Russia may face decade of sluggish development

Russia is entering a period of minor depression with decreased economic growth, which can become an additional challenge for Moscow’s development, noted Yevgeny Balatsky, Director of the Center for Macroeconomic Research of the Financial University under the Government of the Russian Federation, addressing a roundtable discussion, Moscow 2030: Future of Metropolitan Economy. The event was organized by the Invest Foresight business news website and the Technopolis Moscow special economic zone as part of the Engineering the Future Club project.  

“Today’s Moscow can be compared to a four-headed dragon: this city is an administrative, financial, cultural and innovative center. No other region can compete with Moscow; however, the situation may change in a decade. Yet, I am sure that unless the capital city is moved, Moscow will continue to be an administrative, financial and cultural center, but not necessarily an innovative one. The peak of innovation resources’ concentration in Moscow may pass”, the expert noted.

According to Balatsky, Moscow’s development can be compared to that of Shanghai, which accumulated all resources but was not comfortable for living and became overpopulated and polluted.

“This resulted in Jiangsu and Guangdong becoming top cities as regards innovative development. Moscow may share the same fate [as Shanghai]. This is one of the world’s most urbanized cities, with its population density being three times that of Paris”, the expert said.

He emphasized that Moscow must cease to be a ‘black hole’ – a city with ever-expanding infill construction.

“Yet, this scenario is hardly probable; most likely, things will remain as they are and innovation enterprises will relocate to other Russian major cities such as Kazan and Sochi”, Balatsky concluded.

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