SOCIAL-ECONOMY PROGRAMME
OF KEMEROVO REGION
till 2012
I.Analysis of the Kemerovo Region social and economic development in 2001 – 2006.
1.1. Socioeconomic status and basic problems of development in the Kemerovo Region in 2001 – 2006.
Kemerovo Region lies in the South-East of Western Siberia. Geographically, the region lies in-between Moscow and Vladivostok cities. Kemerovo Region occupies 4 percent of Western Siberia territory and 0,56 percent of the whole territory of Russia. It coversabout 500 km from North to South, andabout 300 km from West to East.
Kemerovo Region borders upon five regions of the Russian Federation: Novosibirsk Region, Krasnoyarsk and Altay Territories, Republics of Khakassia and Altay.
The main treasures of Kemerovo Region are hidden under the ground. The main treasure is hard coal. Coal is the main mineral product found in this region. Saleable hard coal reserves in the Kemerovo Region are 7 times as large as all the world reserves of oil and natural gas (in terms of standard oil) and is 693 billion tons, crozzling coal being 207 billion tons of them. Kuzbass coals are unique in quality. They contain almost all process ranks and groups: from brown coal to anthracides.
There are also other types of anthracides in the Kemerovo Region, such as peat, oil and natural gas leaks.
By this time, over 90 fields and 20 ore occurrences of various metals have been discovered: gold, solver, ferrum, aluminium, manganese, zinc, plumbum, copper, titanium, chrome, tungsten, molybdenum, mercury, antimony, uranium, thorium. They are mainly concentrated in Gornaya Shoria and Kuznetskiy Ala Tau regions.
Economic development of the Kemerovo Region
In recent years, favourable economic situation has been developed in this region, providing improvement of macroeconomic parameters. Along with high production growth rate, public income has also increased. Gross regional product of the Kemerovo Region (hereinafter – GRP) in 2006 was 338138.7 million rubles. Regional trend of macroeconomic index repeats All-Russia trend – starting at 1999, index of GRP physical volume is constantly higher than the 100-percent level. At the same time, rates of increase of GRP in the Kemerovo Region are stable enough: minimum increase in 2000 – 2005 was 3,8 percent, and maximum increase was 7 percents.
The Kemerovo Region GRP structure is characterized by predominance of primary industries and industries with low limit. The main “industrial” contribution to the region’s GRP is made by the plants that conduct such types of economic activities as mining operations, manufacturing activity. In terms of the role that these types of economic activity play in the basic macroeconomic indicator generation, the Kemerovo Region gives way only to the Krasnoyarsk Territory, among the constituent entities of the Siberian federal district.
Coal is the main natural resource of the Kemerovo Region that constructs the whole economy of the region.
The Kemerovo Region is the largest industrial region. The main industrial productions are coal mining, iron ore mining, complex ores mining, ferrous and nonferrous metallurgy, chemical industry, mechanical engineering and metal working, production of construction material. Nowadays, about 56,6 percent of coal mining falls on the Kemerovo Region, about 76 percent of extracting all crozzling coal, 15 – 14 percent of extracting cast iron and steel, respectively, 23,5 percent of bar rolled steel, 22 percent of gas carbon, 53 percent of ferrosilicon, over 10 percent of man-made fibres and yarns.
Food processing plays great role for the region's economy, though the Kemerovo Region is not characteristic of developed agricultural sector: share of production in the sector of “food production, including beverages and tobacco”, is not considerable enough - a little more than 3 percent of total output shipped by production plants in 2006. 56 large processors and over 500 small shops that produce wide range of food products operate at the territory. For producing agricultural goods, 2.6 million ha of agricultural lands are situated in the Kemerovo Region, including 1.5 million ha of cropland and 0.9 million ha of forage land.
The Kuzbass energy system is one of the largest ones in the country. The Kemerovo Region energy system includes 8 thermal power plants (“Kuzbassenergo”, OJSC) and 2 isolated generating plants (“Yurginskiy engineering plant”, LLC, and KMK TPP), as well as 5 mains enterprises. Electrical power set is 4757 MW. The energy system operative-dispatcher control is conducted by the System operator branch of the Central dispatching office of the unified electric power system of Russia, the unified Siberian dispatcher administration. Coal is the main type of fuel. Annual production of electric power, following the results of 2006, is 25.7 billion kW (-0.4 percent to the level of 2005), and production of thermal power is 43.3 million Gcal (+0.7 percent).
Rating agency “Expert RA” that has performed evaluation of investment potential of the Russian regions for the last 11 years, has confirmed the 2B investment rating of the Kemerovo Region, following the results of 2006-2007, that corresponds to average potential and moderate risk, as well as credit rating A confirms high reliability level (risk of non-fulfilment of contractual obligations in time is minimal, probability of restructuring debt or its part is minimal).
Over 20 thousand enterprises function at the customer market of the region, including over 14 thousand of trading organizations, 1.3 thousand catering trade enterprises and 4.8 public service establishments. In Kemerovo Region customer market infrastructure is being actively developed. In 2006, due to new construction, expansion and reconstruction, about 69.3 thousand square meters of sales area was commissioned.
Matters of priority that need solution in mid-term perspective are:
high level of business environment dependence at the worldwide products markets of coal and metal;
predictable shortage of electricity generating power capacities;
demand for coal chemistry development;
low level of regional economics diversification.
Evaluation of human potential state
In the Kemerovo Region high natural population decrease is observed (over average levels in the Siberian federal district, as well as heavy mortality and high incidence of disease among productive age population.
The Kemerovo Region is the most densely populated region of the Siberian federal district, in average, about 30 people occupy one square meter; the population density being about 4 persons per a square meter. The largest cities are: Novokuznetsk – 561 thousand people, Kemerovo – 520 thousand people, Prokopyevsk – 214 thousand people.
The main reason of reducing population size is its natural decrease, the most acutely this problem appears among productive age population. Annual loss among the productive age population is 16 – 19 thousand persons, or over one-third of the total number of the dead. The main reasons of mortality among the adults of the Kemerovo Region are circulatory system diseases.
Against negative natural population changes in the region, significance of population movement is growing up. In 2006, 49.6 thousand people moved to this region, and 45 thousand people moved out. Thus, per annum the population of the region, due to positive balance of migration, grew up for 4.6 thousand people, that aligned loss in population due to natural decrease for over a quarter.
The Kemerovo Region is characteristic of high educational potential among the constituent entities of the Siberian federal district. At the end of 2006, 938 infant schools, 955 comprehensive schools, 72 basic vocational training schools and 4 medium vocational training schools existed in the region, implementing basic professional education program.
In the higher education system , there are 41 state higher schools in the region, including 10 independent ones and 31 branches. In independent schools structure, there are 2 academies, 4 universities and 4 institutions. The Kuzbass state technical university is the largest one by the number of students studying in it (22% of the total number of students). It is planned to create the Kuzbass Federal University in the future (this concept is being discussed at the moment).
Over 12 thousand institutions administer medical aid in the Kemerovo Region. Basic development indicators for health care industry in 2001 – 2006 remain the same, though all of them are significantly lower than average parameters all around the country and in the Siberian federal district regions. Due to organizing paid medical services and expanding voluntary health insurance, 1277.1 million rubles (9.33 percent of budgetary funds) have been invested to the Kemerovo Region health care industry in 2006. With regard to the funds invested, medical aid expenses per 1 person increased from 3 934 rubles in 2005 to 4 901 rubles in 2006.
Kuzbass city is characteristic of high cultural and creative potential. The state network of cultural institutions of the region remains relatively stable for the last few years. 2419 cultural institutions, cinemas and theatres now exist in the region. In 2006 7 theatres, 42 museums and showrooms, 330 cinema projectors, 751 libraries and 784 leisure centers worked inside the Kemerovo Region. The most part of cultural institutions (57 percent) are situated in the country. There is one of the best multilevel systems of personnel training for the “culture” industry in the Region, among those all over the country and the Siberian federal district.
The dynamics of income change among the Region dwellers coincide with the average index for the Siberian federal district. Personal income in the Kemerovo Region and the Siberian federal district increased 3.3 times, and real income - 1.8 times from 2000 to 2006. The Region is one of the leading ones among the Siberian regions, regarding the level of average monthly per capita income, which is 1.2 times higher than the average income all around the district. At the same time, average monthly personal income is lower than average personal income level in the country, which does not comply with the living conditions in Siberia - rigorous climate, remoteness from the basic places of resort, cultural centers etc.
The Kemerovo Region is a unique region, in terms of national composition of population. 51 national associations, national and cultural centers, membership clubs, youth and children’s national groups, charity organizations work in the Region; besides, national public associations council works there.
In compliance with the objectives of the state national politics, the basic lines of activity of the Kemerovo Region Administrations focus on preservation of language, culture, national traditions when creating conditions for self-realization of various national groups.
Priority matters for social development of the Kemerovo Region that need solution in mid-term perspective are:
heavy mortality, primarily due to significant accumulated ecological deprivation;
predictable decrease of employable population;
disbalance between training of specialists in educational institutions and employers' demands;
lack of capacities in infant schools.
Spatial development state of engineering and transport infrastructures, ecological situation, construction
Traffic network is well-developed in the Kemerovo Region. Trans-Siberian trunk railway crosses the northern part of the region, and South-Siberian trunk railway crosses its southern part. There is through railway service with all the regions of the country in the Region. The Kuzbass section of the West-Siberian railway is the powerful transport system, providing shipment of large amounts of cargo in Russia. It provides 85 percent of road and 16 percent of network-wide shipment all around the Russian Federation.
The peculiarity of the Kuzbass section is that trunk transport works jointly with the Region industrial productions.
Highway service provides transport connection between 20 cities of the Region. Common highways stretch for 6.761 thousand km, including regional ones stretching for 5.34 thousand km, and territorial ones that stretch for 1.421 thousand km. 6.622 km of these roads have hard coating, including regional ones (5.34 thousand km) and territorial ones (1.282 thousand km). Density of common highways with hard coating is 0.069 km/km2.
Motor transport and railway transport enterprises are the main transportation carriers in the Kemerovo Region. Motor transport is leading in this area - these enterprises transported 61.3 percent of cargo (349 million tons) in 2006. 220 million tons (37.7 percent) were transported by railway. In comparison with 2005, the volumes of cargoes transported grew for 17 percent.
In 2006, 526 million passengers were transported by all types of transport in the Kemerovo Region, in comparison with 2005, this number has increased for 4.8 percent. Thus, in comparison with 2000, number of passengers transported by common transport decreased for 30.5 percent. Passenger turnover index has decreased for 31 percent for the 6-year period.
Implementation of regional purpose-oriented programmes “Transport” made it possible to renew bus fleet that carries out public and municipal passengers transportation order for 26 percents. In 2005 – 2006 480 buses were handed to transport enterprises. As a result, quality and culture of servicing passengers have improved.
In the Kemerovo Region information services are rendered by over 200 large and medium enterprises. Annual electric communication service volume gain exceeded 30 percent for the last 3 years. In 2006 total volume of services rendered by communication enterprises is 9.7 billion rubles that is 31% higher than that in 2005.
Total floor area of flats constructed in the Kemerovo region in 2006 is 804 square meters. As a result, 11.5 thousand families were able to improve their housing conditions. Minimum volumes of house building recorded in 2000 were 338 thousand square meters. Starting from 2001, stable increase of housing entry is observed in the Region.
In recent years, according to the rate of housing construction entry, the Region is significantly ahead of the medium indices recorded in the Siberian federal district and in the Russian Federation. Only the Omskaya Region housing entry rate anticipated growth rate in the Kemerovo Region in 2001 – 2005, among all the Siberian regions. At the same time, according housing construction indices per capita, the Kemerovo Region takes the fifth place. On average, 284 square meters of lodging was constructed in 2006 per each thousand of dwellers. It exceeds the index in the Siberian federal district for 2.5 percent (277 square meters), and is 20 percents as low as in the Russian Federation at average (355 square meters).
The Region population housing at the end of 2006 was 20.5 square meters per one dweller, average Russian housing level is 20.9 square meters.
As of January the 1st, 2007, housing space in the Kemerovo Region is 57.3 million m2. This includes 85.5 percent of urban settlements (49 million square meters of residence) and 14.5 percent (8.3 million m2) of rural settlements. Average living space for per one dweller has increased for 12.2 percent for the last 10 years, and at the end of 2006 it is 20.5 square meters of floor area.
Housing facilities are equipped with the following: water supply system – 84 percent, water disposal – 69 percent, central heating – 70 percent, hot water supply – 63 percent, baths – 64 percent, gas (network and condensed) – 10 percent, floor electric stoves – 47 percent.
Priority matters for spatial development that need solution in mid-term perspective are:
liberalization of tariff restrictions for developing economics in the region;
need for developing transportation corridors for supply of coal, approach lines to the places of coal field development, equipping railway transport;
demand for development of transport and logistic services market;
low availability of residence places in the cities of the Region, high cost of credit proposals at the market (loan programs etc.);
demand for coal chemistry development;
Demand for implementation of modern ecological management system at the manufacturing enterprises of the Region.
State management system
Foreign trading
Foreign trading is one of the fundamental elements of the Kemerovo Region economics. Development of foreign economic relations determines development of productional sector in the Kemerovo Region in many ways.
In 2006 foreign trade turnover in the Kemerovo Region was 7.1 billion dollars and, as compared to the previous year, increased for 29 percent. At the same time, export increased for 32.2 percents, and import increased for 6.9 percents. As a result of foreign trade operations, export surplus became positive, i.e. 5.8 billion dollars.
Export goods structure analysis for 2001 – 2006 shows its narrow raw-material trend. In 2006 99.1 percent of cost export value is distributed among the following types of goods:
fuel and power products – hard coal, gas carbon and semicoke from hard coal. fuel and power products export increased in cost value for 36.2 percent and is 3.4 billion dollars, and physical volumes of supplies increased for 34.9 percent;
ores and products made of them - semifinished materials, rods, moulded angles and special profiles, flat-rolled products made of ferrum or unalloyed steel, steelmaking iron, raw aluminium, ferrous alloys and other products. As compared to 2005, export of this type of products has increased in terms of cost value in 1.3 times and has reached 2.7 billion dollars;
chemical industry products - basically heterocyclic compounds and nitrogen fertilizers. Chemical products export has decreased for 9.7 percent and is 0.24 billion dollars.
In 2001 – 2005 export goods structure remained practically unchanged. At the same time, export supplies geography suffered significant transformations.
In 2006 the Kemerovo Region enterprises and organizations carried out export operations with 66 countries of near-abroad and far-abroad countries. Ten basic commercial partners include: China, the United Kingdom of the Great Britain and Northern Ireland, Portugal, Turkey, Ukraine, the Cyprus, Kazakhstan, Japan, Taiwan, the Islamic Republic of Iran. 69.7 percent of the export cost value goods were directed to these countries.
In 2001 – 2006 import share in macrostructure of foreign trade turnover of the Kemerovo Region floated within 6 – 11 percent. In 2006 cost value of the import was 0.67 billion dollars, or 9.5 percent of total foreign trade volume.
The basis for the import to the Kemerovo Region is the products of mechanical-engineering and chemical industries. At the same time, chemical products share has decreased for the last six years (from 55.1 percent in 2001 to 35.8 percent in 2006), and volume of machine and equipment supplies has increased (in 2001 it was 31.5 percent, in 2006 – 50.3 percent), which shows that the region industry updating process has been activated.