Book Review: Exploring the Future of Russia’s Economy and Markets by Dr. Bruno Sergi
Russia has been an independent nation since the dissolution of the Soviet Union for more than 27 years. Since then, Russia went through a painful and complex process of transition. Over the past 10 years, the 2008 financial crisis and the economic sanctions, due to Russia’s annexation of Crimea, halted the growth possibility for Russia from its existing model: sole dependence on oil and natural resource exportation for revenue. Its GDP growth rate sank drastically in 2015 and 2016. Russia’s economic problem is not cyclical, but structural. Since 1991, Russia has failed to make substantial adjustments to the severe structural deformities inherited from a planned economy of the Soviet period.
However, since 2017, the Russian economy has emerged from recession and is beginning to show signs of recovery, despite the ongoing sanction. Its GDP is back to being positive; it was 2.2% by the end of 2017 and only continues to grow in 2018. The signs of growth have appeared in all aspects of Russia’s economy: industrial, agriculture and services. Fixed capital investment in many industrial sectors has advanced steadily and the unemployment rate fell from 5.5% in 2016 to 4.5% in September 2018. So, how do we explain the recent development in Russia?
Exploring the Future of Russia’s Economy and Markets: Towards Sustainable Economic Development edited by Bruno S. Sergi, is a collection of revealing reports released at a much needed time, as much of Russia’s coverage by western news media today revolves around geopolitical narratives. The 13 chapters of this book penned by Bruno S. Sergi and other veteran academic authors in the fields of economics, finance and Russian studies, helps us see through the fog of geopolitical tension through a glaring reality check about Russia’s economy. The book offers a sweeping examination of Russia’s evolving economic landscape, identifying its growth potentials, risks, and development trends.
Despite its lack of coverage and attention, today Russia is an economic power. Its GDP is the 6th largest in the world (PPP 2017, World Bank). It’s a country paradoxically full of potential, with a vast landscape, rich natural resources, quality education on many levels, and a reservoir of talent in scientific and technological research. The central question is: will Russia ever be able to diversify and modernize its economy?
Bruno S. Sergi, who teaches a course on the political economy of Russia and China at Harvard University, has made steady efforts to track and reveal the political and economic momentum inside Russia. This book is his latest judicious work that offers penetrative and forward-looking analysis about the changes that are taking place in various economic spheres, including innovation, financial markets, the energy sector, and the green economy and the impact of the sanction in Russia. Most importantly, the book offers its perspective on the ongoing structural changes that are fundamental to Russia’s long-term potential.
One could understandably assume that no guaranteed progress will come from the paralyzed economy of Russia, yet this book engages Russia at the frontline of global development. Sergi not only helps us understand what is going on internally, but he analyzes the future of the country and the impact of its changes on the rest of the world. Exploring the Future of Russia’s Economy and Markets: Towards Sustainable Economic Development certainly deserves more attention from the media and academic community alike.
This piece was republished from The Fletcher Forum.