SPIEF-2022: The GDP contribution of cargo traffic along the NSR will amount to at least 35 trillion rubles by 2035, based on projects that have already been invested in
That's practically $100 billion a year in goods that will be produced in the next few years.17 June 2022
SPIEF-2022: Based on the projects that have already been invested in, the GDP contribution of cargo traffic along the Nothern Sea Route will amount to at least 35 trillion rubles by 2035. This was announced by the Minister for the Development of the Far East and Arctic, Alexey Chekunkov, during "The Northern Sea Route: an International Transport Corridor" session at the St. Petersburg International Economic Forum.
The Northern Sea Route is the most important transport artery linking the vast expanses of Russia's Arctic territories, and a natural transport corridor between Asia and Europe. The development of the Northern Sea Route will provide a comprehensive solution to a number of economic, demographic, social, and political challenges facing the northern regions of Russia and the country as a whole.
"It is customary to talk about the NSR in terms of plans for millions of tons of cargo flow. But you have to think about [assessing it in terms of] money. We have calculated the GDP contribution of cargo traffic along the NSR by 2035 by referring to projects that already have investments. That's 35 trillion rubles and another 13.5 trillion rubles of federal budget revenue. That's practically $100 billion a year in goods that will be produced in the next few years. These are Novatek's LNG projects, oil from Vostokoil's fields, valuable metals and concentrates from Nornickel and the Baimskoye ore zone, and coal from the Syradasayskoye field. About 2 trillion rubles are invested in these projects every year," said Alexey Chekunkov.
The head of the Ministry of the Development of the Far East and Arctic noted that the current task is to equip the NSR with the appropriate infrastructure. Russian President Vladimir Putin has given a vital instruction: to create an up-to-date, unified, and comprehensive plan for the development of the NSR, with all the essential components: icebreakers, development of the Arctic class fleet, port upgrades from Murmansk to Petropavlovsk, and the development of satellites and communications. In addition, special attention should be paid to the emergency and rescue infrastructure, as the NSR should be safe enough for frequent and intensive use.
The development of the Northern Sea Route requires industrial capacity to meet the needs of shippers in the commercial fleet. According to State Secretary Viktor Evtukhov, Deputy Minister of Industry and Trade, Russia's degree of technological independence in the construction of icebreakers reaches almost 90%. Russian shipyards are building not only nuclear-powered icebreakers, but also a cargo fleet.
The main port of the Northern Sea Route, the Murmansk transport hub, is the only ice-free port in the North, with a cargo turnover of 54 million metric tons per year, is one of the top five largest ports in Russia by volume of cargo handling and has direct access to the world ocean. Murmansk Region governor Andrei Chibis said that two new icebreakers are based in Murmansk, and that transshipment complexes are being actively developed as well. The head of the region also noted that Murmansk Region has excellent competences in the field of ship repair. Civil ship repair on the basis of the existing facilities is being considered as well. Companies involved in fishing and crabbing are ready to invest in the development of this industry. The west coast of the Kola Bay is being actively developed. Another anchor port for the NSR, Lavna, is under construction. The first cargo will be shipped from the port as early as 2023. Andrey Chibis emphasised that special preferences for the Advanced Special Economic Zone and Arctic Zone of the Russian Federation have created a new powerful impetus for the development of the regional economy and the logistics hub in the Murmansk port.
Arkhangelsk Region governor Alexander Tsybulsky said the following about the dynamics of the local port facilities development: "Cargo turnover at our port is steadily growing. It was 4.5 million metric tons in 2020, 4.8 million in 2021, and 5.4 million in 2022. This year, as of 1 June, we have already gained 10% over last year. Shippers say there is not a single free slot for two months in advance, the port has been booked to full capacity". As noted by the panelists, given the growing dynamics of freight turnover, it is necessary to build infrastructure ahead of the pace.