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Governor of The Kaliningrad Region Georgy Boos: In 2006 industrial production grew a lot, by 66 per cent. In light of that recent growth, we thought the figures for 2007 would be substantially lower. We were expecting something like 20–25 per cent. But the actual results have been far better, more than 40 per cent. Thus industrial production over the last two years has grown by a factor of 2.3.

President Vladimir Putin: In which industries in particular?

Georgy Boos: Last year it was mechanical engineering. Processing grew substantially as well: manufacturing production as a whole nearly tripled (2.6–2.7 times larger). Extraction of natural resources was up by 2 or 3 per cent.

Vladimir Putin: What about the energy sector?

Georgy Boos: Since the first CHP [Central Heating and Power Plant] went into operation, the situation has improved. Nevertheless, this facility is still not enough to meet our needs.

Because of your intervention and the involvement of Prime Minister Viktor Alexeyevich Zubkov, we held a series of meetings about building a second CHP. We have reached agreement with UES [Unified Energy Systems] and Gazprom. Now this will be a joint project.

According to our estimates, after the implementation of the project through to 2015 the energy situation in the region will be sustainable.

Vladimir Putin: What about people’s earnings?

Georgy Boos: Over two years, the real incomes of the population approximately doubled, which corresponds to the growth of industrial production.

Vladimir Putin: I know that some large infrastructure projects are being implemented in the region.

Georgy Boos: We have started our first important infrastructure project, the construction of a ring road along the coast. We have enjoyed the full cooperation of the Ministry of Transport. It is being financed jointly: the major portion, 90 per cent, is federal money; the other 10 per cent is from the region.

The bottleneck for us is infrastructure. Transport is an extremely important issue. Russian Railways has already begun to design and incorporate into its investment programme a railroad around Kaliningrad. There are prospects for the development of the Baltic port, as well as ferry, rail and road traffic. Rail and port facilities are the principle areas of concern.

The airport is doing particularly well. Now we can boast that it handles between 1.2 and 1.5 million passengers a year. Several years ago the figure was between 50 and 100 thousand.