OREANDA-NEWS. February 3, 2012. At the briefing on January, 30 Valentin Luntsevich, Deputy Head of the Republic of Karelia and Minister of Economic Development of the Republic of Karelia, has familiarized journalists with preliminary results of the economy development in the republic in 2011.

According to the Minister, the index of industrial production in 2011 has made 99.5%. The greatest growth of volumes of industrial production in comparison with 2010 was provided in extraction of minerals (growth has made 1.6 times) and in production of nonmetallic mineral commodity (127.4%).

– All our quarries returned to life, – Valentin Luntsevich said, – They are of great interest to international investors, a number of quarries was acquired by Lafarge A&C (Aggregates and Concrete), a French industrial company, there are also investments from German companies. It is related, first of all, to expectation of road construction development. It is no secret that Karelian crushed rock is considered the best in quality. Our miners get ready to the active work ahead.

Production increased in wood-working (103%), metallurgy and metalware manufacturing (106.7%), equipment and machinery manufacturing (104.4%), electric equipment, electronic and optical equipment manufacturing (111.3%), rubber and plastic articles manufacturing (104.8%). In 2011 the building organizations in territory of the republic have commissioned 178.7 thousand sq.m. of total area of apartment houses that has made 125.4% to the level of the similar period of 2010.

As Valentin Luntsevich has noted, some decrease in general production index was caused by reduction of output by Segezha Pulp and Paper Plant Inc. at the end of the year, low water level necessary for electric power generation by hydroelectric power plants of Karelia, and decrease in production of alcoholic beverages because of high prices and competition.

– The year 2011 was critical for forestry enterprises, – the Minister continued. – We have declared a tough stance of the Government concerning payments in the budget, and by a joint effort debts of enterprises for using forest resources have decreased considerably. Cooperation with Federal Forestry Agency will proceed, this year we shall continue renewal of forest fire-extinguishing equipment that will improve protection of Karelian forest.

Small and medium-sized business develop actively. In 2008-2011 to support small and medium-sized business it was assigned more than 280 million roubles from regional and federal budgets. The share of medium and small-sized enterprises in the republic grows. Growth of number of such enterprises compared to 2008 has made 123%, today they number in about five thousand in Karelia.

Support to small business is rendered to provide jobs in regions where during modernization enterprises receive new equipment, and, thus, superfluity of hands occurs. Today shortness of hands is observed at mining quarries, Vartsila hardware plant, Petrozavodskmash Joint-Stock Company, and other enterprises. Certainly, professional people are needed, first of all. To train them it is necessary to introduce new disciplines and majors in specialized schools and universities, to offer professional re-training, to use modern equipment in training.

Russia's accession to WTO, according to the Minister, will both examine Karelian enterprises in a more rigid competitive environment, and will also enable them to acquire modern equipment from abroad with smaller custom charges.

Implementation of investment projects will also continue. In 2011 Kondopoga Inc. has received a new gas-burning thermal power station. FinTech scientific development and production center in Kostomuksha has launched a plant manufacturing glued structures. The new line laminating wood chip boards delivered by Burkle, a German company, is introduced at Karelia DSP Inc. An industrial quarry of Kp-Gabbro Joint-Stock Company is put into operation in Kondopoga region. A crushing and screening plant was launched in the settlement of Kaalamo of Sortavala region. Within the scope of the Cooperation agreement between NordHydro Joint-Stock Company and the Government of Karelia the project of reconstruction and building small hydroelectric power stations is being implemented. The Yagoda Karelii factory processing wood and garden berries was launched in Petrozavodsk. Construction of the largest in the republic pig-breeding complex in the settlement of Beryozovka, Kondopoga region, is completed. A new boiler-house burning local kinds of fuel – peat and refuse wood – has been put into operation in the settlement of Essoila. The volume of investments in 2011, according to Valentin Luntsevich, has almost reached the pre-crisis level, having made almost 26 billion roubles.

This year the Government will support two projects in Pudozh region: one concerns production of wood and heat power engineering, the second is development of Aganozersky deposit where examination of a large mining and metallurgical project comes to completion. Modernization of timber industry enterprises will continue. Further plans of modernization concern the Avangard factory and the Onego Shipyard.

Another challenge issued by the Government is development of small business and new productions in so-called single-industry towns which economy in many respects depends on the work of one enterpris.

– We expect that, at least, one of such projects that we have submitted to the Ministry of Regional Development of Russia will be supported by the federal Government, – Valentin Luntsevich said. A similar problem, in the opinion of the Minister, is already being solved successfully in Kostomuksha where the share of enterprises smaller than compared to Karelsky Okatysh makes approximately 20% of the general municipal budget revenue.

If in the next two ot three years we manage to recover from such dependence, we may be sure that citizens of the republic find jobs, get respectable wages and live in comfortable conditions of a modern infrastructure, – Valentin Luntsevich said.