MAIN PAGE | EVENTS & PROGRAMS | 2001 | IGM | SPEECHES | DR. VICTOR ISHAEV
PACIFIC BASIN ECONOMIC COUNCIL
MAIN PAGE | EVENTS & PROGRAMS | 2001 | IGM | SPEECHES | DR. VICTOR ISHAEV
Regional Vitality in the 21st Century
April 6-10, 2001 — Tokyo, Japan
Dr. Victor I. Ishaev
Dear ladies and gentlemen: 34th International General Meeting is our first encounter in the 21st century which as we all of us hope should open new vistas for humanity. In our opinion it is still impossible to estimate such prospects even for the near future without a brief characteristic of the past century. It was the century of history-making events that drastically changed the life of mankind. This was the century of the unprecedented thrust of the world economy, of colossal social change, of outstanding achievements in science, of immense cultural gains. Still the same century brought most barbarous devastating wars that took away lives of tens of millions and destroyed enormous material assets. All in this controversial century was most directly connected with the Asia Pacific Region which states in the period have survived through the colonial rule, two world wars, socialist revolutions, civil wars, local, ethnic and religious conflicts, a strong opposition of the two social systems during the cold war years. The last decade of the 20th century was characterized by turbulent global structural changes ensuing from the disintegration of the Soviet Union, the collapse of the socialist system, the emergence in place of this system's fragments of new states, the end of the cold war. In the very same years the USA has occupied a position of the only super-state on the world arena. Many were waiting with impatience for the disintegration of the USSR thinking that it would lead to the end of the cold war, the removal of danger of the all-out nuclear war and to increased international security. Still the last decade has shown that the end of the global opposition of the two systems and the transfer from the bi-polar to the mono-polar world did not make it more secure while the course of political process did not become predictable. The open military force dictate of the USA that demonstrated gross negligence of the universally accepted international principles identified itself most evidently during the aggression against Yugoslavia that reduced this so short ago flourishing state to a state of ruins. Clearly manifest in the present-day mono-polar world became the indication of a rigid military (political) and financial (economic) pressure exerted by the stronger states on the weaker ones which grew apparent in the Asia crisis of 1997 - 1998. It was at this time that international political and financial organizations and unions got widely used for the purpose of interference into the inner affairs of sovereign states. International hard currency speculators by manipulating with financial flows caused not only global and regional economic disturbances but also large-scale social conflicts that have put whole states and economic systems to the edge of bankruptcy. This crisis has seriously undermined the process of the region's turning into one of the world economic centers that started already in the fifties. The regular tendency for high indicators of economic growth in the Asia Pacific Region economies surpassing the world mean ones that prepared the ground for this region to become the major world finance and trade center in the near future ousting the north-American and European economic systems from their main roles, this tendency was substituted by the opposite one. The social situation has deteriorated very much in many regions and states. The last two-year performance of Asia Pacific economies allows to make a conclusion that the financial and economy crisis of 1998 has been overcome in general though it is quite obvious that the former growth rates are no more realistic and the economic models themselves need serious adjustment with regard to rapidly growing challenges of globalization in the world economy. For Russia the 90ies were a period of active Pacific foreign and trade policies. This tending towards the Pacific went slowly and with a difficulty but certain goals were achieved. In this period Russia became full member to all major international organizations in the APR and actively participated in the life of the region during this past decade, including not the very best events, I mean the Asia economic crisis. Russia in overall has coped with the main negative aftermath of the crisis. The relevant economic indicators are well known and I will not reiterate that. Many of the audience here today including myself are more interested how the Russian Federation can take a more active part in the recovery of Asia regional vitality. It is a very complicated issue as our state is going through a stage of transfer to market economy. The painful character of Russia's transfer to market and its integration into the world economy is explained by the absence of social concord in society and in the ruling elite as far as the long-term strategy of the country and is also explained by the weakness of the democratic state institutions that are being used by different social groups in their selfish corporate interest. The working group that is headed by me after the commission of the Russian Federation President V.V.Putin and myself being a member to the State Council of the RF Presidium, has worked out a concept of Russia's long-range development in which the conditions, principles and factors of its dynamics and integration into the civilized world economic system are formulated. Our approach consists in the assumption that the state should be regarded as a consolidated system developing as one whole: as one country, as one nation. Under this approach the principles, goals and mechanisms formulated in shape of Russia's strategy should have conformed to the task of forming a strong and efficient state, the state as a system of institutes, the state that should play its role in the transition period and should create the environment for a decent life of its citizens. The state social and economic strategy is a widely used instrument of anti-crisis regulation, of mobilizing all resources for solving the tasks of structural technological and institutional upgrading of the economy, including in the conditions of the so-called «catching-up growth within the globalization process itself. The world experience analysis of states differing in their political structure and economy, gives all reasons to believe in a certain regularity in the efficiency of the methods to overcome the effects of crisis. It consists in the state regulation of transfer and crisis policies with regard to national and economy specifics of the particular state. State involvement was typical of the USA during the Great Depression, of the post-war recovery and de-militarization of economies in Germany and Japan, as well as of South-East Asia states entering the group of dynamically growing ones, and of the changes in China's economy system. Russia is ready to use this experience. The main task in this connection is in ensuring a high-rate and which is most important, sustainable economic growth on a long view. High growth rates are not a narrow task for us. They must be a means to reach clear and acceptable to the population targets of well-being, current success in structural and technological upgrading, obtaining additional competitive advantages for Russia on the international arena. Under this assumption of future policy benchmarks Russia should and can answer the following quite rigid requirements to the parameters of economic growth (Slide: «Annual mean growth rate in major economic parameters»). Our concept relies on the Gross National Product to be at the rate of 5-6% annual at least. It follows that the economic growth key factor in the coming 20 years will be the investment thrust. This investment thrust means firstly the accelerated growth of investment into the main capital at 8-9% minimum annually; secondly, it means the investment maneuver in favor of the branches and enterprises that are able to enter the world markets with the competitive production; thirdly, this will secure the innovative character of investment. I believe such an approach to state investment policies may be of interest to our foreign partners and to our potential APR investors primarily. We find it important that our concept includes the system of state control over financial operations based on the systematically well-balanced legislation. The international community that has for a long time been calling on Russia for a system to counteract «money laundering» is sure to be specially receptive to the steps towards such a system of control. The Concept separately dwells on the system of measures to increase and diversify exports from Russia. The world economy globalization and the increasing international trade open up for Russia and its regions new opportunities for larger exports and more intense foreign trade in general. Our state has a number of serious competitive advantages (qualified and relatively cheap workforce, resource base, transit opportunities, intellectual potential, etc.) that allow it to expand its niche in the world markets. This niche appears thanks to differences in saturation with factors of production in various national economies. There are states that have enough capital and technologies (the USA, Japan and others). There are states saturated with labor resources (China, Indonesia and others). The third group states have rich natural resources (the Near East etc.). As a result of excess of one kind of resource and the lack in the other all states through the international labor division and foreign trade are trying to find the efficient solution to their economic problems. In this situation Russia with its existing economic potential can offer the international markets its raw material products, high-tech and its intellectual potential, it has every chance to grow exports in all the three country groups. This chance should be taken over the next several years. An important requirement for Russia's involvement in the economic globalization and efficient use of its advantages in the international labor division is joining the World Trade Organization (WTO). Regardless of the aftermath of the talks between the WTO and Russia at the federal level there should be set up a viable system of economic and organizational support of exports including the following:
A more active role of Russia in the outer markets will in many ways help it overcome the restrictions of the demand that exist inside the country and will become an important factor of sustainable high economic growth. There is another issue given special attention in the Concept, the issue of regulating the regional outer relations. By admitting the import-substituting policies for Russia in overall, its particular regional policies should be adjusted. Specifically for border regions and for regions with export specialization more efficient is the strategy of promoting exports. This is very important for the Far East and for some other border regions. Working out of the strategic development concept allows us to determine quite clear orientations for the country development in the long-term period, including foreign economic sphere. Forming of such orientations by the state is a good stimulus for the Russian private capital, including the part of it that operates in the Asia-Pacific region, and there is every reason to think that Russian companies will become worthy partners to the leading corporations of the Pacific Basin. |
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