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A. J. Haywood

Prime Minister rejects 'Soviet' plan for Siberia's development

21 February 2013

Dmitry Medvedev rejected plans to set up a State corporation to run the economy in eastern Siberia and the Far East.

'Go from talking about programmes to doing the real work. I believe this is the right approach to take'. Dmitry Medvedev at the Kransoyarsk Economic Forum, picture: government.ru

The idea of such a corporation has been touted by the government over many months but at the Kransoyarsk Economic Forum he called it a 'dead end'.

Supporters of such a plan argued it could deliver a leap forward in economic development in line with government targets. 

'A state corporation, needed or not needed?,' asked Medvedev.

'From an ideological standpoint, it seems to me that it is not needed, because generally all our attempts to resolve all problems with the creation of a State corporation is a dead-end development street. It is partly a Soviet approach."

He admitted that 'some kinds of instruments' to boost Siberia's economic development.

'Is the form of State corporation going to be imparted to these instruments? I strongly doubt it.'

Late last year President Vladimir Putin said of a State corporation: 'I know that this approach is not widely shared but I am ready to return to this issue. We must propose measures that will be effective. Let's consider other possible management arrangements that could be introduced. Above all, they must correspond to the complexity of the tasks we will be addressing.'

Putin linked the scheme to significant tax advantages for businesses in Siberia and the Far East. 

The corporation scheme was intended to cover 16 regions encompassing more than 60 percent of Russia's territory.

One power wsa intended to be the distribution of  mining licenses bypassing state tenders, which are obligatory elsewhere in the country. This could have included many prominent ore deposits, among them Sukhoi Log, the country's biggest gold deposit.

Such a system would see a ceding of significant power by existing regions and governors yet proponents say it would slash red tape and enable faster growth. 

It was initially unclear if Medvedev's comments in Krasnoyarsk represented a new consensus in the government or a sign of a split over how to create an economic surge in Siberia, which has been identified by Putin as a key objective. 

Without going into details, Medvedev stated that 'specialised development institutes that work in the Siberian, in the Far East, direction are needed anyway by virtue of the particulars of our State'.

In other comments, he said: 'The answer to the question of how to develop Siberia lies in its geographical location and geo-strategic capabilities. 

'All this talk that we can't develop anything without a plan is, in my opinion, purely academic. 

'It is unlikely that 100 or 200 years ago there was a comprehensive plan for the development of Siberia, but somehow we were developing it.'

He told participants at the forum: 'Go from talking about programmes to doing the real work. I believe this is the right approach to take'.

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