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Dear Friends

This issue of our journal comes out after an event of the high-est importance for our country the presidential elections. I am especially pleased that the majority of Stavropolians did not stand on the sidelines, mere passive spectators of the politi-cal life of the country, but went to their voting stations and dis-

charged their civic duty. People see the connection be-tween their personal futures and the future of Russia and they want to have a say.

That said, for each of us, our children and grandchildren tomorrow depends on more than the decisions taken at the ballot box on on 4 March. Daily work gives a prom-ising future to everyone who lives in Stavropol Krai. The Krais Government will do everything in its power to create the right conditions to ensure that that work is as effective as possible for the individual worker, the company which employs him and the region in which he lives as a whole.

In spite of the large share social programmes receive from the regional budget, we have not forgotten about support for manufacturers. We understand that only establishing a solid economic foundation will enable us to make the lives of the local inhabitants more com-fortable and help them in their social and professional development. That is the main aim of our long-term strategy.

Making use of a range of mechanisms and instruments, we will gradually make manufacturing the centre of

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gravity in the Krais economy. We started in quite a rea-sonable position, with a strong agricultural sector and well-developed chemicals industry, but today progress must be constantly renewed. Technology is moving ahead in gigantic leaps, and it is only with technology that our businesses and their products will be competi-tive.

Any modernisation is a serious investment, and I regard it as a priority for the economic side of the Government. It is with satisfaction that I am able to say that the num-ber of investors interested in Stavropol is growing. In 2011 investment in starting capital was 10% higher than it had been the year before, and investment in January 2012 was twice that of January 2011.

What is more, investors are finding opportunities in both our traditional industries and the new manufactur-ing clusters. The growth areas, be they energy, pharma-ceuticals or processing, are united by their reliance on high technology.

Innovation is common to virtually all the projects now underway in the Krai, and several of them are covered in this edition of our journal, entitled An Invitation To The Future.

I see a progressive future for the Krai, and if you, the reader, have the same forward-looking perspective, then we are on the same wavelength. Come and visit!

Investment in Stavropol Krai a worthwhile investment in the future.

Yours,

Valery GaevskyGovernor, Stavropol Krai

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DISCOVER STAVROPOL KRAI PERSONAL DISCOVERY DISCOVER OPEN HORIZONS

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Over the past 8 years Stavropol Krai's one-time sanatorium medicine exhibition has matured to become the most professionally-organised event in the south of Russia. Now with international status, this April in Kislovodsk it will refocus on investment in human capital.

Deputy Chairman of the Krai Government Georgiy Efremov spoke with us on the forthcoming

9th International Forum on Investment In The PersonThe forum will address the idea that the knowledge, health and re-sourcefulness of our people are vital to the development of the Krai. Our 2025 socio-economic development programme aims to facili-tate personal growth, and to maximise its effectiveness we are look-ing to open dialogue and exchange experiences with other rEegions,

both at home and abroad. Last year's event attracted representatives from 40 Russian regions and Turkey, Italy and Germany. April's fo-rum will enjoy federal support from the Ministries of Tourism, So-cial Development, Education and the Environment and will dis-cuss health, medicine, education, culture and the environment.

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EF English First Stavropol

Discover Stavropol KraiSocio-Economic Periodical 12 February-March 2012

Published on the initiative of, and with support from, the Government

and Parliament of Stavropol Krai, hamber of Commerce of SK

Chief Editor - Y. V.Yagudaev, Minister of Economic Development, Stavropol Krai

Editorial boardChairman, Editorial Board G. G. Efremov, Vice-Chairmanof the Government of Stavropol Krai

Members, Editorial BoardM.G. Grigorev - the head of department on the state information policy and mass communications of Governmental of Stavropol Krai E.V. Bondarenko - Chairman of the Stavropol Krai Parliamentary Committee for Mass Communication, Information Technology and Means of CommunicationS.V. Mosina - Parliamentary Deputy, City of StavropolV. A. Shapovalov Rector of Stavropol State University,Doctor of Sociology, ProfessorP. V. Akinin Dean of the Faculty of Economics, Stavropol State University; Doctor of Economics, Professor

Design and layoutSergei Bobylev

PhotographyJulia Schupak

TranslationGraham Fraser Teacher,EF English First Stavropol

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DISCOVER STAVROPOL KRAI

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, 2025 , - , - . 2011 104,4% . - 2% 52%. 239,3 . , 15,4%. - - 104,5%. - 174,5 . 15% , 2010 . - , . , , , , , - . , - - - -. 1,5 . , , , . - -, - , - , . - - - - - -.

- - 2011 - . - -500, - - , . - - - -2 14,2 . 110 - - -. - . ( , - ) - 18,5 . 11,0 . - , 2010 , -, 6,3% 4,8%. - - , - , , , - , - . - , - , , , 1 . - 2014 .

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A BASE TO BUILD ON

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, - . , - , - , - - . - - 2011 - - 80 . . - , 2011 57,7 . ( - 17,7%) 7,1 . ( - 7%).

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, , . 8 - 3,7 . . . - - , 17 13,3 .

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Dmitriy Samatov, Stavropol Krais Minister of Industry, Energy and Transport, speaks about his strategic aims for the regions economy and the interim results of the development of the areas under his stew-ardship.

IndustryI would give a satisfactory mark to the work the region's industry has done this year towards implementing the Krai's socio-eco-nomic development programme for 2025. Compared with 2010 the manufacturing index for 2011 stands at 104.4%, and ten of our twelve industrial sectors achieved growth varying between 2% and 52%. The total volume of goods produced was valued at 239.3bn roubles, which is 15.4% up on 2010.In the processing sector the production index stands at 104.5%. Goods produced were up 15% at 174.5bn roubles. OAO Elec-troautomatica, OAO Nevinnomysskiy Azot, OAO Energomera, OAO Arnest and OAO Signal are showing steady growth. Inci-dentally, the latter won a 1.5bn-rouble defence contract last year. It has become a major producer of electronics for the Russian de-fence industry, so we hope to see an increase in its workforce and output in 2012. This year should see the opening of Nevinnomysskiy Azot's new melamine plant and the start of production at OOO Lissant-Yug.

Fuels and EnergyLast year saw several major steps made in line with the Krai's medium-term energy plan. The new PS-500 substation supplies electricity from the Volgodonsk nuclear power station to the North Caucasus Federal Okrug, and construction of a new ener-gy block at the Nevinnomyssk Hydroelectric Station is now com-plete. Kuban Cascade (part of RusHydro) has opened its 14.2MW Egorlykskaya-2 hydroelectric station, and in the city of Stavropol a 110kW substation has opened. The Krai's power stations gener-ated 18.5bn kWh of electricity and 11m Gcal of heat 6.3 % and 4.8% up on 2010 respectively.With the Krai's hydrocarbon fields in their final stages, the ex-traction of minerals for energy, oil in particular, has fallen slightly short of target. OOO Rosneft-Stavropolneftegaz is undertaking an exploration programme that should see Stavropol producing over 1m tonnes of oil by 2014.

Energy ConservationTalks are in progress with several companies in the field of

renewable energy sources. The issue of a solar power station in Kislovodsk has been resolved. Plans are afoot to build several 100MW wind farms, including in the east of the Krai. Sites will be allocated on completion of wind audits at the proposed locations. I expect the wind farm project to bear fruit within a few years. Over 1bn roubles of private and public money was spent under the Krai's energy conservation and renewables development programme last year. Mikhailovsk now has an autonomous boiler powered by biofuel, residential accommodation in Zhe-leznovodsk and the Min Vody polyclinic now receive hot water courtesy of solar energy, and municipal street lighting is being modified to use energy-efficient sodium and LED lamps. This resulted in a reduction in fuel spending of over 80m roubles in 2011.The sound financial health of Stavropol's energy industry led to increases in production. Energy was up 17.7% to 57.7bn roubles and extraction of minerals rose 7% to 7.1bn roubles.

Road and Rail TransportIntense competition and lack of transparency in international bus routes has created a lot of dissatisfaction. I have decided to make changes within the Ministry to ensure a systematic approach. Since September we have brought the granting of city taxi li-cences under control. Applicants who provide safety and comfort receive preference, and 3700 licences have now been granted. We have also included funding in the Krai budget to bring the rail tariff down from 17 to 13.3 roubles.

AviationLast spring Min Vody Airport opened its new all-weather run-way, and we are now looking to widen its route network. Last year 968,000 passengers used the airport, 8.6% up on 2010 but in-ternational traffic rose by 30%. The 600m-rouble reconstruction is now nearing completion, and I think 1.5m passengers in 2012 is attainable. Stavropol Airport was transferred from federal to Krai ownership last year, and passenger flows rose by by 60% to 187,000. Most importantly, it is no longer subsidised by Min Vody Airport, but pays its own way. We are holding talks to attract new carriers, and the airport's inclusion in the federal transport development programme will enable us to resurface the runway, taxiways and apron.

968 . , 8,6% . 5,6%, - 30%. 2012 1,5 . -, , . - - , - 600 . 30 - . - - ,

. 2010 110 . , 2011 60% - 187 . . , - , - . - -. - , - - , - .

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The 5th convocation of the Stavropol Krai Duma has started work un-der a new leader, Yuri Beliy, a former deputy government chairman. Does life in the Krai look different from the Speaker's chair? Has he inherited anything from his predecessors? What does the new Duma plan to add to the Krai's legislation? We spoke with him about this and more.

Yuri Vasilyevich, you had long experience of executive authority. How much has taking over the Krai's legislature changed your views on the political and socio-economic situation?I haven't noticed a big change, but I can certainly say that a parlia-mentary deputy is more of a politician than even the First Deputy Chairman. I know that we would need several annual budgets to cover all the counties' problems, but now I cannot cite a lack of funds as an excuse. I owe it to those who voted for me to attend to both Krai-wide issues and the concrete problems that they send my way. Becoming a parliamentary deputy has changed my viewpoint. Over the course of the election campaign I met 25,000 voters. What are their peeves? Roads, lighting, gas, water. Taking action means finding funding, perhaps by qualifying for a Krai or federal programme, and that will require the local authorities to prepare the paperwork and find funds for co-finance. For that reason at meetings I always say that we will work together. We are all public servants, so we should work for the community.

Does the long-standing rivalry between the executive and legislative branches still exist, and does it interfere with work?Deputies are more aware of the ebb and flow of public opinion, while the executive deals with the big picture, but Stavropol's well-being is the aim of both. If debate helps us find solutions then I am all for it the Duma is a place of discussion. But with-out a tangible result we become populists and demagogues. I be-lieve that the issues should be thrashed out at committee level so that fully-refined plans can be put forward to the full Duma. With all the documents coming in from the government and the pros-ecutor, the Duma really is becoming a place of serious discussion, and in order for our work to be effective we need to be able to listen to each other. What do you think of the work the previous convocation has be-queathed you? What was its greatest achievement?Over the past 18 years our forebears have laid the legislative foundations and set about creating resilient economic, social and political growth. A strong system of land rights has been put in place, which is important in a Krai with 6.5m hectares of arable land and 4m of pasture. The future has surprises in store, but we have been left a secure base from which to move forward.

You must have crossed paths with many of the deputies before, and over the past 3 months you must have formed an impression of the rest...Yes, I've known most for a long time. They are experienced, capa-ble, wide and professional. I'm also glad that we have new blood.

In sum we receive both a measured approach and a modern take on the issues.

What has the 5th convocation of the Duma started work on?The 2012 budget was a very important document and, despite the tight timescale, it was examined very carefully. Over 80% of spending is concerned with improving standards of living. To take an example, expenditure on accommodation for orphans has doubled, state salaries are up and concessions are to become index-linked. Money is going to refurbish cultural centres and children's homes, to health and to housing for rural teachers.

There is a body of opinion which holds that we should spend more on developing the economy in order to be able to afford all this social spending.This the eternal Scylla and Charybdis of issues, but I wouldn't say that we aren't investing in the economy. The sums we put in are not huge, but they attract funding from elsewhere. In agricul-ture our participation in federal programmes brings us 3 roubles of extra money for every one of our own. We put a lot towards subsidising interest payments and supporting investment. More investment means higher tax revenues. Small businesses employ a third of the population. When we proposed reducing taxes for these firms people asked, Where will the budget be funded from? but when our infant small businesses are standing on their own feet the budget will be much better off.

You have proposed setting up a committee on ethic relations Why is it needed, and what hopes will be placed in it?The Krai has always been a magnet for all the mountain republics, and it is no secret that the fact that it is one of the few regions where the population is increasing is largely down to migration. When new arrivals misbehave it causes resentment. I hope the committee will help us keep the peace in Stavropol.

What are the Duma's priorities for the forthcoming year?Helping the poor. Increasing business activity, investment and the use of innovative technology. Building industrial parks. Continu-ing the replacement of agricultural vehicles. Helping pedigree animal breeding and seed development. A law designed to rectify the problems with bread our flour is in demand the world over, yet bread in the Krai is increasingly poor. We want to level the playing field for all bakeries. And some areas of the Krai see no more rain than the desert, so we are working building new irriga-tion systems.

What aims do you have for yourself and the deputies as a corps for the 5-year convocation?Simple ones: to improve standards of living in the Krai and facili-tate its lasting development. I would like the next convocation to value our work as highly as we value that of our own predeces-sors, and I would like every resident of the Krai to feel the benefit.

A New Viewpoint

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From 2012 the kaizen philosophy will be implemented in Stavropol Krai. For over 50 years the Japanese lean manufacturing system has kept a focus on continual improvements in production, research and management. From the shop floor to the boardroom, kaizen keeps waste to an absolute minimum.

Modernisation in Stavropol has always meant new technology and equipment, but experience has shown that rais-ing productivity, reducing the time used by the production cycle, improving quality, freeing up space and reducing breakdowns fundamentally improve companies finances and make them more competitive in the marketplace. In a nutshell, modernisa-tion means the ideology of new management.

In the words of Dmitriy Samatov, the Krais Minister of Industry, Energy and Transport, that is what kaizen will bring. Experience has shown that lean technology is one of the most effective methods and brings the fastest results. Lean manufacturing encourages con-stant improvements in product development and client and supplier relationships. Goods are made precisely to customers requirements, and suffer many fewer defects than those made under the old sys-tem. Labour costs, space, capital and time are all saved, he says.Companies already using lean manufacturing in Russia include RUSAL, VSMPO-Avisma, OAO Sollers (owners of UAZ and ZMZ), KamAZ and Sberbank. Energomera introduced Stavropol Krai to lean manufacturing in the year 2000.We are now taking our first steps, and in 2012 we will launch a programme to introduce lean manufacturing in the Krai. This will include training to acquaint civil servants with kaizen, says Sama-tov. I believe that it will exponentially increase the economic ef-fectiveness of the capabilities that we currently possess. By changing the leaders ideology we will ultimately change the whole production chain, reducing blockages and raising profits. By March next year we will have defined which firms will be taking part in the pilot programme.

The many facets of lean manufacturing include both ab-initio staff training and further career courses, thus changing ways of thinking and approaches to work.One glittering example of lean manufacturing is OAO KamAZ, whose introduction of the philosophy in 2006 has brought results estimated at 16bn roubles. Spring 2012 will see the formation of a working group composed of regional business leaders. Its task will be to visit and learn from those factories in Russia where kai-zen is in use. Larisa Bakhmatskaya

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Ministry Of Industry

To Introduce Kaizen System

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Stavropol Krai has become the first region in the south of Russia to introduce a government-level ecological transport plan. The plan's relevance can be explained by Stavropol's need to improve its envi-ronment and the fact that electric vehicle are noise-free. In addition, electric buses are several times less expensive to operate than con-ventional vehicles.

At 31-53,000 roubles, electric bicycles and scooters are affordable for all, and they are also easy to use, silent, clean, work from a normal socket, have a range of 70km on a single charge (costing 3-5 roubles) and can reach 50km/h. Thanks to the Min-istry of Industry, Energy and Transport, they are now for sale in shops. There are a range of engine sizes to match any need and pocket.

This green project was launched by the Krai government, the Minis-try and a private green tech company. Electric bicycles, scooters and tricycles are currently available, with electric cars soon to arrive.

Dmitriy Samatov, the Minister of Industry, Energy and Transport, says, The region is struggling under the weight of emissions, factories and cars. Our task is to use electric trans-port to lighten the load on the environment. The electric car is also financially attractive it costs 4-5 times less than a petrol car. Over 50km an electric bicycle uses 3 roubles' worth of elec-tricity, and a scooter five. Under our plan Kislovodsk will be the pilot city, and we are currently working on the legislation for that. We plan to use green vehicles as taxis. The economics are enticing, he adds: If a conventional engine uses 250-300 roubles' worth of fuel to cover 100km, an electric motor needs only 60-70 roubles' worth.

In Autumn 2011 the Ministry became the first in Russia to test an electric car un-der carmaker AvtoVAZ's green transport programme. The Ellada externally identical to the conventional Lada Kalina works on a battery charged from an everyday mains socket. While it remains a prototype, production could be started quickly. At 1200kg in weight, the Ellada goes from 0-100km/h in 13 seconds, has a top speed of 140km/h and can travel 140km. The Krai has contracted to receive the first 100 Elladas at

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eco-Transport For The Resorts Of The KMV

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the end of 2012. for the KMV resorts it ideal no noise and no emissions. Charging the battery costs 50 roubles, takes 8 hours and will suffice for 100km. There are also special express chargers capable of doing the job in 30 minutes. The government's plans include installing them at petrol stations to enable drivers to top up en route. Larisa Bakhmatskaya

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Over the past 4 years the Stavropol Krai Dumas Industry, Energy, Building and Utilities Committee has seen 30 of its bills adopted into law, which accounts for 20% of all new legislation. Gennadiy Yagubov, its Chairman, spoke with us on its most notable achievements.

We have held over 70 meetings on issues ranging across the effect of the crisis on the economy, the development of the airport, the state of the trolleybuses, residential refurbishment, utility tariffs and more. Overall, our contribution to improving quality of life has included enabling growth in manufacturing and energy, reforming utilities and stimulating the development of roadbuilding.

Industry- Our legislation provides for guaranteed tax breaks for investment businesses and for the state support available in the industrial parks. These sites, now on the verge of launching manufacturing, will make Stavropolian firms competitive in both domestic and international arenas.

Building- Since last fall we have put an end to unlicensed taxis, which evaded tax and were dangerous for passengers. All taxis should be yellow by 1 Jan 2013, thus enabling passengers to distinguish law-abiding

vehicles from black-market bombilas. We have also regulated the intercity buses, raising levels of responsibility among carriers while allowing them to choose their own service level. Housing and Utilities- We have laid down types of special housing and the people eligible for service accommodation, and the eligibility criteria for welfare housing have been widened. Our deputies' opinion was sought on the reform of housing and the allocation of funds for renovation work. Sixteen municipalities have now joined the Krai's refurbishment programme. Loopholes which prevented athletes and trainers from qualifying for housing subsidies have been closed. Our legislation has established a mechanism to allow cheated private purchasers of off-plan property, a serious issue in the Krai, to seek redress. We supported the executive's amendments to raise allowances towards housing and utility costs, thus improving the lot of the Krai's most vulnerable citizens. We are now working on legislation covering a minimum list of services and prices for building management companies.

Energy- Changes to federal law have freed the Krai authorities to take action in energy saving and efficiency. Krai law will now permit an extra 60m roubles of spending in this area.

Development Understood and Moved Ahead


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- , , ? - -, : - - 24 - 8,5 . 2011 26%. - - 4,4 , 66% 2010 . - - 15%, - 24 - 11% . , , , - - . - , . - - ? - 24 , - . , , - . , , 24 - 600, 7. 70 - 24, .

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DISCOVER NEWS

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January saw the opening of Stavropol Krai's second

full-scale multifunctional centre for the rendering

of government and municipal services, this one in

Kislovodsk. The first had been opened in the city of

Stavropol at the end of 2011. The Krai government

intends to establish a network of similar centres

across the region, with 85% of the Krai's territory to

already have provision by the end of 2013. Last year

a total of 58m roubles was budgeted for the project,

which financed the opening of the centre in Stavropol

and the completion of work on its sister in Kislovodsk.

This year this funding has been increased to 71m

roubles, which sum is intended for the creation of

multifunctional centres in five counties in the region.

In allocating resources for the centres priority is given

to municipalities whose local authorities have already

prepared the necessary planning documentation and

found funds for co-finance from within their local

budgets.

2011 -

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239,3 , -

15,4% , 2010 . -

97,2

( - 15,4%). -

- 107 ( 9,7%).

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37,6 ( 10,7%).

15,1%. -

12 , 18,3% ,

2010 .

(98,4% 2010

). 2011

2010

104% 110,1% 2010 . -

322,4

( - 9,6%), - 19,6

( - 3,5%).

In 2011 the economy of Stavropol Krai grew at

a rate which exceeded that of the previous year,

according to information from the Stavropol Krai

branch of Rosstat, the national statistics authority.

The volume of industrial goods produced in the

Krai and the value of work and services performed

reached 239.3bn roubles, which at current prices

exceeds the figure for 2010 by 15.4%. The volume

of agricultural production also jumped by 15.4%, and

by the end of 2011 stood at 107bn roubles, a rise

of 9.7%. Capital investment rose 9.7% to 107bn

roubles. Construction operations accounted for

37.6bn roubles, up 10.7% on 2010, and residential

construction grew by 15.1%. Haulage companies

transported in excess of 12m tonnes, which

represented a rise of 18.3% on the 2010 figure.

Passenger levels remained at roughly the same level

(98.4%) as during the previous year. The consumer

price index was 104% in December 2011 compared

with December 2010, when the index stood at

110.1% against the same period in 2009. Retail

trade turnover increased by 9.6% to 322.4bn roubles,

and turnover of everyday foodstuffs was up 3.5% to

19.6bn roubles.

-

, -

. -

-

-

-

, -

-

. -

,

-

,

. , -

-

-

, -,

-, -

, -

.

Stavropol Krai has become the only region in Russia

to have its experience in supporting entrepreneurship

noted by the federal Ministry of Economic

Development in its analysis of programmes designed

to encourage competition. Stavropol's establishment

of a multi-level system to stimulate business activity

found a mention in the Survey of Best Practice in

Measures to Foster Competition at a Regional Level,

which is published by the Department of Competition

within the Ministry of Economic Development in

conjunction with NISSE. The survey was compiled

using an analysis of regional programmes aimed at

stimulating competition and available open sources

of information on the situation in regional markets

for goods, including the opinions of industry experts.

Thus Stavropol Krai's positive experience in creating

mechanisms to support start-up businesses, which

include training, consulting, subsidies, grants and

streamlined access to credit, came to be noted.

- 24 - - 24 .

40

41


OAO YugRosProduct, a company established in Stavropol Krai at the close of the 1980s, entered the market at a time when imports ac-counted for 85% of the glass pack-aging used in the region. The situa-tion changed with the establishment of YugRosProduct's first factory, in Novoalexandrovsk, and Stavropol Krai began to supply glass packag-ing to other regions. One of the sec-tor's leading producers, to this day the factory has continued to provide the food and food processing indus-tries with environmentally-friendly and practical goods made to interna-tional standards. The Novoalexan-drovsk glass factory has constantly increased capacity, widened the range of goods on offer and expand-ed the geographical catchment area from which it draws its customer base.

In 2005 YugRosProduct opened a second manufacturing plant, this time in Krasnogvar-deyskoe, and within a few years it saw the start of the production

of what would become 16m m of sheet glass per year making it the only such manufacturer in the south of Russia. Today the Krasnogvardeyskoe plant is a major supplier of float glass, both to cus-tomers within the south of Russia and for export to the countries of the former USSR. Adopting the cutting-edge technol-ogy of float glass produc-tion one which goes hand-in-hand with the factory's advanced tech-nology (components for the manufacturing pro-cess were delivered from 14 countries) has en-abled YugRosProduct to commence deliveries of a new generation of very

high-quality glass from the plant. This is the R-Glass brand, a product which can very much hold its own in both the domes-tic and the international markets. Today the YugRosProduct holding boasts an annual glass pack-aging production level of 450m nominal units. It is making a sig-nificant contribution to the development of the industry, sup-plying glass packaging not just to the Russian alcoholic beverage

, 80- , - , 85% - -. - - - -, - . - -, - - , , - . - - - , - .

2005 - - - , 16 . 2 - - . - - , . - - -

(- 14 ) - - - R-Glass, - , . - 450 . . - , - - , : 2011 - 60 . , 30% -. - , - , - . - : - 100 . . - , - - , , 2011 -.

Success Fo r

T ransparent

Bus iness

: , -

.

.

, .

S E RG E I YA SH KUNOV, General Director, OAO YugRosProduct:YugRosProduct has been providing Stavropol Krai, the south of Russia and other regions of the country with

glass packaging and sheet glass for over ten years. Our operations are focused on achievement in the glass

industry and are making a significant contribution to the economic development of the Krai. We are customer-

oriented, are in step with the times and refuse to rest on our laurels.

42

43


a n d f o o d

i n d u s -tries, but to

pharmaceuti-cal companies

as well: in 2011 Yu gRo s P r o du c t

opened production of medical packaging. Its ca-

pacity of 60m nominal units of medical packaging per year

represents 30% of the company's total output of glass bottles.

YugRosProduct's glass packaging, which complies with world-wide quality standards, is manufactured using enriched sand obtained from the Spasskiy quartz sand fields of Stavropol Krai. Fresh supplies of sand are delivered in an uninterrupted stream, with up to 100 wagons arriving every month.The company's plans for development include the establish-ment of OOO Helios, a regional industrial park to be located in the shadow of the Krasnogvardeyskoe factory. The project was first put forward at the Sochi International Investment Fo-rum in 2011, and comprises the manufacture of high-quality glass products for the fast-growing building, automotive and furniture market segments.Worth over 4.6bn roubles, Helios would have a production capacity of 600 tonnes of sheet glass per day. It would also provide the processing capability to transform the sheet glass into tempered glass, double glazing for windows, low-emissions glass, mirrors and triplex; and it would have its own twenty-hectare greenhouse complex. Building the latter would provide a way to dynamically and expeditiously devel-op Krasnogvardeyskiy County's agricultural industry along with its glass production, and would make use of technology thus far seen only at a select handful of sites overseas. The greenhouse complex's harvest is expected to consist largely of vegetables. In addition, the Helios project envisages the creation of a stand-alone generating capability for the industrial park.

Four gas-piston motor generators would produce around 2.9m kW of electrical energy, entirely meeting the park's de-mand. The electricity and heat generated would also be used to warm the greenhouse complex, thus further reducing run-ning costs.

Full implementa-tion of these plans is scheduled for 2014, and con-struction work has already begun. A leading Russian bank has extended a seven-year lion of credit to finance the OOO Helios. This was made pos-sible thanks to the support the project enjoys at the feder-al level the park, a priority for Stav-ropol Krai, will cre-ate approximately

2000 jobs, and was one of the first to be included in the list of projects eligible to receive support under the federal guarantee system, which minimises risk for outside investors.While OOO Helios is acting as the potential founding resident of the industrial park, interest in the site, where the establish-ment of the glass industry cluster is gathering pace day-by-day, has been coming from other companies, including ones based outside the Russian Federation. They would be welcome to come on board as additional residents and make use of the discounts for industry on offer within the boundaries of the industrial park to manufacture goods using the base materials produced at the glass factory. That could mean that construc-tion or even agricultural companies would find a place at the park. The creation of the new glass industry cluster in Krasnogvar-deyskiy County will enable YugRosProduct to greatly increase its production capacity, but it will also lead to the expansion of the local economy, thus improving the well-being of every resident of the county.

- - 4,6 . - 600 , - ( , -, , -), - 20 . - , - - , , -. , -, . , - - , 2,9 -, 100% . , , , - . 2014 . - -. - . - : -

- , - 2 . , - , - - , - - -. - - - -. , - -, , , - - , , -. -, , - , - , - . , . - - , , , .

44

45


The foundations for the development of the country's innovation economy are being laid in Stavropol Krai, and OAO Stavropolskiy Elektronproekt (StEP) is playing its part.

Where does any manufacturing start? With an idea. Drawing it up as a blueprint, finding the best options for build-ing the factory and attracting the capital to the technology are the role of StEP, an organisation without equal in Russia.

- . .

? . - , - . , - . 44 - - -. , - . 90- , -, - . , - . - - .- - - - - - ,

- - - , - 1996-2002 . - - -, , - ( - ) : - -. , - .

Designing The

uture

46

47


It began life 44 years ago as one of the 8 institutes of Soyu-zelektronproekt. It was never especially advertised, since its work was in the defence industry. In the 1990s it, along with its sister institutes, found itself cut adrift from its moorings but, unlike the others, it was to survive. It came into the ownership of the Telemir company and so managed to ride out the hard-est years.Apart from the planning institute, we also have the well-known retail electronics business and a specialised youth business in-cubator, says the Chairman of the Board of Directors of the Telemir Group, Evgeniy Lukovka, who headed the design in-stitute from 1996 2002. In the 1990s we relied entirely on trade, but we knew full well that demand for the design of class A production (ie. the production of means of production) would return: the level of society determines the degree to which its in-dustry develops. Thus we threw ourselves into saving this unique organisation.With the Russian economy reeling following the shocks of the 1990s, the institute occupied itself with the design of every-day buildings: residential buildings, shopping centres, health and educational facilities and so on. However, once President Medvedev announced that Russia was to march towards mod-ernisation and the establishment of innovative manufacturing StEP's orderbook suddenly began to fill with projects for the construction, refurbishment and re-equipment of businesses. The institute's engineers rolled up their sleeves and, with great pleasure, returned to their vocation.Today StEP operates both in Russia and in neighbouring coun-tries, and it is one of very few institutes on the post-Soviet landscape which specialises in the design of the clean rooms needed for microelectronics and microbiology, shielded spac-es and premises for acoustic production (in the defence indus-try) as well as clean spaces for any manufacturing.Of course, the number of employees has gone down, says Lu-kovka, But we have managed to preserve our backbone of pro-fessionals, many of whom have worked here since the institute's founding. Moreover, we have prepared for the succession, taking on talented young specialists. That has enabled us to combine the wisdom of the greats with cutting-edge technology. Today the automation of the design process is such that work which would once have occupied 600 people can be easily handled by 120. We don't just do two-dimensional blueprints. We also offer 3D mod-elling, and the computer checks the calculations and finds and corrects errors. We have access to 3D printers and 3D scanners. The former enables us to produce 3D models, and with the latter we scan workshops and other production spaces.StEP can also take on building consultancy work, delivering new production capacity ready to use.The institute's geography is wide, but Lukovka says that the manufacturing sector in the North Caucasus is undergoing a noticeable renaissance. The ambitious plans announced by the President's Plenipotentiary Envoy in the NCFO, Alexan-der Khloponin, have begun to materialise. Serious investors

have come to the republics with serious money to invest in the region's industry. StEP has already completed work on a car factory in Karachaev-Cherkessia, and projects for the refur-bishment of an electronics plant in Dagestan, the construction of a ceramics factory in Karbardino-Balkaria and a dry mixes plant in Stavropol Krai are in progress. Regional giants Nevinnomysskiy Azot and Arnest are regular clients, but Stavropol Krai actually accounts for only10% of StEP's orders a situation Lukovka feels belies the Krai's po-tential. Stavropol has a strong base for innovation. Many com-panies have survived hard times. Chemical, microelectronics and microbiology clusters are being developed, and we work closely with those industries. Nevertheless, I feel that small businesses need to be brought into the fold. They are the economy's capillary system, and one which is underused. Our institute stands ready to join the work to modernise that sector.

, 90-, - - : , , , .. , - , - . - , . , - . - , - ( -, ), , - ( -), .- , , - ,- , - , - . , -, . . - -, , , 120 . , 3D-, - , -. 3D- 3D-. , - - . , . - , . . , -, - . , - , , , . -. - -, - -, -

. , - , , . - , , , .- - . - , -, - . - , , -. -. , , - . - , . - - .

. , . , 468.

: (8652) 94-40-35.

e-mail: [email protected]

OAO StEPStavropol, ul. Lenina, 468

Tel: (8652) 94-40-35

email: [email protected]

48

49


Leading linguistics expert David Crystal has said that today almost 3bn people speak English either as a first language or as a second lan-guage. How likely is that situation to remain unchanged? We spoke with the Academic Director of EF English First, Natalya Schipakina, and the school's Senior Teacher, Graham Fraser.

To what extent will the English language be needed in 15-20 years' time?Natalya Schipakina: It seems that in 2007 the British Council asked itself the same question. It used data from UNESCO, demograph-ic returns and other statistics to create a computer model of the likely future demand for the language. The outcome, based on the worldwide demand for English teaching and the number of potential students of English in 2050, was that the world will be engulfed in a wave of English.

Does the spread of English not present a threat to national languages?Graham Fraser: Quite the opposite. For many people who live in countries on the tourist trail English serves as a shield to protect their indigenous culture from foreign influence. They have one language English for show, and another for communication amongst themselves.

How do you think people will learn English in the future?N.S: Regardless of the active introduction of the internet and other electronic aids, face-to-face interaction with a teacher will always be in demand.G.F: The same way as now. Eminently possibly with the use of in-novative equipment, but I think that the ability to teach and to learn will remain more important than anything else.

In your opinion, from what age should you start to learn English?N.S: Experience in many countries, for instance Switzerland, the Netherlands and China, has shown that children who grow up in a bilingual environment or learn two or three languages from the age of 4 or 5 are much better equipped to quickly adapt to unfa-miliar situations, and they are also more tolerant of stress.G.F: I can't really say. Only a child will master pronunciation with age the muscles of the face stiffen but he cannot discuss complex themes. Anyone who speaks with a native speaker rea-sonably often will have a much better chance of mastering the language, as long as he is attentive and self-critical.

-, 3 - , -, , , , . - ? - EF English First - EF .

- 15 - 20 ? : 2007 , , - . , - , - . -, 2050 , , - .

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The Future

Of English

50

51

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52

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54

55

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56

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60

61


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6362

DISCOVER NEWS

Mazda Mazda

CX-5. -

Mazda, -

SKYACTIV,

MazdaMotorCorporation.

-

. Mazda

CX-5 - ,

. Skyactiv, -

, -

,

- 14:1 -

. Mazda CX-5 - -

,

-

.

Mazda CX-5 MAZDA

.

. .

ZZ MAZDA!

Stavropol Krai is readying itself for the introduction

of the latest model in the Mazda range the compact

Mazda CX-5 crossover. This is the first in a new

generation of vehicles from Mazda, and its innovative

SkyActiv technology, developed by Mazda Motor

Corporation, makes it a truly modern breakthrough.

The new car has been styled in the kodo design

language, which means the spirit of movement in

Japanese. The Mazda CX-5 is the result of creativity,

bold ideas and new approaches. Its SkyActiv engine

offers high torque, an unbelievable compression ration

14:1 astonishingly low fuel consumption for a

crossover and uncompromising handling and design.

Find out more about the all-new Mazda CX-5 at the

Mazda Centre in Stavropol. Orders for the new vehicle

are being placed right here, and right now.

DARE WITH MAZDA!

Land Rover -

. 31 2012

Freelander 2

*. -

,

, , -

!

6- I6 3,2

233 .. Freelander 2 -

. -

10,7 /100

.

-

.

Freelander 2 I6 43 ..

, ,

. !

-

Land Rover -

.

** -

Freelander

2 i6 31 2012 .

Land Rover, .

Modus Premium Avto, the official Land Rover dealer in

Stavropol Krai, is offering discounts for all the marque's sup-

porters. Until 31 March 2012 the petrol-engined Freelander

2 will be available for the price of the diesel variant*. By

participating in the offer clients will become the proud

owners of an incomparably fast, powerful and comfortable

vehicle while getting extra horsepower for free!

The six-cylinder inline (I6) engine has a 3.2-litre capacity,

can produce 233hp, and makes the Freelander 2 uncom-

monly dynamic. At the same time fuel consumption in

mixed cycle is only around 10.7 litres per 100km. The

engine is complemented by an advanced automatic trans-

mission with optional manual sequential gear selection.

The Freelander 2 with the I6 petrol engine is 43hp more

powerful and half a second faster than even the most

powerful diesel model. And for a limited period, all for the

same price!

Further details are available at the official Land Rover

dealer in Stavropol, Modus Premium Avto.

* * This special offer applies to a limited number of Free-

lander 2 vehicles with I6 petrol engines and is valid until 31

March 2012. Find out more at the showroom of the official

Land Rover dealer in Stavropol, Modus Premium Avto.

- -

- . , -

- . -

. -

-

-

. 1996

-

, -

. -

2008 , -

. -

15 -

2011 ,

.

,

24 ,

. -

, ,

II , .

The North Caucasus Bank of OAO Sberbank of Russia

has a new man at the helm. He is Pyotr Koltypin,

formerly a vice-chairman of the bank, and brings

with him a solid weight of experience in economics

and finance. A graduate of the Novocherkassk State

Technical University and the Russian Government

Academy of Finance, in 1996 he assumed the position

of Senior Economist in the North Caucasus Bank

and headed up the bank's Pyatigorsk subsidiary.

He has been a vice chairman since 2008, during

which time he has taken charge of operations in the

corporate division. On 15 December 2011 he was

named Chairman of the North Caucasus Bank of OAO

Sberbank of Russia by order of the bank's president,

Chairman of the Board of Directors of Sberbank

German Gref.

Victor Gavrilov, who has headed the bank for the past

24 years, is to become an advisor to the President of

OAO Sberbank of Russia. His meritorious work has

been recognised with silver and gold honours from

Sberbank, a medal For Faithful Service, a medal

second class For Services to the Motherland and

the Order of Honour.

64

65


The arrival of a new General Director, Valeriy Eremin, has opened a new chapter in the decades-long history of Stavropol's Kamaz trailer factory, Kamaz Avtopritsep. With output, sales and investment grow-ing, he spoke with us on his plans.

Valeriy Evgenyevich, what measures will you take to keep Kamaz ahead of its many competitors?The factory still has the potential it had as a showpiece factory 40 years ago. Since last year we have been modernising and in-stalling equipment, including some items from overseas suppli-ers. The trailers we produce are acknowledged for their excellence around the world. They are compatible with all vehicles, not just Kamaz's, and we are constantly working to perfect them. At the moment we are improving their external appearance, which is an area in which we have lagged behind. We are also working on the model range and spare parts using components from leading global manufacturers.

What effect has this had on output?Overall profit tripled and sales revenue doubled in 2011. Output rose from 1800 to 2800 units, with the workforce up 50% to 600. That is just the start we plan to raise production further and diversify our range.

Do you agree with those who say that the factory was in effect for-gotten for several years, which led to a drop in sales?Yes, which is why when competitors appeared the factory was just crossed off customers' lists of suppliers. We are now reviving our network of dealerships. Our marketing department is expanding. We have a strong presence at exhibitions. We haven't done any-thing radically new, just put in place the elementary things that any business needs to survive.

Are there joint production agreements with overseas companies?In the spring we are hosting a German trailer manufacturer with whom we have an agreement of intention for joint production. We would use German technology to produce trailers here, and our equipment could certainly produce trailers for sale in the West.

Does the factory have the necessary quality management system?We are undergoing certification now with entry into the WTO we we have to in order to be taken seriously as equal partners. That should be ready in November. We have also sent staff for training in the Kamaz production system.

Are there going to be any changes to the distribution system?We want to set up consignment warehouses so that customers can drive away with their trailer rather than waiting for delivery. To keep stocks up we will work to a three-month plan. The overall requirement will be to produce 500 units per month.

- (., ), , : , - - , , - -. - - . - .

- , - . , ? - - , -

- . - . - . , - . - - - . - -, , -, . - . - - - -, , . - - -, -. - - - -, , - - , - . , . , -, - .

- ?- 2011 - , . - 1,8 2,8 , - 400 600 . , . , - . , - .

High Quality

For The Domestic Auto-Industry

66

67


What do you have in mind as regards diversification?Diversification is an important part of survival in a crisis. Firstly, we are now basing equipment on both the Kamaz chassis and oth-ers, such as Mitsubishi and Mercedes. We have signed an agree-ment with the Austrian company Palfinger to produce vehicles with cranes using a Kamaz chassis. We are modernising our axle production line and have already reached agreement on sup-plying axles to our parent corporation and others. We are also going to supply side walls for Kamaz. Secondly, we have begun preparations to manufacture non-vehicle-related metal goods. Our factory has plenty of spare room, we know how to weld and metalwork accounts for the majority of our orderbook. Thirdly, we intend to produce consumer goods, but I'm going to keep that under my hat for the moment. Lastly, we are going to let out our spare capacity. We already have other one company in residence, and we are drawing up an agreement on the letting of 2000m to a firm which makes equipment for the oil industry. We are also looking at the idea of setting up a technology park with the Krai, especially since Kamaz already has experience in that field.

Would it be worthwhile setting up your own power supply?We actually have a 12MW power station planned in concert with German partners. The energy we don't use will be sold to the city.

- , - , ? - , , -, - , - , . - , : - , - - . , , , . - . - - , , . , , - .

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68

69


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, , , -, , , - , , - - . , - - - , 18 815 - , - 4,7 .

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A Fairytale CityIgor Olegovich, as a parliamentary deputy resi-dent in your own constituency you must have a clear idea of how it should grow. What plans do you have for using its colossal potential for tour-ism?One of the best examples is the awe-inspiring Mineral Water Valley project, a year-round re-sort to be built on 1000 hectares at the cross-roads of Moscow, Baku, Pyatigorsk and Min Vody. It should create a new image for the region, giving the KMV area individuality, uniqueness and idiosyncrasy and attracting yet more investment.Could you give us more details?It needs to stay open year-round, so it has a wide range of services divided into 4 main ar-eas: recreation, shopping, accommodation and logistics. A lot of attention has been paid to getting the spa complex just right, and its 42.6 hectares of attractions will include a theme park, a golf club, extreme sports, an oceanari-um, a zoo and a boutique hotel on the shores of a lake. It will cost almost 19bn roubles, with a recoupment period of 4.7 years.

An Emphasis on Young PeopleWhat issues does your Committee handle?They are very varied. Culture, art and preserva-tion. Young people and work on discouraging delinquency and popularising sport. We also work with the media and answer for inter-agency communications, including that aspect of the (forthcoming) universal electronic card. Will the Youth Chamber in the Duma continue to exist?I think the appearance of young people in the Duma has been a great advance in the relation-ship between the public and the authorities, and one which must not be lost. About 150 people took part in the Youth Chambers three convocations, and thanks to them we now have 19 county-level chambers around the Krai the largest such network in the NCFO. Our committee decided to support its continuation, and this was endorsed by the full Duma. It will now be known as the Youth Parliament.Who will its members be?Candidates will continue to be chosen on the basis of their work in creating legislation. The first two-year convocation should start in May.

A Stimulus for the TalentedWhat is being done to allow the Krais many tal-ented people to flourish?We have widened eligibility for the Governors Stipend to include students in the Krais art and cultural colleges.With all eyes on the 2014 Winter Olympics, what is being done to develop sport?Monthly payments for Olympic silver medal-lists have been increased, and we now offer grants of 20-50,000 roubles for winners of in-ternational competitions. This should attract more people to sport and encourage athletes to represent the Krai.What are you working on at the moment, and how will it affect life in the Krai?We are examining the one-window proj-ect, which aims to bring government services directly to the public, bypassing paid middle-men. We intend to visit the sports and recre-ation facilities currently under construction or renovation. We also plan to meet young people and people involved in culture, sports and the media to ensure that the decisions we reach an-swer the needs of all.

The newly-elected Igor Nikolaev, a successful businessman and figure in the Krai, now heads the Krai's Committee on Culture, Young People, Physical Education and the Media. He spoke with us on the challenges ahead.

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Stavropol Krai has given a presentation on its

potential for tourism at a giant industry fair in Italy. A

delegation headed by Andrei Skripnik, the Minister of

the Resorts and Tourism in Stavropol Krai, was sent

to the international BIT-2012/BorsaInternazionale del

Turismo tourism fair, which was held in Milan from

16 19 February. The Krai's delegates held a series

of meetings with the heads of leading Italian spa

complexes in order to learn about new approaches to

spa healing and spa holidays. Representatives from

travel companies negotiated their way to agreements

on bilateral relations with well-known national Italian

tour operators. Stavropol Krai's delegation also

included the heads of Stavropol and MineralnyeVody

International Airports. Their task was to hold

discussions with Italian airlines, especially with

budget carriers.

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This year the farmers of Stavropol Krai are set to

receive over 3bn roubles in state assistance from

the Russian federal budget under an agreement

signed in February by the Minister of Agriculture

of the Russian Federation, Elena Skrynnik, and

Valeriy Gaevskiy, the Governor of Stavropol Krai.

The increase represents an increase of almost 500m

roubles in the size of the annual subsidy allocated

to the Krai by the federal government over the

2010 level. The funds are to be used to cover costs

associated with qualifying for loans, the procurement

of mineral fertilisers, elite seed development

(spending on this will more than double) and crop

insurance (up by 36%). Co-finance has already been

included in the Krai's own budget.

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Four investment projects from Stavropol Krai have

been recommended for Russian Federation state

guarantees during 2012: the construction of deep

processing plants for corn and sugar beet (OOO

Melass), the construction of a multifunctional

exhibition centre in the resort city of Kislovodsk (OOO

KMV-City Group), an innovative industrial livestock

complex for dairy production (OAO Molochniy

Kombinat Stavropolskiy), and the establishment of

a sanatorium resort complex and 5+-star spa hotel

to be operated by a leading world hotel chain in

the resort city of Kislovodsk (OOO BVP). The list of

projects put forward for federal guarantees in 2011

featured projects from OAO Gidrometallurgicheskiy

Zavod, OOO StavStal, OAO NPK Escom and OOO

Helios, which comprised over 10bn roubles' worth of

total investment expenditure.

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PERSONAL DISCOVERY

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PERSONAL DISCOVERY

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DISCOVER OPEN HORIZONS

With a new year all companies set themselves new aims, make new plans for long-term development and evaluate their performance over the preceding year. For us 2011 was both incredibly busy and difficult at the same time, since the alcohol market, whose largest players are major customers of ours, was beset by problems.

At the same time, as a business oriented Company to customer needs & requirements and in the course of our daily routine we prove our readiness for technological achievement and innovation. The results of our joint work with clients

were on display at the 20t h Prodexpo International Exhibition, which was held in Moscow early in 2012. Our company is a regu-lar exhibitor at what is an authoritative annual event in the field of food and drink which attracts in total over 2000 exhibitors and plays an important role in the process of shaping and develop-ing the food and drink sector of the economy. For us the exhi-

bition acts as an additional opportunity to publicise our goods, centralise our meetings with our existing partners and, of course, gain the interest of new clients.Partnership with ZAO Kavminsteklo is particularly attractive in that we represent an extremely large international corporation which occupies a leading position in the world market, has high quality standards and brings with its the opportunity to compare experiences between countries and divisions. From another an-gle, however, we have nothing but respect for the idiosyncrasies of local communities and place our faith in regional suppliers. We offer our clients a product that, used for the bottling of alcoholic and alcohol-free drinks, makes their business simpler and more profitable. We also strive towards that goal by providing training, logistical and technical assistance, and project guidance and con-sultations to our highly respected customers.In light of the high profile of environmental issues in general in Russia we invest great care and attention in safety and ecology( I hope that this sentence can be proved: investing in safety and ecology with the different and latest techniques put in place in Kavminsteklo during the social audit that is going to take place very soon). We constantly aim at improving the production process of our glass containers in order to reduce CO2 emis-sions. here does that come from? Are you talking about Verallia or Saint-Gobain? I dont believe that we, as Verallia, have ever stated that ..We always place great emphasis on keeping glass the gold stan-dard in the very varied world of packaging materials.The overriding advantage of glass packaging for beverages and food products stems from the fact that it preserves the original taste of the product it contains and protects it from contamina-tion. In addition, glass is 100% and infinitely recyclable. Above that recycled glass can be used in the manufacturing process to help save on the amount of raw materials used to make new bot-tles and jars ; it also cuts the demand for energy, extends furnace life and lowers emissions. For that reason we believe that devel-oping high-quality is important glass packaging (what does that mean?), along with providing for the workforce and improving working conditions.

Our mission is to succeed and to strengthen our po-sition as a strong producer in Russia.

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