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. Last Updated: 07/27/2016

Russia to revitalize its seaports

The Russian parliament has finished its first reading of a special maritime agreement, prompting optimism among officials that the bill will receive a swift passage.

Issued by President Boris Yeltsin, the decree - titled the Program For Renovation of the Merchant Marine - maps out specific programs for reconstruction of existing ports and building of new ones. Industry officials say it can't come soon enough, given industry chaos and interrepublican bickering.

"We pray to God for the agreement to be passed soon", said Victor Tysyachnikov, head of the foreign relations division of Russia's Department of Maritime Transport. Formerly Morflot, the mighty but bureaucratic Soviet ministry, it is now under the umbrella of the Ministry of Transport, with a staff trimmed from more than 1, 000 down to 300.

New ports and terminals are being considered in Luzhskaya Guba, 70 miles. from St. Petersburg, Novorossisk on the Black Sea, Arkhangelsk in the north and Nakhodka in the Far East. However, the St. Petersburg plan is vehemently opposed by the city council there, and other similar programs are largely dependent on foreign investment.

There are ongoing discussions between Novorossisk and Turkish officials, and the European Bank for Reconstruction and Development visited both ports in March.

Under new laws, foreigners can participate in port privatization, but under the current plan 50 percent of ports will be spun off to workers, half of which will be given to them free of charge.

In general the Russian maritime industry handles more cargo now with fewer assets.

When Morflot collapsed late last year, Russia found itself left with nine shipping companies and not enough ports to handle cargo volume in and out of the republic.

Only 56. 4 percent of all Soviet maritime assets, including ports, ships, maritime academies and containers remained Russian property. Tysyachnikov called this "less than what should have been".

The shipping companies are virtually all independent now, while most ports fight cargo grid lock daily.

Up until now, the Russian government paid little attention to the maritime industry, but given a breakdown in communications between Russia and ports in other republics, namely Ukraine and the Baltic states, it now appears the government is prepared to act fast or face the consequences.