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STRATEGY FOR BURYATIA: Looking into 2030 and Beyond 1

STRATEGY FOR BURYATIA: Looking into 2030 and Beyond 1

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Check-list for Quality Assurance Buryatia-2030 – an expert group, committed to designing solutions for strategic planning of the region Founded in 2014 by Buryatia-born practitioners with international backgrounds and experts in various fields Looks into standing problems and future challenges from the perspective of the heritage to be left for the future generations POSITION PAPER: CHECK-LIST firm criteria and expectations that the regional government should address when re-designing development priorities Meeting expectations of stakeholders Incomes policy – sound sources of growth Horizon-scanning: opportunities Natural resource management and environment policy Human capital policy Institutions and regulation Meeting federal regulation requirements POSITION PAPER: CHECK-LIST firm criteria and expectations that the regional government should address when re-designing development priorities Meeting expectations of stakeholders Incomes policy – sound sources of growth Horizon-scanning: opportunities Natural resource management and environment policy Human capital policy Institutions and regulation Meeting federal regulation requirements 3

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Page 1: STRATEGY FOR BURYATIA: Looking into 2030 and Beyond 1

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STRATEGY FOR BURYATIA: Looking into 2030 and Beyond

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Drivers for Buryatia’s Strategy Update

Need for a NEW SOCIAL CONTRACT in the changing economic and political environment

Economic slowdown

Resource limitations

New political cycle: coming governor

elections

Previous Strategy up to 2025 not fully delivered

Requirements of the new Federal Law 172-FZ “On Strategic Planning in the Russian Federation”

Synchronization of federal, regional and municipal-level strategic planning documents: state programmes, budget forecast, territorial

planning

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Check-list for Quality AssuranceBuryatia-2030 – an expert group, committed to designing solutions for strategic planning of the region

Founded in 2014 by Buryatia-born practitioners with international backgrounds and experts in various fields

Looks into standing problems and future challenges from the perspective of the heritage to be left for the future generations

POSITION PAPER: CHECK-LIST firm criteria and expectations that the regional government should

address when re-designing development priorities

• Meeting expectations of stakeholders• Incomes policy – sound sources of

growth• Horizon-scanning: opportunities• Natural resource management and

environment policy• Human capital policy• Institutions and regulation• Meeting federal regulation

requirements

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Survey “Vision-2030”

Fundamental values of the new strategy?

• A “2 out of 3” choice requested between values of sustainable development

Industries / spheres to be prioritized?

SWOT

• strengths, weaknesses, opportunities and threats for the Republic in the changing world

VALUES OF SUSTAINABLE DEVELOPMENT

1. Breakthrough economic growth: development of innovative and competitive industries and services, integration into global production chains, attraction of large investors, growth rate of gross regional product no less than 8% per year

2. Social balance and protection: preservation of traditional balance between main social groups, equal access to public services (education and health), employment; respect for cultural and social diversity

3. Environment safety: conservation of natural resources for future generations and reducing environmental pollution

24 October – 7 November 2015

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Respondents

43 respondents

Moscow Ulan-Ude Another region of Russia

Abroad

16

21

1

5

Place of residence

Over 50 years

16 – 30 years30 – 50 years

Age

Student

Civil servant

Researcher / Lecturer

Entrepreneur

Other

0 2 4 6 8 10 12 14

Occupation

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5 alternative models: groups with shared values and solutions

Universal and Harmonic Welfare; 5

Innovations and Environment; 14

Buryat Break-

through; 7

Society and Envi-ronment: What

Shall Be Left to Our Children?; 11

School, Village, Bury-atia; 6

Social balance and equality Environment safety

Social balance and equality

Breakthrough economic growth

Breakthrough economic growthEnvironment safety

Breakthrough economic growthSocial balance and equality

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Common grounds: Top-10 industries / spheres of attention

A clearly articulated

policy needed

0 5 10 15 20 25 30 35

Agriculture

Food industry

Power industry

Information tech-nologies

Mining industry

Education

Tourism

Culture

Environmental pro-tection

Resource-saving technologies

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StrengthsNatural gifts • Clean environment for tourism and agriculture

• Rich natural resources: minerals (including gold and jade), forestry, water

• Baikal lake: 1/5 of world fresh water resources

Geographic location

• Close location to growing Asian markets: China, Korea, Mongolia

Productive capacity

• Industrial potential: machine-building (helicopter plant)• Well-established education infrastructure (4 universities for 1

mln population)

Human capital • Attractive cultural heritage• Hospitality• Cultural and religious tolerance• High level of education and in-built values of education

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Internal “enemies” (weaknesses)Weak institutions and elites

• Corruption, nepotism• Weak institutions• Tribalism and psychology of short-term gains among political elites• Absence of development “lighthouses” – benchmarks• Absence of national idea / inspiration, long-term strategic vision• Discouragement of entrepreneurship • Dependence from public sector: investments and employment

Decreasing quality of human capital

• High debt load of population, low financial literacy of population• Widespread poverty• Absenteeism and social indifference• Aging population• Spread of alcoholism and drug addiction• Education not matching economic demand• Short-term gains-focused education, lack of complex vision with population• Low level of technological expertise in resource management (minerals, water)

Production barriers

• Deindustrialization - reduction of the value-generating industrial sector• Environmental burden: “Baikal” factor• Low spread of internet use• Low quality and high cost of energy & transport infrastructure

Weak nature-saving culture

• Weak nature-saving culture, little knowledge and responsibility

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Tackling “internal enemies”Weak institutions and elites

• Propaganda and empowering Rule of law• Improving transparency of decision-making• Criminal penalties for corruption• Competitive employment process, especially in the government • Building strong political will of the Government• Change of ruling elites • Empowering civil society, public control institutions• Improving regulatory regime and financial resource availability for SMEs, with clear

monitoring and evaluation• Strong strategy for Buryats - 10, 20, 50 years (as Tatars)• Equal rent distribution

Decreasing quality of human capital

• Investments into education, link with the best technologies• Common educational standards• Transformation of mind and behavior: vision and horizons widening, building values of

self made men• Large scale program of agriculture development, creating jobs in rural areas

Production barriers

• Lowering tariffs for energy• Use of new energy sources• Building new transport routes• Improving infrastructure quality• Innovative financing tools• Public private partnership

Weak nature-saving culture

• Learning best international practices of saving environment

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OpportunitiesDemand for natural and cultural gifts

• Growing demand for environmentally clean tourist destinations (internal tourists from Russia, as well as from China, Korea and Japan)

• Growing demand for resources (fresh water and minerals, gold and jade)• Growing interest to Baikal and local cultural and historic heritage (Mongol empire, Hunnu

empire)

Access to fast-growing markets

• International transport & logistics projects: Great Silk Road• 3 bln people within 3 hours flight distance (including 1 bln of Asian middle class) • Rise of middle-class in China• “Turn to the East” policy of Russia: support for investment projects with China and other

Asian countries

Demand for production

• Growing demand within Buryatia for high quality products and services• Rise of military tensions as a source of demand for defense technologies and products

(helicopters)• Growing demand for food, and especially for environmentally clean food due to global

population growth

Other advantages

• Rising labour cost in China (as a factor for machine-building and industrial production) • Technological innovations: 6th wave of innovations – energy & resource-saving innovations

for agricultural production (drought-resilient crops), bio-medicine• Crisis sanitation in economics will clear the ground for new industries• Wider use of alternative energy sources• Growing mobility of population, visa-free regimes

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ThreatsAccess to fast-growing markets

• trade barriers at target markets (unclear effects of trade regulation in Asia)

• economic slowdown in China• negative demography: reduction of population,

ageing, brain-drain• loss of control over the resources possessed (to

foreign extracting companies)

• Improving and promoting public image of the republic

• Active use of diaspora links

Relationship with the Federation

• bad federal policy towards Buryatia: focus on resource-extraction, lack of federal investments and support (including into human capital)

• loss of control over the resources possessed (to the federal center)

• federal-level political and economic isolationist policy – worsening political and economic environment around Russia

• federal-level regulatory barriers, including tax policy and lack of predictability

• growing competition among regions for investmentsGlobal trends

• deepening economic crisis in the world and Russia• climate change, environmental and natural disasters

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TODAY’S DISCUSSION: Better Solutions Needed

How to improve?

• Converting weaknesses into strengths– Risk of losing control over resources possessed -

investments into technological expertise / excellence in risk zones. Forestry, water management.

– High debt load - financial literacy / excellence programs, control tools

• Identifying remote lighthouses - next generation technologies / solutions (Japan, Finland)

• Answering what not to do, rather than what to do

WHAT ELSE?

What to improve?

• Incomes policy – sound sources of growth

• Access to markets

• Natural resource management and environment policy

• Human capital policy

• Institutions and regulation

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Thank you!

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Annex. 5 alternative models

Page 16: STRATEGY FOR BURYATIA: Looking into 2030 and Beyond 1

Model 1. Universal and Harmonic WelfareVALUES Breakthrough economic growth

Social balance and equality

Agriculture 9%

Transport and logistics

9%

Power industry

4%

Mining industry4%

Education13%

Health9%

Social protection9%

Tourism13%

Culture13%

Environmental protection

13%

Employment4%

Priority spheres/industries• Influx of tourists • Increase of the middle class,

unemployment and stratification reduction

• Careful attitude to natural and human resources

• Qualitative improvement of transport infrastructure, increase the number of foreign tourists, etc.

• Availability and quality of services in health, education, social protection; 100% employment in the Republic.

• Extend lifespan, reduce mortality, increase birth rate, improve living standards and the welfare of society.

• High wages, decent working conditions, prevent leakage of valuable specialists to other regions.

Indicators of success

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Model 1. Authors

over 50 years

16 – 30 years

30 – 50 years

Age

Student

Doctor

Other

Occupation

Page 18: STRATEGY FOR BURYATIA: Looking into 2030 and Beyond 1

Model 2. Innovations and EnvironmentVALUES Breakthrough economic growth

Environmental safety

Agriculture16%

Food industry13%

Machine-building industry

5%

Transport and Logistics

3%

Power industry

9%

Trade2%

Finance2%

Information technology5%

Mining industry3%

Education11%

Health2%

Tourism9%

Culture5%

Environmental protection

9%

Em-ploy

ment2% Resource-saving technologies

6%

Priority spheres/industries Indicators of success• Economic development of the region• GRP growth +2% above neighbors – Irkutsk and

Chita• Market demand of local products or services• Employment, increase in average wages in the

Republic.• Unemployment reduction, improvement of quality

of life.• Growth in production, deep processing and export

of organic agricultural products at least 10% per year. Growth in tourism at least 10% per year (first of all ecological tourism).

• Growth of environmental safety of region, the purity of lake Baikal, raise cultural and educational level of the population.

• Competitiveness of the economy, improve the position in the ranking of socio-economic situation of regions, reduce corruption.

• High wages, preservation of region`s significant resources.

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Model 2. Authors

30 – 50 years16 – 30 years

over 50 years

Age

Entrepreneur

Civil servant

Researcher/Lecturer

Student

Top-manager

Financial analyst

Specialist

Occupation

Page 20: STRATEGY FOR BURYATIA: Looking into 2030 and Beyond 1

Model 3. Buryat BreakthroughVALUES Breakthrough economic growth

Agriculture19%

Food industry10%

machine-building industry

10%Transport and

Logistics6%

Trade6%

Finance3%

Information technology6%

Mining industry3%

Health3%

Tourism10%

Culture6%

Environmental protection

6%

Employment 6%

Resource-saving technologies 6%

Priority spheres/industries Indicators of success• Economic growth• Consolidation of the political elite around a

common goal, approval of development strategy of region by central government, attracting reliable foreign partners.

• Introduction of new technologies in agriculture (fields irrigation, development of vegetable production, strengthening of breeding works in animal husbandry).

• Development of small and medium businesses in the sphere of processing and food industry; Support machine-building industry.

• Decrease emigration of young people from the Republic of Buryatia. Increase immigration to the Republic.

• Satisfaction with quality of life in the moment .

• Production of real products, GRP growth more than 8%.

• Increase in income per capita.• Self-sufficiency and financial independence

of the region from Federal center.

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Model 3. Authors

30 – 50 years

16 – 30 years

Age

Researcher/Lecturer

Civil servant

Entrepreneur

Occupation

Page 22: STRATEGY FOR BURYATIA: Looking into 2030 and Beyond 1

Model 4. Society and Environment: What Shall Be Left to Our Children?VALUES Social balance and equality

Environmental safety

Agriculture12% Food industry

6%

Transport and Logistics4%

Power industry4%

Construction and Hous-ing 4%

Finance2%

Information technology2%

Mining industry6%Education

8%Health4%

Social protection4%

Tourism4%

Culture12%

Environmental pro-tection

12%

Employment2%

Resource-saving technologies12%

Priority spheres/industries Indicators of success• Decrease of out-going migration.• High employment and high wages.• Decrease of unemployment in villages and

small cities, growth of entrepreneurship in tourism and agriculture industry, emergence of centers of gravity , successful cultural and social initiatives.

• Healthy and wealthy population• High quality of life and the human

development index• Stability• Balanced budget, unemployment reduction,

availability of education and health service• Increase level and quality of life• The interest of the population in the region

development, decrease violations against nature.

• Sustainable development

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Model 4. Authors

30 – 50 year

16 – 30 year

Over 50 year

Age

Civil servant

Entrepreneur

Student

Researcher/ Lecturer

Other

Occupation

Page 24: STRATEGY FOR BURYATIA: Looking into 2030 and Beyond 1

Model 5. School, Village, BuryatiaVALUES Social balance and equality

Agriculture20%

Food industry7%

Machine-building industry

3%Trade

3%

Infor-mation tech-

nology10%

Mining industry7%

Education13%

Health7%

Tourism13%

Culture3%

Environmen-tal protection

7%

Employment7%

Priority spheres/industries Indicators of success• Growth of economic

indicators. Public support.• Moral and physical health of

citizens. High employment. Favourable financial position of citizens

• Region specifics(traditions in the animal husbandry, recreational potential, culture of the peoples)

• Achievement of performance indicators

• Unity of the population.• Standards of living

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Model 5. Authors

30 – 50 years

Age

Researcher/ Lec-turer

Other

Occupation