Russia Pins Her Hopes On Growth in High-tech Exports
In his annual Presidential Address to the Federal Assembly, RF President Vladimir Putin once again emphasized the crucial importance of import substitution as a means of increasing the competitive capacity of the Russian economy.
As far as this matter is concerned, the Presidential Address places special emphasis on the export of highly processed products. It stipulates that Russian hi-tech exports should grow 1.5 times over the course of the next three years (by 2018).
At present, Russian exporters of hi-tech products have a very weak presence in international markets. Thus, Russia accounts for 0.5% of global exports of machinery, equipment and transportation means, and for a mere 0.4% of global hi-tech exports (telecommunication equipment, pharmaceutical products, and office equipment). It should be noted in this regard that a 'reasonable' import substitution focused on non-raw material exports can indeed enable the Russian economy to not only fully satisfy existing domestic demand, but also to increase Russian manufacturers' competitive capacity on overseas markets by improving the quality of their products.
It is expected that the planned creation of a Center for Exports Credit and Insurance Support on the basis of the Russian Export Credit Insurance Agency (EXCIAR) will give a strong impetus to and increase the volume of Russian hi-tech exports. The Center will be created as a result of the transfer of 100% of shares in Roseksimbank into the Agency's ownership. Thus, the integration of the said credit and insurance instruments will be able to create a more stable basis for the support of those export-oriented enterprises that do not belong to the raw materials sector and are faced with shortages of funds, technologies, personnel and equipment. Such shortages frequently prevent Russian companies from consolidating their position on overseas markets or occupying there a suitable niche.
Moreover, the institutional changes will be augmented by projects designed to support those Russians companies that do not belong to the raw materials sector. The RF President has instructed the Agency for Strategic Initiatives to join forces with Vneshekonombank, the Russian Direct Investment Fund, and other development institutions in order to to draft a comprehensive program of target projects. Such target projects will then be offered to exporter companies as a package of insurance and lending solutions to their problems. Also, they will become a means for developing individual lending or insurance products in accordance with the specific features of various export project.
Yuri Zaitsev – Senior Researcher