St. Petersburg is a major industrial center. The city produces 3% of all Russian manufactured goods. The city is renowned as a center of the Russian machine-building. It is home to several huge machinery-building plants like Izhorskiye Zavody, Kirov Plant, Electrosila, LOMO and Leningrad Metal Works. There are also several big shipyards in St. Petersburg - Baltiysky Zavod, Admiralteyskiye Verfi and Almaz, producing ships of various types ranging from yachts to nuclear icebreakers.

St. Petersburg is also a key Russian food-processing region. "Baltika Brewery" alone, the biggest brewery in Russia, accounts for more than 10% of the total Russian beer output. Other significant local industries include pulp and paper, furniture, textiles and clothing, tobacco, leather products, chemical, wood processing, fish processing and shipbuilding.

The industrial growth in St. Petersburg has slowed down lately and was close to zero in 2001. However, the cumulative three-year growth was about 35%, according to the State Statistics Committee (Goskomstat) data, as compared to the average Russian industrial growth of 23% for the same three-year period. The surrounding Leningrad Oblast has demonstrated even better growth rates totaling about 50% industrial output increase over the past three years. The Oblast's industrial production is still less than half of the city's production, according to the State Statistics Agency.

St. Petersburg is the second largest (after Moscow) industrial centre of Russia. Up to the quarter of the working city population are employed in the city industry.

During the period of 1996-2001 the industrial production in St. Petersburg has increased by more than 1.4 times

Dynamics of Industrial Production Volume &
Average Industrial Production Personnel (IPP)
in 1997-2001 (% to 1996)

Industrial production growth in St. Petersburg is also observed in 2002. In January-February2002 the volume of industrial production made 102.2% as compared to the similar period of the previous year.

The projection for 2002-2004 foresees a gradual growth (6-9 %) of industrial production in St. Petersburg.

The key sectors in the structure of St. Petersburg industry which greatly influence its results on the whole are machine-building and metal processing, food industry and power industry. The share of these three branches in the whole industrial production volume in St. Petersburg made 80% in 2001.

The leading branch of the city's economy - machine-building and metal processing - gives over 30% of the production. One of the main features of the branch is the prevalence of complex Hi-Tech production sectors, such as power machine-building and electrotechnical machine-building, turbo engine building, diesel building, instrument-making, radio equipment and electronic industry, printing machine-building, machine-tool industry etc.

A special place in the development of the branch is occupied by shipbuilding. St. Petersburg has always been the centre for shipbuilding in Russia.

Another important branch is food industry which is widely represented by nearly all types of production complexes related to processing and production of food-staffs. It gives 37.5% of the industrial production volume of St. Petersburg.

The power industry supplies 10.5% of the industrial production volume of the city

Sectoral Structure of St. Petersburg Industry to August 2002 (%) in mln RUR

Sector	Production Volume in Jan-Aug 2001	Production Volume	Tax Proceeds into the budget	No. of Personnel
Indus try, total	122228	100.0	100.0	100.0
including: Electric-power industry	13522	10.5	6.0	3.8
Metallurgy	5549	4.7	0.1	2.8
Chemical and petrochemical industry	1542	1.2	1.7	3.2
Machine-building and metal processing industry	36250	30.8	36.6	55.6
Timber, wood processing, and pulp and paper industry	2983	2.4	1.5	4.0
Construction materials industry	3894	2.8	3.2	2.7
Light industry	2403	2.0	2.7	5.6
Food industry	47111	37.5	42.6	13.2
Other	8974	8.2	5.7	9.0

The industry of St. Petersburg is based on 600 large and medium industrial enterprises, some of them being largest enterprises in Russia.

The largest companies in machine-building and metal-processing are:

OAO "Shipbuilding Factory "Severnaya Verf", OAO "Baltijsky Zavod", FGUP "Admiraltejskie Verfi" that build ships of various types (nuclear ice-breakers, nuclear cruisers, vessels of medium capacity etc.), ОАО "Shipbuilding Firm "Almaz" (civic speed boats, including hover-crafts, cruise and racing yachts);

ОАО "Izhorskie Zavody", АООТ "Leningradsky Metal Factory", ОАО "Turbine Blades Factory", АООТ "Nevsky Zavod", АООТ "Elektrosila", ОАО "Novaya Era", ОАО "Novaya Sila",

ZAO "Factory "Electropult", which manufacture various types of energy equipment, electrical machines, engines, machinery and outfit for power plants (nuclear, thermoelectric, gas turbine and hydroelectric power plants), for petrochemical industry, mining industry, metallurgy, shipbuilding, railroad transport and other branches;

ОАО "Kirovsky Zavod" specializes in manu-facturing of tractors and agricultural machinery, road machinery, specialized equipment, machinery for timber industry, automobile transport, machinery for municipal economy, plants and equipment for power branches of industry, machinery for oil and gas industry, metallurgy, equipment of ecological purposes and other types of machinery;

ОАО "Zvezda" manufactures diesels and diesel-generators for maritime and river vessels, for railroad transport and for the objects of energetics;

ОАО "Sevkabel" manufactures a wide range of cables;

AOZT "Electrotyaga", ОАО "Accumulator Company "Riegel", AOZT "Baltelectro" specialize in manufacturing of various accumulators and accumulator batteries, components and batteries for galvanic and nickel-cadmium cylinder accumulators;

ОАО "LOMO" produces various types of medical equipment, optical instruments, equipment for organizational and technical support to election campaigns, photo cameras;

ZAO "Alcatel" produces modern digital automatic telephone stations;

АООТ "Lenigrad Electromechanical Factory" manufactures computing equipment and spare parts;

ООО "OTIS St. Petersburg" is the largest manufacturer of elevators;

ОАО "Morion" develops and manufactures quartz generators, filters and resonators used in telecommunications, control and navigation, in the computing equipment and testing instruments;

ОАО "Podyomtransmash" produces electrical overhead cranes, including special cranes;

ОАО "October Electrical Cars Repair Factory" specializes in repair of rolling stock for railroads;

AOZT "Wagonmash" produces passenger cars for metro and intercity passenger cars;

ZAO "PPI" produces items of private use (shaving blades and sets);

ОАО "Machinostroitelny Zavod" produces oil field equipment and drilling equipment for geological exploration;

GUP "St. Petersburg Electrotechnical Factory" specializes in manufacturing of electrotechnical machinery, equipment, outfit and products for production purposes;

ОАО "Abrasive Factory "Ilyitch" produces a wide range of abrasive tools, including the items made of artificial diamonds, abrasive materials and products.

The products of largest St. Petersburg machine-building enterprises are competitive not only in Russia, but also in Western countries. They are of high quality, and the demand is steady, with the perspective of sales increase both on the domestic market and abroad. In the first turn, it relates to the shipbuilding enterprises and the manufacturers of various types of energy equipment for power plants.

Another leading sector in St. Petersburg - food industry - also possesses reserves for further production growth that will be explored with the increase of the purchasing capacity of the citizens. Many companies have modernized, reconstructed and technically re-equipped their production complexes, built new workshops and factories, developed new types of products, improved the quality of their products. As a result, this sector became most dynamic, capable of satisfying the needs of the local population, and selling their products to other regions of Russia and abroad.

At present nearly 55% of the production volume of food industry are coming from tobacco companies and breweries. The share of the baking industry makes 7.3% of the sector's production volume, butter and cheese making - 10.0%, confectionary industry - 6.6%, fat-and-oil industry - 3.1%.

The key enterprises of the food industry are:

ОАО "Baltika" Brewery, ОАО "Vena" Brewery, ZAO "Stepan Razin Brewery" (brewing industry);

ОАО "Petro", ZAO "Philip Morris Neva", ZAO "Nevo Tabak", ZAO JV "Rothmans Nevo" (tobacco-caporal industry);

ООО "Bravo International", ZAO "Coca-Cola St. Petersburg Bottlers" (soft drinks production);

ZAO "Neva Chupa-Chups", ZAO "N. Krup-skaya Confectionery Factory" (confectionery industry);

ZAO "Parnas-M" (meat products);

ZAO St. Petersburg Dairy Factory "Piskarevsky", ОАО "Petmol" (butter and cheese making and dairy industry);

ОАО "Kirov Baking Factory", ОАО "Pekar", ОАО "Khlebny Dom" (baking industry);

ZAO "Nevskaya Cosmetica" (perfumery and cosmetics);

ZAO "Aist" (production of soaps and deter-gents).

In metallurgy, the largest companies that produce various brands of steel and types of rolled metal are: ZAO "Petrostal" Factory, ОАО "Krasny Vyborzhets". The secondary processing and metal production is performed by ZAO "Vtortchermet", ZAO JV "LST-Metall", ZAO "Petromax".

In chemical and petrochemical industry, the largest enterprises are:

ОАО NPF "Pigment" (paintwork materials), ОАО "Krasny Treugolnik" (general mechanical rubber goods), ZAO "Petrospirt" (products of primary organic synthesis), ОАО "Plastpolimer" (plastic products).

The largest enterprises in timber industry, wood-processing and pulp and paper industry are:

ОАО "Ust-Izhorsky Plywood Factory" (plywood producion);

ОАО "Lenraumamebel" and АООТ MKO "Sevzapmebel" (furniture industry);

ОАО "Svetoch" and ZAO PO "Parus" (products of paper and carton);

ZAO "Prestige" (structural elements made of wood and wood pulp);

ОАО "Bumaga" Firm" (production of cellulose pulp, paper and carton);

ОАО "Unipack" (production of paper and carton packages).

The largest enterprises in the construction materials industry are:

ZAO "Pobeda/Knauf", ZAO "NPO "Ceramica" (construction bricks and ceramic tiles);

AOZT "Barrikada", АООТ "Stroydetal" (ready-mixed concrete and mortar mix);

ZAO "Stroypolimer" (construction materials and items made of polymeric materials);

ОАО "Asphaltobetonny Factory No.1" (produc-tion of asphalt conctere);

ZAO "Stone-carving Factory "Vozrozhdeniye" (facing materials made of natural stones);

ZAO "Metrobeton", АООТ "Lenstroydetal" (prefabricated ferroconcrete and concrete elements and items).

Enterprises of the light industry of St. Petersburg produce a wide range of clothes, textiles, fabrics, footwear and other products. The leading clothing factories specialised in the production of men's and women's overcoats are ZAO "Pervomayskaya Zarya", ZAO "Clothing Factories of St. Petersburg", ZAO "Bolshevichka". In the textile industry the largest manufacturers are: ОАО "Nevskaya Manufactura" (production of woolen fabrics), АООТ "Sovetskaya Zvezda" and ОАО "Kirov PNK Spinning Mill" (production of cotton yarn and sewing threads), ОАО "Krasnaya Nit" PNK Spinning Mill" (cotton fabrics).

The products of the leading companies of St. Petersburg (in food industry, light industry, timber industry, wood-processing and pulp and paper industry and other sectors) that specialize in the production of consumer goods are of great demand both on the domestic, and on the foreign market.

Nevertheless, many local enterprises need renovation and technical re-equipment of the production complexes, which demands additional funds.

Lately the interest of big financial organizations to the industrial enterprises of St. Petersburg has been growing. In November 2000, on the initiative of Group "Interros" a power machine-building concern ZAO "Siloviye Mashiny" was created, to incorporate such big local power machine-building enterprises as АООТ "Leningradsky Metal Factory", ОAO "Elektrosila", ОАО "Turbine Blades Factory".

ОАО "Foil Rolling Mill" developed a business-plan and started on the implementation of a new production complex for flexible packing materials. The plan is financially supported by a large Italian company.

A number of well-known multinational corporations have been successfully working in St. Petersburg for several years, including Rothmans, Coca-Cola, Sinebrychoff, Kraft Jacobs Suchard, ACN, Unilever, Kurt Kellerman, Gillet, Rigly, JTI Petro, Pepsi Bottling Group and others.
The inflow of investments into the industrial sectors will give a new impulse to further development of St. Petersburg industry.
Administration of St. Petersburg developed and brought into life the Conception for Reformation of Industrial Enterprises of St. Petersburg. The Conception is based on the regulation system which stimulates the enterprises to implement the restructuring measures and ensures co-ordination of the city's and enterprises' social and economic interests.

Realisation of Conception will allow to optimise the industrial enterprises' structure, to co-ordinate the production costs and the output volume, to secure effective operation of enterprises. During the restructuring period Administration of St. Petersburg will support the enterprises on the agreement basis.

Co-ordination of the industry development in St. Petersburg is the responsibility of the Committee on Economic Development, Industrial Policy and Trade:
190000, St. Petersburg, Voznesensky prospect, 16.
Tel.: (812) 315-5152, 319-93-60,
fax: (812) 319-95-54
E-mail: cedipt@gov.spb.ru