The highly industrialized and export-oriented economy of Murmansk in 2011 saw a 1,3 percent decline in industrial production, the latest Barents Monitoring report reads. The negative result was driven by a 3,1 percent downturn in regional mining, the key industrial sector in the region.
With the decline, Murmansk ended up far below the Russian 2011 federal average of 4,7 percent growth. New figures from the Russian State Statistics Service do indicate an improvement in 2012, with output reaching 2,3 percent in the months January-April. However, considering the major downturn in regional economy following the 2008 financial crisis, the regional growth remains very modest.
Despite declining output, the mining industry in the Kola Peninsula in 2011 still got solid financial results because of the high raw material prices on the international market. According to the Barents Monitoring report, the price rise on key products like iron ore and apatite constituted respectively 50 percent and 22 percent. The production value in the regional mining industry grew by 32,6 percent from 2010 and amounted to about 82,6 bln rub.
In the regional processing industry, the output was stable with an overall production of 2,5 percent. The federal average growth in the processing industry was 6,5 percent.
The weak industrial results were accompanied by a downturn in transportation. In 2011, more than 38 mln tons of cargo was transported, which was 6,4 percent less than in the same period of 2010.
The fisheries, another key sector in the region, in 2011 had a total catch of bio resources of 623,2 thousand tons, which was six percent less than in the record-setting 2010. At the same time, fish farming in the region picked pace and output increased with as much as 70 percent to 8900 tons.
In the construction sector, several years of crisis were in 2011 followed by a solid 27,4 percent growth.
Foreign trade was one of the main positive elements in the regional economic in 2011. According to preliminary estimates from the Federal Custom Service, the foreign trade volumes in the region increased by 60 percent to a total of $3,34 billion. Exports increased by almost 50 percent, and import with as much as 170 percent. The major increase in imports resulted in a reduction of the export share in foreign trade from 90 percent to 83 percent.
Some changes took place in the export-import structure. By means of considerable price’s rise at the external market, minerals products in 2011 became dominant in export (constituted 56,7% of the export, which is up 3 times from 2010), while the share of metal shipments slightly decreased comparing to the previous year and amounted to 34,2% of exports. The main part of the raw materials from Murmansk is shipped to the Netherlands (more than 40%), the USA (18,7%), China (10,2%) and Norway (6,8%).
The main changes in the import structure were connected, on the one hand, with rapid growth in the import of metal constructions (growth by 13,4 times from 2010), which amounted to 37,5 percent of the total import structure, as well as by a growth in machinery and equipment by 3,4 times. In 2011, the bulk of import came from Finland (31,9%), Italy (18,5%) and Norway (10,6 %).
After a relatively positive growth in consumer market registered in 2010, the year 2011 revealed a significant decline in rates of growth.
The average monthly gross salery in 2011 increased nearly by 11 percent to a total of 32 500 rub.
