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What and where do the regions of the Far East export - EastRussia |

Irkutsk
Ulan-Ude

Blagoveshchensk
Chita
Yakutsk

Birobidzhan
Vladivostok
Khabarovsk

Magadan
Yuzhno-Sakhalinsk

Anadyr
Petropavlovsk-
Kamchatsky
Moscow

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Goods with potential

What and where do the regions of the Far East export

The growth of exports from the Far East to the countries of the Asia-Pacific region (APR) and the creation of new industries oriented to this largest part of the world market was recognized by the government commission on the socio-economic development of the Far East as one of the main directions for the development of this region. Today, the volume of exports from the Far Eastern Federal District and the Baikal region is growing - for 9 months 2017, it increased in value terms by 18,2% and 10,1%, respectively, compared to the same period of 2016. At the same time, this growth is mostly extensive. Where there is a potential for increasing exports and what factors can help attract more foreign investment, EastRussia found out.

Goods with potential
Photo by: laovaev.net
EXPORT COST GROWTH

For 9 months 2017 of the year from the DFO was exported products worth $ 16,2 billion, which is 18,2% more compared to the same period of 2016. Commodity exports exceeded the volume of non-primary exports by almost three times, while the growth rates of non-primary exports in 2017 were slightly higher than those of raw materials - 22 and 16%, respectively.

Dynamics of raw and non-primary exports of the Far Eastern Federal District, 2015-2017. ($ mn)
Source: Far Eastern Customs Administration


From the Baikal region for this period, exports were exported to the amount of $ 5,14 billion, which is 10% more than in the same period of the year 2016. At the same time, unlike the Far Eastern Federal District, the cost of non-primary exports was 1.5 times higher than that of raw materials, however, if raw materials exports increased significantly (by 22,5%), then the non-raw material export decreased by 2%.

Dynamics of raw and non-raw exports of the Baikal region, 2015-2017. ($ mn)
Source: Russian Export Center (REC)


The largest volumes of exports were typical for the Sakhalin, Irkutsk regions, the Republic of Sakha (Yakutia), the Primorsky and Khabarovsk Territories. The same regions demonstrated positive dynamics of exports during the period under review. The decrease in exports in value terms occurred in the Amur and Magadan regions - by 20,6 and 3,9%, respectively.

Export of subjects of the Far Eastern Federal District and the Baikal region for 9 months. 2017 G. compared to the same period 2016 G.
Source: REC and the Far Eastern Customs Administration


In most regions, the growth in the value of exports occurred in parallel with the growth of physical volumes of export of goods, but this dynamics did not coincide completely. For example, the cost of exports of the Irkutsk region in January-September 2017 year compared to January-September 2016 year increased by 11,3%, while the physical volume of exports of goods increased by only 2,3%. This situation was due to the increase in exports of crude oil, aluminum products and other goods, the world prices for which grew during the 2017 year.

NOT ONLY IN CHINA

Despite the prevailing opinion about the preferential export of goods from the Far East to China, the region's exports are much more diversified. So, more than 30% of goods from the DFO during 9 months 2017 year was exported to the Republic of Korea, by 25,5% - to Japan and China. Outside the Asia-Pacific region, Belgium and Israel were the most important trading partners of the Far Eastern Federal District.

In the commodity structure of exports of the Baikal region, China's predominance is more noticeable. So, more than 60% of the Trans-Baikal Territory's products were exported to this country, 55% - of the Irkutsk region and 32% of the Republic of Buryatia.

At the same time, it can be noted that the list of importing countries of individual regions was very extensive with the trend of further expansion. For example, the Irkutsk region in 2016 year exported goods to 83 countries of the world, and in 2017 year - already in 91 country.

Structure of DFO exports by countries for 9 months. 2017 (%)
Source: Far Eastern Customs Administration

The main export items from the Far East to the Republic of Korea are crude oil and oil products (58,6%), frozen fish (9,8%); petroleum gases and other gaseous hydrocarbons (9,0%).

Japan exports oil gases and other gaseous hydrocarbons (46,6%); oil and oil products (35,0%); coal coal and solid fuel from it (5,0%).

Frozen fish (21,3%) are sent to China from the DFO regions; coal and solid fuel from it (14,8%); unprocessed timber (12,6%). Electricity (from the Amur Region), ores and concentrates of ferrous and non-ferrous metals (from the Kamchatka Territory, the Republic of Sakha (Yakutia)) are also exported to China.

The main commodity positions of exports from the DFO to India are coal of hard and solid fuel from it, to Taiwan - also coal, and oil gases and other gaseous hydrocarbons.



POTENTIAL IS

Undoubtedly, the growth of exports from the Far Eastern Federal District and the Baikal region in the future will be due to an increase in the export of coal and other primary commodities. Expansion of raw material exports will also be possible, thanks to the implementation of major raw material projects in the Far Eastern Federal District and the Baikal region.

For example, the capacity of the LNG plant "Sakhalin-2" for 2025 is planned to increase by one and a half times to 15 million tons per year, which will allow additional volumes of natural gas to be supplied to the countries of the Asia-Pacific region.

Also, in the context of restructuring the Chinese coal industry and reducing coal production, this country is increasing imports, which opens up new export opportunities for the Far East enterprises. The Memorandum between Mechel Group and the Chinese giant Jidong Cement for supply of up to 3 million tons of steam coal produced at the Elginsky section (OOO Elgaugol) and the Neryungrinsky (HK Yakutugol) section, signed in 2017 year. A year ago, a similar agreement was concluded between the companies, and all obligations under it were fulfilled. Today Jidong Cement is the main foreign consumer of Elginsky energy coal, and the proportion in its implementation will be 50 / 50 - that is, half is exported, and half - to the domestic market.

As for the non-oil non-energy export segment, here the main foreign trade potential of the Far East is fish products and seafood, which are traditionally export products of the region. At the same time, experts of the press service of the Russian Export Center (REC) believe, the greatest prospects are concentrated in the processing segment of these products, as they ensure the receipt of higher added value by Far Eastern companies. There is considerable potential in the woodworking and agricultural industries - first of all, in the cultivation of soybeans and the production of products from it (butter, meal, etc.), as there is a significant deficit in soy products in the APR countries.

In the Baikal region, REC experts consider the sale of goods from wood, for example sawn timber, cellulose, to be the most promising direction for export. "The production of pellets is actively developing on the territory of the Irkutsk region, which are in demand both in Europe and in Asia. Also, the increase in exports from the Irkutsk region is possible due to aluminum products, fertilizers, mineral water, agricultural products and pharmaceutical products, "the press service of the REC said.

In the Republic of Buryatia and the Irkutsk region, the growth of supplies is possible due to aircraft construction (Ulan-Ude helicopter plant and Irkut Corporation) and by expanding the external market for wild-growing products. The Trans-Baikal Territory will be able to increase exports, focusing on coal processing in products with high added value, after the construction of a coal-chemical plant.

In addition, experts draw attention to the fact that throughout the region there is a positive dynamics in the export of services in the field of tourism, which is gaining popularity in the countries of Asia.

Another direction for the development of foreign economic activities of the Far Eastern Federal District and the Baikal region is the attraction of foreign investments. For this, favorable (preferential) conditions have already been created - the regime of the territories of advanced development (TOR) and the implementation of the regime of the Free Port of Vladivostok. Traditional partners in the field of foreign investment in the Far Eastern Federal District and the Baikal region are China, the Republic of Korea and Japan. An important task is to attract investments in the creation of export-oriented projects, the development of which is supported by the REC, such as the launch of a new export railway route to China and others.