STRUCTURAL TRANSFORMATIONS OF THE ECONOMY IN THE PACIFIC REGION OF RUSSIA AND EFFICIENCY TRENDS 1

Pacific Russia is viewed as an aqua-territorial macro-region that encompasses the Far Eastern Federal District and the adjacent water area within the 200-mile maritime economic zone. The macro-region has a wealth of natural resources at land and on sea, opportunities for the use of sea transport to link Russia and Europe with the countries of Asia-Pacific Region. Pacific Russia is divided into 2 latitudinal zones — the northern zone and southern zone, which include the territories of northern and southern constituents of the Russian Far Eastern Federal District. The combinations of activities by constituent entities and latitudinal zones are considered as the territorial structures of the economy. This article reveals the differences in socio-economic capacity and development level of these latitudinal zones. The authors have assessed the structural transformations in the economy of latitudinal zones in 2004–2013 by taking into account the changes of similar activities in the constituent entities and their ratios measured as a share of value added. This allowed to identify the transformations of territorial economic structures in the latitudinal zones. Over this period, the greatest changes of economic structures occurred in the northern zone. In the southern zone, the structural transformations of the economy were smaller, except for the Sakhalin region. In all latitudinal zones, there was a decrease in the share of manufacturing industries and the increase in the share of extractive industries. The article compares the generalized assessment of changes in the social and economic efficiency (by the growth of population income, labor productivity, and profits) with the structural changes in the economy of the constituent entities of Pacific Russia. The authors note that an important premise for building a sufficiently sustainable system of interregional division of labor in Pacific Russia is the location of extractive industries and initial stages of the manufacturing industry activities in the northern zone, while the major manufacturing industries and interregional transport and logistics services are located in the southern zone. This article is intended for experts and students interested in the development problems of Russia's eastern regions.


Introduction
Far Eastern region of Russia, viewed within the boundaries of the Far Eastern Federal District, is the most easterly and largest macro-region of the Russian Federation. Based on its strategically important geographical position near the Pacific, we can identify two groups of Russian territories which, to varying degrees, gravitate towards the Pacific ocean: 1. Constituent entities of the Russian Federation with direct access to the Pacific Ocean that have a great economic and geographical pull towards it (Primorsky Krai, Khabarovsk Krai, Kamchatka Krai, Sakhalin Region, Magadan Region, and Chukotka Autonomous District). The economies of these constituent entities have various and well developed marine economic structures and functions.
2. Constituent entities of the Russian Federation with no direct access to the Pacific Ocean, but still experiencing a substantial economic pull towards it, including through transport and energy communications (Republic of Sakha (Yakutia), Amur Region and Jewish Autonomous Region).
An important role in the economies of these constituent entities is played by the transport (Trans-Siberian Railway and Baikal-Amur Railway, Eastern Siberia -Pacific Ocean main oil pipeline, navigable Amur river), and extractive industries whose products are exported to Asia-Pacific Region (APR) largely through existing transport infrastructure and maritime transport. The significant import links are maintained in the opposite direction.
It should be noted that the Republic of Sakha (Yakutia), with its extensive northern coast, has access to the Arctic Ocean. Therefore, with the future development of the Northern Sea Route, the external relations of the Republic will have an increasingly eastward orientation. The Amur-Yakutsk Railway and Power of Siberia gas pipeline, that are under construction, will contribute to this trend.
In the future, the role of proximity to the ocean in the development of the macro-region will be strengthened not only due to the extensive development of fisheries and marine products, but also oil and gas, and various mineral natural resources offshore. The involvement of poorly developed territories and sea water areas (including the totality of locally available natural and economic resources) in the economic activities can be regarded as a determining factor for the development of the economy, the population of Russia as a whole, which will ultimately determine its geopolitical weight and security. Therefore, we regard the Far Eastern region within the boundaries of the Federal District together with the adjoining 200-mile maritime economic zone as Pacific Russia, the largest aqua-territorial macroregion [2]. This macro-region has a great extent (more than 4 thousand km) from north to south and from west to east, which is reflected in the spatial differentiation of its economy both in the meridional direction (from continental types to the maritime types) and in the latitudinal direction (from the northern, arctic types to southern, more diverse types). Accordingly, there are also differences in the structural changes of activity types that we have studied, primarily, for the latitudinal zones.

Defining the objective
As the latitudinal zones, we identify the combinations of territories belonging to the constituent entities of the region located sequentially in the latitudinal direction -from west to east (or from east to west). Such latitudinal zones do not coincide with the natural ones, yet they have substantial differences -natural, climatic, resource-related and environmental -which have a great impact on the spatial differentiation of the economy.
The most important premise for the regional development of any latitudinal zone is the established spatial structure of economic activities of the population and, in a broader sense, the territorial organization of economy. The territorial organization of economy means the orderly location of activities in the form of various economic enterprises and their combinations on the territory accompanied by the establishment of economic relations between them and connections with the territory [2]. On the one hand, the territorial organization of the economy reflects regional differences in the implemented types of development and their certain inertia while, on the other hand, it reflects certain trends in the future development of regional economic structures.
The constituent entities of Pacific Russia, included in its northern and southern latitudinal zones, have different indicators of socio-economic capacity and the size of the territory (Table 1).
A general pattern emerges clearly -the northern constituent entities and latitudinal zones have much more territory, while the southern ones have a significantly higher demographic and socioeconomic capacity. For example, the constituent entities of northern latitudinal zone account for 76.6 % of the surface area and 23.7 % of the population, as well 29.9 % of Gross Regional Product and 33.0 % of the industrial production in Pacific Russia. In the southern latitudinal zone, 76.3 % of the population, as well as 70.1 % of the Gross Regional Product and 67.0 % of the industrial production of the region are concentrated on 23.4 % of the territory of Pacific Russia.
Therefore, this study has two following objectives: 1. To identify and assess the changes, structural transformations of the economy in the latitudinal zones of Pacific Russia from 2004 to 2013.
It seems that such assessments could be more rigorous if performed for three latitudinal zones -northern, central and southern -according to the number of the most easterly constituent entities of the Russian Federation from the north to the south: Chukotka Autonomous District, Kamchatka Krai, and Sakhalin Region. However, there are only two most westerly constituent entities in the region: Republic of Sakha (Yakutia) and Amur Region. The Republic of Sakha (Yakutia) has the northern, arctic types of the economy, as well as the combinations of extracting and manufacturing types of activities that have emerged in its central and southern areas [8,9,12,13]. However, given the absence of reliable data for individual districts of the republic, that can be compared with the data on constituent entities, we have identified (with a certain degree of conditionality and generalization) two latitudinal zones: the northern that includes the territories of the Republic of Sakha (Yakutia), Magadan Region, Kamchatka Krai and Chukotka Autonomous District, and the southern consisting of the Amur Region, Jewish Autonomous Region, Khabarovsk Krai, Primorsky Krai, and Sakhalin Region.

2.
To assess trends in the efficiency of activity types and social sphere in the constituent entities of latitudinal zones of Pacific Russia over the same period by using several socio-economic indicators, such as the per capita Gross Regional Product, labor productivity index (% YoY), balanced financial result (profit minus loss) of organizations, average per capita income.
3. Based on comparisons of structural changes in the economy by latitudinal zones and changes of the socio-economic efficiency, to identify trends in the efficiency of structural transformations.
In this regard, the quantitative description of the economy of latitudinal zones and the analysis of their spatial features can be made by latitudinal profiles, which reflect the spatial differences and similarities between the neighboring constituent entities of the Federal District included in the same latitudinal zone as homogeneous types of economic activities and their combinations.
The structural changes were assessed in terms of transformations of the territorial structures of the economy for specific periods, including from 2004 to 2013. The transformation of territorial structure means changes in interconnected parts of the economy (types of economic activities) within a specific territory. At the same time, the territorial structures of the economy are examined in a generalized way, in the form of combinations of activity types in the constituent entities and latitudinal zones of Pacific Russia.

Source data and research methods
The structure of the economy in the latitudinal zones was assessed by the ratios of activity types in the corresponding constituent entities of Pacific Russia. The combinations of activity types in the constituent entities were assessed by the sectoral structures of value added, based on the statistical data for 2004 and 2013.
In a generalized way, the combination of constituent entities included in the same latitudinal zone and reflected by quantitative characteristics in the form of homogeneous indicators or combinations of the same indicators were examined as specific latitudinal profiles. In this study, we used the systemic and structural approach, the concept of unevenness and inertia in spatial development, the concept of sustainable development. We used economic and geographic research methods, such as comparative geographical method and methods of statistical analysis. We also used the approaches to the study of territorial structures of the economy, their inertia and structural transformations.

Main findings
The transformation of economic structure in the constituent entities of Pacific Russia, as a change in their territorial structures, was assessed by their prevailing sectoral structure of gross value added, including the main and auxiliary types of economic activities, as of 2004 and 2013. The main types of activities in the economy of the Republic of Sakha (Yakutia) are -The extraction of minerals (non-ferrous and precious metals, diamonds, coal, oil and natural gas); -In Kamchatka Krai -fishing, fish processing, mining of precious metals; in Primorsky Krai -fishing, fish processing, extraction of non-ferrous and precious metal ores, production and repair of machinery and equipment, timber industry, food industry, transport; -In Khabarovsk Krai -production and repair of machinery and equipment, extraction of nonferrous and precious metal ores, timber industry, transport; -In Amur Region -extraction of non-ferrous and precious metal ores, timber industry, power industry, transport; -In Magadan Region -extraction of precious metals; in Sakhalin Region -extraction of oil and gas, fishing, fish processing; -In Jewish Autonomous Region -extraction of ferrous and precious metal ores, consumer goods industry; -In Chukotka Autonomous District -extraction of precious metal ores.
Other types of activities are referred to auxiliary. Their composition is almost the same for all constituent entities of Pacific Russia, while the amounts and ratios are determined, primarily, by the number of employed population, the size of specialized production facilities, natural and climatic conditions. Therefore, in the constituent entities of northern latitudinal zone of Pacific Russia, the main specialized types of economic activities are the extraction of minerals, fishing and fish farming, agriculture (reindeer husbandry), hunting. In 2013, their share accounted for 45.3 % of gross value added in the Republic of Sakha (Yakutia), 34.4 % in Chukotka Autonomous District, 20.5 % in Magadan Region, 15.8 % in Kamchatka Region.
A significant amount of gross value added in these constituent entities is provided by auxiliary types of activities (construction, production and distribution of electricity, gas and water, transport and communications, wholesale and retail trade, hotels and restaurants, education and health care, real estate operations, etc.) ( Fig. 1).
In the southern zone, in addition to the extraction of minerals, an important role in the formation of specialized types of production activities is played by manufacturing industries and transport. The share of specialized production facilities in most constituent entities of this zone does not exceed 50 % (for example, in Amur Region, 45.6 %; Primorsky Krai, 34.7; Khabarovsk Krai, 36.1; Jewish Autonomous Region, 30.7). Only in the structure of gross value added of Sakhalin Region, a significant role is played by extractive industries and, as a result, the share of specialized production facilities in this area accounts for 63.6 % of output. These data show that, in the southern zone, the share of specialized types of activities is substantially higher.
The same pattern can be seen more clearly in the development characteristics of the territory ( Table 2). The highest socio-economic development of the territory is registered in the constituent entities that belong to the southern zone of the spatial economy in Pacific Russia. It has the highest specific indicators, such the density of population, infrastructure development (density of hard surface roads), economic characteristics (Gross Regional Product per 1 km 2 ), investment attractiveness (investments in fixed assets per 1 km 2 of the territory).
Therefore, the economic capacity of the territories in general substantially decreases from southern to northern areas (the density of population decreases from 5.18 people/km 2 in the southern area to 0.35 in the northern area; the Gross Regional Product -from 2691.9 thousand rubles/km 2 in the southern area, to 181.1 in the northern area; the density of motor roads -from 44.6 km 2 in the southern area to 3.5 in the northern area; the investment in fixed capital -from 771.1 thousand rubles/ km 2 in the southern area to 53.0 in the northern area). Similarly, there is a significant decrease in the demographic potential and reduction in the variety of activities. It should be noted that the greatest contribution to the capacity of the southern zone is made by two constituent entities, Sakhalin Region and Primorsky Krai.
It should be noted that the northern latitudinal zone (territories of all constituent entities) adjoins a huge water area within the 200-mile maritime economic zone with its large and diverse natural, resource, transport and transit capacity. Therefore, in the long run, a major increase in economic capacity will be occurring in the eastern and northern latitudinal directions. A greater variety of specialized types of activities will remain and increase in the southern zone. As a result, it will have a higher self-development capacity. This interdependence was noted in several studies [1,4,15,23].
To assess the transformation of territorial structures of the economy in 2004-2013, we analyzed the changes in the sectoral structures of the economy in the constituent entities of Pacific Russia for identified latitudinal zones ( Table 3).
The particular aspects of structural transformation affecting the industrial production in the northern zone of Pacific Russia (Republic of Sakha (Yakutia), Magadan Region, Kamchatka Krai and Chukotka Autonomous District) from 2004 to 2013 are presented in Fig. 2. Despite great differences in quantitative indicators of these constituent entities, there is a significant similarity in the structure of production, which is caused by the impact of similar factors affecting the development and location of industrial facilities. In this case, an important role is played by the wealth of mineral resources, the development of which is constrained by the weakness of production and social infrastructure, as well as the significant remoteness of these constituent entities of Pacific Russia from their sales markets.   where a "plus" sign means an increase in the share and a "minus" sign means the decline in the share.
The end of the Table 3 From 2004 to 2013, the most substantial changes affected the extraction of minerals in Chukotka Autonomous District (the share of this type of economic activity in the gross value added increased from 6.4 to 31.3 %). In the Republic of Sakha (Yakutia), the share of extraction of minerals increased by 3.6 %. Both constituent entities (the Republic of Sakha and Chukotka Autonomous District) experienced a significant decline in the share of manufacturing industries in the gross value added. Also, there was an increase in the share of produced electricity, gas and water.
In Magadan Region, we have seen a significant decline of the share of industrial production in the structure of gross value added (for example, the share of the extraction of minerals decreased from 31.9 % to 17.4 %, the share of manufacturing industries -from 6.3 % to 2.5 %, and the production and distribution of electricity, gas and water -from 12.2 % to 9.4 %). A similar situation is emerging in the industrial sector of Kamchatka Krai.
In the constituent entities of the southern latitudinal zone of Pacific Russia, a particular characteristic is their relatively low share of economic activities related to industrial production (except for Sakhalin Region). This markedly differentiates the constituent entities of southern zone from the constituent entities of northern zone, where we see a high share of industrial sector (primarily, the extraction of minerals) in the gross value added. The southern zone experienced a greater development of such types of economic activities as transport and communications, construction, agriculture, services, including trade, which all belong to auxiliary types of activities.
In 2004-2013, the most marked changes took place in the industrial structure of Sakhalin Region and Amur Region, which is related to the increase in the share of extraction of minerals in the structure of gross value added of these constituent entities. For Sakhalin Region, this is associated with the increased extraction of oil and natural gas, and in Amur Region -with the development of the metallurgical complex (extraction of non-ferrous metal ores) (Fig. 3).
In 2004-2013, all constituent entities of the southern zone experienced a decline of the share of manufacturing industries in the structure of their gross value added, as well as in the share of production and distribution of electricity, gas and water (except for Jewish Autonomous Region, where the share of production and distribution of electricity increased substantially).
The combinations of diagrams in Fig. 2 and 3 can be viewed as latitudinal profiles which, in a generalized way, reflect the main units of territorial structures of the economy in the northern and southern latitudinal zones, as well as the changes in these structural units. This allows to see clearly a

Manufacturing industries
Production and distribution of electricity, gas and water It should be noted that, while the economic capacity of the constituent entities of Pacific Russia markedly decreases from south to north, the level of economic efficiency, expressed in the production of Gross Regional Product per capita, on the contrary, increases in the northern constituent entities and decreases in the southern constituent entities of Pacific Russia (Fig. 4). It should be noted that, since 2004, Sakhalin Region, Chukotka Autonomous District, Magadan Region, and the Republic of Sakha have been leading in terms of this efficiency indicator. In 2013, the greatest value of this indicator was reported in Sakhalin Region, next -in the northern latitudinal zone -come Chukotka Autonomous District, Republic of Sakha (Yakutia) and Magadan Region (1,369.0 thousand rubles, 927.4 thousand rubles, 595 thousand rubles, and 584.7 thousand rubles, respectively), in the sectoral structure of which a significant role is played by export-oriented extractive industries (production of oil and natural gas, extraction of precious metal ores and diamonds). The lowest values have been reported in Jewish Autonomous Region, Primorsky Krai and Khabarovsk Krai, Amur Region (220.8 thousand rubles, 296.2 thousand rubles, 353.2 thousand rubles, 259.4 thousand rubles, respectively); in the structure of their economies an important role is played by manufacturing industries and transport services. It should be noted that, for this indicator, the differences between the constituent entities substantially increased The structure of the Gross Regional Product in Sakhalin Region is marked by a high share of extractive industries associated with the production of oil and natural gas. The negative financial result reported in the economy of Sakhalin Region for 2014 was associated with the drop in the global fuel prices (oil and gas).
The structural transformations of the economy in the northern latitudinal zone made a different impact on changes in the overall financial results of organizations. In Chukotka Autonomous District, a substantial gain in the share of extractive industries and some changes in other types of activities were accompanied by the increase of total profit. In Yakutia, there was a significant drop in profit against a slight increase in the share of extractive industries and changes in other types of activities. The decline in shares of the extraction of minerals and manufacturing industries in Magadan Region and Kamchatka Krai was also accompanied by a decrease in total profit (for 2010-2013).
The economy of the southern latitudinal zone was characterized by a substantial drop in the share of manufacturing industries, which was also reflected in the decline of profits. An exception is Sakhalin Region, where the high growth of the production of oil and gas was accompanied by significant profit gains.
The analysis of dynamics in the labor productivity index also shows different production efficiency in the constituent entities of Pacific Russia compared to the Russian Federation as a whole (Fig. 5). In Table 4 The balanced financial result (profit minus loss) of organizations in the constituent entities of Pacific Russia, million rubles 2006, the labor productivity index in the constituent entities of Pacific Russia was above the national average only in the southern zone (Sakhalin Region).
In 2008, the constituent entities in the northern zone of Pacific Russia (Republic of Sakha (Yakutia) and Chukotka Autonomous District) demonstrated the labor productivity growth that was above the average for the Russian Federation (104.8 %), 106.8 % and 116.6 %, respectively. However On the whole, the constituent entities of northern and southern (except for Sakhalin Region) zones showed a decline in labor productivity growth. To some extent, this was, apparently, aggravated by corresponding structural transformations in their economies.
The substantial fluctuations of labor productivity index are largely dependent on the economic situation that is developing in the leading economic sectors of the constituent entities of Pacific Russia, for example, the extraction of minerals for the constituent entities of the northern zone or manufacturing industries, transport, services for the constituent entities of the southern zone.
Therefore, the structural transformations of the economy in the northern latitudinal zone (the increase in the share of the extraction of minerals and decline of manufacturing industries) did not result in an overall increase in labor productivity. The decline in the share of manufacturing industries in the southern zone was accompanied by a slight overall decrease in labor productivity, except for Sakhalin Region, which showed a slight gain.
With a general pattern towards the growth in the variety of activity types existing in the southern constituent entities of Pacific Russia, we also observe some similarities in their production specialization. For example, the industrial production plays a leading role in all constituent entities. The industrial production employs more than 15 % of the total employed population in Pacific Russia.
In the constituent entities of northern zone, the share of industrial production in the structure of the employed population is higher than the average for Pacific Russia. In the southern constituent entities, the service sector accounts for the main share of the employed population 2 .
There is a following generalized dependence of the regional population income on the population employment structure and sectoral structure of production [24][25][26]: 1) the amount of per capita income in the region, first, depends inversely on the share of agriculture in the Gross Regional Product and in the number of employed population; 2) depends directly on the share of mining and manufacturing industries; 3) has a direct, but weakly expressed, dependence on the share of service industries. The difference in the structure of value added in the constituent entities of Pacific Russia is, to some extent, also related to the average per capita income. We have identified the following dependencies between average per capita income and the structure of gross value added and sectoral structure of employment: 1. The average per capita income in the constituent entities of Pacific Russia depends inversely on the share of agriculture in the gross value added of the constituent entity. In 2013, the highest share of agriculture was reported in the gross value added of Jewish Autonomous Region (6.5 %), and Amur Region  (Table 5).
2. There is a direct dependence between the average per capita income in the constituent entity and the share of industrial production in gross value added.  (Table 3). These constituent entities are also characterized by the low share of agriculture in the sectoral structure of gross value added. For example, in 2013, it was 1.9 % in the Chukotka Autonomous District, 0.9 % in Sakhalin Region, 1.4 % in Magadan Region, 2.3 % in the Sakha Republic.
3. There is a weakly expressed direct dependence between the relatively high average per capita income and significant share of service industries in the gross value added of the constituent entities in Pacific Russia. For example, in 2013, the share of services (wholesale and retail trade, repair of motor vehicles, motorcycles, transport and communications, household products and personal goods; hotels and restaurants; financial activities, real estate operations, lease and services; social insurance; education; health care and social services; other utilities, social and personal services) accounted for 62.5 % of the gross value added in Primorsky Krai and 58.1 % in Khabarovsk Krai. At the same time, in 2013, Primorsky Krai and Khabarovsk Krai ranked 25th and 14th among the constituent entities of the Russian Federation in terms of average per capita income (in 2014, Primorsky Krai ranked 18th and Khabarovsk Krai -14th).
The positive trends in economic restructuring of the constituent entities in Pacific Russia, which lead to higher incomes of the employed population, are primarily associated with the growing shares of such types of economic activities as the industrial production and services in the structure of employed population and production of gross value added.
Overall In the northern zone of Pacific Russia, the constituent entities have the highest level of per capita income (in 2013, the Republic of Sakha (Yakutia) ranked 3rd in Russia, Chukotka Autonomous District -4th, Magadan Region -5th, and Kamchatka Krai -8th), which can be explained by their high share of industrial production (extraction of minerals) in the gross value added and the structure of employed population. An important role in achieving a high level of average per capita income is played by significant "Northern" wage bonuses applicable to these constituent entities of Russia.
The southern zone of Pacific Russia also has in place additional "Far Eastern" wage multipliers, but they are not as high as in the northern areas of Pacific Russia. The types of activities, that are better developed in the constituent entities across the southern zone of Pacific Russia (such as agriculture, education, health care, etc.) are "less profitable" which does not favor the growth of average per capita incomes either. In general, both the level of employment and rising incomes of the population are associated with the increase in the share of extraction of minerals in the structure of the economy of the northern latitudinal zone. This can be primarily explained by a higher level of wages paid by the mining companies in northern conditions. The structural transformations of the economy in the southern latitudinal area did not result in a substantial increase in incomes of the population, although there was neither a noticeable reduction in such incomes. The incomes of the population increased substantially in the mining companies of Sakhalin Region following the higher production of oil and natural gas.

Conclusion
As we can see, the transformations of territorial structures of the economy, that occurred in the constituent entities of Pacific Russia over a 10-year period (2004-2014), were largely not accompanied by the growth in the share of manufacturing industries. Moreover, this is typical both for the northern zone and southern zone, which is more developed and differentiated in terms of its economic structure. On the contrary, the share of extractive industries was increasing at a slightly higher pace in the northern zone and less so in the southern zone (with the exception of Sakhalin Region).
The structural transformation associated with the higher share of extractive industries in general, lead to some increase in efficiency in the northern latitudinal zone, and to a lesser efficiency in the southern zone. However, the general decline in the share of manufacturing industries and the industrial production as a whole has a greater impact on the decrease of efficiency.
In general, the ongoing structural changes in the economies of the constituent entities of Pacific Russia have not yet led to any substantial increase in the efficiency of the region. It continues to be oriented on the priority development of extractive industries, that are largely dependent on fluctuations of world commodity prices. In the northern latitudinal zone, the high costs of production and sales in the extractive types of economic activities, a relatively low labor productivity and poorly developed infrastructure cannot provide high living standards for the population. The insufficient development of manufacturing industries does not allow to shift the employed population to more efficient types of economic activities. In the southern zone, the development prospects are mainly associated with the modernization of manufacturing industries, development of logistical activities and formation of modern service industry.
In the second half of the 20th century, the rapid economic growth in Japan and newly industrialized countries of Southeast Asia was largely the result of substantial restructuring in the economy. Most of people in the Asia-Pacific region are employed in high-tech manufacturing industries and service sector [26]. Such restructuring of the economy allowed to substantially reduce the consumption of natural resources in the material production and increase the labor productivity in the industrial sectors.
The Pacific Russia has the premises for building a sufficiently robust system of inter-regional division of labor, where the extractive industries (given the uniqueness and wealth of natural resource potential on land and at sea) and the initial stages of the manufacturing industry activities can be located in the northern latitudinal zone, while the major manufacturing facilities and service sector can be located in the southern zone. This will lead to the formation of complete vertically integrated value chains, the territorial structures of which display successful forms of territorial organization of industrial production.