Economists specify reasons for low ratings of North-Caucasian regions

The shadow economy, deficit of qualified workforce and corruption lead the republics of Northern Caucasus to last places in socioeconomic ratings, the economists interviewed by the "Caucasian Knot" believe. In their opinion, the financing of outsiders from Moscow will continue.

The "Caucasian Knot" has reported that, according to the data of the "Rosstat" (Russian Statistics Committee) for Quarter 2 of 2019, the Kabardino-Balkarian Republic (KBR) and the Stavropol Territory entered the ten regions with the highest share of families, which have enough incomes only for food. On October 22, it became known that the check conducted by the Auditing Chamber showed the inefficiency of state support of Northern Caucasus.

Sergey Zhavoronkov, an expert at the Gaidar Institute for Economic Policy, believes that Moscow is unlikely to curtail the economic programmes for outsider regions. "Such a decision is unlikely; for example, the support of Chechnya won't be reduced," he said.

He treats the attitude to work as the main problem of the regions of the North-Caucasian Federal District (NCFD). "In these regions, the population has grown such a culture that work is for the naïve people, while serious guys should be busy dividing budget money. Corruption and lack of professionalism of local cadre are also affecting the situation," Mr Zhavoronkov asserts.

Natalia Zubarevich, an expert in regional socioeconomic development, Professor at the Moscow State University (MSU), is sure that the shadow economy is most likely to lead to depression in the NCFD regions. "There is quite a lot of shadow economy there. There are practically no investors, apart from the state budget, since there are huge risks for investments. They are cutting the budget; and the so-called 'kickbacks' are widespread. Besides, there's a deficit of proper cadre, while consumer demand is low. What else can we expect in such conditions?" Ms Zubarevich has asked rhetorically.

In her opinion, the situation will at least not improve, if the necessary steps are not taken. "Another crisis may happen; and the situation will worsen significantly. I can't say for sure, but most likely everything will remain as it is, if the economic situation and the cadre policy not change," Professor Zubarevich has concluded.

This article was originally published on the Russian page of 24/7 Internet agency ‘Caucasian Knot’ on October 23, 2019 at 09:35 pm MSK. To access the full text of the article, click here.