June 1998

by Michael Trainor

The Omsk Oblast in Central Siberia covers nearly 140,000 square kilometers and has six major cities with populations exceeding 100,000. The largest of these is the regional capital, Omsk, whose 1.2 million inhabitants represents 55 percent of the region's 2.2 million people. Omsk, bordered by Kazakhstan to the south, is one of the most important regions in Central Siberia.

Industry
Petrochemicals, electronics, agribusiness, building materials, and machine building are the most prominent industries in the oblast. The city of Omsk is home to approximately 90 percent of the region's industrial activity. The Omsk Oil Refinery processes nearly 20 million tons of crude oil yearly. The refinery requires more than $90 million per year in spare parts, maintenance, and consumables, which represents an export opportunity for U.S. suppliers.

Omskiy Kautchuk plant is a is a major chemical producer in the oblast. The plant seeks to expand and modernize its operations to expand its markets. It also requires investment in pollution abatement technologies.

Investment
In the first nine months of 1997, Omsk received more than $300 million in direct foreign investment. A number of joint ventures with foreign partners have been formed in the oblast, of which the $17 million Volvo-Irtysh bus manufacturing company is one of the largest. Volvo-Irtysh will initially produce up to 500 buses per year from Swedish components.

The region's telephone monopoly, Elektrosvyaz, is investing in the modernization of Omsk's switching network, replacing mechanical switches with digital and electronic systems. Elektrosvyaz is also involved in the development of the region's cellular telephone networks--Omsk Cellular Communications and Siberian Cellular Communications--which are also a promising area for investment in the region.

Enterprises in the fields of consumer electronics and medical instruments are also interested in collaborating with foreign partners. The regional government continues to invest in the construction of residential buildings, which may represent export opportunities for building materials suppliers.

Natural Resources
The Omsk region possesses significant natural resources. Its oil reserves are estimated at 150 million tons, and gas condensate is also abundant. Peat reserves amount to nearly 350 million tons and could, with investment in appropriate processing technologies, prove a viable alternative to imported coal as the region's primary energy resource. The region's forest covers 4.5 million hectares and holds reserves of 577 million cubic meters. The Omsk region is also endowed with zirconium and titanium deposits, as well as nearly 90 million hectares of arable and grazing land.

The agricultural sector is another important contributor to the region's economy. The regional administration plans to offer financing to local agricultural concerns to purchase equipment and food-processing technologies, which hold promise for U.S. exports to the region's agricultural sector.

Transportation
Omsk is served by the West Siberian railroad, the Irtysh-Ob river network, and two airports, the newest of which, the Omsk-Fedorovka airport, can handle up to 1,900 passengers per hour and is the largest in the Asian portion of Russia. The Irtysh River, the largest tributary of the Ob River, crosses the region, and is navigable along its entire length. For more information, visit http://www.omsk.ru:8100/city/index.htm

Michael Trainor is an occasional contributor to BISNIS Bulletin.

This report is provided courtesy of the Business Information Service for the Newly Independent States (BISNIS)