The following is the first in a series of posts that will provide facts about Russia on various topics.
1. General Information: St. Petersburg, Russia is the country’s second largest city and is located in the Northwest Federal District. It is approximately 1400 square kilometers in size and has a population of 4.6 million people (as of 2005). The time zone is +3 GMT and +8 from the east coast of the United States.
The government of St. Petersburg includes a governor, a city administration and a single-chamber legislative body, the City Legislative Assembly. In 2006, the governorship became an appointed position. The current governor, Valentina Matviyenko, was elected to the position in 2003, and then appointed by the President of the Russian Federation in 2006.
The main airport servicing St. Petersburg is Pulkovo International Airport. If traveling by train, St Petersburg has five railway terminals – Baltiysky, Finlyandsky, Ladozhsky, Moskovsky and Vitebsky – within its borders.
St. Petersburg features an extensive public transportation system consisting of an underground metro, trams and buses. The underground metro system, the most efficient of the options, opened in 1955 and features five color-coded lines. The fare for the underground transport system is always the same, no matter the distance traveled, and can be paid by token or metro pass.
2. Recent foreign investment: In 2009, the top five countries investing in St. Petersburg (categorized by percentage of total investment volume) were Belarus (15.8 percent), Switzerland (14.7 percent), Germany (10.1 percent), Cyprus (10.1 percent) and Great Britain (9.5 percent). Investment from the United States accounted for 3% of total investment volume. During the first quarter of 2010, foreign investment in the nonfinancial sector of St. Petersburg economy was equal to $1.1 billion. During that time, 90.3 percent of the foreign investment was for manufacturing.
3. Investment creating employment opportunities: As of December 2009, 920 major and medium organizations with foreign capital operated in St. Petersburg. These organizations employed more than 205,300 people.
4. Popular industries: The leading industry in St. Petersburg is manufacturing (machine-building and metalworking), which accounts for 42% of production volume in the city. Two additional important industries include food industry and textiles.
5. Automotive Sector Development: Some recent major automotive investments include:
• In September 2010, Magna opened three facilities in the St. Petersburg area. Two of the facilities operate as Cosym, a joint venture started in 2006 between the company and Korea’s Shin Young Co. The third is a Magna Exteriors and Interiors facility.
• In late September 2010, Hyundai opened a manufacturing facility in St. Petersburg. The plant is expected to produce 105,000 vehicles in its first year, and 150,000 vehicles per year thereafter.
• Also in September, Grupo Antolin - a Spanish automotive components manufacturer - announced plans to open a new parts production and warehouse facility in St. Petersburg by the end of the year. This new facility, which is replacing an older and smaller facility, is expected to help Antolin service the company’s growing number of automotive customers in Russia.
6. High Speed Rail development: In 2006, Russian Railways announced plans to upgrade Russia’s rail travel services to include high-speed rail. In 2009, Russian Railways introduced a high-speed train service that travels between Moscow to St. Petersburg in just under four hours. The service uses high-speed Siemens-produced Sapsan trains that can reach a speed of up to 250 kilometers per hour.
As part of the Strategy for Developing Rail Transport to 2030, the government hopes to increase the speed of the trains on the high-speed rail to 350 km/hr. Back in July, Russian Railways said the company will launch an international tender for the construction of a second high-speed railroad which would decrease the travel time to two and a half hours between Moscow and St. Petersburg.
Additionally, last week Siemens announced it will being to produce high-speed trains in Russia in 2015, producing 160 trains per year for the first two years and then increasing production to 240 trains per year.
7. Retail sector development: St. Petersburg has a growing retail market. In September, H&M announced that it was going to open two additional stores in St. Petersburg. Both stores will be housed in two large retail centers set to open this fall.
8. Health care sector development: In May, Dutch company Royal Philips Electronics and Russia’s Electron announced an investment of $20 million to develop medical equipment in Russia over the next several years. The agreement also said the companies will provide technologies needed for early diagnosis of cardiovascular diseases and cancer, enabling the earlier treatment of patients.
9. Investment policy of St. Petersburg: St. Petersburg law requires a variety of state support of investment activity in the city. The city has identified three investment areas to focus their efforts: developing small businesses, creating a municipal order system and promoting a favorable investment climate.
10. St. Petersburg International Economic Forum: Each summer, St. Petersburg hosts the St. Petersburg International Economic Forum. The forum brings together entrepreneurs and businesses from across the globe to discuss investment.
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