It is a specific feature of state capitalism in Russia that all decisions and processes are centralized, so if a single actor appears in the region to pursue a consolidated policy, it will be a positive factor for the economic development of Siberia and the Far East.

       Valdaiclub.com interview with Oleg Barabanov, Professor, Department of International Affairs, Faculty of World Economy and International Affairs, National Research University - Higher School of Economics.

       What do you think is the reason for the failure of the national development programs for Siberia and the Russian Far East?

       The key reason is the sluggish nature of most of the programs. They are either follow-up programs of projects launched back during the Soviet era or were designed to be implemented all at once. Soviet programs were based on the precept that regions are component parts of an integrated national economy. However, the dissolution of the Soviet Union severed many transport and economic links, and so the country’s economic development strategy, including regional development programs, needed to be reviewed.

       Second, although some programs were interregional, nearly all the regions involved in them sought to secure their own interests above everything else, which is why they often included projects in these programs which had no relation to the development of Siberia and the Russian Far East as a whole.

       The third reason is the inefficient use of funds. Even if we disregard the corruption factor, which is in any case one of the key reasons for the failure of many national programs, the remaining funds get squandered on other things or do not provide [positive] long-term results and do nothing to resolve the regions’ main issues.

       The biggest of these issues is the underdeveloped transport infrastructure. The failings of regional and small-scale aviation have become a standing joke; the first important advances in this field over the past 20 years were only made after Vladivostok Avia was incorporated into Aeroflot. But this is only a very small part of what needs to be done.

       This issue requires state intervention and the allocation of budget funds, which need not be very big, especially compared to other infrastructure projects. This is also true of the railway infrastructure. There are several bottlenecks on the Trans-Siberian Railway, where inefficient junctions and other stations are preventing the rapid transportation of cargo. Unless we streamline the transport infrastructure, the development of East Siberia and the Far East will continue to lag behind.

       There is also the issue of tariffs. Of course, transporting cargo such long distances is going to be considerably more expensive, but, on the other hand, no one has ever properly regulated the tariff policy in Russia. Loud statements have been made, but no systemic tariff policy has ever been implemented to facilitate the economic development of Siberia and the Far East.

       Will the Ministry for the Development of the Russian Far East be successful?

       I think it will succeed if it simplifies the decision-making and development processes in the region. One of the ideas underlying the new ministry is the one-stop-shop principle. The ministry will also be able to act as the arbiter in disputes between regional elites. It is a specific feature of state capitalism in Russia that all decisions and processes are centralized, so if a single actor appears in the region to pursue a consolidated policy, it will be a positive factor for the economic development of Siberia and the Far East.

       How will the infrastructure projects prepared for the APEC Leaders’ Week bolster the region’s development? What will happen after the Leaders’ Week? Will the billions of rubles invested there turn out to be money well spent?

       We know now that a large part of the facilities on Russky Island will be handed over to the Far Eastern Federal University, whose former rector is currently the governor of the Primorye Territory. These hotels, office buildings and other infrastructure facilities can be used to create a high-tech cluster, maybe not on the scale of Skolkovo or Silicon Valley but still enough to attract international partners.

       So far, a common problem for all the cities in Russia’s Far East, including Vladivostok, which is our Pacific showcase, is that visitors from China, Korea and Japan, who live in ultramodern high-tech cities of the 22nd century, experience a kind of culture shock when they come to Vladivostok or Khabarovsk and see how backward these cities are in terms of technology and infrastructure.

       Of course, you cannot replace all the Soviet-era houses and neighborhoods with smart homes, but the preparations for the APEC Leaders’ Week included the creation of a regional high-tech cluster comparable to some ultramodern districts in Singapore or Tokyo. If we continue to develop this cluster, instead of allowing it to go to seed, it could become a growth driver for the city and the region as a whole. For example, it could be used as a testbed for new urban development solutions.

       However, considering that the Minister for the Development of the Russian Far East will have the ministry’s headquarters in Khabarovsk, competition between Khabarovsk and Vladivostok, which is similar to the rivalry between Moscow and St. Petersburg though on a smaller scale, could lead to a tug-of-war between them. But anyway, the cluster on Russky Island will be made use of somehow in the future. In other words, the country will reap long-term dividends from the one-off investment there.

       Is there a point of no return beyond which negative processes in the region, such as depopulation, cannot be reversed?

       The main threat of the suspension of production and economic decline in the cities in the region in the 1990s was not depopulation but desocialization. The most active, creative and capable people left the region, and the only ones to stay behind were those who, for whatever reason, were unable to leave. Small towns and villages passed the point of no return in the 1990s. Getting young, creative and active people to go back there now has become virtually impossible. The infrastructure projects of Gazprom and Russian Railways helped ease the problem of lumpenization and social degradation, but only to a certain extent. These issues are seldom raised, even though they are very important.

       In other words, poverty breeds poverty?

       Yes and not just poverty. Cultural and social ties are being severed. People in Moscow have an ironic attitude toward youth projects proposed by various political structures, but these projects often become a tool of socialization and social mobilization of young people, which allows young people to escape from cities that lack economic drivers. These programs are a solution that allows people to break out of the bog of social degradation and to join in with active life.

       Views expressed are of individual Members and Contributors, rather than the Club's, unless explicitly stated otherwise.