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Turn to the East it's time to turn into a nationwide phenomenon
HSE experts on how to find new growth points in the Russian Far East
Photo by: spiegel.de
Four years have passed since Vladimir Putin, in his address to the Federal Assembly, called Siberia and the Far East “a national priority for the whole XXI century.” Time has confirmed the correctness of this goal setting. First, the shift of the center of economic and political power to Asia continues: the history of the world of the 21st century will be written not in the Atlantic, but in the Pacific region. Secondly, China’s movement to the West, and Russia to the East provides opportunities for creating a new zone of cooperation and development in Greater Eurasia, which is fully capable of becoming a new center of world development, the attraction of financial resources, goods and people. Third, the economic model that has been operating in Russia over the past decades, based not only on the export of raw materials, but also on centralizing management and concentrating financial and labor resources in Moscow, no longer works. Need to look for new growth points. Fourth, Russian cooperation with Asian countries is developing dynamically, while relations with the West have entered a difficult and long-term crisis.
Efforts to outstrip the development of the Far East are already yielding some results: GRP growth rates here exceed the average Russian indicators for four consecutive years. In 2017, the volume of attracted investments, industrial production and construction shows positive dynamics at last. The first fruits in the form of dozens of new projects are given by the territories of advanced development and the free port of Vladivostok. However, while the scale of these successes is not so great, it allows us to speak more about the outrunning exit from the crisis than about accelerated growth. And in trade and investment cooperation between Russia and the leading Asian countries, political declarations often go ahead of economic content. On the path of Russian non-commodity goods, there are still high barriers to entry to Asian markets, and Russian companies are finding it difficult to adapt to new, though promising, markets for them. The investment climate in the country plays a negative role. Despite all the efforts, the East of Russia has not yet become the territory of economic freedom. And only so it developed in the XVIII and XIX centuries.
The Russian turn to the East is constrained by the inertia of the long-standing desire for Europe. It is peculiar to business: in 2000-ies. he was so relaxed by high oil prices that he missed the wave of Asian economic growth and did not take advantage of many of the opportunities he gives. Even more inertia is typical for a large part of the political elite: to some of its representatives, only sanctions opened their eyes to the fact that life exists outside the West. However, even now, some of these elites are afraid of turning to the East, confusing it with a supposedly rejection of European civilization identity and comfortably staying in the familiar, but long-obsolete coordinate system where Europe is associated with progress, Asia - with Asiatic, and Eurasia - with marginal great-power Eurasianism. In fact, the path of modern Russia to progress and modernization lies precisely through Asia and Eurasia - only there are growing markets for the promotion of Russian medium and high-tech goods, there are opportunities for the spread of Russian standards, there is the potential to build powerful technological alliances, manifestations of entrepreneurial initiative. Naturally, at the same time, that from the European technological, financial and especially cultural resources to refuse recklessly. But where the future is, it's high time to understand.
Representations about the Far East and many citizens of Russia, and even a number of federal politicians are still largely formed by myths, and sometimes deliberately spread disinformation. For example, there are myths about the terrible climate of the Far East, about the Chinese demographic expansion, about the extremely low standard of living in the region and its general economic backwardness. The attention of the majority is eluded also by the fact that the quality of human capital in the East of Russia is better than the national average. It is easy to explain: for centuries, the most dashing, free, energetic, industrious people went there and survived there. And this potential must be used.
The turn in the heads is gradually going on, but much can be done to speed it up. Russia needs a new ideology of turning to the East. Its task is to create a fashion for the East of Russia, to form an idea about it as a region of the future, a land of opportunities that brings success to those who are willing to take risks and work hard. Especially since the time of easy earnings for Russia in any case ended.
EastRussia help. Despite significant efforts to accelerate the development of the Far East, the dynamics of the main indicators of its economic development are still unstable. 2017 year will be the first since 2012 year, when the Far East will exceed, and immediately significantly, the average Russian indicators for all the main indicators of economic activity: the index of industrial and agricultural production, the volume of construction, and investments in fixed assets. The last of these indicators is particularly revealing. After the mass investments timed to coincide with the APEC summit in Vladivostok in 2012, a three-year failure followed. However, since 2015, that is, from the moment when the first territories of advanced development have earned, investments in fixed capital demonstrate encouraging dynamics, indirectly indicating that the economic incentives used in the region give a result. At the same time, behind the figures of gross growth lies the unevenness of this growth by regions. For example, the overwhelming part of the increase in investments in 2016 was provided by one region - the Republic of Sakha (Yakutia).
The basic steps necessary for the accelerated development of the East of Russia are well understood and repeatedly suggested by us, in particular, in the series of reports of the Valdai Club "Towards the Great Ocean". Here we mention the most strategically important of them.
First, it is necessary to stop as soon as possible the artificial fragmentation of the Asian part of Russia into Siberia and the Far East. The huge macroregion, lying to the east of the Ural Mountains, has a historical, economic and transport-logistic unity. When the idea of turning to the East only began to be discussed, including at a high level, the Siberian Federal District was considered as its integral part. The fact that Siberia fell out of the plans is a big omission. It's not even in its objectively higher economic potential compared with the Far East. It is more important to coordinate the development of these regions, in which there are many opportunities for industrial cooperation, and the economic potential can not be realized without the development of a common transport infrastructure, primarily the Trans-Siberian Railway and the Northern Sea Route. Territories of advanced development should be extended to Siberia, as well as other economic incentives, tested and used at present only in the Far East.
Secondly, it is important to continue to change the attitude of both political elites and the population of the country to natural resources. In Russia till now, extraction, primary processing and transportation of raw materials are considered to be the most primitive types of economic activity. In reality, as exhausting readily available reserves and tightening requirements for environmental protection, production technologies become truly innovative. A similar situation is observed in agriculture and fisheries: biotechnology, gene modification, drip irrigation, robotic agricultural machinery, geoinformation technologies, mariculture make these activities more highly precise, requiring highly skilled personnel and significant capital expenditures. The construction in the East of Russia of an innovative resource economy capable of satisfying the growing world demand for resource-intensive goods while simultaneously following the world trend for "green" development is the goal to be pursued. Its achievement will transform this macroregion into one of the most attractive territories of the planet.
Thirdly, it is necessary to rediscover the history, nature and daily life of Siberia and the Far East for the population of the European part of the country, elites and journalists.
Most Russians, including even Siberians themselves, have little knowledge of the history of the Trans-Urals. It is important, with grief and gratitude, to return to the national memory the suffering of the millions of involuntary GULAG who built the mines and roads that mined gold, uranium and other resources that saved the country. In Moscow, the national wall of grief, a memorial dedicated to the victims of political repression, has finally been opened. Similar monuments are needed in the East of Russia.
Tourism in the East of Russia should be guided first and foremost by a Russian tourist. Visiting Baikal, Altai or Kamchatka is a dream for many Russians, alas, often unattainable. Expensive air tickets, as well as lack of tourist infrastructure make recreation here difficult and almost impossible, and it is important to overcome this perception and send a stream of Russian tourists here, including through state subsidies.
Federal channels should be more accentuated to cover the life of the eastern regions on the screens. Fashion on Siberia and the Far East could be developed by means of documentary and entertainment programs, as well as artistic cinema.
Fourthly, mass student exchanges should become an important tool for the unification of the country and the rise of its eastern part. In a number of specialties (oceanology, oriental studies, geological exploration, natural resource management, etc.), universities located beyond the Urals can provide students with opportunities that are inaccessible in the European part of the country.
Even coming for a year or semester, students will discover Siberia and the Far East, and the chances that they will later choose them as a place of residence or business will increase. These same students will become translators of knowledge about the East of the country in their small homeland, will contribute to the destruction of established myths.
Fifthly, it is important to return to the issue of transferring some of the capital's functions to one or two Siberian and Far Eastern cities. A number of federal agencies may be moved here. This would also facilitate the repeatedly postponed transfer to the East of the central offices of Russian state-owned companies, especially resource companies - those whose main assets are located directly in Siberia. Such a transfer would not only create new jobs in the region and help renew the political and business elites, but also make the inhabitants of the region involved in decision-making, would give a signal that in order to succeed, it is not necessary to move to another part of the country.
Sixthly, it is necessary to improve qualitatively the expert and intellectual support for a turn to the East. With regard to its external, Russian-Asian agenda, in recent years a whole community of scientists, businessmen, journalists, intellectuals promoting and medially developing Russia's integration into the Asian region has formed. And they need many times more, but with regard to internal, Siberian-Far Eastern issues, such a community has yet to be created.
For the accelerated development of the East of Russia, the state has already done a lot. Now it is time to translate the turn to the East and, first and foremost, the development of Siberia and the Far East from the phenomenon of the technocratic to the phenomenon of a nationwide one. Bring him to the broad strata of the educated middle class and youth. Add to it the courage, to direct to the development of the East of Russia a positive patriotic energy, which is so difficult to find a way out inside the country.
Text: Sergey Karaganov, Dean of the Faculty of World Economy and World Politics, HSE, Honorary Chairman of the Council for Foreign and Defense Policy, Igor Makarov, Head of the World Economy Program, HSE