Discussion Papers 2001.
Role of the Regions in the Enlarging European Union 113-123. p.
Role of the Regions in the Enlarging European Union
0 Edited by Zoltan Gal, Pecs, Centre for Regional Studies, 2001
RECENT TRENDS IN THE RUSSIAN
REGIONAL POLICY AND USE OF THE
EU COUNTRIES' EXPERIENCE
Sergey Artobolevskiy
Regional disproportions in Russia
On the basis of the official statistics analysis it is possible to conclude, that in
Russia regional socio-economic disproportions in level of economic develop-
ment and quality of life are great: in 1997 the difference between maximum and
minimum was 21 times for GDP per head (1996), 13 times for income per head
(10 times taking into account purchasing capacity of rouble in different regions)
and 14 times for level of unemployment (see statistical yearbook for Russian
regions for 1998). By their scope Russia considerably surpasses countries of
EU).
There is the basis to approve that in the 90-s years occurs sharpening of re-
gional disproportions. The geography of Russian crisis is very unequal and that
caused further increase of territorial disproportions. Huge regional socio-eco-
nomic disproportions are dangerous for any country, especially such big and
non-uniform as Russia.
One can see increase in anti-Moscow "moods" practically in all regions. The
main reason of this phenomenon is higher benefits received by Moscow in the
period of reforms, reflected in much higher level of personal incomes, than
average in the country (more than 3 times higher, than in the country on aver-
age), better employment opportunities (both in official and grey economy).
The state has to react on existing spatial disproportion, i.e. has to conduct
socially and politically oriented regional policy.
Recent financial and economic crisis (after August 17, 1998) increases dis-
integration tendencies in the country. One can saw a lot of economic separatism
attempts from regional authorities, fragmentation of all-country market. Discus-
sions about future unity of Russia again become popular in mass media and
scientific community. Necessity in regional policy became even more obvious
after "August events".

Sergey Artobolevskiy : Recent Trends in the Russian Regional Policy and Use of the EU Countries' Experience.
In: Role of the Regions in the Enlarging European Union. Pécs, Centre for Regional Studies, 2001. 113-123. p.
Discussion Papers. Special
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Institutional infrastructure of regional policy
In RF so far, despite availability in the country of big regional socio-economic
disproportions, effectively functioning system of regional policy has not yet
developed. It is determined by many factors, the not last place in a number of
which takes institutional factor. The efficiency of any regional policy in many
respects depends on how institutions, created for its "registration" and realisa-
tion, are organised and work.
In RF various aspects of regional policy are realised by various official in-
stitutions, without proper co-ordination of their activities in the field (some-
times they even compete with each other — as Ministry of economy and Minis-
try of regional policy). Another big problem is — the institutional instability of
regional policy in the country (practically during all 90-ies years).
Theoretically country already for several years has all necessary institutional
infrastructures for realisation of regional policy. Till now in Administration of
the President there was Territorial Department (and under "tutoring" of other
department the representatives of the President worked in the regions — see
.
below). There is now separate Ministry of regional policy (ex-Ministry of na-
tional problems and federal relations). In addition to this, "regionally oriented"
departments exist in Ministry of economy. In both chambers of the Parliament
(in Duma and in Council of Federation) there are commissions on federalism
and regional policy.
In Administration of the President one couldn't find structures directly en-
gaged in nation-wide regional policy, though the Administration conducts
monitoring of socio-economic situation in the regions and still has large op-
portunities of influence on the administration of the regions. It carries out own
regional policy of Administration, largely subordinated to the achievement of
the political purposes. Problems of regions are sphere of activities of 2 above-
mentioned independent departments: earlier they were parts of one big depart-
ment and now are again in process of unification. Under conditions, when the
role of President is decreasing, possibilities of Administration become smaller.
Formally just Ministry of economy was leading until now in the field of re-
gional policy. Thus it considers as sphere of its activities only regional eco-
nomic policy, and till now pays very little attention to other aspects of spatial
effects of state influence, including social ones (only as slogans, but not as
guidelines of practical activities).
Obviously, that the activities of the Ministry provides realisation of eco-
nomic strategy of government in regions, decides huge quantity of current re-
gional and local problems. At the same time its activities can not replace state
regional policy, directed on smoothing of spatial distinctions in quality of life
and level of development, frequently even to the detriment of economic effi-

Sergey Artobolevskiy : Recent Trends in the Russian Regional Policy and Use of the EU Countries' Experience.
In: Role of the Regions in the Enlarging European Union. Pécs, Centre for Regional Studies, 2001. 113-123. p.
Discussion Papers. Special
Recent Trends in the Russian Regional Policy and Use of the EU Countries'...
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ciency (the latter, and is absolutely fair, dominates in the activities of the Min-
istry). If to recognise the social bases of regional policy, it is absolutely clear,
that Ministry of economy cannot be main institution responsible for it.
From autumn of 1998 country has independent Ministry regional policy,
which included part of Ministry of regional and national policy and previously
independent State committee on development of the North. Ministry of regional
and national policy existed, officially, only from spring 1998, earlier it has an-
other title — Ministry of national problems and federal relations, and the latter
till 1996 has another official title — Ministry of nationalities and regional pol-
icy. Before 1998 changes formally the Ministry realises policy of state in the
field of the national and federal relations, local self-governing. Now the Minis-
try is still not closely connected, in its practical activities, with questions of re-
gional policy, but try to occupy new field.
It is the third attempt of the Ministry to play more active role in federal re-
gional policy. In 1993-95, when in the name of Ministry there was word collo-
cation "regional policy", attempts has been done to make regional policy one of
the main directions of specified Ministry activities. The Ministry even discuss
its regional policy programme (see below) in the Council of ministers (1995-
96), but without any practical consequences. The programme has been rejected.
Current "administration" of the Ministry tries to include regional policy into
sphere of its activities. At the moment only basic documents are preparing and
it is too early to discus even first results. Two obvious problems exist: Ministry
can decide to work only in sphere of federal relations and municipal problems
(and call these "regional policy") or other more powerful ministries would not
give rights and means to the Ministry (for regional policy realisation).
It is necessary to stress, that the Ministry can become the leading executive
body in the field of regional policy. But in future legislative decisions, con-
cerning the role of Ministry in regional policy, it is necessary to exclude effect
of the subjective factors (so strongly influenced on the regional policy in the
Ministry).
Previously independent State committee on development of the North
formed federal policy concerning northern territories and executes its realisa-
tion. A sphere of the Committee activities varies from scientific researches and
monitoring till realisation of "northern delivery" (supply of various goods by
water transport to remote northern areas during short summer, only period
when it is possible). As a whole it was possible to welcome the existence of
such complex development body for the super-region, covering 2/3 of the
country territory. Just due to existence of the specified Committee the North
and its population "are supplied" by the laws on the order better than other
territories.

Sergey Artobolevskiy : Recent Trends in the Russian Regional Policy and Use of the EU Countries' Experience.
In: Role of the Regions in the Enlarging European Union. Pécs, Centre for Regional Studies, 2001. 113-123. p.
Discussion Papers. Special
116
S. Artobolevskiy
At the same time the Committee acted absolutely independently, develop-
ment of the northern territories were not co-ordinated with regional develop-
ment of country as a whole (to the point, so was and during its — Committee —
functioning within the framework of Ministry of national problems...). The
development of northern territories was considered as a separate task, their
problems are not compared with existing in other regions. From the point of
view of northern territories development existence of independent management
body is positive phenomenon, but realisation of all-country regional policy it
hinders. Now the main task is real integration of ex-Committee (even separately
located in Moscow) into the new Ministry (till today this part of Ministry of
regional policy de-facto continue to work independently). Otherwise the state
would receive 2 regional policies.
The special attention deserve so called "profile" committees of both cham-
bers of the Parliament (both of them include "regional policy" into theirs offi-
cial titles), for really only they can initiate and lobby the laws in the field of
regional policy. But till now the main work of the committees in the field of
regional policy is the expert and legal assessment and support of the federal
laws and their drafts (till their full formal approval). Assessment of the com-
mittees pass many mentioned above documents in which refinements and cor-
rection has been introduced for the protection of various regions interests.
As a whole examination of various laws regional consequences (and dimin-
ishing of possible negative consequences) is important component of any re-
gional policy. It is bad; that such examination is carried out not in the frame-
works of officially approved federal regional policy (and, hence, can not take
into account its priorities).
Regional policy programmes
In the 1990-s several programmes in the field of regional policy has been cre-
ated. Strategy of regional development of Russia — the most valuable of these
documents, was prepared in 1993 in Analytical Centre of the President. This
document has become the base for discussions on regional policy.
From the moment of creation this document was several times revised and,
thus, even improved, but has not become the base of legal decisions (laws, de-
crees of the President, enactments of the Government). Even official approval
of the document by President doesn't make it the basis for practical steps.
The main arguments presented in the document for the necessity of interfer-
ence of state into decision of regional problems are: preservation of country
unity, strengthening of regional disproportions on the way to the market, social

Sergey Artobolevskiy : Recent Trends in the Russian Regional Policy and Use of the EU Countries' Experience.
In: Role of the Regions in the Enlarging European Union. Pécs, Centre for Regional Studies, 2001. 113-123. p.
Discussion Papers. Special
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justice. This approach is very close to the Western ones and corresponds to
Russian reality.
In the autumn of 1994 on the basis of the Strategy was produced already
more "practical" document — "About the Program of the help to the depressed
regions" (in the same Analytical Department) and again it was not, in any form,
realised. At first were hopes to take it into account in the 1995 budget, then in
1996 budget, etc. (but really the developers of the budget never even do not
know about existence of the Program). Now it is absolutely clear that this
document will never be realised. What is interesting, that this existing only on
paper draft document received active support of some crisis regions?
Programs of regional policy for Russia were developed in 1993-1995 also
by Ministry of national problems and regional policy and by fraction "New
regional policy" in previous parliament (1993-1995). Politics and experts
already some times discussed both documents. The main defect of both pro-
grams is misunderstanding what is regional policy. The authors of both docu-
ments include in it and strategic, and external economic, and pure social, and
etc. problems. Practically all, what determines development of the country were
included into regional policy. Clearly, on the base of so wide documents it is
impossible to develop the real laws concerning regional policy, to accept the
executed organisational decisions.
Developed by Ministry of economy document of the same period was de-
voted to only regional economic policy (and was made at high professional
level). But it rather the plan of territorial organisation of Ministry of Economic
Affairs, instead of base for creation Russian regional policy. In the specified
document one can find idea about stimulation of development of leading re-
gions, the implementation of which could only strengthening regional dispro-
portions. But the latter is difficult to include into main aims of regional policy
in Russia, where regional differences are so big.
As has been already mentioned in 1996 Ministry of nationalities... prepared
and even send to the Government already very realistic documents, proposed
how to organise regional policy in Russia. In many aspects specified document
has much in common with the Strategy and with the described document on
regional economic policy and can be easily included (naturally partially) into
the potential law on regional policy. But it has been rejected. Now "new" Min-
istry of Regional Policy creating new programme of regional policy and its ac-
tivities in the field.
Programmes for the development of regional policy in Russia became the
field of international activities. TACIS project on Russian regional policy
(which is represented by the author of this text), started in January 1998 (for 3
years), and will be implemented in close co-operation with Ministry of regional
policy. It has clear aim — create "reasonable" models of socially oriented fed-

Sergey Artobolevskiy : Recent Trends in the Russian Regional Policy and Use of the EU Countries' Experience.
In: Role of the Regions in the Enlarging European Union. Pécs, Centre for Regional Studies, 2001. 113-123. p.
Discussion Papers. Special
118
S. Artobolevskiy
eral regional policy. The project could support Ministry efforts to become
leading state institution in the field of regional policy. If the Ministry succeed,
results of project would have more practical value.
Legal base of regional policy
As already has been mentioned there are no official documents, regulated re-
gional policy in a country as a whole. There are laws and other official docu-
ments regulation development of Northern regions. However, even towards
northern territories the federal government is not present clear and consistent
decisions. The federal law "About the bases of state regulation of socio-eco-
nomic development of the RF North (is accepted in the middle of 1996) is pos-
sible to consider as the unique complex legal document in the field of regional
policy. But it only declares only the right of state to stimulate development of
northern territories (instead of the responsibility to do it). Under the conditions
of the budget deficit, naturally, very small sums of money are allocated for
realisation of the law.
In spring 1996 Council of ministers sent to the President project of the De-
cree of the President "Main directions of regional policy in Russia", prepared
by mentioned above department (working directly under the Chairman of Gov-
ernment). This 20 page document don't propose any real steps in regional pol-
icy, but describe what will be good to achieve in the sphere of economic and
social development of regions, ecology, national relations etc. (in very general
terms) without any indication how to achieve these aims and what state bodies
will be responsible (and who will pay).
Even from the contents of the document one can see that unknown authors
include into regional policy all problems connected with federal relations, local
self-management, all forms of international activity of regions, employment,
ecology, national relations... At the same time regional economic policy is ab-
solutely separated from regional social economic policy (even ideas on co-ordi-
nation are in absentia). Naturally one could not find in the document under-
standing of regional policy as institutionally independent activity of the state.
It is possible to agree with the document that forecasts and programmes
have to be the main tools of regional economic policy. But what institutions
will be responsible for creation and implementation of these documents, what
will be their place in economic strategy of the state?
The Decree of the President by its status has to be "temporary" law and has
to include practical steps in the field, orders for various state institutions, time-
table, etc. Lets take for example last part of the document — "Legal base for
regional policy". It is logic to find in it list of necessary laws and other legal

Sergey Artobolevskiy : Recent Trends in the Russian Regional Policy and Use of the EU Countries' Experience.
In: Role of the Regions in the Enlarging European Union. Pécs, Centre for Regional Studies, 2001. 113-123. p.
Discussion Papers. Special
Recent Trends in the Russian Regional Policy and Use of the EU Countries'...
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documents, institutions responsible for them, propose dates. But what we find
instead: "Law creation process in the field of regional policy has to increase
harmony in relations between federal centre and subjects of Russian Federa-
tion. Constitution of Russian Federation creates the necessary conditions for
this as the base for creation of federal relations mechanism". The rest of this
part of the document (in total less than 1 page) is devoted to indicate in what
field's federal centre and regions has common interests and responsibilities.
But this one can easily find himself in the Constitution of the country.
Though the texts of the agreements about differentiation of subjects of man-
agement and rights between federal executive authorities and bodies of a state
authorities of the RF subjects with various regions (and appendices) have much
in common, all they take into account and features of the particular region and
attitude of Centre toward it. Therefore it is possible to consider, that in the
specified documents the regional policy of the federal authorities has partly
received expression.
In principle the specified agreements and appendix to them could become a
powerful tool of federal regional policy (especially taking into account the ten-
dency of more and more complete scope by the given documents of the subjects
of Federation). For this purpose federal level should officially be responsible
(completely or partially) for the decision of the most acute problems of regions,
which the latter are not able to solve using only own resources.
The Decree of the President about the proxy representative, signed on July
9, 1997 granted large opportunities for strengthening of Presidential structures
influence on regions. Obviously, that the opportunities of this "new" represen-
tative, in course of interactions with regional authorities, would sharply in-
crease. The representative of the President even now has an opportunity to act
as the supporter of municipal authorities in their conflict with regional ones.
But how far central authorities will go in specified direction, and there is a risk
destroying normal relations with the administration of regions, is not clear. The
decree has some potential to be used as regional policy "tool". Unfortunately 2
years that has been passed after the Decree approval didn't show any big prog-
ress in the implementation of its ideas.
Practical steps in the field of regional policy
It will be exaggeration to insist, that now Russia has no regional policy at all. In
Russia, as well as in practically all other countries, territorial redistribution of
public funds goes actively. State provides help to regions of coal mining and
ecological disasters, social help to poor regions through the budget (beginning
from 1994 — see below), etc. In total approximately of 15% of the country

Sergey Artobolevskiy : Recent Trends in the Russian Regional Policy and Use of the EU Countries' Experience.
In: Role of the Regions in the Enlarging European Union. Pécs, Centre for Regional Studies, 2001. 113-123. p.
Discussion Papers. Special
120
S. Artobolevskiy
budget are used for the help to closed cities, support of the regional budgets,
financing of the regional programs, etc., i.e. for regional purposes. But speci-
fied redistribution, in many cases, goes without official criteria and as a result
one can see great subjectivism of the accepted decisions.
The especially strong effect on redistribution of means has the political fac-
tors. For 1992-94 years the President and Government have accepted 70 de-
crees and enactments on regions and practically all of them included granting of
the additional rights or/and means. But no general regional analysis proceeded
to these official decisions. It was not clear, whether the help was provided
really to the most requiring it regions.
Ministry of regional policy, Ministry of economy and Ministry of construc-
tion are engaged in preparation and realisation of several regions complex pro-
grammes of development. Programmes of concrete regions development may
be part of federal regional policy if they have been prepared for really most cri-
ses territories. Even from this list it is clear that nobody compared selected
regions with others. Why concrete regions were selected? The answers one can
find in pure political sphere, analysing political weight of regional leaders in
Moscow.
The Government were not able to resist to political pressure, but find solu-
tion in permanent under-financing of all programmes. In 1997 these pro-
grammes received on average below 10% of proposed sums (1998 situation
would be even worse).
Attempts to solve the most acute problems of crisis regions at the expense of
providing to them exclusive economic advantages (taxes, credit, in export)
don't achieve, in majority of cases, the proposed aims. And these exclusive
advantages lead mainly to increase of tensions between regions.
Transfers ("transferti") from the Fund of financial support of the regions can
be partially regarded as regional policy. In their frameworks part of taxes is
transmitted by federal centre to regions, possessing insufficient tax base, not
ensuring average country level. Transfers are intended to cover current charges
(on education, health service, support of housing, etc.). In 1994 they have for
the first time occurred in the budget, but the regions have received only half of
transfers — because of low rate of taxes collection. Thus some regions depend
on them on 80-90%.
The direct state redistribution of means between regions can be regarded as
regional policy. But regional policy should assist to the most crisis regions, and
the latter cannot coincide with regions with insufficient tax base. Plus this
means cannot be used for any investments.

Sergey Artobolevskiy : Recent Trends in the Russian Regional Policy and Use of the EU Countries' Experience.
In: Role of the Regions in the Enlarging European Union. Pécs, Centre for Regional Studies, 2001. 113-123. p.
Discussion Papers. Special
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What can be taken from EU countries' experience?
World experience shows (and especially of EU countries and Union as a
whole), that more often the regional policy has social roots. Excessive territo-
rial distinctions in the level of development naturally result in significant spa-
tial disproportions in quality of life. The latter threaten to real economic and
social unity of the country (and, in extreme cases, even to its political unity). As
a result one can see "picture" of two Italies (North and South), Great Britains
(South and North), Frances (Paris and "French desert").
In EU countries, even on the ideological level, it is considered as inadmissi-
ble the existence in uniform country of excessive spatial disproportions (thus
scales of "excessive" is defined individually by each country). The same ap-
proach dominates and in frameworks of EU, determining its common regional
policy (one of the main directions of its activities).
Regulating the processes of regional development the EU states realize its
own "understanding" of territorial justice (responsibility for all population of
the country, where it did not live, and for all territory). But solving social tasks
the state (within the frameworks of regional policy) realizes them through econ-
omy. But taking into account, that the regional policy is directed on achieve-
ment of spatial "equality" (or what is more precise — on decrease of inequality
degree) between separate territories, projects realized in its frameworks are not
maximally effective from the purely economic point of view.
The social purposes of the state couldn't be separated from its political
goals. Regional policy role in preservation of country unity has been already
mentioned. In many countries the role crisis regions electorate is great. In a
number of cases crisis territories coincide (partially or wholly) with areas of
ethnic (or other) minorities. Thus, the regional policy is executed by a state, in
majority of cases, proceeding from socio-political reasons.
Naturally Russia simply has no means to realized EU-countries type of re-
gional policy (or Brussels one). But Russia can borrow logic of western re-
gional policy: its socio-political orientation, values of spatial justice and re-
sponsibility for the whole population, etc. Russia can follow logic of its devel-
opment: creation of program and responsible institutions, adoption of specific
laws, fixing of its financial basis, etc. All this will help to use even scarce
available resources for real needs of regional policy. Use of some practical
instruments of EU countries regional policy is much easier task (naturally only
as the next stage)
In Russia any sphere of state activity is strongly politicised and closely con-
nected with personal relations. The campaigns for the election to Duma (Lower
chamber of Russian parliament) — 1999, and for the post of President — 2000,
have really started. The regional policy should "to take into account", that in

Sergey Artobolevskiy : Recent Trends in the Russian Regional Policy and Use of the EU Countries' Experience.
In: Role of the Regions in the Enlarging European Union. Pécs, Centre for Regional Studies, 2001. 113-123. p.
Discussion Papers. Special
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S. Artobolevskiy
the nearest 2 year it would be realised under conditions of political and institu-
tional instability and growing politicians populism.
Conclusions
1) Level of socio-economic disproportions (asymmetry) in Russia lead to dis-
integration of the country and really threatening to its unity. But the scales
and form of regional policy (i.e. reaction of federal state) does not corre-
spond with acuteness of the country territorial problems.
2) In Russia there is significant number of institutions, responsible for regu-
lation of various regional processes. But activities of these institutions are
extremely weakly co-ordinated and frequently contradicts to the aim of spa-
tial socio-economic disproportions smoothing. New Ministry of regional
policy could become leading institution in the field, but only in sharp com-
petition with other federal institutions.
3) Russia still don't have officially approved programme of federal regional
policy (neither of spatial development strategy), which can be really imple-
mented. But already existing documents create good base for such pro-
gramme. The main problem — absentia of institutional initiator.
4) It is urgently necessary to intensify legislative processes in the field of re-
gional policy. Taking into account slow "velocity" of both chambers of the
Parliament, probably the temporary decision of the problem is Decrees of
the RF President. Ministry of regional policy is really the only institution,
which can initiate legislative process in the field.
5) The federal state does not have now enough means for "normal" regional
policy. But part of existing regional redistribution of means has to "service"
regional policy aims: promote economic development in predetermined cri-
ses areas.
6) Decisions of regional sphere are too subjective. This is great obstacle for
regional policy development. Regional policy has to be more open for insti-
tutions of various territorial levels and to the public. Without this pre-condi-
tion it will not receive support in the country.
7) EU countries experience in the field of regional policy (as well as of com-
mon EU regional policy) is extremely valuable for Russia. It is impossible
even to speak about replication of western regional policy in Russia, but
general logic and main approaches can be taken. As well as EU countries
Russia needs socially and politically oriented regional policy, aimed on de-
creasing of spatial disproportions in quality of life and, correspondingly, in
level of economic development. It is necessary to understand that people are
aim of such regional policy and economy is only instrument.