The oblast forms the westernmost part of the Russian Federation, but it has no land connection to the rest of Russia. Since its creation it has been an exclave of the Russian SFSR and then the Russian Federation. The fall of the Soviet Union left it isolated from the 'mainland'. It is surrounded by Lithuania, Poland, and the Baltic Sea. Borderless travel to the main part of Russia is only possible by sea and/or air. This political isolation became more pronounced when Lithuania and Poland both became members of the European Union and NATO, and entered the Schengen Zone, which means that the oblast is surrounded by the territories of these organizations as well.
The oblast's largest city and the administrative center is Kaliningrad (formerly known as Königsberg), which has historical significance as both a major city of the historical state of Prussia and the capital of the former German province of East Prussia, partitioned after World War II between the USSR and Poland, and renamed after the Soviet Head of State Mikhail Kalinin.
The territory of the Kaliningrad Oblast coincides with that of the northern part of historical East Prussia, (German: Nord-Ostpreussen), which was an exclave of Germany from World War I until 1945. In that year, it was occupied by the Soviet Union and annexed according to the Potsdam Agreement. It was attached to the Russian SFSR. Most of its German population had fled to the "mainland" of Germany during the war; the rest were expelled from 1945 to 1950. Russian settlers moved in, and the population has been Russian ever since.
Currently it is one of Russia's best performing regional economies, bolstered by a low manufacturing tax rate, as set by its 'Special Economic Zone' [SEZ] status, given by Moscow. As of 2006, one in three televisions in Russia are made in Kaliningrad, and its population is one of few in Russia which is expected to show strong growth.