Primorsky Territory, Russian Federation

Busy Vladivostok Port

Primorsky Territory is located in the southern part of the Russian Far East, at the edge of the Eurasian continent. It is bordered by the East Sea of Korea/Sea of Japan, China, and the Democratic People's Republic of Korea. Most of Primorsky Territory is mountainous, with the 2,000 km long Sikhote-Alin mountain range occupying most of the eastern part. Nearly 75% of the 165,900 km² area is forested. The climate - with short, cold and sunny winters and rainy and cloudy summers - has given Primorsky the richest biodiversity in the Russian Federation.

Economy

Primorsky Territory has the largest economy in the Russian Far East and the Tumen Region, accounting for a large portion of the total GDP of the Russian Far East. At least half of that is generated within southern Primorsky Territory, near the Tumen River delta. Primorsky is rich in natural resources, and relies heavily on their processing and trading.

Natural Resources

Primorsky's forests support the lumber and building materials industries as well as recreational tourism. There are abundant seafood resources, and Primorsky produces a significant portion of Russia's total fish catch. The fishing industry accounted for 30% of Primorsky's industrial output in 2001.

Agricultural resources are centred around Lake Khanka and southern Primorsky, the warmest parts of the Territory. Most output is based on grain, soyabean, potato and crops for animal fodder, but a sizeable portion of agricultural output is livestock-based (meat, milk, and deer and mink farming). Primorsky is self-sufficient in vegetables, meat and dairy products. Primorsky also has thriving medicinal plant, wild berry, apiary, medicinal mud and mineral water industries.

Primorsky has major bitumen, brown coal, tin, fluorspar and bromide deposits as well as large reserves of lead, zinc and tungsten. Coal mining provides most of the Territory's energy, and employs 28,000 people.

Industry

Coal and non-ferrous metals mining, ship repair, ship building and food processing are the largest industrial employers. Many former state owned enterprises from the Soviet era have been restructured or liquidated, and private sector firms now represent approximately 90% of total enterprises. The service sector has increased dramatically during the last decade, reflecting the absolute decline in manufacturing.

The transport industry accounts for a significant portion of Primorsky's GDP, and Primorsky ports handle most Russian Far East freight.  Of the ten major Russian shipping companies, five are based in the Far East. The transport sector is overwhelmingly export-oriented. Exports have increased in recent years, particularly of metals.

None of the seven ports in Primorsky Territory operate at above 50% of capacity. The ports of Nakhodka and Vostochny each have handling capacity of 15 million tonnes per year, compared to 3 million tonnes at Rajin port (DPRK) and about 1 million each at Zarubino and Posiet. Zarubino currently handles metals, refrigerated cargo and timber. Posiet handles bulk cargo (coal, tiber and metals) and some containers from Yanbian Prefecture in China.

Nakhodka and Vostochny are the termini of the Trans-Siberian Railway (TSR). The TSR is one of the shortest routes between East Asia and Europe and has been a major route for Japanese transit cargo. At its height in 1983, the TSR handled 110,683 TEU (twenty-foot equivalet units) from Japan. However, because of problems with tariffs, handling and security, this traffic was reduced to 7,453 TEU in 1998. The TSR connects with Zarubino and Posiet as well as with Hunchun and Suifenhe in China.

The devaluation of the rouble had a profound effect on Primorsky's economy. Total trade declined from US$ 1.4 billion in 1997 to US$ 1 billion in 1998. In 2001, trade turnover increased to above the 1997 level, with US$ 1.9 billion.

The Primorsky Territory government is working to add value to the area's natural resource base and increase use of its transport capacity.