Thursday, August 12, 2021

Moscow’s Promise to Develop Russia’s East has Not Been Fulfilled, Leading Vladivostok Economist Says

Paul Goble

            Staunton, August 7 – Academician Pavel Minakir, head of the Institute for Economic Research at the Far Eastern Branch of the Russian Academy of Sciences, says that Moscow’s oft-repeated promise to devote itself to the development of the Russian Far East has not been fulfilled.

            The Vladivostok scholar’s article in which he made that declaration was apparently judged so politically suspect that it was subsequently removed from the portal on which it had appeared. It was put up at but is no longer available.

            However, Minakir’s arguments are clear from a longer interview at the same time in which he discussed the failure of the Russian Far East to benefit from Moscow’s promises up to now in somewhat less sharp language (

            Despite claims to the contrary, Moscow has not provided the necessary support for the Russian Far East either in terms of tax moneys or in terms of policies that will produce genuine development, the academician says. In 2020, for example, Moscow sent “less than 10 percent” more to the budgets of the 11 federal subjects in the Far Eastern FD, a miniscule amount.

            Worse, Moscow has arranged things so that those regions that do better will get less the following year while those who do less well will get more. Not surprisingly, the central government is encouraging exactly the opposite kind of behavior that it says it hopes to see, Minakir continues.

            “We have an absolutely archaic tax system and an absolutely savage system of administration” which ignores both the realities it says it is addressing and the impact its mistaken policies are having. Instead, in many cases and especially in the Far East, Moscow simply doubles up on its policies however much they fail, the academician argues.

            But these financial arrangements are but the tip of a much larger iceberg of problems, he continues. First of all, the Russian Far East is not some homogeneous region. It is extremely diverse. Second, it is so large and dispersed that its parts can’t possible develop at the same pace. Third, it is so poorly connected by transportation networks that it will always consist of enclaves.

            Fourth, Moscow has fed itself and the rest of the country with the myth that people in the Far East are highly paid. No, they aren’t. In purchasing power they are the same or even lower than Russians elsewhere because of high prices. And fifth, Moscow has forgotten that economic growth is not development and that development happens best when people are free.

            In the past, people came to the Russian Far East because there was less supervision and more opportunities. Now, the government has imposed restrictions limiting freedom, and any opportunities that remain are insufficient to attract a permanent population. At best, they attract people who come here to work and then immediately leave.

            Minakir goes on in the same vein, but his basic point is this: Moscow has failed in its approach to the Russian Far East, and its failure there reflects its failed approach to the country as a whole. It thus should come as no surprise that his summary presentation of these arguments was quickly taken down by the powers that be.  

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