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"Eastern polygon" activates demand

"Eastern polygon" activates demand

Basil Koltashov

Head of the Center for Economic Research, Institute of Globalization and Social Movements (IGSO)

Vasily Koltashov, Head of the Center for Economic Studies of the Institute of Globalization and Social Movements (IGSO):

- Large projects are needed to stimulate the economy in Russia. The Eastern Polygon infrastructure and transport project should theoretically connect a number of areas, such as the timber industry, mining, mechanical engineering, that is, the entire manufacturing industry and the innovation sector, because numerous equipment will be required. It will be very good if the orders are received by Russian enterprises.

It is assumed that the "Eastern Polygon" will operate as a project that stimulates demand. Demand at least in the business-to-business format, and then in the format of consumer demand. These are new jobs that will "improve" the labor market in the country. Look, the demand for cars in Russia has been declining recently, the real estate market is stagnant. A decrease in prices in a number of segments is already underway. At least in some places, demand has dropped dramatically. For example, it sank in Moscow, and this is a very important indicator; Moscow is the economic heart of Russia.

The world market does not stretch the Russian economy, it does not come to the rescue and does not say: "All problems will be solved by increasing the demand for Russian products." At the same time, there are problems of geopolitical order. The conflict with the European Union and the United States is jeopardizing the established trade relations with these countries, primarily European ones, because it becomes unclear whether stable supplies of Russian raw materials to these markets will continue, whether competition with Russian goods will intensify, or whether Russian raw materials will be squeezed out. Under these conditions, Russia is making a turn to the East, and rapprochement with China begins. By the way, China has also received a serious lesson recently. That is why Chinese investors are interested in working more actively in Primorye and Siberia.

In 2012, the economic blockade of Iran took place, and the EU, the US and their partners demonstrated to China that its sea communications can be easily cut off, and China is enormously dependent on imports. Despite the fact that China pays a huge amount of steel, it produces a huge amount of ore and coal, it constantly lacks raw materials. In these conditions, there is only one country that is able to provide China with stable and reliable supplies - Russia.

Meanwhile, in China they are talking about building the Silk Road - a railway that will go in the direction of the Southern Silk Road through Iran, Afghanistan, perhaps Pakistan, or bypass these dangerous zones through Kazakhstan. But this is still projects, and only Russia has ready-made lines of communications that have been built for more than one decade, this is Russian Railways. Therefore, it is one of the objectives of the Eastern Polygon to modernize rolling stock, means of communication, stations, and to reduce the time for transportation.

The "Eastern polygon" can make changes in the direction of the world flow of goods, at least on the scale of Eurasia - the largest and most developed economically continent in the world. The project really has a great Eurasian significance. It is interested in South Korea and other countries that would like to use railroads for the delivery of goods. Russian companies are also planning numerous investments in the extraction of various natural resources in this region.


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