Friday, November 17, 2017

Innovative Activity by Russian Business Continues to Fall, Now at Lowest Point in Putin Years

Paul Goble

            Staunton, November 16 -- The level of the introduction of innovative technologies is now at its lowest level since 1999, according to new research conducted by scholars at Moscow’s Higher School of Economics, yet another confirmation of the degradation of the Russian economy under Putin and a serious threat to Russia’s future economic development.

            The decline, which has only increased during the last three years, can be explained, the researchers say, “by a reduction in the intensity of innovation processes in technologically mid-range producers, such as the production of electric machines and equipment and metallurgy” (

            And this fall off in innovative behavior is leaving Russia ever further behind not only leading Western countries but also most of those who were part of the USSR or the Soviet bloc in the past. Indeed, statistics show, the Higher School of Economics report, that the only country in the entire region with a lower level of technological innovation now is Romania. 

            Between 1999 and 2011, Russia had been making some progress in this regard, the research says. But since then, there has been a serious decline across the board, even in industries where things had been looking up. The explanations lie with declines in oil prices or possibly with the introduction of sectoral sanctions.

            Conditions in the most high tech areas of production are especially dire in this regard, the Moscow scholars say.  And because much of the technology being used and not being replaced is wearing out, the prospects for the future are bleak unless this trend is changed and changed soon. Otherwise in some places, production will simply stop.

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