Main activities of JSC "Nizhnekamskneftekhim"

General development of industry branch.

Chemical and petrochemical industry is a basic branch of industry in the national economy of Russian Federation. It is a major supplier of raw materials, semi-processed materials and various products to all branches of industry, agriculture, service sector, trade, science, culture and education, defence complex. This branch of industry covers about 9% of country's industrial fixed assets; in 1998 it was rated the fifth among other branches of industry by the volume of commercial output. The enterprises of chemical and petrochemical industry provide about 3,5% of tax revenues to the income part of the state budget.

In 1998 it was not possible to secure the trend to the stabilisation and certain growth of petrochemical production which had been marked in 1994 - 1997. Volumes of production of synthetic rubber, polystyrene, truck tires, etc. decreased in 1998 as compared with 1997. Indices of physical volumes of production in the branch of industry decreased by 7,5%. Absence of centralized investments and difficult financial conditions of the enterprises dramatically slowed down the rate of technical reconstruction and reequipment of the branch; degree of wear and tear of major enterprises in the petrochemical industry is about 60%.

The most stable enterprises of this branch of industry were operating in following regions: in North-west region - Novgorod area; in Central region - Kostroma area; in Volga region - Republic of Tatarstan, Volgograd area; in East Siberia region - Krasnoyarsk territory, where the output of products was more than 100% as compared with 1997. Significant increase in commercial output was marked in the Republic of Tatarstan as far as the production of polyethylene and car tires is concerned.

The volume of chemical and petrochemical production in 1998 was mostly defined by the demand on the domestic market. Export share in the total production volume was 32% and decreased by 0,4% in comparison with 1997. Steady trend to the decrease in volumes of export shipments to far abroad countries was marked from January till June, 1998. Due to the growth of US dollar exchange rate in the second half of 1998 first a certain deceleration in export volume fall rate started, the the increase in export volumes was marked. In general, in the 3rd quarter 1998 the volume of export deliveries increased by 1,7% in comparison with pre-crisis period and in the 4th quarter it again increased by 20,3%. At the same time the growth of US dollar exchange rate had negative impact on the supply of petrochemical products to the countries of the near and far abroad.
Main tasks of the industry in 1999 and further years are:

• stabilization of the industry enterprises, growth of productivity level;

• development and implementation of measures to maintain the productive potential at competitive level in order to retain and to strengthen domestic commodity producers on internal and external markets;

• reconstruction, technical reequipment and organisation of new productions in order to fill the sectors of domestic market arising by creation of new product types in the consuming branches;

• support of the export potential on a high level.

Regional aspect of the chemical production complex aims to further organisation of territory and production complexes in the region having rich reserves of hydrocarbon and mining chemical raw materials, first of all in Western and Eastern Siberia and in Volga region, where with the rise of market economy it became usual to set up "oil recovering - oil processing - petrochemistry" complexes. Balanced development of such a complex in Tatarstan which is one of the leading Russian regions is the strategig goal of the policy conducted by the government of the Republic of Tatarstan. JSC "Nizhnekamskneftekhim" plays a significan role in these plans.