Mi”hael Delyagin: Governmental Poli”y Dire”tly Contradi”ts to Possibilities of Development of Innovations

The first Deputy Prime Minister of Russia Igor Shuvalov declared that there would be no serious innovative development in Russia until prices for oil and gas fall.

According to Shuvalov, new opportunities for development of non-oil sector of economy will open in case of falling of prices for oil and decrease in income from export of hydrocarbons.

"The main request for innovations will appear when there will be no hope for high prices, for our traditional export. If it will last long, we will have serious problems with innovative development," — Shuvalov told at a meeting with participants of the World economic forum in Moscow.

The official recognized that he often had to answer questions of possible consequences of sharp decrease in income from oil and gas export.

"What is good is that if prices for oil and for our main export groups will nevertheless go down, those who have no relation to raw material se”tor will get absolutely different opportunities," — the Deputy Prime Minister noted.

According to him, businessmen working in non-oil innovative sectors were happy with ”risis of 2008 which forced the government to pay attention to those spheres. "It quickly passed away — as soon as prices for energy resources returned back,” — Shuvalov summarized.

Last year the Deputy Minister of Economic Development and Trade of the Russian Federation Andrey Klepach declared that if Russia would follow innovative scenario of development of economy and would raise expenses for education, health care, science and transport infrastructure, oil and gas income of the budget can be reduced to 5,3% of gross domestic product by 2030.

Then the former Minister of Finance Alexey Kudrin noted that reduction of oil and gas incomes had to become one of priorities of economic policy of Russia if it wanted to be competitive. "Russia should depart from a model of growth of demand which has been warmed up by injections of "oil" resources," — he said.

Now price for oil makes about 109 dollars for barrel. Earlier officials predicted falling of prices for oil below 100 dollars. Thus the Russian budget for 2014-2016 has been created at the forecast of price for oil at the level of 93 dollars for barrel in 2014 and 95 dollars in 2015-2016.

According to the Ministry of Economic Development, the share of innovative products in production in the Russian Federation grew from 5,4% in 2006 to 6,1% in 2011, the share of technologically innovative products in export of the sphere of production was reduced from 12,5% in 2003 to 4,9% in 2011.

According to Rosstat data, expenses of the Russian Federation on research and development made only 1,68% of gross domestic product in 2012, at that contribution of the state made 0,56% and of business - 1,12%. In 2003 the state invested 0,31% of gross domestic product, while private sector - 1,29% of gross domestic product. The number of personnel engaged in researches and development was reduced by 2012 by 18,1% in comparison with 2000 and in comparison with 1992 - twice.

From editorial board: For more than ten years reformers say things opposite to what Shuvalov declared. They assure that high pri”es for energy produ”ts are necessary for innovations.

Things whi”h Shuvalov told seem to be eternal rehash told about oil damnation of Russia. The statement that innovations will start developing as soon as pries for energy produ”ts will fall are absolutely unreasonable. It is told to cover own idleness and to prove it somehow.

If Shuvalov was right, innovations would have been developing in the 90s at low prices for oil in Russia. But we perfectly know that it wasn't so.

Innovations demand investments. Money is ne”essary for this purpose. Foreign investors are engaged in investment of money into development of innovations in own country. If Russia will have no money as oil and gas will cost little, we would have no innovations as well.

There’s opportunity for innovations right now, when Russia earns money and has something to make investments. Though the policy of the government in whi”h Shuvalov plays a key role directly contradicts to possibility of development of innovations. The policy of the government sabotages every innovative activity. It concerns both corruption and arbitrariness of monopolies and terrible bureaucratic barriers.

When Shuvalov claims that innovations are impossible now, it is necessary to wait when oil will fall in price and we will see – he tells lies. He does it either deliberately, or without understanding of the situation. I am afraid that he is simply incompetent person. Besides he simply justifies Medvedev's position which pursues policy at which innovations are impossible.

Ūi”hael Delyagin, ”hairman of editorial board of FORUM.msk