1. Russian mono-sectoral cities scale of the problem, development trends, crisis management policy Natalia Zubarevich Moscow State University

2. Mono-Sectoral cities - the heritage of industrial planned economy. What is the size of the problem? 150-160 BB mono-sec.cities - 14% of Russian cities - 11% of urban population 330, including 223 cities and 107 small towns & settlements – estimation of Regional Development Ministry 2009 460 mono-cities (45%) in the Soviet period Total number of Russian cities - 1090

3. Big Business Mono-sectoral Cities: core and peripheral

4. Specialization matters! Industrial output dynamics, % to 2008 Regions with biggest share of mono-sectoral cities Oil&gas extracting industry Non-ferrous metallurgy, Fertilazers, Pulp industry MetallurgyEngineering

5. Federal subsidies and credits were given to 35 MSC in 2010 + 15 MSC in 2011

6. Contradictory measures Total support – 27 bln.rubles per year (700 mln. EUR) in 2010 and 10 bln. rubles in 2011 Nontransparent criteria of MSC choice for support and money distribution Dominating goal is to keep employment Lack of money for infrastructure and human capital modernization, mobility growth Lot of papers needed to get subsidies: complex investment plans (CEP). Some cities reject a MSC status to escape expensive CEP preparing

7. Are there any results of the MSC crisis management? Mono-sectoral cities monitoring - 2010 Ministry of Regional Development No positive changes in development Population decline - 4,4% Work force decline - 6,4% Investment decline - 31% (from 715 to 493 bln. rubles) Average wage in MSC - 16% less compared Russian average (17,6 and 21 thous.rubles) Better results in employment growth Number of unemployed - 40% decline (from 299 thous. people in March 2010 to 180 thous. people in Jan. 2011) Registered unemployment rate more than 5%: - 26 MSC (2011), - 60 MSC (2010) Registered unemployment rate is still higher in 129 MSC compared Russian average (2,1%)

8. What should be done? Individual approach to MSC problems solution taking into account geographical location, number of population, human and social capital, depopulation factor etc. Transformation MSC to local centers, service functions development instead of new industries planning Local community activities empowerment Mobility growth stimulation including mortgage program (housing credits) implementation Monitoring of social risks Honest talking to people instead of unreal promises