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Chukotka: results of the year
How to keep the growth rate?
Chukotka is distinguished by extremely unstable economic and financial indicators, which testifies to the region's weak economy with its vast territory, a tiny population of about 50 thousand people. and a small number of operating industrial enterprises and investment projects, which are also very expensive due to extreme conditions. Nevertheless, in January-August 2014, the volume of industrial production in Chukotka grew more than one and a half times. In the first half of 2014, agricultural production increased by almost half. Okrug authorities made a number of decisions aimed at the development of reindeer herding and crop production, and providing the region with food. In general, the year turned out to be very successful for the Chukotka Autonomous Region, but, given the trends of the past years, it does not at all mean that the region expects rapid growth in the future.
The Budgetary Paradox
It should be noted and a paradox that is not surprising when it comes to such a specific region, that in the same 2013, the Ministry of Finance, on the contrary, considered Chukotka the most inefficient DFO region in terms of the quality of budget management. This was the only region of the DFO, which fell into the worst - the third group. According to the results of 2013, Chukotka excelled and the highest in the Far Eastern Federal District, while the extra-high level of debt burden on its budget (it amounted to 123%). Thus, in reality, it is unlikely that 2013 was successful for Chukotka and its authorities. But in 2014, there have been positive trends in both the economy and the financial sphere. And the federal center began to pay much more attention to the support of this region, which in general is also very unstable.
If we talk about the budget situation, the income of Chukotka is relatively small. In the Far East, only in the Jewish Autonomous Region they are even smaller. At the same time, the region is subsidized. In January-October 2014, its own revenues amounted to 53,2% of all regional revenues, that is, in other words, almost half of Chukotka's funds are received through federal transfers. An analysis of Chukotka’s fiscal sphere shows that there is a raw material sector in the region that contributes to filling the budget, but it is not so large. Thus, the share of income from income taxes in their own regional incomes is 29,5%, at the level of Yakutia and significantly worse than Sakhalin (income tax provides 35,6% of the region’s own incomes). It is also interesting that Chukotka is the leader in the Far East in terms of the importance of revenues to the regional budget of the mineral extraction tax (16,9%). This tax is essential in the Far East only for it, Yakutia and the Magadan region. On the contrary, there are no prerequisites for the development of small business in the region and, as a result, taxes on total income make up the entire 1,7% of own tax and non-tax revenues of the regional budget.
However, 2014 made Chukotka the leader of the Far East in terms of growth of budget revenues. This happened mainly due to the next revision of the volume of subsidies for equalizing the budgetary provision in favor of this region: this volume for the year (or rather, according to data for January-October) increased in 40 (!) Times. Interestingly, budget subsidies, on the contrary, were cut more than threefold. Subventions have experienced relatively moderate growth - by almost 20%. But in general, federal transfers increased by 4,5 times, which, of course, was a huge achievement for Chukotka.
It is important to note that, although the region also knocked out large transfers, at the same time it began to provide a very substantial increase in its own revenues - by 17,7%. A good trend is, first of all, a sharp increase in income from income tax - by 65%. Increases in 34,8% of revenues from the tax on mining, also indicating a new growth in the raw materials sector of Chukotka. On the contrary, income from income tax fell (by more than 6%), revenues from excise taxes, taxes on aggregate income, etc. decreased. The region received a lot of money from selling its assets (growth of revenues by 56%).
Thus, in 2014 (according to the data of January-October) the budget incomes of Chukotka have grown in record way 1,8 times. The main role in this was played by the federal center, but the dynamics of its own income looks good. Nevertheless, given the fundamental problems of the unstable Chukchi economy, which is always reminiscent of the spasmodic dynamics of its indicators, this can not be considered a long-term trend, and each year in Chukotka is different from the others.
As regards the expenditure policy of the Chukotka authorities, first of all, pay attention to a high share of expenditures on housing and communal services (23,3%). Leadership of Chukotka in the Far East on this indicator is not surprising, since utilities in the Far North are worth a lot of money, and there is nobody to take care of the state apart from the state. Due to intensive state support and new construction, Chukotka is characterized by extremely low indicators of dilapidated and dilapidated housing (total 3,6%, according to data for 2013 year). Although the share of loss-making utilities is still high, amounting to 40% (for the same 2013 year).
The social sphere of Chukotka, therefore, is not adequately resourced. Again, at the expense of a small population, it turns out that the region is best provided by teachers, places in kindergartens, doctors and hospital beds in the Far East. But the salaries of state employees in Chukotka significantly lag behind the average in the region. As a result, in 2013, in education they were only 73% of the average (which was one of the worst results in the Far Eastern Federal District), in healthcare - 78%.
Not surprising feature of Chukotka is a rather large number of employees in state and municipal government. In severe northern conditions, this is one of the few opportunities to receive a guaranteed and good salary. Therefore, for example, the number of officials per capita in Chukotka is greater than anywhere else in the Far Eastern Federal District. However, the costs for national issues are at the same level, amounting to 8,1% of the district budget.
There will not be a breakthrough?
At the same time, without active support from the federal authorities, the region is still unable to survive under current conditions. This explains the constant attempts to promote Chukotka's interests in negotiations with leading government officials. However, Chukchi projects, on the other hand, are not so important for the Russian economy as a whole, not a single breakthrough project exists there. Therefore, the arguments of the Chukchi authorities do not look so strong in the eyes of the federal center, and the region is supported more from social motives, or through effective lobbying. As a result, Chukotka turned out to be the only Far Eastern region where it was not planned to create territories for outstripping development (although this issue is not completely closed). Priority investment projects claiming federal support were reduced to one project that fell into the second group.
Thus, in the western part of the region, a new energy system and a new, related raw materials sector of the Chaun-Bilibinsky industrial region should appear. The main perspective of Chukotka is connected with this. The calculations of the Chukchi authorities are such that the implementation of this plan should begin as early as 2015. As the meeting of the governmental commission in December 2014 showed, the federal center supports these plans and calculations. The authorities of Chukotka are also counting on the reconstruction of the airport in Pevek and, in general, pay great attention to the airport infrastructure, the development of which has also been repeatedly discussed with federal officials.
In addition, Chukotka may become one of the beneficiaries of the new Arctic policy of the federal center. According to the decree of President V.Putin, it is entirely related to the Arctic zone and is the only such region in the DFO (Yakutia is assigned to the Arctic zone only partially). Therefore, Arctic projects of the federal government should be extended to Chukotka. The center will also pay attention to the development of the eastern part of the Northern Sea Route, which is beneficial to the ports of Chukotka, including the same Pevek.
The "double" dependence
The political background in the meantime remains very favorable for the authorities, enjoying the loyalty and support of the population, as already mentioned above. R. Kopin is quite noticeable at the federal level, often falling into high positions in expert ratings. His work is highly evaluated by federal experts. In 2014, the mayor of the regional capital of Anadyr was successfully replaced. Former Mayor A. Shchegolkov resigned, and his place was taken by First Deputy Governor I.Davidenko. Then he calmly, with two formal competitors was elected to the position with the result of 83,1%. Thus, the governor strengthened his influence on the municipal authorities of Anadyr, while not abandoning the institution of direct elections. For all 100%, the new Duma of the district center, consisting of 13 United Russia and two representatives of the LDPR, which habitually plays the role of a sparring partner of the party of power (the LDPR candidate was nominated in the election of the mayor of Anadyr) is loyal too.
Although it should be noted that the elections in Chukotka far from always have a referendum character, and in remote territories there are a lot of local contradictions. For example, in the elections for the head of the Chukotka region, the candidate of “United Russia” L. Yurochko won, but its result was not as impressive as that of I. Davydenko (46,8%). In the village of Providence, there was a split in the elite, as a result of which a member of United Russia, an independent candidate D.Olhovik won first place in elections, and the official candidate of the party A.Devyatkin was only the third. However, political life in Chukotka still remains very sluggish, and conflicts arise only during individual local election campaigns.