Address by the Governor of St. Petersburg

Declaration of the General Council
The Strategic Plan for St. Petersburg
The Main Goal and Principal Strategic Objectives
The Strategic Plan for St. Petersburg: Main Bearings



The main goal and strategic objectives of the Strategic Plan were identified following numerous discussions and in the light of the conclusions reached in analysis of the city's competitive potential. Changes in its geopolitical, social and economic situation have forced St. Petersburg to confront its need to develop new functions and means of existence. Moreover, this is the first time that the task of finding a path for development has been approached as a task of self-identification. The city has had to find its own place on the map of the global economy and post-industrial society; and it has had to do so without being instructed by central government in Moscow and without being able to count on the support of the latter. This explains why creation of the Strategic Plan has become a truly all-city project, involving and uniting hundreds of specialists.

The main goal for development of St. Petersburg is sustained improvement of the quality of life of all categories of St. Petersburg citizens. Arrived at after extensive discussion, this goal is universal: it applies to the development of all cities. However, it is important that the Strategic Plan identify a more specific main goal, relevant for this particular city in its current period of development. In the light of foregoing analysis of the city's competitive potential, this main goal can be identified as development of St. Petersburg as a multifunctional city integrated into the Russian and world economy and providing a favorable environment for life and economic activity. This wording not only clarifies the goal, but also indicates the main ways in which it may be achieved - by integration of the city into the Russian and world economy and by improvement of its urban environment and social climate. Achievement of the main goal implies consolidation of St. Petersburg's position as Russia's principal center of contact between the Baltic region and the North West of Russia.

All three formulations given above together form an overarching block of goals, the keystone of which is improvement of quality of life.

The notion of quality of life implies, above all, having a good job and a good salary, guaranteed and good-quality medical care and social welfare, good housing, public safety, political stability, educational opportunities, culture and entertainment, and quality of environment.

Stable improvement of the quality of life should be based on an effective, mobile and diversified economy in which constant increases in labor productivity are accompanied by expansion of markets and creation of new products and services, thus ensuring a high level of employment. Measures aimed at supporting the economy and establishing markets should produce a desire to work, increase levels of employment and consumption, and allow the current decline in production to be reversed, leading to improvement in quality of life. St. Petersburg's citizens place particular importance upon cultural elements in the quality of life; humanization of the environment; renewal and preservation of the specific St. Petersburg mentality; democratic opportunities for realizing the full creative potential of the individual; and increased freedom of choice in all spheres.

In order to improve the material aspects of quality of life it is important to provide economic growth such as will put more money both in citizens' pockets and in the city exchequer. As for developing "non-economic" aspects, where much depends upon the use made of public resources, it is necessary to guarantee effective expenditure of municipal funds. Thus the main goal formulated above divides into two lower-level sub-goals:

a) increases in income and employment levels as a result of economic growth; and

b) improvement of general living conditions as a result of increases in efficiency of expenditure of resources in the city exchequer.

If St. Petersburg is to enjoy stable economic growth, it is important for it to create and develop industries which exploit to the full the existing local potential and advantages. The core of St. Petersburg's potential consists of its geographic location, port, transport network, highly qualified personnel, and the city's architectural, cultural and historical heritage. It is a sad truth that in spite of St. Petersburg's great potential and the international reputation it has gained thanks to its museums, theaters, architectural monuments, foreign trade and port, leading-edge industries and science and education, the volume of services and manufacturing generated for the city by these sectors is very low. Among the reasons for this situation, apart from causes applicable to Russia in general, are the city's imperfect system of economic regulation, its poorly developed infrastructure, its abundant bureaucratic constraints and its inefficient economic structure.

Analysis has emphasized: the need to develop functions of the city which make it a unique multifunctional center for contact between Russia and the European Union; the need to extend the orientation of St. Petersburg's main industries towards foreign markets, whilst maintaining and strengthening these industries' positions on local markets within Russia; the inevitability of restructuring the city's public utilities and systems of social support. It is important to understand that no one industrial sector is capable of ensuring proper development of the city on its own. Sustained development of St. Petersburg depends upon the city remaining multifunctional.

St. Petersburg's relations with the rest of the world are best characterized by the concept of a "contact center": the city is an international multifunctional center of contacts between the Baltic region and the North West of Russia, realizing and developing contacts of all kinds (trade, financial, industrial, research, cultural, and political). A contact center should combine all the various individual qualities required of smaller centers (centers of, for example, transport, business, information, tourism and culture). To this purpose it needs an appropriate infrastructure and the ability to support a "contact environment"; the latter is characterized by openness, security, convenience, attractiveness, friendliness, beauty and uniqueness.

On a geopolitical level, the break-up of the USSR and the move towards integration in Europe have strengthened St. Petersburg's position as a transport bridge between Russia and the West and as an important center in Europe's new growth area, the Baltic Sea region. On the other hand, transition to an open-market economy has meant that many enterprises and industries have lost competitiveness, and the end of the cold war has left many organizations in the defense industry without contracts.

Amongst St. Petersburg's principal functions, the leading place is occupied by the trade and transport sector, which includes, apart from the transportation industries themselves, businesses engaging in storage and trans-shipment of cargo, as well as foreign trade and related industries such as the packaging and assemblage sectors. Today St. Petersburg is Russia's biggest transport center; it provides full-service cargo handling, specializing in import/export transit cargo. The planned reconstruction of the port; the construction of a new port terminal and other transit terminals and warehouse capacity; and, in the more distant future, the construction of high-speed railways of federal importance - all this will help the city to make effective use of its geopolitical location. In addition, there are high hopes that development of St. Petersburg's airport will go ahead; this will turn the airport into a major transport hub connecting local and international air routes. Some of the latter projects are to be brought together under the "Russia's gateway into Europe" project, which will give a new impulse to the city's specialization as a trade and transport center.

St. Petersburg remains an important Russian industrial center with many competitive leading industries in various sectors. However, further falls in the employment rate are inevitable due to restructuring of the defense industry, as well as to productivity increases and to drops in production levels of enterprises manufacturing non-competitive products. Job losses should mainly affect low-paid employment. Structural shifts in the industrial sector should focus on creation of jobs for highly qualified and well-paid specialists and on increasing levels of production of market-competitive products. Industries such as food and power have potential for development. Shipbuilding and energy-plant engineering are organic to St. Petersburg; given renewal of contracts from the state and abroad, they should be able to stimulate growth amongst the large clusters of manufacturing industries that depend upon them.

In line with global tendencies, St. Petersburg will undergo further changes in its economic structure resulting in the increased importance of services, tourism, financial services, trade, information technologies and communications. As and when economic stabilization is achieved, there will be a revival of sectors related to science, education, culture and the arts. The latter sectors have great strategic importance if long-term sources of development are to be preserved and if a favorable image of the city is to be maintained. St. Petersburg will continue to be a center of science, education and culture for the neighboring regions of Russia and a center for contacts with the Baltic states; it will reinforce its position as a world cultural center. Projects celebrating the city's 300th anniversary (e.g. "Saint Petersburg 2003" and "Saint Petersburg: cultural capital") should help develop these functions.

To back up the large-scale changes envisaged by the city's main goal and its two subgoals, four strategic objectives were identified to guide the selection of specific measures (see illustration). Measures directed by these strategic objectives will allow the city to realize its competitive potential.

FIGURE: The Main Goal and Principal Strategic Objectives