Vologda is the capital of Vologda region in the Northern central European Russia, on the Vologda River. It is a major river and rail junction in a dairying region. There are railroad repair yards, machine factories, lumber mills, and flax-processing plants. Vologda is famed for its lace. Founded in 1147 by merchants from Novgorod, it passed to Moscow in the 15th cent. and was from the 15th to 17th cent. a major trade center and transit point to NE Russia, Siberia, and W Europe. It declined in the 18th cent. but revived in the late 19th cent. with the development of the lumber industry and the coming of the railroad. In Vologda's old kremlin are the 18th-century bishop's palace and the Cathedral of St. Sophia, built (1568-70) by Ivan IV. The Spasso-Priluki monastery is nearby. The leaders of foreign trade in the Region are Severstal and Ammophos. Other local companies with considerable foreign trade operations are: Cherepovets Steel Rolling Plant, Azot, Management of Gas Pipelines under construction, and Vologda Ball Bearing Plant. The most widely used form of investment in the Region is establishing joint ventures or companies with foreign investments. The surprising beauty of nature, abundance and variety of monuments, high saturation of the art, original culture of the population have found reflection in the poetic name of territory - the Reserved Russian North.