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The NTI Competence Center at Moscow State University and the Roscongress Foundation evaluated the potential of urbanization as a driver of socio-economic development in the Far East

9 September 2022
Центр компетенций НТИ, МГУ и Фонд Росконгресс оценили возможности урбанизации как драйвера социально-экономического развития Дальнего Востока

Accelerated socio-economic development of the regions of the Far Eastern Federal District is one of the key priorities of government policy in the Russian Federation. The most important process affecting the macroregion's economic potential is urbanization. This means the growth and expansion of major economic centres and an increase in the share of the urban population, including through the concentration of highly qualified specialists in the main cities of the Far East. The prospects, opportunities and obstacles to Far Eastern urbanization are discussed in the report ‘The Horizons of the Urbanization of the Far East’, prepared by the NTI Competence Center for Storage and Analysis of Big Data at Moscow State University, with support from the Roscongress Foundation for the 7th Eastern Economic Forum.

The specific features of the Russian Far East include its extremely low population density (1.2 people per km2) and the predominance of small settlements. The population of the Far Eastern Federal District as of 2021 is 8.1 million people and is declining by approximately 20–40 thousand people annually. The largest economic centres of the Far Eastern Federal District are the cities of Khabarovsk (617,000 people) and Vladivostok (603,000 people). The share of the Far East in Russian GDP in 2020 was 6.44% (compared to 6.05% in 2016). Potential drivers for the long-term socio-economic development of the Far Eastern Federal District include:

 geographical location close to the fast-growing markets of the Asia-Pacific region;

 the availability of significant reserves of natural resources;

 location in a natural transport corridor between Europe and Asia;

 construction of a new civilian spaceport Vostochny;

 availability of scientific and educational potential provided by research centres of the Russian Academy of Sciences and federal universities;

 development of major industrial centres in the aviation, shipbuilding, automotive and oil and gas industries.

Thus, the economic potential of the Far East depends to a large extent on the pace of urbanization, increasing the share of highly qualified specialists and developing backbone enterprises based in major urban agglomerations. It also depends on the development of innovative infrastructure, including the Smart City project of the Russian Ministry of Construction, which is being implemented in more than 10 cities in the Far Eastern Federal District. Alexei Beloshitsky, Executive Director of the NTI Competence Center for Technologies for Storage and Analysis of Big Data, has identified three main barriers to this process and possible ways of overcoming them: “The urbanization of the Far Eastern Federal District as a factor in the socio-economic development of this region faces three main barriers. These are the outflow of population, which is mainly young specialists leaving for central regions of Russia, the low level of transport and social infrastructure development, and high tariffs for energy supply and logistics services. The diversity of the Far East makes it impossible to choose a single solution for these barriers. This is because local specifics, including climatic conditions, the presence of major economic centres and transport hubs must be taken into account. For the effective development of the macroregion, efforts need to be coordinated not only at different levels of government but also at the level of business and in the scientific and educational environment. This ‘triple helix’ will allow for a synergistic effect in implementing innovative projects, which will help to attract qualified personnel to major cities in the Russian Far East.”

The Far East has impressive potential for growth in terms of the development of transport and energy infrastructure, both between major economic centres and as part of the regional transport network. The provision of affordable means of transport mobility, combined with the timely regulation of energy tariffs in the short and medium term, can help to increase the number of innovative infrastructure projects in the Far East. Raising private investment and consequently developing tourism infrastructure and creating high-tech production facilities are ‘targets' within the framework of overcoming barriers to the socio-economic development of the Far East.

Using a systematic approach to strategic planning for the development of the Russian Far East can help to create new infrastructure projects and modernize the existing transport network and production facilities in the Far Eastern Federal District.

“Despite its remote location from the federal centre of government, difficult climatic conditions and low population density, the Russian Far East has several advantages. With the correct approach, these advantages will ensure the sustainable socio-economic development of the macroregion. In this case, urbanization is one of the drivers of economic growth. In order to fully realize this potential, a comprehensive policy focused on improving the quality of the urban environment, modernizing backbone enterprises, providing institutional support and solving problems with the infrastructure provision of the Far Eastern regions should be pursued,” summarizes Oleg Karasev, Director of the Centre for Science and Technology Forecasting, Economics Faculty, Lomonosov Moscow State University.