Facts At a Glance: The Saratov Region and The City of Saratov

The profile was prepared by Boris Brouk who served as a Chamber intern in summer 2002.

The information is derived from the following sources:

Ministry for International Affairs and External Economic Relations of the Saratov Region

(web site: http://www.mininter.saratov.gov.ru),

http://www.bisnis.doc.gov/bisnis/country/990525sar.htm,

http://www.geocities.com/WallStreet/7138/text_6.htm

History

The Saratov Region was formed in 1934. The history of Saratov, the Region’s administrative center, dates back to 1590 when the city-fortress on the Volga River was founded. Saratov gets its name from the Tatar word Sary-Tau (“Yellow Mountain”). During its more than 400 year history, Saratov has served as the crossroads for many historical events and outstanding people. In the late 19th century, Saratov became a center for industry, trade, and culture. By that time it had become famous for its agricultural products, fishing, and salt industries, as well as manufacturing and metal processing.

Geographical Position and Climate

The Saratov Region is located in the southeast of the East European Plain, in the heart of the Volga River Region, 858 km southeast of Moscow.

It occupies a territory of 101,200 sq. km that equals the total area of such states as Belgium, Switzerland, and Albania. The Region extends 575 km from the west to the east and 240 km from the north to the south.

The Saratov Region enjoys continental and moderate climate. Saratov’s climate is much like that of Chicago. The average temperature in summer is around 80°F and about 11°F in winter. Snow covers the ground from December and melts down towards the last part of March.

Administrative Units and Population

The Saratov Region consists of 39 administrative areas having their

own representative and executive authorities. The population of the City of Saratov is over 900,000 people. The total population of the region is over 2.7 million people.

Political Status and Branches of Power

The Saratov Region is under the jurisdiction of the Russian Federation. The head of the executive branch of power is the Governor. The Regional executive branch is currently headed by Dmitriy F. Ayatskov who was re-elected for a second term in March 2000. The Governor forms the Regional Government headed by the Chairman whose appointment has to be approved by the Regional Duma.

The Saratov Regional Duma represents the legislative power.

The Regional Duma consists of 35 deputies, representing 35 committees and standing commissions.

Natural Resources

The Saratov Region has significant reserves of natural resources. It has large deposits of natural gas, oil shale, salt, chalk, limestone, clay, sand, dolomites, and aragonite. The oil shale deposits alone equal to over a billion tons. Oil and gas are considered to be the most significant natural assets of the region. The oil and gas production has been developed since 1944. In total, oil deposits of the region are estimated at 500 million MT, 43.1% of which are extractable. Projected reserves of gas condensate are 164 million MT, 56.2 percent of which are extractable.

Industry and Major Enterprises

Over 2000 large and middle-sized enterprises with developed instrument making, electronics, aircraft manufacture, machine-tool manufacture, oil and gas production and processing, chemical, and construction industries represent the industrial sector of the Saratov Region.

The oil/gas and energy generation sectors account for 37.3 per cent of the regional industrial output. The average oil production equals to 1 million MT per year. Crude oil is mainly processed in the Saratov Oil Refinery. The Saratov-Moscow gas pipeline, 843 km long, passes through the Region.

Other important industries include machine building, production of chemicals and petrochemicals. Companies operating in the machine building sector specialize in manufacturing commercial electronics with dual applications (navigation systems and controls for aviation, merchant ships and the Navy, telecommunications and radar equipment, measuring instruments), diesel generators, aircraft, machine-tools (tooth-cutting machines) and equipment for the energy, chemical, and oil industry sectors.

The Saratov Aircraft Plant is a manufacturer of various modifications of YAK-42 aircraft for commercial and training purposes. The Saratov Trolley-Bus Plant is the major supplier of trolley-buses in Russia. It also exports its production to Europe, Asia, and Latin America. The Saratov Bearing Plant specializes in producing a broad line of roller bearings. Litiy-Element is the only Russian supplier of lithium batteries used in small-sized measuring instruments, computers, and cardiac implants.

The regional chemical sector accounts for 16 per cent of the industrial output. Rubber products made by Balakovorezinotekhnika are widely used in the vehicles produced in Russia.

The Saratov Region is considered to be the largest Russian producer of chemical fibers and filaments. Local chemical companies also produce acrylic acid, methyl acrylate, phenol, sulphuric acid and fertilizers.

The construction materials industry is highly developed in the Region. This sector employs approximately 88,000 workers. There are 35 factories, which fabricate reinforced concrete products. As for cement products, the Region holds the first place in the Volga Region area.

The companies producing fabrics, footgear, clothing, and knitwear represent the light industry.

Agribusiness

In terms of total agricultural production, the Saratov Region is ranked as one of the leading in the country. Agribusiness accounts for approximately 15 per cent of the gross regional product. The main trends of the regional agriculture are determined by grain-crabs, meat, and milk cattle-breeding, as well as meet and wool sheep-breeding. The Saratov Region is one of the leading Russian producers of winter wheat.

In the volume of grain harvest, the Saratov Region is in the second place in Russia. In the volume of the most valuable hard wheat production, the Region is in the first place.

Agricultural land amounts to 8.5 million hectares and makes up 84 per cent of overall land resources. Over 20 per cent of the regional workforce is employed in agribusiness.

Culture and Education

The Saratov Region possesses an enornous scientific and cultural potential. Saratov is the greatest educational center of Central Russia. It offers a highly skilled and educated work force. In the City of Saratov, there are 11 institutions of higher education, about 30 research and science ceenters, 12 colleges, 70 vocational schools, more than 100 secondary schools and 25 musical and arts schools. Saratov State University, founded in 1909, is one of the oldest and respected universities in Russia. The Saratov Conservatory is the third biggest in the country after Moscow and Saint-Petersburg.

In the Region there are 12 professional theaters, 25 museums, the oldest circus in Russia and several art galleries. The most famous art gallery is the Radischev Art Gallery, which possesses a unique collection of Russian and European masterpieces of art. Art experts have called the Gallery the “Volga Hermitage.”

Transportation

Saratov is situated on the crossroads of Europe and Asia. The airport, highways, railway system, and the Volga River connect Saratov with the western part of Russia as well as the Urals, Siberia, and Asia.

The Saratov airport is located in the city and can be reached in less than 15 minutes from the downtown. It offers air service throughout Russia, some of the former republics of the Soviet Union, and a number of major international locations.

Saratov is an important railway junction connecting the center of Russia and the Urals, Siberia, and Central Asia. Since 1993 the city has had the direct railway route Saratov – Berlin. All of Russia’s major cities can be reached by train.

Saratov is one of the main river ports on the Volga River. The water routes connect the city with Moscow (the Moscow canal), the Western Urals (the Kama River), the Black Sea (the Volga-Don canal) as well as the Baltic and White seas (the Volgo-Balt waterway). The cargo port was recently expanded and renovated to accommodate heavy industrial use.

Saratov has a well developed public transportation network. Over 300,000 passengers use the services of public transportation. The total length of municipal transportation network exceeds 700 km.

Foreign Trade

Principal foreign trade partners of the Saratov Region are the companies from the United States, Great Britain, Italy, Holland, Turkey, and Germany. Moreover, the Region has also been actively reestablishing economic and trade relations with Macedonia, Bulgaria, Hungary, Slovakia, and Poland.

Enterprises and companies of the Region export goods into more than 67 countries of the world. The most exportable products include electronic devices, electrical equipment, vehicles, crude oil, oil products, mineral fertilizers, chemicals and petrochemicals. The largest exporting companies are Kreking, Balakovo Fibers, Irgiz, and Saratovstroisteklo. The majority of companies with foreign capital have German partners, including Bosch and Henkel. Other large-scaled projects in the Saratov Region include the modernization of the oil-processing company Kreking involving the U.S. and Spanish companies, a joint venture between the Saratov Tobacco Factory and British American Tobacco that acquired controlling interest in the Saratov company, and a lot of other projects.

The August 1998 Russian financial crisis led to the internal production growth that was mainly determined by changes in the export and import dynamics related to ruble devaluation.

Investment Opportunities

Investment opportunities and a favorable investment climate is one of the core issues of the Saratov Region’s development. The regional investment policy, formed in accordance with the federal legislation, has been successfully carried out. The Saratov Regional Duma adopted a number of laws to stimulate and guarantee investments in the Region, including the Laws On Guarantees of Private Investments in the Saratov Region, On Stimulation of Investment Activities in the Saratov Region, On Land, and a number of other laws and regulations. Under these laws investors are entitled to exemptions from taxes on profit, property, and vehicles paid to the local treasury for 3 years. Moreover, under the Law On Land, land for investment projects may be provided on lease (for up to 49 years) or may be bought by individuals or commercial entities.