On Russia’s Long-Term Economic Strategy

DOI: 10.33917/es-2.194.2024.70-77

Overcoming the main problems of the Russian economy based on domestic demand and potential for the internal development will require a significant change in its structural proportions. Necessary transformation, spurred by defence needs, is already underway with results surprising the West, which had hoped that unprecedented economic sanctions would break Russia’s resistance to its dictates. Moreover, the comprehensive aggression of the West against Russia seems to be backfiring and, instead of destroying it, contributes to its strengthening, creating conditions for a powerful economic breakthrough of the Russian state.

References:

1. Putin: Rossiya nakhoditsya v avangarde sozdaniya spravedlivogo miroustroystva [Putin: Russia is at the Forefront of Creating a Fair World Order]. RIA Novosti, 2023, 28 noyabrya, available at: https://ria.ru/20231128/putin-1912427138.html?ysclid=lpm3g5c34f738783092

2. Reddaway P., Glinsky D. The Tragedy of Russia’s Reforms. Market Bolshevism against Democracy. Washington, 2001.

3. “Ushcherb ot kapitalizma za 30 let okazalsya bol’she ushcherba ot Gitlera v Velikuyu Otechestvennuyu”: eksperty rasskazali, kak zhila by segodnya Rossiya, esli by ne raspalsya SSSR [“Damage from Capitalism in 30 Years Turned out to be Greater than the Damage from Hitler During the Great Patriotic War”: Experts Told How Russia Would Live Today if the USSR had not Collapsed]. Utrenniy Yug, 2023, 4 oktyabrya, available at: https://dzen.ru/a/ZR2QIZHw-xOJYg8D

4. Rasporyazhenie Pravitel’stva RF ot 16 avgusta 2003 g. N 1163-r “Programma sotsial’no-ekonomicheskogo razvitiya Rossiyskoy Federatsii na srednesrochnuyu perspektivu (2003–2005 gody)” [Decree of the Government of the Russian Federation of August 16, 2003 No. 1163-r “Program of Socio-

Economic Development of the Russian Federation for the Medium Term (2003–2005)”]. Kodeks, available at: https://docs.cntd.ru/document/901871783

5. Gil’manova Elena. Putin zayavil, chto Rossiya dolzhna stroit’ sotsial’noe gosudarstvo [Putin Declared that Russia Must Build a Social State]. Komsomol’skaya pravda, 2021, 21 oktyabrya, available at: https://www.kp.ru/online/news/4487099/?ysclid=lpnvdhmod8305588273

6. Nekipelov A.D. Vybor ekonomicheskoy strategii. Problema individual’nykh i obshchestvennykh predpochteniy Rossii i puti razvitiya Rossii [Choosing an Economic Strategy. The Problem of Individual and Public Preferences of Russia and the path of Russia’s Development]. Svobodnaya mysl’ — XXI, 2003,

no 9, pp. 5–16.

7. “Ochen’ tyazhelaya istoriya”. TsB nazval summu zablokirovannykh za rubezhom aktivov rossiyskikh investorov [“A Very Difficult Story.” The Central Bank Announced the Amount of Russian Investors’ Assets Blocked Abroad]. Banki.ru, 2023, 31 yanvarya, available at: https://www.banki.ru/news/lenta/?id=

10979472&ysclid=lpnz7p8eb5916326358

8. Plenarnoe zasedanie Peterburgskogo mezhdunarodnogo ekonomicheskogo foruma: Vladimir Putin prinyal uchastie v plenarnom zasedanii XXVI Peterburgskogo mezhdunarodnogo ekonomicheskogo foruma [Plenary Session of the St. Petersburg International Economic Forum: Vladimir Putin Took Part

Russia under Collective Western Sanctions: Crisis Trends

DOI: 10.33917/es-6.192.2023.40-45

The reasons for Russia’s unique success in relieving the sanctions shocks of 2022 and signs of its plunge into prolonged sanctions stress from 2023 are described. It is shown that Russia has exhausted the advantages of a “big country” in increasing macro-financial stability, and its model of recovery growth creates imbalances that aggravate sanctions deformations.

References:

1. Hufbauer G.C., Schott J.J., Elliott K.A. Economic sanctions reconsidered. Washington, DC, Peterson Institute for International Economics, 2009.

2. Morgan T.C., Syropoulos C., Yotov Y.V. Economic sanctions: Evolution, consequences, and challenges. Journal of Economic Perspectives, 2023. Vol. 37. No. 1. P. 3–29.

3. Mulder N. The economic weapon: The rise of sanctions as a tool of modern war. New Haven, Yale University Press, 2022.

4. Felbermayr G., Morgan T.C., Syropoulos C., Yotov Y.V. Understanding economic sanctions: Interdisciplinary perspectives on theory and evidence. European Economic Review, 2021, vol. 135, no 1, p. 103720.

5. Chowdhry S., Hinz J., Kamin K., Wanner J. Brothers in arms: The value of coalitions in sanctions regimes. Kiel Working Papers, 2022, no 2234.

6. Russia Sanctions Dashboard. Castellum.AI, available at: https://www.castellum.ai/russia-sanctions-dashboard

7. Smorodinskaya N.V., Katukov D.D. Rossiya v usloviyakh sanktsii: predely adaptatsii [Russia under Sanctions: Limits of Adaptation]. Vestnik Instituta ekonomiki RAN, 2022, no 6, pp. 52–67.

8. Sal’nikov V.A., Galimov D.I., Gnidchenko A.A. O promezhutochnykh itogakh razvitiya promyshlennosti s nachala 2022 g.: proizvodstvo i investitsii [On the Interim Results of Industrial Development since the Beginning of 2022: Production and Investment]. Trinadtsat’ tezisov ob ekonomike, 2023, no 3.

9. Bank Rossii. O chem govoryat trendy [Bank of Russia. What are the trends saying?]. Byulleten’ Departamenta issledovanii i prognozirovaniya, 2023, no 5.

10. Russia Hikes Interest Rates Despite World’s Biggest Currency Surge. Bloomberg, available at: https://www.bloomberg.com/news/articles/2023-10-27/

russia-hikes-rate-sharply-despite-world-s-biggest-currency-surge

11. Gutmann J., Neuenkirch M., Neumeier F. The economic effects of international sanctions: An event study. Journal of Comparative Economics, 2023, vol. 180, pp. 1–18.

Culture as an Instrument for Ensuring the National Interests of the Russian Federation in the Context of Global Transformations

DOI: 10.33917/es-5.191.2023.32-37

The article dwells on the role of Russian culture in the context of global transformations and emerging multipolarity. It is noted that the US line to neutralize cultural differences is utopian.

References:

1. Kartseva A.A. Dialog i vzaimodeistvie kul’tur kak uslovie sokhraneniya stabil’nosti sovremennogo sotsiuma [Dialogue and Interaction of Cultures as the Condition for Maintaining Stability of Modern Society]. Izvestiya Sankt-Peterburgskogo gosudarstvennogo agrarnogo universiteta, 2014, no 37, available at: https://cyberleninka.ru/article/v/vzaimodeystvie-i-dialog-cultur-kak-uslovie-sohraneniya-stabilnosti-sovremennogo-sotsiuma

2. Kontseptsiya gumanitarnoi politiki Rossiiskoi Federatsii za rubezhom [Concept of the Russian Federation’s Humanitarian Holicy Abroad], available at: static.kremlin.ru/media/events/files/ru/G3CkAuMhZXio8AzNaweT3wTGTaEA16OU.pdf

3. Vladimir Putin: Preslovutaya “kul’tura otmeny” prevratilas’ v “otmenu kul’tury” [Vladimir Putin: The Notorious “Cancellation Culture” has Turned into “Cancellation of Culture”] Rossiiskaya gazeta, 2022, Federal’nyi vypusk no 65(8713), available at: https://rg.ru/2022/03/28/vladimir-putin-preslovutaia-kulturaotmeny-prevratilas-v-otmenu-kultury.html

4. Prokof’ev V.I. “Bol’shoi balet vernulsya v Parizh” [“The Bolshoi Ballet has Returned to Paris”]. Rossiiskaya gazeta, 2023, 6 aprelya.

5. Mikhalkov N.S. “Kinoassorti dlya lyubitelei” [“Assorted Cinema for Lovers”]. Vechernyaya Moskva. Ezhednevnyi delovoi vypusk. Weekend, 2023, no 72(29406), 21 aprelya.

6. Vulf Virdzhiniya. Russkaya tochka zreniya [Woolf Virginia. The Russian Point of View], available at: http://www.apropospage.ru/herson/vulf/v7.html

7. Likhachev D.S. Russkaya kul’tura [Russian Culture]. Moscow, Iskusstvo, 2000, 428 p.

Russia’s International Specialization: Opening and Missed Chances

DOI: https://doi.org/10.33917/es-6.186.2022.86-91

We describe the “window of opport unity” objectively opened up after the coronacrisis for Russia’s entering advanced service niches in global industrial chains and improving its international specialization. We show that after falling under Western sanctions in Spring 2022, Russia has lost this opportunity and suffers a technological rollback due to isolation from global markets.

References:

1. Export by Product Group. 2020. WITS, available at: https://wits.worldbank.org/

2. Smorodinskaya N.V., Katukov D.D., Malygin V.E. Global’nye stoimostnye tsepochki v epokhu neopredelennosti: preimushchestva, uyazvimosti, sposoby ukrepleniya rezil’entnosti [Global Value Chains in the Age of Uncertainty: Advantages, Vulnerabilities, Ways for Enhancing Resilience]. Baltiiskii region, 2021, no 3, pp. 78–107.

3. Ivanov D. Viable supply chain model: Integrating agility, resilience and sustainability perspectives-lessons from and thinking beyond the COVID-19 pandemic. Annals of operations research, 2020. P. 1–21.

4. World Bank. World development report 2020: Trading for development in the age of global value chains. Washington, DC, World Bank, 2020.

5. World Bank. Russia integrates: Deepening the country’s integration in the global economy. Washington, DC, World Bank, 2020.

6. Abdrakhmanova G.I., et al. Sektor IKT v 2021 godu: na pike rosta v preddverii novykh uslovii [ICT Sector in 2021: the Pinnacle of Growth on the Threshold of New Conditions]. Tsifrovaya ekonomika, 2022, no 56(240), available at: https://issek.hse.ru/news/655861546.html.

7. Smorodinskaya N.V., Katukov D.D. Shansy vykhoda Rossii na rynki Industrii 4.0 cherez uluchshenie svoikh pozitsii v raspredelennom proizvodstve [Russia’s Opportunities for Entering Industry 4.0 Markets by Improving Its Position in Distributed Production]. Zhurnal Novoi ekonomicheskoi assotsiatsii, 2022, no 1(53), pp. 223–231.

8. Panel’ monitoringa sanktsii protiv Rossii [Russia Sanctions Dashboard]. Castellum.AI, available at: https://www.castellum.ai/russia-sanctionsdashboard

9. Bank Rossii. Makroekonomika i rynki [Bank of Russia. Macroeconomics and Markets]. O chem govoryat trendy, 2022, no 2, available at: https://cbr.ru/Collection/Collection/File/40953/bulletin_22-02.pdf.

10. Simola H. Trade sanctions and Russian production. BOFIT. Policy Briefs, 2022, no 4.

11. Chorzempa M. Export controls against Russia are working — with the help of China. The Peterson Institute for International Economics, 2022, available at: https://www.piie.com/blogs/realtime-economic-issues-watch/export-controls-against-russia-are-working-help-china.

12. Bank Rossii. Osnovnye napravleniya edinoi gosudarstvennoi denezhno-kreditnoi politiki na 2023 god i period 2024 i 2025 godov [Bank of Russia. The Main Directions of the State Monetary Policy for 2023 and the Period of 2024 and 2025]. Moscow, Bank Rossii, 2022.

13. Chebakova D., Balashova A. Uchastniki rynka otsenili novuyu volnu uezzhayushchikh iz Rossii aitishnikov [Market Participants have Assessed a New Wave of IT Specialists Leaving Russia]. RBK, 2022, 28 sentyabrya, available at: https://www.rbc.ru/technology_and_media/28/09/2022/633324f39a7947518c6fd452.

Contemporary Narratives for Applying International Economic Sanctions

DOI: https://doi.org/10.33917/es-5.185.2022.22-29

Recently the role of sanction restrictions has sharply increased in the practice of regulating economic relations between countries,

meanwhile their application is determined by many factors. At the same time, in the context of intensifying geopolitical competition and growing volatility of the global economy, the dynamics of sanctions application raises more and more questions. On the one hand, economic sanctions are an instrument of coercion for target countries, and on the other hand they make international exchange and cross-border mobility of the factor more and more vulnerable. Heterogeneous nature of the economic sanctions’ impact on sending and target countries does not allow us to say that sanctions are an unambiguous instrument of an effective trade policy.

This article analyzes the key narratives of economic sanctions regimes in all their diversity at the present stage, new forms and

mechanisms of sanctions, as well as their consequences for various aspects of life of the world community.

References:

 

1. Spiegelberger W.R. Anatomy of a Muddle: U.S. Sanctions against Rusal and Oleg Deripaska. Russia Political Economy Project, Foreign Policy Research Institute, 2019, April 29, available at: https://www.fpri.org/article/2019/04/anatomy-of-a-muddle-u-s-sanctions-against-rusal-and-oleg-deripaska/

2. Sanger D.E., Benner K., Goldstein V. Huawei and Top Executive Face Criminal Charges in the U.S. New York Times, 2019, January 28, available at: https://www.nytimes.com/2019/01/28/us/politics/meng-wanzhou-huawei-iran.html.

3. Hufbauer G.C., Jung E. What’s new in economic sanctions? European Economic Review, 2020, vol. 130, iss. C, pp. 103572.

4. Bapat N.A., Heinrich T., Kobayashi Y., Morgan T.C. Determinants of Sanctions Effectiveness: Sensitivity Analysis Using New Data. International Interactions, 2013, vol. 39 (1), pp. 9–98.

5. Early B.R., Spice R. Economic Sanctions, International Institutions, and Sanctions Busters: When Does Institutionalized Cooperation Help Sanctioning Efforts? Foreign Policy Analysis, 201, vol. 11 (3), pp. 339–360.

6. Peksen D. Autocracies and Economic Sanctions: The Divergent Impact of Authoritarian Regime Type on Sanctions Success. Defence and Peace Economics, 2017, vol. 30 (3), pp. 253–268.

7. Connolly G.E. Economic Sanctions. Agencies Assess Impacts on Targets, and Studies Suggest Several Factors Contribute to Sanctions’ Effectiveness. Report to Congressional Requesters, GAO-20-145, United States Government Accountability Office (GAO), 2019, October, p. 19.

8. Krustev V.L., Morgan T.C. Ending Economic Coercion: Domestic Politics and International Bargaining. Conflict Management and Peace Science, 2011, vol. 28 (4), pp. 351–376.

9. Nooruddin I., Payton A.L. Dynamics of Influence in International Politics: The ICC, BIAs, and Economic Sanctions. Journal of Peace Research, 2010, vol. 47 (6), pp. 711–721.

10. Golliard M.M. Economic Sanctions: Embargo on Stage. Theory and Empirical Evidence. Fribourg, University of Tampere, 2013, January, pp. 107, 108.

Features of the formation of state industrial policy (for example the aviation industry)

The article deals with the mechanism of formation of the state industrial policy on the example of the aviation industry, the aviation industry is defined, its composition and structure are presented, the importance of the aviation industry for the strategic development of the state is analyzed and also it is proved that the  development rates of the aviation industry have a direct impact on the formation and support of the country’s defense, scientific and technological development ensuring the constitutional right of citizens to freedom of movement.

Economic Sanctions Against Russia: Damnation of Decrease or Springboard for Free Flight?

#8. Ideas Change the World
Economic Sanctions Against Russia: Damnation of Decrease or Springboard for Free Flight?

2000s and 2010s are usually called “transition period”. On the one hand, during this time we observe the strengthening of the international cooperation actively being started with reforms under the rules of the G20 as the response to the intensification of global financial system’s development internal contradictions and the emergence of global economic crisis. On the other hand, these years are characterized by an increased level of conflicts manifested in the vigorous and collective application of sanctions and the declaration of trade wars. The subject of the article is especially relevant for Russia having been already sanctioned for 5 years. The purpose of this research is to analyze the impact of sanctions on the target economy. The paper provides a brief description of the existing sanctions against Russia since 2014. The second part of research is devoted to the identification of conditions for the effectiveness of economic sanctions. The third section includes the analysis of the negative sanction effect’s reasons and evidence. Finally we provide arguments in favor of real and potential opportunities for Russia to obtain economic benefits from the sanctions. In 2014–2016 we observed the negative effect of economic sanctions expressed in the form of losses and lost profits and caused as logical consequence of Russian economy’s development features. There are preconditions for creating a positive effect from sanctions — an impulse that can bring Russian economic system to a qualitatively new stage of growth. These positive trends need to be developed and sustained by domestic government support.

Marriage of Convenience

#4. The Square of Transformation
Marriage of Convenience

China and the attitude to it are an important and enduring part of the Russian foreign policy. To a large extent the Russian fates depend on it. According to the article’s authors, supporting relations with China at the level of good-neighbourliness, friendly cooperation and strategic partnership is main task of the Russian foreign policy. Such relations are a trump card in the international and forceful solitaire.