Information provided courtesy of the City Administration of Voronezh. Additional information on Voronezh can be accessed on their World Wide Web Site at: http://www.city.vrn.ru/content.html. Information and consultations for Russian and foreign businessmen on starting small business are available at the following address: Administration of Voronezh, Russia 394067 Voronezh, ul.Plekhanovskaya, 10; Department of Industry and Communications, Tel. (0732) 56-05-52, Fax (0732) 55-47-16; Committee for Economy, Tel. (0732) 55-08-76, 55-06-30, Fax (0732) 55-47-16.

Overview

Voronezh is a major Russian administrative, industrial, and cultural centre. It covers a total area of 69 hectares along the banks of the rivers Don, Usmanka, and Voronezh. Half of the territory is occupied by real estate, the other half is comprised of parks and forests. In 1996, Voronezh became a city of a million - the population now totals 1,027,000 people. A favorable geographic position at the cross-roads of important transport routes, a powerful industry, a strong scientific potential and productive agricultural base - all makes Voronezh a leader among the cities of the Central Black Earth Region. The Board of Directors of Association for economic interaction of the oblasts of the Central Black Earth Region (&laqno;Chernozemye») is located in Voronezh.

The Research and production potential of Voronezh is virtually unmatched. There are 1380 industrial enterprises (of which 150 are large- scale producers), 127 contract construction companies, dozens of companies providing transportation, communication, and catering services. There are 141 joint ventures with participation of foreign investors. The number of workers involved in the city economy is 462 thousand including 193 thousand industrial employees. By production output, Voronezh is ranked 14th among the 89 largest cities of the Russian Federation. Nearly 30 per cent of the goods produced in Voronezh are exported to 30 countries.

The total number of economic entities is 26,000, of which 19,000 are small businesses. Over 90% of state enterprises have been turned into private and joint-stock companies.

In Voronezh, there is one state bank and 16 commercial banks which have branches in all the city's districts.

Residential area covers 16.4 million square meters. The total length of the city transport routes runs to 1350 kilometers. In 1995, 17.8 thousand meters of paved roads were put into service. Voronezh airport has acquired international status.

The ratio of telephones per 1000 people places Voronezh in 25th place in Russia. The total number of telephone sets exceeds 177 thousand. Telephone communication is provided by 40 telephone stations and substations; also available are modern communications networks including satellite communication which makes it possible to quickly link with any area in the world.

Voronezh is a cultural capital of the Central Black Earth Region. There are 5 theaters, a philharmonic, concert halls, numerous museums and exhibition halls to meet the most sophisticated cultural needs of the public.

The current city development trends are restoration of historical monuments, public welfare, expanding of civil construction. The central district of Voronezh is now being renovated which focuses on construction of the business district (trading centre, exhibition hall, underground parking, and offices) and development of Petrovskaya embankment and adjoining streets.

Foreign Trade and Investment

In recent years, the range of international interaction has widened significantly, new forms and directions have been introduced, and number of participants has grown.

Foreign economic activities are considered the main priority. Many industrial and trading companies of Voronezh have direct contact with foreign partners. The range of exported products include machines, electronic goods, and chemicals; Voronezh-made synthetic rubber is in great demand on the world market. Of the total export volume, 70 percent goes to the Baltic republics and to the developed industrial countries. In the composition of imports, prevailing items are: consumer goods, foodstuffs, chemical raw materials, equipment for food and light industries.

In regards to the geographical distribution of trade, the largest share of exports goes to Germany, Italy, Great Britain, the U.S., China, Hungary, Poland, and the Czech Republic. In Voronezh, many foreign companies have representative offices; joint ventures are being established, international production and trade exhibitions and fairs are being arranged. Voronezh companies are active members of foreign exhibitions.

International cooperation in education and research has expanded notably. Institutions of higher education are involved in academic exchange of lecturers and students and are sharing up-to-date teaching techniques.

A new development in this area is cooperation within the international programs of the European Union TACIS, TAGS (TEMPUS), INTAS and others.

In recent years, the emphasis is being put on stimulating international activity with the aim of integrating Voronezh into the world system of economic, scientific and cultural relations.

The Administration of Voronezh is a member of a number of international organizations and associations of the bodies of local authorities. The city has established extensive contacts with Charlotte (Northern Carolina), Sliven (Bulgaria), Chungkin (China) and with the land district Wesermarsch (Lower Saxony, FRG).

Industry

Voronezh is a major industrial center of the Central Black Earth Region. There are 1380 enterprises in Voronezh distributed over 16 industrial branches. Its employees constitute 40% of the total labor force. The leading branches are: radioelectronics, machine-tool industry, mechanical engineering, aircraft industry, chemical, food, and light industries, and production of building materials.

In the course of the market reforms, the share of joint-stock companies in industry is growing fairly steadily, the private economic sector is gaining strength, its share exceeding 90%. There are 43 industrial joint ventures registered in Voronezh, which constitutes 30% of the total number of joint ventures.

Voronezh enterprises produce unique forge and pressing machines well-known in the world market; powerful hydraulic excavators; broad-fuselage air buses Ilyushin-96-300; rocket engines for spacecraft; automatically controlled equipment for processing industries; videotape recorders; grain cleaning machines; color kinescopes; TV-sets; metal-cutting machine tools; electric micromotors; radiotelephone communication systems; various types of synthetic rubber; tires for automobiles and trucks; bridge and aluminum constructions; well pumps; wind power stations; a wide assortment of foodstuffs and consumer goods.

The city possesses considerable potential in production of small piece building materials, construction parts and frames. There are about a dozen factories producing ferroconcrete goods, three factories of large panel constructions, and a wood-processing production amalgamation in Voronezh.

The value of the total industrial output produced by Voronezh enterprises in 1995 amounts to 5.144 billion rubles. Voronezh-made products are exported to 30 countries. Exports of goods are valued at about 700 billion rubles.

Despite the signs of a crisis in economy in the 1990s, the city enterprises have succeeded in a preserving highly-qualified engineering based work force which is capable of quick adoption of advanced technologies.

The main industrial enterprises of Voronezh include mechanical engineering and machine-tool manufacturing, radioelectronics, chemical industry, light industry,, food and processing industries and the building materials industry.

Small Business

Small business is one of the priorities of economic policy of the city Administration. In recent years, due to entrepreneurial efforts and purpose-oriented activity of the city and district authorities, the number of small enterprises has increased considerably. In 1996, their number exceeded 19,000. Small business accounts for 12% of the city annual output employing about 10% of the city labor power.

Banking

In recent years, there has been formed in Voronezh a well-developed banking system including the State Savings Bank with a wide network of affiliates in all the city districts, and 16 commercial banks among which are affiliates of the major Russian banks Inkombank, Agroprombank, Kredobank, Russian Credit.

Banks in Voronezh provide a wide range of services: opening and keeping of current ruble and hard currency accounts; accelerated payments through a correspondent network in Russia and abroad; crediting of enterprises with rubles, hard currency, and bills and issuing bank guarantees; operations with securities; disbursement of cash to the holders of VISA, Mastercard, and Eurocard. Using computer-aided "Bank-Client" system, a customer can settle accounts without leaving the office. In 1995, Voronezh banks were incorporated via satellites into the international information and dealing system "Reuter".

A greater part of Voronezh banks have entered the system of international transactions SWIFT and have made direct contacts with the banks of Germany, the USA, Switzerland, Great Britain, Austria, Italy, Canada, China, the Czech Republic and other countries and have opened correspondent accounts in many European, American, and Asian banks.

Market reforms stimulated the growth of investment and finance companies which accumulate assets and private funds with the aim of facilitating city projects, in particular, to promote housing construction. At the moment there are over 60 finance and investment companies in Voronezh. Various kinds of insurance are provided by numerous insurance companies located in the city.

Last Updated: June 10 1999. Copyright Russian-American Chamber of Commerce® 1995-1999. All rights reserved.