Business environment in St. Petersburg

, updated on April 23, 2013
Economy of St.Petersburg

St. Petersburg is one of the biggest European cities with population of near 5 million people. It’s an important economic and scientific centre of Russian Federation and a big transportation hub.

In 2007 the city government has approved the concept of social-economic development of St. Petersburg till 2025. It also covers an international aspect of city’s development as a business, political and cultural centre integrated in the world economy.

The city has already got a lot for that – The geographical position of St. Petersburg on the coast of the Baltic Sea, being close to the European Union and Moscow makes the city the most important transportation hub between Russia and EU.

“A Window to Europe”: infrastructure

The recent modernization of the Seaport of St. Petersburg helped to increase the volume of cargo and passenger shipping.

“Pulkovo” airport is also adjusting to the changes – it is under the large-scale reconstruction: a new international terminal is being built, the passenger terminal “Pulkovo-1” is being modernized. It will make “Pulkovo” airport the biggest in Baltic region and the service level standard will reach IATA “С”.

Economy – “Russian Detroit”

Gross Regional Product (GRP) of the city was 1 882 billion RUB (1 662 billions in 2010) in 2011 with the main shares being:  wholesale and retail trade (40,2%), manufacturing industry (36,2%), transport and telecom (7,2%), real estate business (6,6%).

The major industries in St. Petersburg are heavy industry. In the native city of the Russian fleet that was created in Peter’s times, the shipyards are still functioning: “Admiralty Shipyard” that constructs ships, tankers and submarines; “Baltic Shipyard” with the navy ships and icebreakers and “Northern Shipyard” that also creates navy ships.

The city hosts a number of big mechanical engineering enterprises: Kirov factory produces tractors, metal production and agricultural equipment; “Electrosila” – electrocars and generators; Leningradsky Metallichesky Zavod – steam, gas and hydraulic turbines.

One of the most developed city industries is transportation machinery construction –  represented by “Vagonmash”, which produces coaches, electro coaches for the tube stock; assembly bus plant “Skaniya-Piter”; Petersburg Tram Mechanical Factory.

Such automotive giants like Toyota, General Motors, Nissan, and Huyndai built their own plants in St.Petersburg, and that together with Ford’s plant near St. Petersburg make people call the city “Russian Detroit”.

Machine-tool construction, instrument making, electrical appliances production and optical industry also play an important role in the city’s economy.

Nonferrous and ferrous metallurgies, chemical, printing, light and food industries are highly developed. Five breweries, including “Baltika” and “Heineken brewery function in St. Petesburg producing 20% of beer in the country.

“Ceremonial Petersburg”: business status

Known as “The most European city”, St. Petersburg takes part in political and economic life of Russia, national and international events, i.e. conferences, forums, negotiations and talks at the highest level.

Every June St. Petersburg hosts the International Economic Forum with lots of officials coming from Russia and abroad to discuss the most urgent political and economic issues .

There are important national and federal institutions based in St. Petersburg:

– The Constitutional Court of Russian Federation

– Territorial boards of federal ministries and departments

– Representatives of 24 regions and 2 cities of Russia

– 59 consular offices of foreign states

– Inter-Parliamentary Assembly of the Commonwealth of Independent States with HQ in Turide Palace

– Informational bureau of the Nordic Council of Ministers;

– Offices of international funds and unions, UN organizations

– departments of international cultural institutions: German cultural centre of Goethe, French institute, Institute of Finland, Dutch institute, Danish cultural institute, Israel cultural centre, Italian cultural institute, Houses of Poland and Finland, Stockholm’s and Helsinki’s missions

– Offices of the Chambers of Commerce and Industry and business centres of foreign states.

A modern exhibition centre “Expoforum” is built near “Pulkovo” airport – the project sponsored by Gazprom was launched to enhance MICE capabilities of the city.

The business climate of the city is far more stable than its weather – a lot of organizations chose it to be their HQ including big oil and gas companies like “Lukoil”, “Rosneft’” and “NOVATEK”. “Gazprom neft’”, “SIBUR holding”, “Rostelekom”, “Transaero”, “Sovkomflot”, “Vneshtorgbank” and a lot of other leading Russian companies have also moved to St. Petersburg. The concept of St.Petersburg further development implies new offices of the biggest international companies to be based here making the city another European business centre alongside with Moscow.

It goes without a saying, that St. Petersburg is a city of world significance – its historical centre is part of World Heritage of UNESCO, its palaces and parks, historical and cultural monuments are renown worldwide – all that together with the developing infrastructure makes St. Petersburg a great business travel and sightseeing destination.

Translation by Igor Todorov and Svetlana Serebryakova

About Ekaterina Kazmina

I love St. Petersburg and sincerely wish more people from all over the world come here and see its beauty!

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