1. Socio-Economic Development of Russia's Regions:
the results of a turbulent decade and prospects
Natalia Zubarevich
MSU

2. Economic development of Russia's regions depends on:
Macroeconomic dynamics (periods of growth and crises)
The objective competitive advantages: resources, agglomeration effect etc.
Contradictory institutional factors

3. Long term dynamics of Russia's development, % to 1990/
Long term dynamics of Russia's development, % to 1990
GRP
Real money incomes
Real wages
Real pensions

4. The current crisis socio-economic trends stagnation or slow growth Dynamics to the same quarter of the previous year, %

5. Russian regions economic inequality GRP per capita (adjusted for prices differentiation),% to Russia average
Leaders
Sakhalin,Tumen, Moscow
More developed
Median group
Outsiders

6. Industrial output dynamics in Russia (1990 =100%)

7. Regions' industrial output polarization in post-Soviet period (mainly in 1990-th) Industrial output dynamics, 2018 to 1990, %
depressive regions
Center
North-W
South
N.Cauc
Volga
Urals
Siberia
Far East

8. Industrial growth during last 10 years was mainly due to food, military industries and new oil&gas extracting territories Industrial output dynamics, 2018 to 2008, %
Center
North-W
South
N.Cauc
Volga
Urals
Siberia
Far East

9. Spatial polarization of investment dynamics is higher compared to GRP dynamics Number of regions with different dynamics of investment (2018) and GRP (2016) to 2008, %

10. Real investment drop -5%, 2018 to Moscow and the main oil&gas extracting regions kept growing Investment dynamics, 2018 to 2013,%
Center
North-W
South
N.Cauc
Volga
Urals
Siberia
Far East

11. Investment leaders are nearly the same in the last 10 years Investment share in 2008 and 2013 , % of Russia total (=100%)
2008
2013

12. Investment concentrates in the regions with the big competitive advantages (Moscow agglomeration +oil&gas extracting) and in geopolitical priorities The share of Moscow aggl. increased to 20% by Investment spatial structure in 2018, % ( the same structure)

13. Foreign direct investment drop seems to be a long trend FDI $ bln
TNK-BP /
Rosneft
CNPC

14. The most regions are still oriented on Europe in their foreign trade (The main foreign trade direction)
Europe
CIS countries Asia

15. Labor market: Long term employment shift to informal sector
Unemployment rate is extremely low (4,8% in 2018)
% of labor force
informal employment
unemployment rate

16. Unemployment rate is low in the most regions exepting Nothern Caucasus and Siberian republics. Factors preventing unemployment growth are the age structure, short-time employment, informal employment growth, labor migration Unemployment rate in , % (ILO methodology)
Center
North-W
South
N.Cauc
Volga
Urals
Siberia
Far East

17. Informal employment share is higher in the underdeveloped or depressive regions and in the southern ones Share of informal sector employment in 2017, % Russia total =20%
Center
North-W
South
N.Cauc
Volga
Urals
Siberia
Far East

18. Money incomes decline: -10% (2018 to 2014) The new Rosstat metodology estimation -8% Slowdown to 2010 real incomes level is painfull for population Real money incomes dynamics, %
Crimea
Sevastopol
Center
North-W
South
N.Cauc
Volga
Urals
Siberia
Far East

19. Population incomes dependence on the state benefits/subsidies has grown from 11% to 20% Population money incomes structure, %

20. Poverty rate growth during the last crisis was moderate due to subsistence level (poverty line) very slow raise Poverty rate, %
Center
North-W
South
N.Cauc
Volga
Urals
Siberia
Far East

21. Self-assessment of poverty is much more higher - 39% Levada center poll
there is not enough
money for food
there is enough
money for food but
not enough for clothes

22. Demography. Russian population shrinks again since Strengthening of natural decline and migration shrinkage Migration balance drop by 40%
Thousand population
Migration
Total Growth/Decline
Natural Growth

23. Depopulation increases Natural growth/decline 2018

24. Far East migration outflow goes on "Turn to the East" seems to be myth Natural growth/decline and migration balance per 1000 population
Center
North-W
South
N.Cauc
Volga
Urals
Siberia
Far East

25. Regional budgets Budget revenues stagnation was replaced by fast growth only in 2018 due to profit tax + transfers growth Regions' budgets dynamics to the same period of the previous year, %

26. More than 40% of regions are highly dependent on federal budget transfers. Chechnya - 80%, Tyva - 77% The share of transfers in the region's budget revenues, %
Center
North-W
South
N.Cauc
Volga
Urals
Siberia
Far East

27. Geopolitical priorities of budget transfers distribution Chechnya's share is 3-4% of the total amount of transfers compared to the less 1% of population Regions share in transfers and population, %

28. Budget spendings are higher only in the richest regions and geopolitical priorities (Crimea + Sevastopol) Regional budget spendings per capita (adjusted prices) after transfers redistribution, % to Russia average (=100%)
Moscow
Sakhalin
Tyumen region
& aut.districts
St-Petersb.
Kaliningrad
Crimea
Sevastopol
Center
North-W
South
N.Cauc
Volga
Urals
Siberia
Far East

29. Prospects Economic stagnation or slow growth
Money incomes drop will be replaced by slow growth +1%
Spatial development polarization: investment concentration in the Moscow agglomeration and the main oil&gas extracting regions
Long term negative effect of sanctions for FDI
Gap between poverty rate statistics and population perceptions
Strong dependence on transfers for 40% of regions
Federal authorities increased transfers to regions in 2018 trying to solve problems of public discontent but …

30. Public attitude to the state policy Things are going in the wrong direction – 40%(May) Levada Center opinion polls, %