Russia is extremely heterogeneous country: whatever parameter is used at comparing of its regions, they will all be different from each other. The territory, climatic conditions, ethnic composition, economic potential and level of social development - all these parameters are different.
However, there is a need to understand the specificity of each subject of the federation, in determining the amount of the investment, demographic and consumer potential, the degree of business representation. For these purposes the Information agency Credinform has prepared a "Rating of socio-economic development of the regions".
The statistical data collected by our experts are quite different in each region, due to the heterogeneity of the territories. Bringing them to the standardized indicators (points) helps to get the generalized result, which will give an objective picture of regional development and allow comparison of the republic, territory, region, autonomous regions, and federal cities with each other.
The bases of the rating consist of 15 indicators best reflecting the current socio-economic situation in each of the 85 Russian regions. This is information on the demographics, level of wages, incomes of regional budgets and size of the GRP (gross regional product) per capita, inflation, investments, retail turnover, number of legal entities and individual entrepreneurs, etc. (see Table 1).
Table 1. Indicators used to compile the rating of the regions; minimum and maximum values.
№ | Indicator | Minimum points (1) | Maximum points (85) |
---|---|---|---|
1 | Population on January 1, 2016 | The lowest population | The highest population |
2 | Rate of natural population growth, 2015 | The lowest value | The highest value |
3 | Relative increase (decrease) of population, 2015 | The lowest relative growth / decrease in population | The highest relative growth of the population |
4 | Life expectancy at birth (both sexes, the entire population), 2014 | The lowest life expectancy | The highest life expectancy |
5 | Unemployment rate in average for the year, 2015 | The highest level of unemployment | The lowest level of unemployment |
6 | Volume of gross regional product (GRP) per capita of the RF subject, 2014 | The lowest GRP per capita | The highest GRP per capita |
7 | Average monthly nominal wage of employees on a full range of organizations, January-December 2015 | The lowest wage | The highest wage |
8 | Investments in fixed capital per capita, 2014 | The lowest investments per capita | The highest investments per capita |
9 | Retail trade turnover per capita, 2014 | The lowest retail trade turnover per capita | The highest retail trade turnover per capita |
10 | Revenues of the Russian Federation subject budget (excluding non-repayable income) per capita of the subject of the Russian Federation, 2014 | The lowest revenues of the budget per capita | The highest revenues of the budget per capita |
11 | Turnover of public catering per capita, 2014 г. | The lowest turnover of public catering per capita | The highest turnover of public catering per capita |
12 | Basic consumer price index in December 2015 to December 2014 | The highest price index (inflation rate) | The lowest price index (inflation rate) |
13 | Index of industrial production, 2015 | The lowest increase in the index of industrial production | The highest increase in the index of industrial production |
14 | The number of individual entrepreneurs on March 1, 2016 | The lowest number of individual entrepreneurs | The highest number of individual entrepreneurs |
15 | The number of legal entities on March 1, 2016 | The lowest number of legal entities | The highest number of legal entities |
To assign the region of a numerical point for each of the 15 indicators, the data were ranked by decrease / increase of their numeric values. For example, the inflation rate was ranked from the lowest to the highest value, while the index of industrial production - from the highest to the lowest.
The total index of socio-economic development of the Russian Federation subjects was calculated by summing up the points for all indicators.
Eventually three groups of territories under the following conditional names were drawn: "Regions of the first group" (from the 1st to 30th place), "Regions of the second group" (from 31st to 60th place) and "Regions of the third group"(from 61st on the 85th place).
Expectedly, the "Regions of the first group" are areas with the major sectors of the Russian economy: oil and gas, mining, agriculture, as well as the capital cities (Moscow and Saint-Petersburg). The level of social and economic development in these regions is higher than the average around the country.
The first place in the national rating is taken by Moscow (1091 points). With the exception of high inflation and the reduction of the index of industrial production, the capital shows the great potential both in demographics (ongoing growth of the population, high life expectancy), and in the development of the regional economy in general. The highest number of legal entities and individual entrepreneurs, the highest budget revenues per capita, the lowest unemployment level in the country are recorded in the capital.
The Republic of Tatarstan takes the second place (1046 points) having high values of all 15 assessment indicators.
Saint Petersburg is on the third place (1027 points), and as well as Moscow, is lagging behind in terms of higher inflation and lower industrial production index.
Table 2. "Regions of the first group". Top-10 of the RF subjects with the best level of socio-economic development
Place in the rating | Subject of the Russian Federation | Total points |
---|---|---|
1 | Moscow | 1091 |
2 | The Republic of Tatarstan | 1046 |
3 | Saint-Petersburg | 1027 |
4 | Khanty-Mansi autonomous okrug - Yugra | 993 |
5 | Moscow region | 987 |
6 | Tyumen region (excluding AO) | 986 |
7 | Krasnodar territory | 961 |
8 | Yamal-Nenets autonomous okrug | 932 |
9 | The Republic of Sakha (Yakutia) | 929 |
10 | Krasnoyarsk territory | 910 |
The "Regions of the second group" are subjects, demonstrating the best values of one indicators and unsatisfactory of other.
For example, the Chukotka autonomous okrug (595 points) has one of the lowest levels of inflation in the country, the highest level of wages paid, high budget revenues and volume of the GRP per capita, in the background of "catastrophic" demographic processes: Chukotka has one of the worst indicators of life expectancy, total population, and the relative increase in population. Thus, high income today does not make this harsh land attractive for living, as it was in the Soviet period. The romance of the northern territories development has gone.
On the contrary, the Republic of Dagestan (697 points) with a relatively low level of economic development shows good demographic data, including for life expectancy, which is typical for the whole Caucasus.
The "Regions of the third group" are entities of Russia with the worst values of the general index of socio-economic development. New regions of the Republic of Crimea (468 points) and Sevastopol (390 points) were also included in this group.
It is interesting, that last year Sevastopol showed the highest relative increase in population among all the regions of Russia, but poor economic figures has not yet allowed this region to rise above the 75th place of the rating.
The Republic of Crimea has low values of the GRP and budget revenues per capita. Also, the highest value of core inflation dynamics is recorded. All these put the Republic on the 69th place of the national rating.
Kurgan region (298 points) closes the final table with the smallest composite index. The region scored the minimum points on all key indicators.
Table 3. "Regions of the third group". Top-10 of the RF subjects with the worst level of socio-economic development
Place in the rating | Subject of the Russian Federation | Total points |
---|---|---|
75 | Sevastopol | 390 |
76 | Oryol region | 379 |
77 | Republic of North Ossetia-Alania | 378 |
78 | Kostroma region | 367 |
79 | Jewish autonomous region | 364 |
80 | Ivanovo region | 357 |
81 | Republic of Ingushetia | 343 |
82 | Republic of Kalmykia | 339 |
83 | Pskov region | 321 |
84 | Karachai-Cherkessian Republic | 309 |
85 | Kurgan region | 298 |
The presented rating largely explains the budget, migration and investment attractiveness of the Russian regions, and their image ("bad" - "good") among the population. Migratory and financial flows go to the conditionally "promising" areas to the development prejudice of other regions of the Russian Federation.
This situation is associated with the policy of level equalization of budget financing through intergovernmental transfers, subsidies, grants. Such actions lead to two paradoxical results: the Federation accumulates tax revenues in a single center, and the regions in their turn expect the budget funds inflow without efforts to their own socio-economic development. Hence, there is a significant predominance of the recipient regions over the donor regions. The same applies to the local authorities, which on paper are endowed with a wide list of powers, but there is often no funds for their implementation. Excessive centralization leads to obvious distortions in the development of the country in general. The government should seek to balance the interests of the regions by providing them more autonomy and financial resources without compromising the integrity.
Appendix. Rating of socio-economic development of the region
Table 4. "Regions of the first group". The first 30 subjects of the Russian Federation in terms of socio-economic development
№ | Subject of the RF | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | 13 | 14 | 15 | Total points |
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
1 | Moscow | 85 | 65 | 79 | 84 | 85 | 80 | 81 | 73 | 85 | 81 | 81 | 26 | 16 | 85 | 85 | 1091 |
2 | The Republic of Tatarstan | 78 | 69 | 67 | 72 | 80 | 72 | 56 | 76 | 78 | 66 | 66 | 69 | 39 | 79 | 79 | 1046 |
3 | Saint-Petersburg | 82 | 64 | 73 | 82 | 84 | 75 | 75 | 67 | 77 | 76 | 72 | 24 | 11 | 81 | 84 | 1027 |
4 | Khanty-Mansi autonomous okrug - Yugra | 58 | 80 | 77 | 74 | 70 | 83 | 79 | 83 | 81 | 80 | 82 | 8 | 21 | 61 | 56 | 993 |
5 | Moscow region | 84 | 45 | 81 | 62 | 83 | 65 | 73 | 59 | 80 | 70 | 71 | 6 | 42 | 83 | 83 | 987 |
6 | Tyumen region (excluding AO) | 54 | 74 | 83 | 50 | 38 | 76 | 71 | 78 | 79 | 79 | 79 | 31 | 79 | 53 | 62 | 986 |
7 | Krasnodar territory | 83 | 50 | 80 | 75 | 44 | 57 | 44 | 75 | 75 | 45 | 74 | 50 | 44 | 84 | 81 | 961 |
8 | Yamal-Nenets autonomous okrug | 14 | 81 | 4 | 69 | 81 | 84 | 84 | 84 | 83 | 83 | 84 | 80 | 64 | 21 | 16 | 932 |
9 | The Republic of Sakha (Yakutia) | 30 | 79 | 66 | 36 | 24 | 79 | 77 | 79 | 63 | 78 | 80 | 82 | 63 | 55 | 38 | 929 |
10 | Krasnoyarsk territory | 73 | 61 | 65 | 23 | 41 | 74 | 70 | 74 | 62 | 68 | 42 | 83 | 28 | 74 | 72 | 910 |
11 | Sverdlovsk region | 81 | 46 | 55 | 34 | 35 | 66 | 63 | 57 | 82 | 59 | 77 | 16 | 19 | 80 | 82 | 852 |
12 | Novosibirsk region | 71 | 55 | 70 | 47 | 31 | 56 | 50 | 47 | 59 | 48 | 46 | 67 | 46 | 72 | 80 | 845 |
13 | Samara region | 75 | 34 | 43 | 31 | 82 | 61 | 47 | 66 | 74 | 61 | 62 | 30 | 30 | 71 | 77 | 844 |
14 | Sakhalin region | 13 | 47 | 39 | 10 | 36 | 82 | 80 | 82 | 84 | 84 | 73 | 75 | 83 | 23 | 25 | 836 |
15 | The Republic of Bashkortostan | 79 | 56 | 51 | 35 | 43 | 50 | 41 | 46 | 73 | 38 | 55 | 66 | 47 | 77 | 75 | 832 |
16 | Belgorod region | 57 | 28 | 59 | 73 | 78 | 68 | 38 | 51 | 56 | 41 | 14 | 77 | 68 | 59 | 53 | 820 |
17 | Perm territory | 69 | 49 | 48 | 21 | 37 | 63 | 52 | 52 | 71 | 49 | 68 | 58 | 35 | 73 | 73 | 818 |
18 | Nizhny Novgorod region | 76 | 20 | 32 | 29 | 71 | 51 | 45 | 55 | 72 | 51 | 41 | 62 | 56 | 75 | 76 | 812 |
19 | Nenets autonomous okrug | 1 | 78 | 78 | 56 | 17 | 85 | 83 | 85 | 67 | 85 | 85 | 4 | 76 | 1 | 1 | 802 |
20 | Rostov region | 80 | 31 | 46 | 65 | 42 | 32 | 33 | 32 | 66 | 29 | 56 | 46 | 85 | 82 | 74 | 799 |
21 | Khabarovsk territory | 50 | 53 | 33 | 11 | 53 | 70 | 72 | 62 | 68 | 69 | 69 | 29 | 38 | 48 | 59 | 784 |
22 | Murmansk region | 23 | 48 | 17 | 40 | 19 | 71 | 76 | 71 | 76 | 72 | 75 | 42 | 75 | 22 | 33 | 760 |
23 | Chelyabinsk region | 77 | 42 | 57 | 32 | 27 | 42 | 58 | 36 | 47 | 39 | 40 | 81 | 24 | 76 | 78 | 756 |
24 | Voronezh region | 64 | 15 | 58 | 61 | 69 | 48 | 36 | 69 | 69 | 33 | 16 | 20 | 60 | 66 | 69 | 753 |
25 | Leningrad region | 59 | 8 | 62 | 48 | 57 | 69 | 66 | 63 | 49 | 71 | 44 | 18 | 29 | 57 | 48 | 748 |
26 | Irkutsk region | 66 | 63 | 49 | 4 | 15 | 64 | 65 | 58 | 18 | 62 | 22 | 53 | 67 | 70 | 70 | 746 |
27 | Tomsk region | 37 | 66 | 63 | 57 | 20 | 67 | 68 | 68 | 14 | 63 | 58 | 47 | 33 | 35 | 50 | 746 |
28 | Stavropol territory | 72 | 59 | 56 | 77 | 49 | 20 | 27 | 18 | 58 | 16 | 70 | 13 | 71 | 78 | 61 | 745 |
29 | Magadan region | 3 | 43 | 2 | 6 | 72 | 78 | 82 | 81 | 64 | 77 | 78 | 64 | 74 | 5 | 5 | 734 |
30 | Omsk region | 62 | 54 | 53 | 45 | 32 | 47 | 49 | 17 | 52 | 43 | 39 | 73 | 41 | 60 | 64 | 731 |
Table 5. "Regions of the second group". Subjects of the RF from 31st to 60st places in terms of socio-economic development
№ | Subject of the RF | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | 13 | 14 | 15 | Total points |
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
31 | The Republic of Komi | 26 | 58 | 6 | 22 | 28 | 77 | 74 | 80 | 70 | 74 | 67 | 32 | 48 | 29 | 31 | 722 |
32 | The Republic of Udmurtia | 56 | 60 | 52 | 42 | 59 | 44 | 37 | 27 | 29 | 44 | 65 | 71 | 22 | 52 | 57 | 717 |
33 | Orenburg region | 63 | 44 | 31 | 17 | 61 | 62 | 35 | 50 | 33 | 56 | 60 | 78 | 9 | 58 | 55 | 712 |
34 | Yaroslavl region | 47 | 19 | 54 | 55 | 52 | 49 | 43 | 45 | 42 | 65 | 47 | 14 | 70 | 46 | 60 | 708 |
35 | Kaliningrad region | 31 | 41 | 75 | 49 | 47 | 53 | 53 | 39 | 34 | 55 | 52 | 54 | 13 | 41 | 67 | 704 |
36 | Primorye territory | 61 | 38 | 40 | 18 | 30 | 59 | 67 | 44 | 41 | 57 | 54 | 57 | 2 | 64 | 71 | 703 |
37 | Astrakhan region | 34 | 67 | 37 | 59 | 23 | 41 | 40 | 72 | 54 | 35 | 53 | 44 | 72 | 38 | 29 | 698 |
38 | The Republic of Dagestan | 74 | 82 | 76 | 83 | 5 | 12 | 1 | 41 | 60 | 4 | 83 | 15 | 52 | 62 | 47 | 697 |
39 | Lipetsk region | 42 | 17 | 45 | 53 | 77 | 60 | 32 | 60 | 61 | 52 | 28 | 49 | 43 | 40 | 32 | 691 |
40 | Kamchatka territory | 8 | 62 | 29 | 12 | 68 | 73 | 78 | 53 | 38 | 73 | 76 | 43 | 53 | 9 | 15 | 690 |
41 | Kemerovo region | 70 | 30 | 35 | 9 | 21 | 39 | 51 | 56 | 20 | 46 | 36 | 60 | 54 | 63 | 65 | 655 |
42 | Saratov region | 67 | 24 | 41 | 63 | 62 | 28 | 22 | 23 | 19 | 23 | 20 | 63 | 58 | 67 | 63 | 643 |
43 | Arkhangelsk region (excluding AO) | 41 | 36 | 7 | 46 | 34 | 52 | 69 | 43 | 65 | 67 | 61 | 19 | 12 | 45 | 37 | 634 |
44 | Vologda region | 43 | 37 | 34 | 33 | 33 | 55 | 48 | 40 | 23 | 54 | 23 | 52 | 51 | 47 | 58 | 631 |
45 | Tula region | 55 | 2 | 22 | 30 | 76 | 38 | 46 | 33 | 44 | 60 | 6 | 34 | 80 | 54 | 51 | 631 |
46 | Kaluga region | 33 | 27 | 50 | 39 | 73 | 54 | 57 | 65 | 53 | 58 | 25 | 7 | 4 | 42 | 42 | 629 |
47 | Penza region | 51 | 16 | 20 | 68 | 64 | 25 | 26 | 28 | 32 | 21 | 38 | 72 | 73 | 51 | 41 | 626 |
48 | Volgograd region | 68 | 29 | 25 | 67 | 26 | 40 | 30 | 48 | 25 | 30 | 11 | 38 | 32 | 69 | 66 | 604 |
49 | Kirov region | 48 | 26 | 18 | 52 | 56 | 18 | 17 | 15 | 24 | 24 | 63 | 74 | 62 | 50 | 54 | 601 |
50 | Chukotka autonomus okrug | 2 | 72 | 9 | 2 | 79 | 81 | 85 | 77 | 10 | 82 | 7 | 84 | 1 | 2 | 2 | 595 |
51 | The Republic of Khakassia | 15 | 57 | 61 | 20 | 45 | 46 | 59 | 49 | 21 | 34 | 43 | 85 | 23 | 17 | 14 | 589 |
52 | The Republic of Buryatia | 32 | 76 | 68 | 16 | 11 | 16 | 55 | 7 | 37 | 20 | 64 | 70 | 55 | 27 | 30 | 584 |
53 | Kursk region | 39 | 12 | 64 | 44 | 75 | 37 | 28 | 38 | 40 | 37 | 17 | 10 | 65 | 37 | 36 | 579 |
54 | Novgorod region | 16 | 6 | 21 | 14 | 66 | 58 | 42 | 64 | 48 | 50 | 51 | 40 | 57 | 16 | 19 | 568 |
55 | Amur region | 24 | 39 | 19 | 5 | 46 | 43 | 64 | 61 | 55 | 64 | 49 | 22 | 5 | 26 | 24 | 546 |
56 | Bryansk region | 44 | 14 | 16 | 27 | 67 | 21 | 10 | 22 | 51 | 13 | 59 | 35 | 82 | 44 | 34 | 539 |
57 | Tambov region | 36 | 4 | 3 | 64 | 65 | 35 | 12 | 70 | 50 | 17 | 13 | 45 | 66 | 31 | 28 | 539 |
58 | The Republic of Chuvashia | 45 | 51 | 47 | 54 | 58 | 17 | 8 | 12 | 12 | 18 | 48 | 61 | 17 | 49 | 39 | 536 |
59 | Ryazan region | 40 | 10 | 23 | 60 | 63 | 36 | 39 | 21 | 36 | 36 | 26 | 36 | 18 | 36 | 45 | 525 |
60 | Vladimir region | 53 | 9 | 15 | 24 | 51 | 29 | 29 | 19 | 28 | 31 | 34 | 41 | 50 | 56 | 46 | 515 |
Table 6. "Regions of the second group". Subjects of the RF from 61st to 85st places in terms of socio-economic development
№ | Subject of the RF | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | 13 | 14 | 15 | Total points |
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
61 | Tver region | 49 | 3 | 8 | 15 | 48 | 30 | 34 | 34 | 45 | 47 | 32 | 51 | 14 | 43 | 49 | 502 |
62 | Ulyanovsk region | 46 | 22 | 28 | 51 | 60 | 26 | 24 | 30 | 27 | 25 | 15 | 21 | 45 | 39 | 43 | 502 |
63 | Ulyanovsk region | 52 | 85 | 82 | 78 | 3 | 3 | 20 | 11 | 6 | 3 | 57 | 11 | 40 | 28 | 12 | 491 |
64 | Smolensk region | 29 | 5 | 14 | 28 | 39 | 33 | 25 | 25 | 43 | 32 | 45 | 65 | 34 | 30 | 40 | 487 |
65 | The Republic of Karelia | 17 | 21 | 26 | 25 | 12 | 45 | 60 | 20 | 46 | 40 | 33 | 59 | 31 | 13 | 35 | 483 |
66 | Altai territory | 65 | 32 | 30 | 41 | 16 | 15 | 2 | 9 | 26 | 14 | 8 | 55 | 36 | 65 | 68 | 482 |
67 | The Republic of Mordovia | 25 | 13 | 44 | 66 | 74 | 24 | 19 | 26 | 7 | 53 | 9 | 68 | 15 | 19 | 18 | 480 |
68 | The Republic of Marii El | 20 | 52 | 38 | 26 | 54 | 23 | 18 | 42 | 11 | 15 | 35 | 27 | 78 | 11 | 21 | 471 |
69 | The Republic of Crimea | 60 | 25 | 71 | 58 | 25 | 1 | 21 | 2 | 5 | 1 | 5 | 1 | 81 | 68 | 44 | 468 |
70 | Zabaikalye territory | 38 | 68 | 27 | 7 | 7 | 22 | 62 | 35 | 22 | 28 | 50 | 12 | 27 | 34 | 20 | 459 |
71 | The Republic of Adygea | 10 | 40 | 69 | 70 | 13 | 10 | 15 | 8 | 57 | 11 | 19 | 48 | 61 | 14 | 10 | 455 |
72 | The Republic of Tyva | 7 | 83 | 72 | 1 | 2 | 8 | 54 | 24 | 2 | 8 | 4 | 76 | 77 | 7 | 4 | 429 |
73 | The Republic of Kabardino-Balkaria | 28 | 75 | 60 | 81 | 8 | 5 | 5 | 3 | 15 | 7 | 12 | 5 | 69 | 33 | 17 | 423 |
74 | The Republic of Altai | 5 | 77 | 74 | 8 | 9 | 13 | 23 | 37 | 9 | 10 | 10 | 39 | 84 | 6 | 8 | 412 |
75 | Sevastopol | 9 | 33 | 85 | 76 | 14 | 2 | 31 | 1 | 8 | 75 | 21 | 2 | 7 | 15 | 11 | 390 |
76 | Oryol region | 22 | 7 | 11 | 37 | 40 | 31 | 11 | 31 | 30 | 22 | 27 | 37 | 25 | 25 | 23 | 379 |
77 | The Republic of North Ossetia - Alania | 21 | 73 | 42 | 79 | 10 | 11 | 6 | 13 | 31 | 6 | 24 | 28 | 3 | 18 | 13 | 378 |
78 | Kostroma region | 19 | 18 | 24 | 43 | 55 | 27 | 13 | 10 | 13 | 26 | 31 | 33 | 8 | 20 | 27 | 367 |
79 | Jewish autonomous region | 4 | 35 | 1 | 3 | 18 | 34 | 61 | 29 | 17 | 42 | 29 | 79 | 6 | 3 | 3 | 364 |
80 | Ivanovo region | 35 | 11 | 12 | 38 | 50 | 6 | 7 | 4 | 35 | 12 | 30 | 23 | 10 | 32 | 52 | 357 |
81 | The Republic of Ingushetia | 12 | 84 | 84 | 85 | 1 | 4 | 14 | 5 | 1 | 2 | 1 | 3 | 37 | 4 | 6 | 343 |
82 | The Republic of Kalmykia | 6 | 71 | 13 | 71 | 6 | 9 | 3 | 54 | 3 | 9 | 3 | 56 | 20 | 8 | 7 | 339 |
83 | Pskov region | 18 | 1 | 10 | 13 | 29 | 14 | 9 | 14 | 39 | 27 | 37 | 17 | 59 | 12 | 22 | 321 |
84 | Karachai-Cherkessian Republic | 11 | 70 | 36 | 80 | 4 | 7 | 4 | 16 | 4 | 5 | 2 | 25 | 26 | 10 | 9 | 309 |
85 | Kurgan region | 27 | 23 | 5 | 19 | 22 | 19 | 16 | 6 | 16 | 19 | 18 | 9 | 49 | 24 | 26 | 298 |
The operating efficiency of the small and medium enterprises (SMEs) is one of the main indicators of the State’s competitiveness. According to the experts, in France the share of SMEs by GDP cover is 62%, in Italy - 60%, Japan – 55%, Germany – 54%, Great Britain - 53%. The share of SMEs by GDP cover in Russia is about 20%. SMEs play important role in the market conditions, but can they unlock the potential and become the reason of rise and development of the Russian economy?
Legislation establishes the criteria of enterprises’ affiliation to the SMEs. The Federal Law № 209-FZ of July 24, 2007 «On the development of small and medium enterprises in the Russian Federation» (as amended on 29.12.2015) defines the average number of workers for small and medium enterprises. Meanwhile the order of the Government of the Russian Federation # 702 of 13 July 2015 set the maximum sales revenue for each category. The number of enterprises by categories and separation criteria are represented in Table 1.
The SMEs categories | The number of active legal entities, units |
---|---|
Micro-enterprises (up to 15 workers, maximum sales revenue up to 120 mln RUB) | 1 428 536 |
Small enterprises (up to 100 workers and 800 mln RUB) | 412 060 |
Medium enterprises (101-250 workers and 2000 mln RUB) | 34 166 |
Taking into account the criteria above, according to the Information and analytical system Globas-i, currently there are more than 1,87 mln of SMEs in Russia; that is 37,5% of total active legal entities (4,99 mln legal entities). The comparison of SMEs number and the result of their activity demonstrate the minor contribution of SMEs to the country’s economy. For incorporation and development of SMEs, as well as investors, it is necessary to create the conditions.
What are the small and medium enterprises waiting from the State today? Some interesting suggestions were made on the forum «Small business – the national idea», the Presidium of business association «Support of Russia», VII Conference of the Chamber of Commerce and Industry of the Russian Federation; the events were held in the first quarter of 2016 and dedicated to small and medium enterprises. Among noteworthy proposals are:
- the use of VAT credit in the simplified procedure for enterprises, exporting non-oil and gas products;
- leave the number of reporting forms at current level, simplification of HR record management in micro-enterprises;
- depositing the amount of security by the winner of the contract in dependence on proposed price in the competition (now on price of the contract);
- deliverance of respectable companies from banking collateral;
- increase of maximum revenue amount from 60 mln to 120 mln RUB for using of simplified taxation system;
- extension of small business participation in procurement of state-owned companies up to 15% of annual procurement volume by direct contracts;
- mitigation of the requirements for execution of contracts, the transition to life cycle contracts in procurement of state-owned companies (the cycle includes procurement, future maintenance, and disposal);
- establishment of the uniform rules for taxation and others.
By the end of the events, the Administration of the President of the Russian Federation released a list of orders, which satisfied the representatives of SMEs. It is expected, that in April the Government of the Russian Federation will consider the number of bills, which let to facilitate business activities. However not all requests of SMEs will be satisfied. For example, the Ministry of Finance of the Russian Federation imposes the restrictions on use of some tax benefits.
In particular, the abolition of unified tax on imputed income is transferred on 1 January 2021. It is also suggested to decrease the amount of expenditure tax instead of tax rebate for online buying of cash register equipment, if SMEs were not required to use the cash registers earlier; there are also other restrictions. However, one thing is obvious – the facilitation of small and medium business activities will contribute its revival, the growth of economic entities, their income and, accordingly, income of the State.