Who will make the breakthrough?

Russians are asking the question: why, with constant and stable growth in the country’s economy, positive achievements have such little impact on the lives of citizens?

Among the reasons, there is one that the Russian authorities have been so actively fighting lately - the predominance of the raw materials sector of the economy over the manufacturing sector. We are not even talking about the notorious “oil needle”, but rather about what advantages the raw materials sector can provide. Yes, the majority of Russian companies in this sector are demonstrating stable growth, but real acceleration, the much-anticipated “quantum leap,” is only possible in the case of stable economic growth in the manufacturing sector, which creates a product, not a semi-finished product. Russia, of course, is strong with its raw materials companies, but name any brand representing high-tech products to a foreigner, and you will see a complete misunderstanding of what they are talking about.

One of the few truly famous high-tech industries in Russia is the defense industry. The reason for this is many factors that have recently been proposed to be transferred to the civilian industry.

One of the most relevant options for economic development is a new industrial policy aimed specifically at developing the production of final products. It, according to leading economists, will make it possible to break the circle of constant failures in the manufacturing sector: low efficiency with a weak financial position makes the industry unattractive and less and less competitive. And of course, we are not talking about redirecting all the country’s funds to the development of high technologies.

Industrial policy is necessary to support the most competitive and viable industries, as well as those industries that are strategically important for the country. It is necessary to develop the medical industry, bio- and nanotechnologies, nuclear engineering, aviation and space industries, shipbuilding and a number of other industries. We are historically strong in these industries, but the crises of the nineties brought them to the brink of extinction. I know that many Russian entrepreneurs, including those from the top ten, are ready to consider the prospects for the development of high technologies, but they are stopped by a number of barriers, or rather, the weakness of the industrial policy itself.

Raw materials industries provide their owners with good income, and in order to attract them to a new field, this process must be stimulated. New developments are needed in the field of legislative and regulatory regulation. Manufacturing sectors are in especially dire need of developed infrastructure - this includes transport, communications, and energy. Enterprises producing end products are usually smaller than mills or factories, so they often cannot build the infrastructure themselves. But the state could very well, besides, the principle of special economic zones and public-private partnerships makes it possible in this area to minimize costs and centralize efforts. Technology parks are designed to give all their participants the opportunity to develop. According to the conditions, this can be called a kind of incubator, where young and still unprotected ideas have the opportunity to grow in market conditions. At the next stage, manufacturers can be encouraged to consolidate, and this will already have a strong position in the international market. Here it is also important to create competent and effective laws in the field of intellectual property protection - this is the guarantee of protection that is now noticeably lacking.

Despite all the problems, it must be recognized that industrial policy, including stimulation of processed industries, is already working. More than 540 billion rubles were allocated in the federal budget for 2007 to finance federal target programs, or 1.4 times more than in 2006, investments in the construction and maintenance of roads and key sectors of the manufacturing industry are growing. The creation of venture funds will provide new investments to medium and small businesses - often they are the ones who make breakthroughs in the field of innovation. The coordinated work of three institutions at once is important - government, big business and those directly who intend to make a “breakthrough”. These changes will directly affect the population; inexpensive and high-quality services and domestically produced products are exactly what the population lacks in order to experience real economic growth.

Georgy Shevtsov, Deputy Chairman of the Duma Committee on Industry, Construction and High Technologies