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SIBERIA: RUSSIA’S ECONOMIC HEARTLAND AND DAUNTING DILEMMA

By Fiona Hill

Siberia has loomed large in perceptions about Russia’s place in the world. Throughout Russia’s modern history, Siberia’s size – it encompasses more than three-quarters of Russia’s total territory – and its geostrategic position astride the Eurasian landmass have contributed significantly to Russia itself. And the exploration and development of Siberia have helped shape Russian national identity. Siberia has been seen as Russia’s “treasure chest,” the source of new wealth, new territory, and folk traditions that evolved alongside the unique cultures of Siberia’s indigenous peoples. Russian writers have extolled Siberia as the “untamed frontier” and a “New World” savior for the rest of Russia. As late as the 1980s, a statement attributed to Mikhail Lomonosov, the great Russian scholar of the eighteenth century – “Russia’s power will grow with Siberia” – adorned the walls of Russia’s science classrooms.

Siberia, as the primary repository of Russia’s massive natural resource base, has played a vital role in underpinning the Russian economy. Furs from the forestlands across the Ural Mountains and Siberia, along with salt and minerals, bolstered the economy of Muscovy and the early Russian empire from the fifteenth to the eighteenth centuries. Siberia’s mineral resources fueled the industrialization of the Russian empire in the nineteenth century and the development of Soviet industry after the 1917 revolution. West Siberian oil became the mainstay of the late Soviet economy from the 1960s, and it remains the backbone of the Russian economy today.

According to Russian calculations, Siberia holds just under 80 percent of Russia’s oil resources, about 85 percent of its natural gas, 80 percent of its coal, similar amounts of precious metals and diamonds, and a little over 40 percent of the nation’s timber resources. As a result of this rich base, and its exploitation, Siberia is in many respects what geographer David Hooson would call Russia’s “effective national territory,” or its economic heartland – the region that produces a surplus relative to the size of its population and that essentially supports the rest of the country. As a number of recent studies by geographer Michael Bradshaw and economist Peter Westin have demonstrated, with the exception of the city of Moscow and the industrial region of Samara in the Urals, the major contributors to the Russian economy in terms of per capita gross regional product (GRP) are all natural-resource regions, primarily in Siberia and the Russian Far East. The oil-producing region of Tyumen in West Siberia tops the list; then Chukotka, also a major energy producer; Sakha (Yakutia), the site of Russia’s world-class diamond industry; Magadan, a major mining region; Sakhalin, the island repository off the Pacific coast of one of Russia’s richest new finds of oil and gas; and Krasnoyarsk, a vast coal mining, mineral, and precious metal producing region.

Siberian economy: facts and figures

In the 1st quarter of 1995 Siberia gave 24% of Russia’s industrial output, its share of national economy balance-sheet profits in the quarter was 18.3%. Indicators of economic efficiency for majority of Siberian regions and territories considerably exceed the Russian economy average. That is, labor productivity in Siberia surpassed the Russia’s average for 58% in the 1st quarter. In certain Siberian territories the superiority is even greater: in Tyumen region – for 326%, in Irkutsk one – for 94, in Krasnoyarsk krai – for 66%. Average wages in Siberia exceeded Russia’s average earnings by 32% in the 1st quarter of 1995.

http://www.brookings.edu/experts/hillf.aspx