Separate development plan approved for areas near Chinese border in Russia’s Far East regions

BOFIT Viikkokatsaus / BOFIT Weekly Review 2015/48

In recent years, Russia has focused greater attention on its Far Eastern regions, but despite development programmes, a special fund and a special ministry, rather little has been accomplished. The latest approved programme is the first to specifically tackle areas along the Chinese border. The programme applies to the Primorsk, Khabarovsk, Amur and Jewish Autonomous regions and reflects Russia’s split-mindedness in relations with China. Even as major speeches proclaim closer cooperation and economic ties with China, many Russians are worried about China’s emergence as a global economic superpower. This year, for example, planned Chinese agricultural projects in the Far East and Siberia have aroused intense opposition over fears of an influx of Chinese immigrants. Bilateral cooperation in the border areas has otherwise stumbled and e.g. of the 38 investment projects mentioned in the 2009 joint development programme, 30 have already been abandoned due to lack of investor interest.

The stated purpose of this latest development programme is to secure Russia’s national interests in the Far East in an unfavourable international economic and political environment. To try to assure stable economic and social development in the Far East, the plan calls for e.g. supporting small and medium-sized firms and dealing with the region’s poor infrastructure. To increase the population numbers, e.g. social support to families with children will be increased and new residents attracted through distribution of land. A bill proposal has already been submitted to the Duma that would give every Russian citizen the possibility to have up to one hectare of land in the Russian Far East. The programme also brings forth the issue of increasing the competitiveness of regions on the Russian-side relative to the Chinese side, which enjoys clearly higher growth and population number vastly greater than the Russian side. Russia’s limited fiscal capacity to finance the public sector aspects of the programme suggest it may be even harder to implement than earlier.

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