And the first will be the last – Newspaper Kommersant No. 48 (7493) of 03/22/2023

The three most import-dependent regions of the Russian Federation are the Kaluga, Ulyanovsk and Samara regions, experts from the HSE ISSEK have assessed. The current heightened risks of these entities are explained by their former advantages: a high share of the manufacturing industry in the gross regional product, a significant level of innovative development and a multi-industry model of specialization. Least of all, the reduction in imports of intermediate products affects Chechnya, Ingushetia and Altai – regions that are poorly involved in the international division of labor.

Institute for Statistical Research and Economics of Knowledge (ISSEK) HSE made up rating of Russian regions in terms of import dependence. The experts’ calculations were based on the data of the Central Bank on the share of imports from the countries that announced sanctions in the total value of the final products of industries. The ISSEK estimates of the share of those employed in regional specialization industries were also used.

It was determined that most of all the import of goods for production needs is necessary for such industries as: automotive (25% of imports), production of rubber and plastic products (18%), production of other vehicles (16%), machinery and equipment (15%) , pharmaceuticals (15%). The specialization of the region in these types of activities increases the risks of its economic and social problems, the ISSEK notes.

As a result, the five most import-dependent subjects of the Russian Federation were Kaluga, Ulyanovsk, Samara regions, Tatarstan and Vladimir region. Of the 30 most import-dependent regions, 24 are located in the Central and Volga Federal Districts. The greatest risks of import dependence are in subjects with a high share of the manufacturing industry in the gross regional product, with a high level of innovative development and a multi-industry model of specialization.

In turn, Chechnya, Ingushetia, Altai, Tuva and the Jewish Autonomous Region were named the most import-independent regions. These subsidized regions are characterized by weak involvement in the international division of labor, and their economy is mainly oriented towards local markets.

Evgeny Kutsenko, director of the Russian Cluster Observatory Center at ISSEK, notes that “the more actively the regions attracted foreign investors, built new factories and formed new industries in the previous 20 years, the more difficult their economic situation turned out to be in 2022.” According to the expert, the further development of such regions depends on the success of attracting replacement investments from friendly countries, as well as on participation in competition for new federal resources to ensure technological sovereignty. Any scenarios are possible – both the loss of leadership by some regions, and the emergence of new points of growth.

According to last year’s survey of industry representatives, business is experiencing a critical need for import substitution, primarily in terms of purchasing components and equipment. At the same time, it is the lack of competencies and scientific and technical base that most of all prevents companies from building their own production facilities integrated with science to replace imports (see Kommersant of October 7, 2022).

However, in the HSE analytical report on import substitution published in February, the authors pointed out that, according to estimates for 2018, the level of dependence of the Russian industry on imports (the share of consumption of foreign value added in industrial production) was 39%, which is 1.3 times lower than Germany, and comparable to the US and India. Now, probably, the dependence has become noticeably less. The authors noted a greater dependence of the manufacturing industry on imports of services and technologies, rather than components and equipment. The recommendation given by them is to move a number of supporting industries to friendly jurisdictions instead of their localization in the Russian Federation (see Kommersant of February 16).

Venera Petrova