Deputy Dean, School of Political Affairs (MGIMO-University), Associate Professor
September 2-3, 2016, Vladivostok hosted the second Eastern Economic Forum on the campus of the Far Eastern Federal University. The event, which attracted broad international participation, primarily businessmen from the Asia Pacific region, is aimed at maintaining interest in Russia’s Far East and at sustaining the initiatives launched in the Primorskiy krai while preparing for the APEC summit.
While the first Forum held in 2015 seemed spontaneous, the second one was due and was to provide a platform for considering the preliminary results of the accelerated development programs as well as Primorye’s economic future. Actually, by that time the Ministry for Development of the Russian Far East had already made the list of development strategies public. The most important items included priority development areas (PDAs) and Vladivostok’s porto-franco regime.
It is also noteworthy that the sidelines of the 2016 Eastern Economic Forum saw the first Russia — ASEAN University Forum (UF ASEAN), a momentous event in our bilateral relations.
Generally, the Forum opened up opportunities for in-depth discussions of both Far Eastern economic processes and international cooperation between the region and Asia-Pacific. Panels on priority development areas, the “Far Eastern Hectare” project, industrial clusters, small business, healthcare, city development, and the Far Eastern financial market and logistics networks in Primorye and beyond its borders examined various aspects of the Far Eastern advancement. Multi-track business dialogues took place, with particular panels devoted to Russia’s economic and investment collaboration with China, Japan, South Korea and ASEAN member-states.
The distinguishing feature of the 2016 Eastern Economic Forum constituted a broader participation of ASEAN countries. The workshop on ASEAN economic engagement in the Far Eastern development touched upon the investment projects launched by Singapore, Thailand, Indonesia and Vietnam in Russia’s Far East and elsewhere. For instance, Thailand’s Sutech Engineering allied with Indonesia’s Salim Group had invested in building a Sugar Refinery Plant in the Khabarovsk Krai. This issue was brought up during the panel discussion. This marks the beginning of the Far Eastern economic diversification and signifies the region’s search for new partners apart from China, Japan and South Korea as its traditional agents.
The Eastern Economic Forum also witnessed the exhibition on the campus of the Far Eastern Federal University. It displayed both priority development areas and Russia’s particular companies such as Norilsk Nickel, VTB, Alrosa. RusHydro etc.
The panel discussions demonstrated that the projects in the Russian Far East so far had represented a mixture of success stories and setbacks.
The positive results undoubtedly include a five per cent growth in manufacturing across the region this year, which is by far higher than the Russian average. Other accomplishments are an unprecedented surge in investment projects (about three hundred projects) and better vital rates. Putin presented all these figures in his speech during the WEF plenary session. Due to the PDAs the economic situation in the Far East is more favorable than across Russia. PDAs’ activities do not overlap; the areas differ in industrial specialization. For instance, PDA Big Stone focuses on shipbuilding and ship repair, PDA Mikhailovsky develops the agro-industrial complex, and PDA Nadezhdinskaya specializes in transport, logistics and the light industry.
However, despite a number of obvious achievements, development strategies actually lag behind planning. Thus, the visa-free regime for Vladivostok and the territories in the free port which was due this June has been postponed.
Even though the Russian authorities who are in charge of the Far East development invested a great deal of effort, many participants of the Forum were still concerned about the consistency of the efforts to implement the presented program as stability and predictability are central to business.
Regardless of the importance of the economic agenda per se, this year it was closely intertwined with political issues as Korean President Park Geun-hye and Japanese Prime Minister Shinzo Abe became the distinguished guests of President Putin. The three leaders spoke at the plenary session moderated by former Australian Prime Minister Kevin Rudd. Putin dwelt predominantly on the development problems of the Russian Far East, as well as on the need for joint economic development of Russia, the Eurasian Economic Union and the Asia-Pacific region through multilayered integration on the macro-regional scale. President Park Geun-hye and Prime Minister Shinzo Abe contributed their ideas about the development of the Far East, but they could not but deal with the political issues of the bilateral relations. Quite expectedly President Park touched upon the North Korean nuclear issue. In his turn, Abe expatiated on the Russian-Japanese territorial dispute over the Kuril Islands. The leaders expressed their vision of the issues. Most importantly, the meeting was trilateral, it brought together the leaders of Russia, Japan and South Korea, it was held on the eve of the G-20 summit in Hangzhou and Putin’s schedule included bilateral talks with Park Geun-hye and Abe. Thus, Russia aspires to give positive impetus to Japanese-South Korean relations, as well as it aims to demonstrate its constructive approach and its leading role in many political and economic processes in the Asia-Pacific region.