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Economic development of the Republic of Karelia in 2006

  Economic Policy

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  Cooperation

   Results of 2006

International and Inter-Regional Cooperation

International and inter-regional activity is the major factor in formation of favorable image of Karelia, both abroad, and in Russia. Government of the RK considers maintenance and development of international contacts as a precondition and source of attraction of investments, expansions of commodity markets for production of Karelian producers, increase in opportunities for citizens of the republic to participate in various programs with foreign partners.

Inter-regional cooperation for the Republic of Karelia always was an important factor of development, both in industrial, and in social sphere. Last year Government of the Republic of Karelia continued following policy of expansion and strengthening trade, economic, scientific, technical and cultural relations, both with regions of the Russian Federation and with the CIS countries, and with foreign partners.

With a view of attraction of additional resources for improvement of conditions of social and economic development of the Republic of Karelia, cooperation of the republic with regions of Finland, Sweden, Norway, Greece and the USA proceeded successfully. Cooperation was conducted within the framework of the Barents Region, with Nordic Council of Ministers, and also within the EU programs.

In 2006 in territory of the RK there had been implemented 87 projects which total sum of annual external financing made 6,5 million euro. In October, 2005 Souperä international check point has been put into operation. For its construction 5,6 million euro has been allocated from the EU funds within the TACIS program, and 70 million rbl. from the federal budget, and Finnish town of Kuusamo has undertaken to deliver electric power free of charge within 5 years. Large TACIS project e-Karelia with 2 million euro financing from the EU funds aimed at development of information in the sphere of small and medium business has been completed. Realization of projects in the field of municipal economy and agriculture, power engineering, transport and tourism, public health services, rescue service proceeded. As a whole, it is possible to ascertain appreciable growth of projects of economic orientation that became a result of joint efforts of Government of the RK and foreign partners.

In 2006 work within the EU new regional program Good-Neighbourliness - Euroregion Karelia has begun. Representatives of Government of the RK are among supervising and working bodies of the program. In 2006 of 46 project applications considered, 16 projects have been approved for financing of 3,6 million euro total. At that, 70% of projects are of economic orientation (logistics, new technologies, creation of preconditions for organization of new enterprises, development of tourism, power engineering, etc.). Preparation of documents of the new seven-year program of EU, starting in 2008 and providing total amount of European financing at the rate of 23,2 million euro was conducted simultaneously.

With the Ministry for Foreign Affairs of Finland within the scope of the Intergovernmental Russian-Finnish working group on frontier cooperation for 2007 there has been coordinated 24 projects for the total sum of 1 million euro. It has been implemented more than 30 projects and actions stipulated by the Memorandum of bilaterial cooperation between the RK and province of Oulu (Finland) for 2005-2006. In November, 2006 the new Memorandum for 2007-2008 has been signed.

Since 2006 the Republic of Karelia presided in the Regional Council of Barents Euro-Arctic Region, in Parliamentary Association of Northwest of Russia Karelia is given the status of constant observer, the new Barents program of radical people and youth program are supported. Petrozavodsk hosted final conference within the Barents 2010 project and Karelian information Barents centre is opened which primary goals are establishment of contacts between Karelian and Norwegian organizations, granting information on projects, and rendering practical assistance.

Within the scope of bilaterial cooperation of the Republic of Karelia and province of Troms (Norway) in 2006 in territory of the Republic of Karelia it was implemented more than 10 projects (Barents projects and bilaterial projects in the field of culture, public health services and research activity). Such as, for example, Stone Book of the White Sea Coast, Preparation of Adopting Parents, New methods of social rehabilitation of children and Families, Youth literary camp of the Barents region, Complex humanitarian researche in the White Sea basin. Now preparation for signing the new report on cooperation for the period of 2007-2009 is conducted.

In 2006 within the framework of TACIS project Industrial partnership of the Swedish province of Västerbotten and the Republic of Karelia, and also through Swedish-Karelian information business center working more than ten years Government of the RK kept selecting business partners in economic sphere. In February, 2007 the new protocol on cooperation with the province of Västerbotten for 2007-2013 has been signed. In 2006 implementation of SIDA (Swedish International Development Agency) financed projects in territory of the Republic of Karelia proceeded. Among the most significant projects there were Training of Timber Industry Employees and Development of Rural Regions. Stage 3. The project covers many fields of activity, promoting economic, cultural and social development of Pryazha, Olonets, Pitkäranta, Suojärvi and Medvezhiegorsk regions. In the future it is planned to distribute the project for territories of Lahdenpohja and Sortavala regions.

Government of the RK organizes and leads in Petrozavodsk large international actions: conference Industrial partnership betweenthe province of Västerbotten and the Republic of Karelia, the Second annual international conference Frontier Cooperation between the Russian Federation and EU, the Second Russian-Finnish economic forum.

Due to sharp growth of freight traffic through Luttä railway check point its after-development has been held, tasks of increasing in regular number of bodies of boundary and customs control, increase in railway check point operating time have been completed.

Reconstruction of Värtsilä and Lyttä railway check points and their inclusion in Russian Federation Frontier (2003-2010) Federal Target Program have been coordinated. The corresponding decision of the Government of the Russian Federation is expected in 2007.

Arrangement and functioning of operating simplified border crossing points continued. References of Government of the RK about expediency of continuation of work of simplified border crossing points have been sent to federal state bodies. During certification of crossing points within a year interaction with divisions of control bodies in the RK, NWFD and corresponding federal state bodies was accomplished. Transition of simplified border crossing points from January 1, 2007 to visa regulations has been adjusted. Work of Kuolismaa border crossing point has been coordinated with Fedetal Transportation Service of the Russian Federation.

Tasks for 2007:

  • work with Government of the Russian Federation on preservation and perfection of available boundary andcustoms infrastructure, promotion of projects of international transit transport corridors;
  • finding of conciliatory proposal on border zone in the territory of the RK;
  • successful completion of the RK's presidency in the Regional Council of BEAR and transfer of above mentioned powers in November, 2007 to the Regional union of Oulu (Finland);
  • signing of reports for the next period of cooperation with provinces of Västerbotten (Sweden) and Troms (Norway);
  • continuation of work within the EU operating regional program Good-Neighbourliness - Euroregion Kareliaand development of the new EU ENPI CBC Karelia 2007-2013 Program.

Speaking of cooperation of the Republic of Karelia with regions of the Russian Federation, Byelorussia and Ukraine, it is necessary to note, that almost all enforcement authorities of the republic participate in this process. The interested enterprises and establishments and Administrations of local self-government of the republic join in this work.

Now inter-regional relations of the Republic of Karelia cover 20 regions of the Russian Federation, Byelorussia, Autonomous republic of Crimea and Odessa area of Ukraine. Total number of the agreements concluded on trade, economic, scientific, technical and cultural cooperation make 23.

The most effective are agreements with reports stating specific actions on their implementation. There are seven agreements of this kind: with Governments of Byelorussia, Moscow, regions of Leningrad, Vologda, Murmansk, and Archangelsk, and Republic of Komi. It is possible to note, that commodity circulation with these regions grows constantly.

Cooperation is carried out in such spheres, as engineering industry, timber and mining industries, construction, housing and communal services, agriculture and fish industry, tourism. Cooperation in the fields of culture, education, public health services develops traditionary.

Due to inter-regional cooperation, deliveries of Karelian fishery products to St.-Petersburg, Moscow and Leningrad region grow constantly. The Republic of Karelia continues active cooperation on development of road-transport routes with Leningrad, Arhangelsk regions and Republic of Komi. Tasks of attracting of means of the federal budget for construction of sites of the road being a part of Northern transport corridor are completed in common. Within the scope of the working report signed by Government of the Republic of Karelia with the Government of Archangelsk region, outlet to the border with Archangelsk region is provided. Petrozavodskmash JSC and Onego Tractor Plant, Inc., deliver paper-making equipment and tractors in Vologda region, the Archangelsk region, and Republic of Komi. Petrozavodskmash JSC is performing the order to make equipment for construction of pulp and paper mill in Shklov, MTZ production association service dealer center is being created on the basis of Karelagroservis, Inc., cooperation in the sphere of peat extraction and processing is carried out.

For activization of spheres of inter-regional cooperation Government of the RK work on preparation of projects of new protocols on cooperation is spent. In 2006 projects of protocols with the Government of Leningrad region, and the Government of Moscow were prepared. Now they are at coordination in the Government of Moscow and Leningrad region. The coordination has been lead and procedure of signing the Protocol to the Cooperation Agreement of the Government of the Republic of Karelia and the Government of Autonomous republic of Crimea by correspondence is being carried out. Work in the given field will continue in 2007.

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Created: April 20, 2007. Last updated: April 26, 2007.
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