Wednesday, November 27, 2019

Chechnya, Tatarstan and Daghestan Give Higher Shares of State Contracts to Local Firms than Do Any Other Federal Subjects

Paul Goble

            Staunton, November 24 – Because so many Russian firms are centered in Moscow and are active over large swaths of the country, most federal subjects let contracts for services to firms registered and based outside their territory, something that integrates them in important ways with the rest of the Russian Federation.

            But a new Audit Chamber report says three republics are outliers, with Chechnya, Tatarstan and Daghestan giving far more contracts to local firms than do others. Chechnya lets more than 89 percent of contracts to local firms; while Russian areas let 50 percent or less to local firms (

            This difference is extremely important for two reasons. On the one hand, it suggests that the things non-Russian republic governments want to contract with the private sector can be handled by local firms, an indication that such firms not only exist but have good, even special relations with the government.

            And on the other, it suggests that these non-Russian republics and possibly others as well are following a pattern that the non-Russian union republics did at the end of Soviet times, seeking to make themselves economically more self-sufficient so as to be in a position to become politically ore so when conditions allowed.

            The report of this Audit Chamber study does not say whether the Kremlin requested this study, but it is almost certain that the powers that be in the Presidential Administration’s domestic policy branch will focus on it and begin to take steps to bring the non-Russian republics more in line with the balance between local and all-Russian firms found in mostly Russian areas. 

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