Regional projection of the crisis

In the early 1990s, when the Russian economy was experiencing a deep systemic crisis, the regions with open economies and the presence of competitive goods and raw materials on the world market found themselves in the most stable position. Today, the same openness to global processes results in heavy losses and acute crisis experiences for them. "Polit.ru" publishes an article by Natalya Zubarevich , in which the author, based on her own calculations and statistical data, describes the current state of affairs in the regions, based on the dynamics of recent years, makes forecasts about the depth of the crisis and its consequences for Russian industry, and also indicates the most problem areas of the regional economy, the reform of which should be facilitated by the crisis. The article was published in the new issue of the journal "Pro et Contra" (2008. No. 5-6), published by the Carnegie Moscow Center.

The impact of the global economic crisis on the development of Russian regions depends on its depth and duration. With a strong and protracted recession, there will be no “safe havens” in the regions, just as there are almost no countries left untouched by the crisis, with the exception of those that have fenced themselves off from the global world. Nevertheless, the risks and the nature of the impact of the crisis on Russian regions are not the same, and the exit trajectories will also be different, as evidenced by the experience of previous crisis periods.

The first data on changes in the situation in the regions show that the new crisis has the character of a center-peripheral diffusion: it spreads from the centers and regions most connected with the global economy to peripheral territories that are poorly included in global exchanges. This nature of spatial changes is described by the theory of center-peripheral development (John Friedman, Emmanuel Wallerstein [1] ), although now we are observing the diffusion not of modernization, but of the opposite, crisis impulse.

The peculiarity of the new crisis is that it calls into question the benefits of globalization. In Russia, throughout the transition period, the thesis was confirmed that the globalization of regional economies has a beneficial effect on their development. In the early 1990s, a systemic crisis collapsed the entire economy of the country, but about a dozen regions turned out to be more stable not only due to competitive advantages (economies of scale, raw materials, etc.), but also to the relative openness of their economies. The country's capital emerged from the recession faster by restructuring the economy with the attraction of external investors and borrowing new market institutions, and the leading oil and gas regions were characterized by less significant rates of economic decline due to the export of resources. Since the mid-1990s, the scope of globalizing territories has been replenished with “new exporters”—regions producing metallurgical and chemical products reoriented for export. Their economy recovered faster.

The financial crisis of 1998 hit the banking sector and, in general, the nascent market services sector, which was concentrated in the largest cities. At the same time, the result of the crisis was a fairly rapid modernization of the services market with the involvement of international capital and, subsequently, specialists from developed countries. Export industries suffered not so much from the financial crisis as from the inadequate exchange rate that the government had maintained in the previous period. The overvalued ruble exchange rate negatively affected exporters' costs in the context of a market decline in world prices for raw materials. Let us recall that the decline in industrial production began before the crisis (in January-August 1998 it amounted to 7 percent), and after the default, rapid industrial growth began in September 1998. The sharp reduction in costs of export industries after the devaluation of the ruble and the subsequent increase in world prices for raw materials ensured that the raw material export regions retained their leading positions, although the largest agglomerations of federal cities grew even faster. In the 2000s, globalization led to the expansion of the zone of rapid growth: it included the port regions of the west and south, located on the main trade routes.

The new crisis is developing differently - the greatest losses were suffered by those companies and markets that are more involved in the global economy (including through credit mechanisms). Three interrelated processes have a negative impact:

• the financial crisis itself, which hit the banking sector and companies in various sectors of the economy with large external debt; the trust in the financial market necessary for lending has been destroyed;
• a significant decrease in prices for export resources on world markets (prices for oil and non-ferrous metals fell by more than half by November 2008, for wheat, diamonds and steel - by 25-50 percent, gold and timber - by 15-20 percent [2 ] );
• reduction in global and domestic effective demand, primarily in sectors of the investment cycle: exports of metallurgical products fell by almost half, and domestic demand for rolled steel used in construction fell sharply; in the cement industry, both demand and prices fell by 30-40 percent.

The combination of these factors creates different levels of risks for economic sectors. The most problematic group is the banking sector, development (construction), and, to a lesser extent, retail. Development companies have the highest debt burden; they built mainly with borrowed funds. Retail chains were also financed with borrowed funds up to 70 percent. new projects. The second group is the export of raw materials (ferrous and non-ferrous metallurgy, oil and gas, diamond, pulp and paper industries), for which a significant decline in world prices is complemented by large credit debt, although this affects companies to varying degrees; For government agencies, it is mitigated by a guarantee of budget support. At the same time, the risks of ferrous metallurgy are maximum: a strong decline in prices was accompanied by a significant reduction in demand on the world market and in Russia. The third group is import substitution industries with a strong decline in demand (cement industry, automotive industry, especially trucks); for the cement industry, the risks are amplified by a significant reduction in prices for its products.

Russia is characterized by a high spatial concentration of export industries and investment cycle industries, as well as the banking sector, so the emerging crisis is affecting regions to varying degrees. It is still difficult to measure the impact of the crisis in space - Russian regional statistics are not used to rushing (for comparison, the website of the Kazakh Statistics Agency already has preliminary information on gross regional product and unemployment for the first half of 2008, and for Russian regions data is available only for 2006- y). We have to rely on current information in the media and expert assessments based on an analysis of the location of industries and the structure of the regional economy.

Projection of industry risks onto the country's territory

For industries (including raw materials and manufacturing) and the service sector, the spatial projection of the crisis is not the same. The industries with the greatest risks are also heterogeneous; the labor intensity of the industry and the state of specific enterprises must be taken into account. The maximum risks are concentrated in the ferrous and non-ferrous metallurgy not only due to the decline in world prices and demand for products, but also for other reasons: this industry is more labor-intensive, but employment optimization has not been completed in it, in addition, smaller and older enterprises have not received the necessary investments for technological modernization. All this is aggravated by the concentration of metallurgical assets in a small number of regions, especially in the Urals, and the single-industry nature of metallurgical industry cities. The problems of metallurgy are confirmed by current statistics: a reduction in energy consumption by more than 5 percent. for October was recorded in 11 regions of Russia, among which the majority are metallurgical (Chelyabinsk, Lipetsk, Kemerovo, Vologda regions, as well as Bryansk with pig metallurgy and heavy engineering) [3] .

In the coal industry, the most vulnerable are the extraction of coking coals, which are supplied mainly to Russian metallurgical enterprises, as well as the production of coke. The owners of mines in Kuzbass (Kemerovo region) and the Pechora coal basin are mainly metallurgical companies, which will retain both the coal and iron ore assets of vertically integrated holdings. Given the sharp decline in demand for coking coal and the low mobility of miners, reductions in working hours (part-time work, etc.) and wages are inevitable, but the reduction in employment in coal towns and villages is likely to be limited, since the risk of social tension and protests is high. moods.

Unlike metallurgical cities and regions, in the leading regions of the oil industry, already in the early 2000s, employment optimization was carried out, accompanied by a noticeable increase in unemployment in the cities of the Khanty-Mansi Autonomous Okrug. In addition, the mobility of the population of the oil cities of Siberia and the North is much higher than that of the residents of the metallurgical cities of the Urals, since the oil cities are populated by first and second generation migrants. Mobile residents respond more adequately to changes in the labor market situation. Migration outflow from the autonomous districts of the Tyumen region was noted three times: in the first years of the systemic crisis (1991-1993), during the period of ultra-low oil prices (1997-1998) and since 2006 due to a reduction in the supply of new jobs in the labor market. The consequence of the new crisis will be another increase in migration outflow, while the labor intensity of the oil industry is low, and all large oil companies have already optimized employment by outsourcing auxiliary and service enterprises. In addition, in oil regions, companies can reduce tensions in local labor markets by regulating shift work. Compared to oil companies, Gazprom has done much less to optimize employment in the Yamalo-Nenets Autonomous Okrug, but there is someone to take care of it: its problems are the problems of the state.

Pulp and paper mills are also located in single-industry cities, so the risks are comparable to metallurgy. The only difference is that pulp and paper mills have already gone through a strong economic downturn in the early 2000s, their owners have experience of surviving in difficult conditions, large enterprises are more modernized and therefore better prepared for a new crisis.

In mechanical engineering, the first to suffer were manufacturers of trucks, whose production is localized in Naberezhnye Chelny (Tatarstan) and Nizhny Novgorod and is already declining. For AvtoVAZ and other manufacturers of domestic passenger cars, it is more difficult to assess the prospects; in November 2008, the market just began to decline. Much will depend on the dynamics of the effective demand of the population, government policy (an increase in customs duties on imported cars has already been announced) and the timing of the commissioning of new car plants of Western companies. The extent of the decline will become clear only in 2009. Cement production is geographically more dispersed, enterprises are located mainly in small towns, the risks of a market downturn are mitigated by the low labor intensity of this industry.

In general, if the duration of the crisis in Russian industry is limited to a short period (a year and a half), the most acute problems will be localized in single-industry cities and a limited number

regions.

The crisis in the development and service sectors will have the greatest impact on the development of large cities, where these industries are mainly concentrated. The risks for the largest cities of different sizes and status will be different. Moscow is distinguished by its overconcentration of economic resources (see Table 1). The capital accounts for more than 23 percent. total gross regional product (GRP) of all regions; This is a city of post-industrial economy, in the structure of its GRP services reach 80 percent. The concentration of trade and paid services in the metropolitan agglomeration is extremely high - 25-30 percent. of the entire volume in the country. The concentration of investments also remains high, although they have been redistributed within the agglomeration (in the late 1990s, every sixth ruble in the country was invested in Moscow, and in 2006 - every ninth). The metropolitan agglomeration accounts for 20 percent. commissioning of housing in the country. In addition, Moscow has huge funds of its own; its budget accounts for more than 20 percent. of the total budget of the regions of the Russian Federation, while the share of investments from the city budget makes up more than a third of all investments in the capital (from the federal budget - less than 6 percent, that is, six times less). These figures show that the scale of the economy of the largest agglomeration is extremely large compared to Russia and that the capital’s authorities have the ability to mitigate the crisis. In addition, the crisis will somewhat cool the overheated labor market and inflated salary expectations.

Table 1. Share of the largest cities in the main socio-economic indicators of Russia for 2006, in%.

*With the Moscow region.

** Cities with more than a million inhabitants according to the 2002 census.

Compared to Moscow, the share of St. Petersburg is significantly smaller in all indicators and slightly exceeds its share in the population. Nevertheless, crisis risks for the Northern capital are relatively small due to the special attention of the federal authorities. This is not only direct support from the federal budget (in 2006, the volume of federal investments in St. Petersburg exceeded investments from the city budget by 20 percent). To replenish the city budget in St. Petersburg, the legal addresses of several large Russian companies were registered, which now pay taxes to its budget.

Smaller service centers will be at risk during the crisis. Firstly, these are cities with a population of over a million, in which the development of the service sector and the modernization of consumption significantly accelerated only in the 2000s. In recent years, their weight in retail trade has noticeably increased due to the massive arrival of large, including international, retail chains and the growth of effective demand of the population. In addition, thanks to the growth of housing construction, the share of “millionaires” in housing construction has increased. But the main problem remains unresolved - low investment attractiveness: the share of these cities in investments is lower than their share in the population. It is obvious that the financial crisis will slow down the already insufficient influx of investment, and, consequently, the pace of modernization of consumption and lifestyle. In a more obvious form, the same problems are characteristic of smaller regional capitals with a population of over 250 thousand inhabitants [4] , where the expansion of Russian retail chains reached its peak on the eve of the crisis. The country's medium-sized and small cities did not receive the same significant boost in consumer modernization during the economic boom, so they have nothing to lose.

Social consequences: work and wages

The experience of the crisis 1990s showed that in Russia the main form of adaptation to the difficulties associated with the transition to a market was not a reduction in employment (the unemployment rate in the mid-1990s was low), but a large-scale reduction in wages, which in 1995 dropped to 40 percent from the level of 1991 [5] . Unsustainable growth followed, interrupted by the financial crisis, and by 1999 legal wages were little more than a third of their 1991 levels. Given this experience, many experts believe that in Russia the response to the crisis will again be in the form of wage cuts (and excessive ones, given that the economic downturns in the early 1990s and during the financial crisis were less significant than the reductions in wages).

The financial crisis of 1998 resulted in a significant decline in employment for the first time, with the ILO unemployment rate for the country as a whole rising from 9 to 13 percent. Over the years of economic growth, the employment structure has changed significantly. As Vladimir Gimpelson’s research shows, in Russia there has been a steady decline in employment in the formal sector—in large and medium-sized enterprises that account for the bulk of GDP. During 1999-2005 they “dropped” 10 percent. labor force (4 million people) [6] , despite the fact that employment in public sectors, also part of the formal sector, continued to grow. Employment has increased in small enterprises and in the informal sector - the low-productivity and least socially protected part of the labor market, where 45 percent work. busy. The creation of new and modern jobs was hampered by problems of the investment climate, which disincentivized the demand for labor. Despite economic growth, in 2002–2004 there was no decrease in the unemployment rate in the country as a whole or in most regions. Only since 2005 has it begun to decline more steadily, falling in 2007 to a very low level of 5.6 percent.

According to estimates by the Institute of National Economic Forecasting of the Russian Academy of Sciences, by mid-2009 the number of unemployed will increase by 270-340 thousand people [7] , most of the layoffs will affect office workers and officials. With a total number of unemployed people of 5 million [8] , this will lead to a slight increase in the unemployment rate to 7 percent. economically active population, that is, up to the levels of the quite prosperous year 2006. Such figures are difficult to believe given the changes in the structure of employment, namely the growing share of jobs with less social protection, and given that layoffs have already begun in many large and medium-sized enterprises, and this process is developing quite quickly. But still, only with a long recession can we expect the worst - an increase in the unemployment rate to 13 percent, as was the case during the financial crisis of 1998.

Compared to national data, the regional picture is much more differentiated: there is practically no unemployment in federal cities and the Moscow region (1-3 percent), in most republics of the North Caucasus its level exceeds 20 percent, and in Chechnya and Ingushetia it reaches 50-70 percent ., although the reliability of the data for these two republics is low.

Changes in the regional employment picture during the crisis can be assessed using foreign and Russian experience. In EU countries, as the economic situation worsens, unemployment in developed regions is growing faster than in less developed regions, where it is already high. Thus, regional differences are reduced [9] . And in Russia, the last financial crisis somewhat smoothed out regional differences in the level of unemployment due to the fact that in developed regions it grew at a faster pace: in 1998, when unemployment in the country was maximum, the ten regions with the best and worst indicators differed by 2.9 times , in the more prosperous 2002 - 5 times, and in 2006 - 6.4 times. Subsequent economic growth was accompanied by positive changes in the labor market, but in the most problematic regions the situation improved more slowly than in economically developed ones, so regional differences increased. And during the new crisis, regional indicators will change cyclically: the unemployment rate will grow faster in economically strong regions, where it is now low, and more slowly in underdeveloped ones, where a lack of jobs is a common problem.

Unless the downturn and subsequent recession lasts for several years, dramatic changes are unlikely. But in those regions where the share of people employed in industry is large, the risks are higher than in others (see Table 2). Among them, most of all are metallurgical and mechanical engineering, since the labor intensity of these industries is high, and the structural restructuring of employment was slow.

The real problems are concentrated at the municipal level, primarily in single-industry industrial cities. As already noted, cities with unmodernized industrial assets and more labor-intensive industries have the highest unemployment risks. This is where the negative social impacts can be most severe, both in employment and wages. However, according to experts [10] , the main mechanism will still be adjustments or delays in wages, since the reduction in employment will be opposed by regional authorities who fear the growth of social tension.

This scenario has already worked out twice (in the early 1990s and in 1998), but there are doubts that it will be the only one a third time. In single-industry cities of those large companies where employment optimization is far from complete (metallurgical cities and cities of the automotive industry), business has the opportunity to carry it out under the guise of a crisis, and it is unlikely that such an opportunity will be missed in the face of an urgent need to reduce costs. In addition, a strong decline in product prices made it unprofitable to use old, low-performing assets, especially in medium and small cities of the Urals (small enterprises in the ferrous metallurgy, copper, nickel industries, bauxite mining), the European North and Siberia. The owners of such enterprises are already stopping production; examples include the nickel plant in the city of Verkhny Ufaley, the Baikal Pulp and Paper Mill, and the number of such examples will grow. It is important to take into account that, compared to the 1990s, large Russian businesses have established themselves as owners and are therefore ready to more strictly optimize both employment and assets. Regional authorities, no doubt, will try to prevent such measures, but business has a fairly strong negotiating position - “war will write off everything.” A compromise could be significant severance pay or smaller cuts, provided that those remaining will be paid only a low tariff part (the salary consists of a low tariff and numerous flexible additional payments) of wages; it is possible to transfer specialists and skilled workers to other enterprises of the company in the form of rotational employment. However, significant job losses in such cities seem inevitable. The process is somewhat facilitated by the fact that a significant part of those employed in industry is approaching retirement age.

Table 2. Regions with the maximum share of employed in industry of the total number of employed, in %.

Source: Rosstat, author’s calculations.

In federal cities, the dismissal of even a significant number of people employed in the banking sector and other sectors of market services will not have serious social consequences, since agglomerations have a huge advantage - a diversified labor market with a large number of alternative jobs.

A separate problem is the massive release of those employed in construction, mainly migrant workers, including illegal ones. Many of them were not paid by their employers for their last months of work, making it difficult to leave the country. But still, a considerable part of those who have lost their jobs will leave Russia, and this must be facilitated. For others, the authorities of the largest cities are able to provide an alternative to employment in the form of low-skilled jobs in the urban economy. With a high probability, the number of migrant workers and jobs for them will gradually balance out. This applies not only to migrants from the CIS, but also to Russian labor migrants from regions adjacent to the agglomerations, who mainly work in numerous security structures and trade.

In all major cities, employment cuts will be the most common response to the crisis; High mobility in the labor market mitigates social consequences, and in addition, job reductions are easier to implement here: in the dominant area of ​​employment - the service sector - labor relations are more flexible and less formal. In general, the labor markets of agglomerations react faster than others to changes - both positive and negative. The country's largest cities with the most developed service sectors were the first to react to the approaching economic crisis. Already in the first half of 2008, the index of per capita income of the Moscow population showed weak negative dynamics (99.4 percent compared to the first half of 2007) against the backdrop of rapid growth throughout the country (119.6 percent); growth continued in St. Petersburg, but its pace was minimal (101.5 percent over the same period). Operational semi-annual data will be adjusted; a clearer picture will emerge only at the end of the year.

Another trend that largely concerns cities is the announced reduction in the number of civil servants in a number of regions (Tatarstan, Perm Territory and Ulyanovsk Region, Altai Republic, etc.). As some commentators ironically note, there would be no happiness, but misfortune would help. Indeed, since the late 1990s, the number of people working in public administration has more than doubled; This dynamic is a clear example of the ineffective structural transformation of the labor market during a period of economic growth. But the picture differs significantly from region to region. As a rule, underdeveloped republics with a high level of subsidies have the highest share of people employed in management (7-12 percent of the total number of employees). In such regions, this is the most enviable job, nothing can compare with it. A significant reduction in civil servants will create a threat of destabilization, so for such regions it is necessary to seek a reasonable compromise: the costs associated with maintaining redundant bureaucracy will most likely not be as high as those required to overcome socio-political tensions.

The analysis shows that the manifestations of the crisis on regional and local labor markets will be different. In large cities, there will be a simultaneous decline in employment and a decline in real wages, and both to the greatest extent possible. In resource-producing regions and single-industry cities, the main ones, as before, will be various forms of wage reduction (payment of a “naked” tariff rate, delays in payments, etc.) with a moderate reduction in employment due to secondary industries and less qualified workers. But for several metallurgical single-industry towns with the most problematic assets, “hour X” may come—the closure of enterprises and mass layoffs. For underdeveloped regions of Russia that are not included in the global economy, the main mechanism will be a slight reduction in the number of state employees and their real wages, which serves as a “reference point” for other employers, although the reduction will depend on both the rate of inflation and the amount of federal assistance.

Budget risks

Any crisis increases tension in the budget system, but even here the risks will be different for different regions, since in Russia they are sharply differentiated by the level of budgetary security. The impact of the crisis on regional budgets depends on three factors:

• stability of sources of the budget's own revenues, which is most important for economically developed regions;
• the credit burden of budgets, which is also a problem in more developed regions, since the rest were not allowed to borrow;
• stability of federal assistance, which is vital for underdeveloped recipient regions.

In regions where the basis of the economy is the export industry, especially in single-industry ones, the stability of budget revenues depends on the situation at large enterprises. In the structure of budget revenues of such regions, the share of income tax is high, this is especially typical for regions of metallurgical specialization - Lipetsk, Vologda, Chelyabinsk regions, Krasnoyarsk Territory (see Table 3). For the largest Russian companies in the oil and gas sector and natural monopolies, the main center of profit has long been Moscow, where their headquarters are located, so the contribution of income tax to the capital’s budget is maximum. In addition to commodity companies, profits in Moscow are provided by the banking sector (80 percent of banking assets are concentrated in the capital), which has also fallen on hard times. The transfer of some companies to St. Petersburg also made its budget dependent on the economic state of large Russian businesses, although on a much smaller scale than is the case in Moscow. For all these regions, the problem of filling budgets in 2009 will become noticeably worse.

Table 3. Regions with the highest share of corporate income tax in consolidated budget revenues in 2007, in% (RF average - 31.6%)

Source: Ministry of Finance, author’s calculations.

At the same time, the metallurgical regions, which have lived well in recent years, will suffer more than others, since income taxes mainly go to the regional budget (most metallurgical companies are “registered” in the regions). For the regions of the fuel and energy complex, the most important source of budget revenue was the mineral extraction tax (MET), which was previously distributed between the federal budget and the regions in a 50:50 ratio, but already in the mid-2000s it was almost completely centralized into the federal budget, that is, the main source Budget revenues were taken away from them even before the crisis. For oil and gas regions, corporate income tax plays an important role, but a significant part of the profit is recorded at the place of registration of the company's headquarters, that is, in Moscow. This is confirmed by budget statistics: in 2007, of all taxes collected in the oil and gas producing autonomous districts of the Tyumen region, 76-82 percent. went to the federal budget, and in the almost single-industry metallurgical regions of Vologda and Chelyabinsk regions, the share of taxes going to the federal budget amounted to 29-32 percent, in Lipetsk - only 9 percent [eleven] . The budgets of these regions will suffer significant losses during the crisis, as production volumes and profits of metallurgical companies are already declining.

The second risk is not sectoral, that is, not related to the inherited structure of the economy, but “man-made.” It is due to the risky borrowing policy pursued by some regions and the investment funds they created. The Moscow region, which was the largest sub-federal borrower among the regions of the Russian Federation, especially distinguished itself. The Mosobltrustinvest fund, created by the regional administration, actually went bankrupt, and the total debt of the region exceeded half of its budget for 2007 (see Table 4 on page 58). The federal government is unlikely to allow a major region to default and will likely help refinance the debt. In the Yaroslavl and Samara regions, repayment of loans taken to co-finance infrastructure projects is also a big question. In Yakutia, taking into account the 30% decline in world prices for diamonds, the problem is even more acute, as is the case in the Belgorod region with its metallurgical specialization. They all become dependent on federal assistance. For other constituent entities of the Russian Federation, the problem of debt repayment is less acute.

Table 4. The volume of debts of the subjects of the Russian Federation (as of October 1, 2008) and the ratio of debt to budget revenues for 2007

* Total borrowings of the constituent entities of the Russian Federation and regional investment funds created by the administrations of the constituent entities of the Russian Federation.

Source: Ministry of Finance, author’s calculations.

Thanks to accumulated financial resources and the relatively stable state of the federal budget, the federal government can provide stable assistance to less developed regions. The share of transfers to the budgets of constituent entities of the Russian Federation in recent years was 13-14 percent. from all federal budget expenditures. However, for the vast majority of the least developed republics, the share of federal assistance in budget revenues is much larger, and it has not decreased during the years of economic growth (see Table 5). This indicates the ineffectiveness of equalization policies and the stagnant nature of “dependency.” The Federal Center actually gave indulgence to regions that did not stimulate internal development resources.

Table 5. Regions with the maximum share of gratuitous receipts from the federal budget in the revenues of the consolidated budget of a constituent entity of the Russian Federation, in%.

Source: Ministry of Finance, author’s calculations.

If the crisis lasts no more than a year, we can hardly expect noticeable changes in the existing redistribution policy. But if the depression lasts for a long time, it will hardly be possible to increase assistance to the troubled republics, and then the federal government will have to choose priorities. They are not difficult to determine: in 2007, the budget of the Chechen Republic was one third higher than the budget of the Stavropol Territory (63 and 47 billion rubles, respectively), although the population of the region is 2.5 times larger. The per capita budgetary provision in Chechnya exceeds the national average by 65 percent, and in comparison with all other regions of the Southern Federal District, including the most developed, by 2-3 times. This priority is unlikely to change, and it is not just a matter of the need to finance the restoration of infrastructure destroyed by the war. Political stability is expensive, and the federal authorities will certainly find the money. But it was not possible to fill all the pain points of the North Caucasus with money even in the most prosperous years: the budget of Dagestan in 2007 was only 60 percent. from the budget of Chechnya, although its population is 2.5 times larger, and in terms of per capita budgetary provision the lag was more than three times. In the context of a protracted crisis, the state will not have enough financial resources to mitigate the crisis in the republics of the South, but the economy of Chechnya will be supported “until the last bullet.”

Crisis reorganization of regional policy: every cloud has a silver lining

A crisis always plays a sanitizing role, rejecting ineffective priorities of regional policy. But at the same time, there are projects that are unlikely to be affected by the crisis. These are projects designed for political effect - the preparation of the Olympics in Sochi and the APEC summit in Vladivostok. The political significance of these projects for the federal authorities is so great that resources for their implementation will be allocated even to the detriment of vital tasks. Unfortunately, the crisis cannot reduce the costs of the demonstration policy of “rising Russia from its knees.”

But all other stimulating policy priorities will most likely be revised. The economic growth of the 2000s created the conditions and resources for the transition from a purely equalizing policy to stimulating regional development. Since 2005, regional development strategies began to be developed, highlighting the so-called “growth engines” regions, in order to then join weaker neighbors. The next step was the resuscitation of the Soviet priority of developing the east of the country, large-scale industrial and infrastructure projects beyond the Urals. For example, the development program for Yakutia includes metallurgical plants and cascades of hydroelectric power stations with the necessary investments of 20 billion dollars, which is one and a half times more than all direct foreign investment in Russia in 2006. The Northern Sea Route was again declared strategically important, although the population and economy of the Far North had decreased significantly. Despite the crisis state of transport infrastructure in the main settlement zone, where more than 90 percent live. Russians, the state priority has become the development of infrastructure in the zone of development of new natural resources. However, relying on resource wealth is dangerous due to market fluctuations in prices and is fraught with stagnation due to the “resource curse.” The onset of the crisis highlights these risks, and, most likely, the likelihood of implementing extremely costly resource projects will sharply decrease.

In addition, the Ministry of Regional Development began planning the specialization of regions for decades to come in the style of the State Planning Committee. Regions are actually prescribed industry specialization, regardless of what the prospects for the corresponding industries are in a market economy. The balance between dirigiste and institutional-liberal approaches in regional politics has clearly shifted towards the first. But dirigiste policies and public investments require large financial resources, which will not be available in the coming years - a crisis has arrived.

Crises are sobering, so there is hope that an understanding of the “corridor of opportunity” will emerge in Russian regional policy and a more rational approach will prevail. Depopulation, the gathering of the population into the populated regions of the country and the largest agglomerations, the lack of human and financial resources for extensive development will force us to strictly define priorities. In particular, we will have to admit that it is impossible to carry out new development of the eastern regions and mass migration of migrants there; it is impossible to turn back the clock and pretend that resource limitations do not exist. Life will force us to focus on the development of large city centers, ports and infrastructure corridors that “support” sparsely populated areas. The state will provide only targeted infrastructure support to the most effective resource projects financed by private business.

So far, the Ministry of Regional Development has no idea that the policy of stimulating regions should be based on their competitive advantages. Meanwhile, such a policy is necessary so that areas of rapid growth can accelerate the development of the entire country. The growing competition between regions for human and investment resources is clearly underestimated, although it is this competition, and not the plans of ministries and departments, that will determine spatial development in the future.

The crisis will accelerate the modernization of institutions responsible for regional policy, but this is a long-term process. Instead of attempts at state dirigisme, it will be necessary to solve the problems of maximizing the competitive advantages of regions, coordinating territorial strategies of the state with business strategies, and mitigating market failures through effective redistribution. In the meantime, we see another transformation of the role of the Ministry of Regional Development. Just a year ago, the expert community was discussing what the creation of Dmitry Kozak’s “super ministry” with extensive powers would lead to. The answer became clear during the financial crisis - the Ministry of Regional Development is once again turning (as it already was in the 1990s) into an institution with vague goals and powers, with insignificant financial and hardware resources, which is unlikely to allow the implementation of dirigiste projects. “Cyclicality” in the sphere of public management of regional development (multiple changes in the name of the ministry, its reorganization, dissolution and revival) is perhaps even more regular than the cycles of the world economy. But, unlike economic crises, its healing effect tends to zero. The state has not yet recovered from dirigisme, has not yet gotten rid of the feeling of omnipotence, and is not yet ready to act effectively in a clearly understood “corridor of opportunities.”

* * *

A crisis, like any drastic change, heightens interest in forecasts, but given the obvious lack of information, this is not a very rewarding task. It is a little easier for regionalists to make predictions, because the development of space is extremely inertial. If the crisis is limited to a year, its regional projection will be blurred, and the recovery from the crisis will again confirm the advantages of the regions included in the global economy - they will grow faster because they have competitive advantages. The political consequence of the crisis will most likely be a revision of government investment programs. Although priorities in this area will be determined primarily by geopolitical factors, the number of high-cost “development” projects in Siberia and the Far East will decrease. Perhaps the authorities will learn to make more rational decisions, despite the lobbying efforts of large companies, even state-owned ones. The previous financial crisis taught us to reduce the budget without a deficit...

If the crisis is deep and long-lasting, its consequences for regional development will be multifaceted:

• the worst enterprises of ferrous and non-ferrous metallurgy will cease to exist, which will hit the regions of their concentration (the Urals, to a lesser extent the North and eastern regions);
• unemployment will increase significantly in single-industry cities with more labor-intensive export industries and some import substitution industries (mechanical engineering);
• there will be a reduction in employment in management, but it is unlikely to be significant where this area is especially inflated - in underdeveloped regions, since in such regions these are the most valuable jobs in the labor market;
• the migration outflow from the leading oil and gas production regions located in the Northern zone (autonomous okrugs of the Tyumen region) will increase and become more stable;
• the modernization of consumption and lifestyle will slow down in cities with a population of over a million, and especially in other large regional centers with a population of over 250 thousand people;
• funding for the state’s high-cost and ineffective investment policy for the development of the eastern regions will be reduced.

With the exception of the slowing modernization of consumption, all other trends contribute to the rehabilitation of the economy and local labor markets, although at great cost to the population. The authorities’ task is to dampen these costs for households as much as possible; As for business, it generally benefits from such reorganization.

A slowdown in consumer modernization could lead to an increase in autarkic, even xenophobic sentiments, already growing in the country. The weakening of the global openness of the economy and society of large cities, the decline in the modernization potential of their residents is perhaps the biggest risk for the Russian space, but this gloomy prospect can only be realized in special political conditions.

For the state's investment policy, the revision of over-expensive development priorities is an undoubted benefit, but the entire historical experience of Russia shows that there will certainly be ineffective expenses. Both in a relatively short crisis and in a long one, all forces and resources will be thrown into emergency mode to improve the image of the authorities and the country. And the construction of the Olympic Village may eclipse the history of the Potemkin villages.

[1] See: Gritsai O.V., Ioffe G.V., Teivish A.I. Center and periphery in regional development. M.: Nauka, 1991.

[2] Expert. 2008. No. 40. P. 20.

[3] Demand for energy is falling // Vedomosti. 2008. November 5. S. B1.

[4] The population limit of the country’s cities with more sustainable development is highlighted in: Nefedova T.G., Treyvish A.I. “Strong” and “weak” cities of Russia // Poles and centers of growth in regional development / Ed. SOUTH. Lipetsa. M.: IG RAS, 1998.

[5] Review of social policy in Russia: early 2000s / Ed. T.M. Maleva. M.: NISP, 2007. P. 219.

[6] Gimpelson V. Election work // Vedomosti. 2007. 16 Jan.

[7] In working order // Vedomosti. 2008. November 7.

[8] Rosstat data as of the end of November 2008.

[9] Martin F. Geography of inequality in Europe // SPERO. 2008. No. 9.

[10] See, for example, the opinion of Vladimir Gimpelson: Krans M. Staffing according to the crisis option // RIA Novosti. 2008. 10 Oct.

[11] Such a low share is most likely explained by the fact that VAT payments are made by the Novolipetsk Iron and Steel Works through structures (legal entities) registered outside the region.