The vast territory of the Russian Federation determines the emergence of the most ambitious, and at the same time promising ideas for harnessing the capabilities of various regions. Among the places where such initiatives can be implemented in large numbers is the Far East. Due to what advantages can this region be built dynamically? What are the prospects for the development of the Far East?
General characteristics of the Far East
The Far Eastern region of Russia is a territory that is important both in the military-strategic aspect and in the economic one. The total area of this region is about 36% of the territory of the Russian Federation. The development prospects of the Far East are associated with the presence of a huge amount of natural resources. At the same time, the practice of developing the region’s capabilities is complicated by the underdeveloped infrastructure, as well as population migration.
Remoteness from Moscow, the political and financial center of the Russian Federation, is also sometimes considered as a constraining factor in the development of the Far East. The current concept of the foreign policy of the Russian Federation involves strengthening the country's position in the Asia-Pacific region. The successful implementation of this task involves solving the problems noted that are characteristic of the Russian Far East, stimulating the economic recovery of the constituent entities of the Russian Federation located here. Therefore, the state pays special attention to the region.
Competitive Advantages of the Far East
The prospects for the development of the Far East are largely related to its competitive advantages over other parts of Russia. These include direct geographical proximity to the large markets of the countries of the Asia-Pacific region - China, South Korea, Vietnam. The economy of these countries is growing steadily. The second most important competitive advantage that the Far East possesses (the prospects for the development of this territory are based on it, perhaps to a certain extent) is the availability of a large number of natural resources: coal, oil, gas, iron, non-ferrous metals, and wood. The third competitive advantage of the region lies in the diversity of the climate. This determines the possibilities for the successful use of the territory of the Far East for agricultural development.
Factors for the successful development of the region
Under what conditions can the development prospects of the Russian Far East be realized? First of all, significant investments are needed in infrastructure - transport, energy. The next most important area of work is stimulation of business development with the goal of a general increase in the level of capitalization of the regional economic system, growth of population incomes and tax payments to the budget. The solution to this problem is adjacent to another important aspect of the state’s activities in the framework of the development of the capabilities of the Far East - the formation of strong market demand in this region.
Another significant area of work for the authorities is to increase the comfort of citizens living in order to stop migration to other parts of the Russian Federation and, conversely, make the Far East attractive for moving from other entities.
Toolkit state
What practical tools to implement the prospects for the development of the economy of the Far East does the state have? First of all, researchers rank resources as those that allow them to form special economic clusters in the region that are characterized by a high degree of investment attractiveness - in particular, for foreign partners. The next tool that the authorities have is the opportunity to significantly increase the income of part of the population working in the public sector, by indexing the corresponding labor compensation. Due to this opportunity, the state can stimulate the growth of solvent demand in consumer markets, as well as contribute to strengthening the attractiveness of the region for the migration of citizens from other regions of the Russian Federation.
A significant amount of financial resources through which the prospects for the economic development of the Far East can be realized is concentrated in the hands of private businesses aimed at constructive interaction with the authorities. At the same time, many analysts believe that the corresponding mood is becoming more noticeable due to the sanctions of Western countries against Russia. Entrepreneurs from the Russian Federation, who do not have access to foreign markets due to artificial restrictions, are one way or another reviewing the directions of their activities in favor of investing domestically. The Far East may be an attractive region for them in terms of making promising financial investments.
International Partnership in the Far East: Russia and China
Many foreign partners of the Russian Federation are already showing interest in contributing to the development of the Far East. Among the largest - of course, China. For example, in 2013, the volume - when there were no Western sanctions - the trade turnover between the Far East and China amounted to more than 12 billion dollars. Corresponding indicators have every chance of rapid growth, firstly, due to natural economic reasons, which consist in harnessing the capabilities of the Far East, and secondly, due to an additional incentive to further increase the turnover between the Russian Federation and China due to Western sanctions.
By 2020, trade between China and Russia is expected to reach $ 200 billion. A significant percentage of it will probably be in Far Eastern projects, to which the famous Power of Siberia gas pipeline is directly related. The one that will be built on the basis of the agreements of the Russian Federation and China signed in 2014. It is impossible to say in a nutshell about what prospects for the development of Siberia and the Far East are opening in connection with the signing of the corresponding agreement. But if you try - the most ambitious.
But for now, let's continue about the Far East. What other states express their readiness to cooperate with the Russian Federation in this region?
Far East and South Korea
South Korea is also interested in exploring together with Russia the opportunities offered by the Far East. Prospects for the development of cooperation between the Russian Federation and South Korea are mainly related to the industrial sphere. The trade turnover between the countries in 2013 was comparable to the figures for cooperation between the Far East and China and amounted to about $ 5 billion.
It is noteworthy that for the implementation of some projects, specialists from North Korea are also invited to work in Russia. Perhaps this will be an additional factor in the rapprochement of the two states in which one people live.
Far East and North Korea
Actually, direct cooperation between the Russian Federation and the DPRK is also actively developing. At the end of 2014, trade between the countries showed modest figures - about $ 30 million. But this, however, is 70% higher than in 2013. About 25 representative offices of companies from the DPRK are present in the Far East. The North Korean state has greatly simplified visa criteria for Russian entrepreneurs.
Far East and Japan
Japan has traditionally been a major trading partner of the Russian Federation. Due to the geographical factor, the Far East is among the key regions where relevant communications are being implemented. The prospects for the development of the Russian-Japanese trade partnership have great potential. True, now their practical implementation is likely to be very difficult due to the fact that Japan has joined Western sanctions. At the same time, experts believe that there are chances to normalize cooperation between the two countries, and they are not bad.
What other states is the Far East actively collaborating with? The prospects for developing partnerships, in particular with Vietnam and Singapore, are assessed by experts as very positive. So, in 2013, trade with both countries totaled about $ 300 million. By the way, not one of them shows public interest in following the line of the West with respect to the Russian Federation. Therefore, there is every chance of further growth in cooperation between the Russian Federation, Vietnam and Singapore in the Far East. In the future, in the region, it is possible to establish partnerships between the Russian Federation and a number of other states - India, Latin America, South Africa.
Far East and USA
The largest economy in the world is considered one of the leading initiators of sanctions against the Russian Federation, but before the relations between Russia and Western countries in the foreign policy arena worsened, the prospects for cooperation between the Russian Federation and the United States in the Far East were quite obvious to many experts. So, there was an American interest in building industrial enterprises, infrastructure facilities, residential buildings, and investing in agriculture. It is difficult to say how possible the resumption of cooperation between Russia and the United States in this region again. But many researchers believe that private American corporations - probably not an example, probably to the US government - continue to consider the Russian Federation as a completely reliable partner, including in the aspect of implementing promising initiatives in the Far East.
Far East and the EAEU
Among the most significant and positive factors that may affect the development of the Far East are the integration of the economies of the Russian Federation and the EAEU countries: Belarus, Kazakhstan, Kyrgyzstan, Armenia.
The corresponding area of partnership between states may involve initiating projects in various regions of the common economic space - including the Far East, despite the considerable geographical remoteness of this part of the Russian Federation from its allies. According to researchers, entrepreneurs from the EAEU states may well make the most significant contribution to the development of the economic system of this Russian region.
Government program
Problems and prospects for the development of the Far East are being studied at the state level. As a result of many years of work, the authorities developed a strategy for the socio-economic development of the Far East, as well as the Baikal region. This initiative was approved in December 2009. It should be implemented before 2025. Having studied the problems and prospects of development of the Far East, the state set the task - to form a socio-economic system in the region that can ensure a high standard of living for citizens living in it.
The total amount of investments, which is supposed to be directed to the implementation of the program, is about 411 billion rubles. As a result of its completion, it is planned to create 69.9 thousand jobs in the region and increase the volume of GDP in the corresponding part of the Russian Federation by 2.6 times, the volume of goods shipped - by 2.3 times, the total investment - by 3.5 times, the number citizens belonging to the category of economically active population - 1.1 times.
