARUS Yaroslavl Moscow Tver 1100 kmкм km Minsk 1000 850 km 1300 km OVER 45 MLN. PEOPLE INFRASTRUCTURE FOR BUSINESS live within a 1000 km radius from Petrozavodsk • total area: 180,5 thousand square kilometers; • population: 618,1 thousand people; • capital: city of Petrozavodsk; • in the South Karelia borders on the Leningrad and Vologda regions, in the North – on the Murmansk region, in the East – on the Archangelsk region. In the North-East the region is washed by the White Sea. The western border of Karelia coincides with the state border of Russia with Finland and is 798 kilometers long. INVEST IN RUSSIA 7 3 federal highways R-21 А-119 А-121 INFRASTRUCTURE FOR BUSINESS Kola Vologda-Medvezhiegorsk Sortavala А-137 Р-21 Kola – Kostomuksha - state border • International federal airport Petrozavodsk • 1 port, open for vessels under foreign states flags (port of Petrozavodsk) • The White Sea-Baltic Sea Canal, connecting the White Sea with the Onego lake and having an exit to the White Sea and the Volga-Baltic waterway state border The White Sea-Baltic Sea Canal region border International border-crossing points motorway Port (main directions) Airport/airdrome railroad Passenger airline service INVEST (main directions) IN RUSSIA 9 FUEL & ENERGY COMPLEX Kumskaya HPP GDS Loukhi GDS Sovporog PRIONEZHSKIY DISTRICT VerkhovieВерховье Matkachi st.Shuiskaya Chalna Shuya GDS Kalevala Nizhniy Meliorativnyi 2 Besovets Solomennoe 1 Military Novaya SKZ Krivoporozhskaya HPP town Vilga GDS Kem Peski GDS Kostomuksha Putkinskaya HPP Вил га GDSSevernaya GDS Belomorsk GDS Yuzhnaya Ptitsefabrika GDS Ledmozero KONDOPOGA REGION Ondskaya HPP GDS Segezha GDS Berezovka РС Spasskaya Guba Bolshoe Martsialnye Kondopoga Voronovo GDS Brusnichnaya Vody s. Konchezero GDS Medvezhiegorsk GDS Pyalma JSC «Kondopoga» CHPPlant GDS Berezovka Small HPP Ryumyakoski GDS Pudozh Small HPP Kalliokoski GDS Yuzhnaya GDS Sortavala Petrozavodsk CHP Plant Small HPP Lyaskelya GDS Ikhala GDS Pitkyaranta GDS Ladva Potential for small hydropower in Karelia INFRASTRUCTURE FOR BUSINESS 700-900 0,06-8,96 KW/KM KW/KM2 AVERAGE SPECIFIC POWER AVERAGE POWER DENSITY OF SMALL RIVERS AND STREAMS OF THE SMALL RIVERS AND STREAMS IN KARELIA IN KARELIA 6,4 56,2 MW MW INSTALLED CAPACITY PLANNED CAPACITY OF THE SMALL OF THE SMALL HYDRO POWER HYDROPOWER IN KARELIA PLANTS IN KARELIA IN OPERATION BY THE YEAR 2020 Substation 300 kW Existing gas pipeline Substation 200 kW Perspective gas pipeline ETL 330 kW CHP plant Substation 330 kW, ETL 330 kW (in operation by 2018) HPP ETL 220 kW 1 2 Small HPP’s Beloporozhskaya 1 & 2 (perspective) INVEST Source: Rosstat, http://resources.krc.karelia.ru/, by the Nord Hydro company IN RUSSIA 11 HUMAN RESOURCES Secondary 618,1 vocational education THOUSAND PEOPLE POPULATION 13,5 284,2 THOUSAND STUDENTS THOUSAND PEOPLE NUMBER OF ECONOMY 15 WORKERS EDUCATIONAL INSTITUTIONS Key education 39 trends: THOUSAND RUBLES • Road construction sector AVERAGE SALARY • Electric power IN 2015 • Heating • Machine building • Materials engineering • Mining sector • Healthcare • Forest-industry complex Mine: Statistical digest “Socio-economic situation of the Republic of Karelia for 2018» 12 Assessment of the Ministry of economic development and industry of the Republic of Karelia Higher education 4 Incl. 2 11,7 HIGHER BRANCHES THOUSAND EDUCATION STUDENTS INFRASTRUCTURE FOR BUSINESS INSTITUTIONS Petrozavodsk State University: 10 departments, 6 educational institutes, 79 chairs, 84 laboratories, design and design-and-engineering departments 2 technology parks 117 patents, received as a result of scientific research Examples of successful developing: CARDIACARE PROGNOSIS AQUAVITA System of automated distant Program-methodical complex Automated fry breeding diagnostics. The service lets for numerical calculation of complex – regulation of oxygen analyze the ECG, detecting characteristics of the human and temperature in the fish different types of irregular resources in the subjects of the nursery. Creates conditions for heart rate in real time. Russian Federation. the year-round fish breeding. INVEST IN RUSSIA 13 DEVELOPED DEPOSITS AND RESERVES 525 DEVELOPED DEPOSITS MOLYBDENUM IRON ORES 35 129 THOUSAND TONS 1.1 BILLION TONS TYPES OF SOLID COMMERCIAL MINERALS 50% OF THE RUSSIAN RESERVES GOLD PLATINUM GROUP OF CHROME ORES 40 TONS ELEMENTS 1ST PLACE IN RUSSIA 187 TONS ONE OF THE LARGEST IN THE WORLD DEPOSIT OF PLATINUM GROUP METALS, SUITABLE FOR OPEN EXTRACTION THE ONLY IN RUSSIA «UNCONFORMITY» TYPE URANIUM DEPOSIT CHROME URANIUM 28 MILLION TONS 3 THOUSAND TONS 14 Source: Data by the Ministry of Economy of the Republic of Karelia, Rosstat, companies data. INFRASTRUCTURE FOR BUSINESS SAND AND GRAVEL PEAT INDUSTRIAL WATER 193 MILLION M3 323 MILLION TONS RESOURCES 23 THOUSAND M3/DAY COVER STONE CONSTRUCTION DRINKING QUALITY WA- 172 MILLION M3 SANDS TER RESOURCES 20 MILLION M3 34 THOUSAND M3/DAY CRUSHED STONE CONSTRUCTION 2.7 BILLION M3 STONE 3.3 BILLION M3 INVEST IN RUSSIA 15 INDUSTRIAL LOCATIONS Industrial park Nadvoitsy General information Type of location Greenfield Permissible danger class III–V Specialization Industry Status Under construction Infrastructure Land plot 17.4 ha Heat energy 7 Gcal/hour Electricity supply 5MW Water supply 80m3/h Transport availability Distance to town 0 km (in the town of Nadvoitsy) Distance to Petrozavodsk 287 km Distance to the railroad 0.5 km 16 Source: Development Corporation of the Republic of Karelia Priority Development Area Nadvoitsy Requirements for PDA INFRASTRUCTURE FOR BUSINESS Nadvoitsy residents’ projects: Textile good Non-metal goods 2,5 production production MILLION RUBLES Minimal capital investment during the first year 10 Minimal number Cafes Hotels of new jobs, established and restaurants during the first year Metal goods Wood processing, production manufacture of wood products and cork INVEST IN RUSSIA 17 INDUSTRIAL LOCATIONS Industrial and Technology Park Yuzhnaya Promzona (Southern Industrial Zone) General information Type of location Brownfield Specialization Stone working Status 1st stage of production building reconstruction in progress Infrastructure Land plot 7,9 ha Electricity supply 10 MW Gas supply 4 100 м3/h Water supply drain system, storm-water drainage system Telephone and Internet connection Leasable areas from 150 to 21 000 sq. m. Transport availability Distance to town 0 кm (Petrozavodsk) Distance to Saint-Petersburg 436 кm 18 DEVELOPMENT INDICATORS GRP, Billion rubles DEVELOPMENT INDICATORS 212,0 231,4 252,7 270,0 2015 2016 2017 2018 Source: Statistical book « Key indicators of a system of national accounts of the Republic of Karelia» 2019 Direct Foreign Investment Volume of investment, million $ 231 155,6 188 251 210 2014 2015 2016 2017 на 01.10.2018 INVEST Source: Central bank of the Russian Federation IN RUSSIA 19 FOREIGN ECONOMIC ACTIVITIES Import Million $ Finland 22% Estonia 9,6% Sweden 7% Other 61,4% 155.6 188 251 210 2015 2016 2017 2018 20 Source: Regional authority of statistics Export Million $ DEVELOPMENT INDICATORS Finland 22% Netherlands 8,5% Turkey 7,8 % Other 61,7% 735 741 1131 1269 2015 2016 2017 2018 INVEST Source: Regional authority of statistics IN RUSSIA 21 KEY PRODUCTS. SHARE OF KARELIAN COMPANIES IN THE NATIONAL PRODUCTION >70% 60% CAGE CULTURE TROUT PAPER BAGS AND PACKAGING «KALA JA MARJAPOJAT» LLC «SEGEZHA PACKAGING» LLC 44% 18% NEWSPAPER PAPER PAPER JSC «KONDOPOGA» JSC «KONDOPOGA» JSC «SEGEZHSKIY PPM» 22 1,2% 13% MUSSELS PULP DEVELOPMENT INDICATORS «RK-GRAND» LLC 21,6% 11,1% IRON-ORE PELLETS IRON ORE JSC «KARELSKIYOKATYSH» JSC «KARELSKIYOKATYSH» INVEST IN RUSSIA 23 24 KEY INDUSTRIES II FORESTRY 25 SHARE OF KARELIAN COMPANIES IN THE INDUSTRY Share of Karelian companies in the national production, 2018 (assessment), % 1st PLACE IN RUSSIA IN PAPER PRODUCTION 56 44 11 PAPER BAGS AND PACKAGING NEWSPAPER PAPER PAPER 8,7 2,8 13 INDUSTRIAL NON-PROCESSED PULP CHIPS WOOD 26 Share of Karelian companies in the total gross profit of the industry in Russia, 2016, % FORESTRY 49,4 №1 in Russia 4,4 FOREST PAPER HARVESTING 4,1 3,9 SAWN WOOD PULP PRODUCTS INVEST Source: Statistical book «The Republic of Karelia in Figures. 2018» IN RUSSIA 27 28 KEY INDUSTRIES III FISHERY 29 KEY INDUSTRY INDICATORS Share of Karelian companies