KNOWLEDGE ECONOMY FORUM IV Istanbul, March 22-24, 2005 Country Exercise: Russia

Diagnosis for Russia: Key issues to address Russia’s readiness for Knowledge Economy: looking at three KE “pillars” of four Missing link Need for a national development strategy and tools to implement it

Diagnosis for Russia: KE Readiness - Business Climate Underdeveloped legal system, high regulatory barriers Poor rule of law, low security of property rights Weak financial system, poor access to credit and to capital markets High level of black economy Source - KAM, The World Bank

Diagnosis for Russia: KE Readiness - Human Resources Poor link to labor market Lack of flexibility of educational system Weak Life Long Learning Insufficient ICT skills and experience of ICT use Low number of Internet users (2004, half year audience: Russia - 16%, EU - 50%, Scandinavia - 70%) Source - KAM, The World Bank

Diagnosis for Russia: KE Readiness - Innovations Low share in world science intensive industry markets (2003 - 0,3%) Low share of innovatively active enterprises in the economy (Russia, 2003 - 9,5%, EU, 2000 - 50%, Germany, 2000 - >60%) Low R&D spending in private sector (Russia, 2003 - <14%; Germany - >60%) Innovation gap between R&D and productive sector Source - KAM, The World Bank

Diagnosis for Russia: KE Readiness - Summary Source - KAM, The World Bank

Diagnosis for Russia: Key Causes of Problems Dependence on natural resources Growing socio-economic divide between social strata and territories Social passivity, very low preparedness of population to get involved in decision making Lack of development vector for the country

government, business, civil society, research & education community Missing Link Knowledge Economy Information Infrastructure Business Climate Human Resources Innovation System Partnership of key stakeholders: government, business, civil society, research & education community

Objective of the Proposal To promote consensus building on development goals To make a national Knowledge Society development strategy a part of political agenda To address the key stakeholders (government, business, civil society, academia) Respective government bodies at federal and regional levels Renowned professional business associations Influential NGOs Leading research & education institutions etc. To gain critical mass of KE actors

Description of the Proposal Preparing a national strategy and action plan for KE development based on a comprehensive KE readiness assessment - $1,000,000 Build on a distinct shift to knowledge society and innovation intensive economy in the recent President’s statements the address by a group of outstanding figures to the President

Description of the Proposal Preparing regional strategies and action plans for KE development - $500,000 x 89 Build on already existing regional initiatives and ongoing programs in Russian regions e.g. Moscow, Tomsk Region, Republic of Mordovia, etc.

Description of the Proposal Creating a monitoring system for strategies and action plans implementation - $3,000,000 per year Build on already available products: Knowledge Assessment Methodology (WB), methodologies for Russia and Russia’s regions e-Readiness assessment (group of experts coordinated by IIS.RU), and a Knowledge Economy Readiness Assessment (IIS.RU & UNECE), etc.

Description of the Proposal Building nation-wide partnership for KE strategy and action plan implementation - $1,000,000 per year Build on the Russian e-Development Partnership (over 260 organizations in 29 regions of Russia, 10 self-managed regional segments); on the newly established Russian Socio-Economic Forum led by M. Gorbachev; etc.

Description of the Proposal Promoting and coordinating available activities - $500,000 per year Build on ongoing programs and initiatives of development communities; on collaborative tools like Russia Development Gateway Network; etc.

Institutions involved Russian Ministry for Economic Development and Trade - business climate Russian Ministry for Education and Science - human resources, innovations Russian Ministry of IT and Communications - information infrastructure Regional governments Partnerships of key stakeholders

Measuring Progress Share of budget and matching funding for KE strategies/action plans preparation and implementation Number of regional KE strategies adopted and programs launched Level of inclusiveness (variety and balance of stakeholders involved)

Background Information Russian Federation Delegation Irina Cherdantseva (Department of Economy, Tomsk Region Administration) Tatiana Ershova (IIS.RU) Yuri Hohlov (IIS.RU; e-Moscow Program) Maria Sigutina (Russian State University for the Humanities) Oleg Sokolov (Department of Science and New Technology, Government of Republic of Mordovia) Contacts: info@iis.ru