As the Russian economy sinks into recession, the Russian government is putting a brave face on things. The threefold argument is that the combination of plummeting energy prices and Western sanctions has been beneficial, that the anti-crisis program is working, and that a “Strategy 2030” is being formulated to show the way into a radiant future. The essence of the latter is import substitution, putting an end to hydrocarbon dependence and promoting diversification. None of this is new, nor is it very smart. The realization that the resource based growth model has been exhausted dates several years back. The belief in import substitution lacks substance, and seeking diversification out of energy, which is the only sector with comparative advantage, makes even less sense. The bottom line is that the Russian economy is headed for protracted decline, leaving economic policy making to grapple with short-term crises rather than long-term visions.
Stefan Hedlund is Professor of Russian Studies at Uppsala University, Sweden. A long-standing specialist on Russia, and on the Former Soviet Union more broadly, his current research interest lies in economic theories of institutional change. He also has a devouring interest in Russian history, which he has sought to blend with more standard theories of economic change. He has been a frequent contributor to the media, and has published extensively on matters relating to Russian economic reform and to the attempted transition to democracy and market economy more generally. His most recent publications include Invisible Hands, Russian Experience, and Social Science: Approaches to Understanding Systemic Failure (Cambridge University Press, 2011), and Putin’s Energy Agenda: The Contradictions of Russia’s Resource Wealth (Lynne Rienner, 2014).
The lecture series is jointly organised by the Centre for EU-Russia Studies (CEURUS) (University of Tartu), Uppsala Centre for Russian and Eurasian Studies (University of Uppsala) and the Global Europe Centre (University of Kent) in the framework of the UPTAKE project funded by the EU.