While the Russian economic system de facto continues to rely mainly on energy resources and export, discussions about the country’s development strategy focus on alternative, innovation-driven models, in line with President Medvedev’s declared commitment to the country’s modernization.
Last winter, Russian Prime Minister Vladimir Putin launched a public debate to generate ideas for revising Strategy 2020, the government’s mid and long term economic development plan. Prominent figures from major universities and state supported agencies were invited to form 21 expert groups to discuss a variety of issues from the economy, innovation, social and environmental policies to the reform of pension funds and natural monopolies as well as of the country’s educational system and federal organization.
“Russia must totally integrate itself into the global economy. The alternative is to build an isolated system like in Soviet times. Not only would this be politically unacceptable, it is unlikely to be even possible given the current resource limitations,” abruptly declared Igor Agamirzyan, Chairman of the Russian Venture Company, speaking at an expert group working on innovation based economic growth last Friday.
“In between, the model of partial integration of recent years has proven exceptionally inefficient and risky.”
One of the few successful examples of full integration is provided by Russian software programmers working for international companies. “When our country imports mobile phones, a part of the added value – even if small – was provided by Russian specialists, and this value is poured into our economy,” said Agamirzyan.
The expert group also acknowledged the important steps that have been made to develop an innovation driven economy. Among the newly available tools for accessing creative energies are university incubators, tax breaks, increased support from the best universities and attempts to develop innovation in state owned companies as well as the public sector.
Technoparks or waxworks?
But government policies also pose serious obstacles on the way to modernization. “For the last twenty years, we have seen only hesitant and uncompleted reforms with no major breakthroughs,” said Leonid Gokhberg, Vice Rector of the Higher School of Economics. “For example, the innovation structures that we have created are just waxworks: the majority of these technoparks and special economic zones are not really functioning.”
Instead of a clear and precise innovation strategy including consistent goals and means, the state sends “uncoordinated signals,” said the experts. Government bodies tend to act individually and there is no unified budget planning system. Officials demand immediate results in matters that should be considered in a long-term perspective.
Gokhberg also expressed concern about the absence of reaction to important international trends. For instance, he noted that the recent US government decisions to favor the move to phasing out cars that run on gasoline “have remained almost unnoticed in Russia, whereas this could lead to a 20% decrease of US oil products import as early as 2020.”
Among the two scenarios provided by the expert group, the first one, called the ‘inertia scenario,’ consists in continuing on the path of partial changes with narrow impact. No serious breakthroughs should be expected in this case, the experts warn. Russia’s economic, social and technological gap with global trends will continue and the country will be ultimately be left on the periphery of the world economy.
In spite of GDP growth, “Russia’s position in competitiveness rankings have continued to deteriorate in recent years,” Agamirzyan pointed out. “There is no alternative to an innovation based development model for our country today.”
Innovation beyond tech sectors needed also
The second scenario aims to ensure the country’s long term competitiveness with thorough reforms of Russia’s legal and research systems and in the parameters of professional and technical education.
Though corporate investment in R&D and modernization is far from being insignificant today, the introduction of innovation on a more massive scale is necessary. According to the experts, this implies not only a range of improvements in the sphere of business innovation but in government as well, with more responsibility given to regional authorities and business associations.
Priorities in the long term scenario for innovation strategy would shift from energy, aviation and other traditional industries to newer high tech industries and service sectors. Such low technology sectors as the forestry and food production should in no way be neglected. The market for children’s food is much larger than the airplane construction market, for instance, but the need to support innovation in such sectors is completely ignored by the government today, the expert group notes.
At an international forum dedicated to knowledge based economy held in St. Petersburg in May, representatives of the research and business communities offered even more concrete recommendations favoring research and innovation in the country. Among them were, in particular, changes in insurance regulation, tax and customs legislation as well as the legal environment for venture investment.
Sources: STRF.ru
