How can Russian avoid a Maidan?

Experts predict that joining Crimea to Russia could negatively affect the Russian economy because of the worse investment climate and withdrawal of capital from Russia.

Alexander Buzgalin, professor of economics at MSU, said that the economic effect of joining Crimea will be controversial: "On the one hand, it is a beautiful and rich land. I like it very much, often went there for vacations, I have a lot of friends there and worked in the MSU branch there. But there are many problems because it involves financial restructuring, infrastructural restructuring, there are many difficult problems with the Crimean economy. So most likely it will be 50/50, with a temporal lag. At first there will be more losses and spending, but then, I hope, if the policy is smart, there will be a good positive effect."

Speaking about how sanctions against Russian could influence relations with the South Caucasus, Buzgalin said that "this question was decided by every country independently. For Russia, this dialogue is possible and necessary. If regions and countries decide that participation in some form in Eurasian integration is their strategic task, I think that Russia will support this dialogue even more. On the Russian side there are new impulses to develop dialogue with the countries of the South Caucasus, Asia and Latin America."

Commenting on the situation in the Russian economy, thr professor reminded that the Ukrainian Maidan was caused, among other factors, by the policy of Yanukovich, and we can face serious problems if we don't develop alternative mechanisms. "Political and economic power in Russia belongs to the block of oligarchs, mostly connected to natural resources, 100 billionaires control one-third of Russia's wealth. This is is 10 times more than the global level. The second side of this block is the state bureaucracy, which organizes a policy profitable to them. In the situation of alleged free market competition, the big structures have big advantages."

What can the alternative be? In the opinion of Buzgalin, Russia needs an industrial policy, support for the real sector, modern industrial and agricultural production, advanced technologies, education, medicine, while science should become a part of the united integral production complex and gain new value. He added that Russian citizens should feel themselves to be the owners of their country: "The majority of us are employees, but an employee in the contemporary world can and should understand what is going on in the economy and how the company works."

The unfair distribution of resources is also a big problem. "Russian has an unacceptable level of social inequality. The wealthiest 10% have 16 times more than the poorest 10%. This is the official number, but the real one is even worse."

He believes that the energy of the business community, workers, engineers, teachers, etc. should be released. "This is what we need, because otherwise we will push ourselves into a situation in which people would go to a "Maidan", and this is not the best way to resolve the socio-political problems"

Vestnik Kavkaza