Continent Siberia

27 december 2012

From a Colony to a Global Player

Vladimir Ryzhkov is Co-Chairman of the RPR-Parnas party and is a former State Duma Deputy representing the Altai Territory.

Vladislav Inozemtsev holds a PhD in Economics; he is Head of the Department of World Economy at the Faculty of Public Administration, Lomonosov Moscow State University, and Director of the Center for Post-Industrial Studies.

Ilya Ponomarev is a State Duma Deputy representing the Just Russia political party in Novosibirsk region.

Resume: Siberia should re-evaluate its place and role, and start developing itself as an element of the global economy, similar to what the eastern U.S. states did several decades ago and China’s coastal provinces did recently.

Siberia is an immense territory that stretches for over 12.4 million square kilometers from the eastern slopes of the Urals to the Pacific Ocean. It took Russia more than four hundred years to develop this land in what proved to be the most ambitious colonization effort in history, during which one European people inhabited an area spanning from the eastern edge of Europe to the middle of North America’s Pacific coast. Today Siberia’s territory is large enough to easily accommodate any contemporary country. At the peak of the expansion (including Russian Alaska) this “European offshoot” (a term coined by Angus Maddison to denote territories occupied by European powers and subsequently inhabited mostly by descendants from Europe) was larger than the New World’s Spanish colonies from Cape Horn to California and Texas, and could incorporate British territories in Asia three times over.

The region is a vast area of wealth and contains 7% of the world’s explored reserves of platinum, 9% of lead and coal, 10% of oil, up to 14% of molybdenum, 21% of nickel, and 30% of natural gas. The potential of the adjacent offshore fields remains largely unknown. Forests in Siberia and the Russian Far East are larger than the Amazon rainforest. The region has 1.15 times more fresh water than the U.S. and 2.3 times more water than the European Union.

Siberia developed as a classical colony for more than four hundred years. Russian settlers moved into sparsely populated areas, suppressed local resistance with military superiority, and created new systems to subordinate the local population and ensure their loyalty. Like elsewhere, the Russians built reinforced settlements and vigorously imposed official religion, taking commercial interest mainly in goods that were rare in the rest of the country (a small forest predator, the sable, whose fur was the dominant export commodity in the 17th century, was the main reason Russia took hold of the large territories beyond the Urals and advanced farther east).

The indigenous population shrank rapidly, even though violence was not used as demonstratively as in South and North America. Interestingly, Siberia did not become a part of Russia until 1763. The region was not ruled by governor-generals, but by the Posolsky Prikaz, or Ambassadorial Office, until 1596, and subsequently by the Siberian Prikaz from 1615-1763, which largely copied European departments for colonial affairs. The colonial nature of these territories was also manifested in the considerable number of settlers who had a connection to military service in the 17th-18th centuries. The territory was mainly used as a place of penal servitude and exile (up to 800,000 people were sent to Siberia between 1823-1888, and at least two million were exiled to Siberia from the start of colonization until 1917), and towns were administrative rather than cultural centers. Transportation was intended to link regions with the capital, not with each other, and the entire territory had a focused specialization until the end of the 19th century. Therefore, it is not surprising that Siberia was commonly referred to as a colony both by residents of the then-Russian capital St. Petersburg (Nikolai Bestuzhev, Gavriil Batenkov) and by Siberians (Grigory Potanin, Nikolai Yadrintsev). The latter also spoke of Siberia’s special identity.

Unlike the “overseas territories” of European countries, Siberia has always been part of Russia and its evolution cannot compare to the development of Spanish Mexico, British India, or French West Africa. But does this mean there are no other historical examples that could correlate with the development of this vast territory in Russia? We think there are.

 

SIBERIA AND THE U.S.: SOME COMPARISONS

The history of Siberia and the history of the United States have much in common, even though each country has distinctive peculiarities. There are some amazing chronological coincidences. The first Siberian towns emerged practically simultaneously with American ones: Tobolsk (1587), Surgut (1594), Tomsk (1604), and Krasnoyarsk (1628) are a little older than Jamestown (1607), New York (1624), and Boston (1630). However, the major difference is that the British colonies gained their independence in the late 18th century. But this made little difference for the further development of the two continents. In the first half of the 19th century, territorial expansion continued mainly through military and political methods, and it was not until the middle of the century that people started to move into new territories in large numbers. One can only marvel at the fact that both Siberia and California had a Gold Rush in the 1840s-1860s. Equally amazing is the fact that two events led to a huge movement of people to the Russian Far East and the “Far West” – the abolition of serfdom in 1861 and adoption of the Homestead Act in 1862. Vladivostok and Los Angeles became official towns only ten years apart. Yet the differences in the speed and effects of Russian and U.S. expansion had become increasingly pronounced by the end of the 19th century.

Russia had to cede “Russian America” to the U.S. in 1867 due to problems in maintaining communications with it. Subsequently, Russia was defeated in the Russo-Japanese War in 1905 and the country lost its positions in the Pacific region. By contrast, the U.S. took control of the Philippines in 1898, thus becoming the main power in the Pacific. By the time Russia had completed construction of the Trans-Siberian Railway (1903), the U.S. already had four railways linking its Pacific coast with the rest of the country. It took no more than half a century after the start of the economic boom in the American West for that region to become an economic and business center comparable to the Eastern Seaboard, while the Pacific region of the Soviet Union remained a “Far East.” In 1890, the western U.S. had a population of about four million people compared to 5.78 million people who lived east of the Urals. In 2005, the reverse was true: more than 66 million people lived in the western U.S. and fewer than 39 million lived in Siberia and the Russian Far East. According to the 1897 census, people who were literate accounted for 12.3% of the population in Siberia, compared to 93.7% in the American West. It is also noteworthy that the first university in the U.S., Harvard University, was founded in 1636, while the first university in Siberia’s Tomsk opened in 1888.

In 1970, California had more cars than in the entire region from the Urals to the Pacific. Founded in Seattle in 1917, Boeing had a turnover of $63 billion in 2009, while an aircraft plant commissioned in 1936 in Komsomolsk on Amur reported a mere 6.4 billion rubles in sales the same year. By the beginning of the 2000s, Silicon Valley companies held nearly 16% of all patents registered in the world, while Siberia neither made computers nor cellular phones. Russia’s three northernmost regions – Kamchatka, Magadan Region, and Chukotka – with a combined territory of 1.62 million square kilometers and a population of 530,000 (making these regions similar to Alaska, with 1.71 million square kilometers and a population of 722,000) have a total regional product of 198 billion rubles ($6.1 billion) compared to Alaska’s $44.9 billion. There is an endless list of comparisons to make, but the conclusion is obvious: Russia has fallen hopelessly behind.

Why did the development of Siberia, which was just as rapid in the beginning as that of the American West, get bogged down by the end of the 20th century? References to uninhabitable territories, huge distances, and “enemy” intrigues are part of the traditional answer. But we think there is a different explanation that seems much more relevant: Siberia failed to copy the “Wild West’s” success mainly because its development was strictly subject to the development of the Russian, and then the Soviet, economy. In the late 1980s, a period that could be called the apotheosis of Siberia’s development, the region produced (in percentage of national volume) 66.9% of Russian oil (including gas condensate), 66.7% of its natural gas, 41% of coal, 18% of electricity, 65% of aluminum, and 98% of nickel. No cars were assembled in this vast area and a mere 14.4% of refrigerators and freezers, 6.2% of televisions, and 17.2% of radios were manufactured in Siberia. Throughout most of its history, Siberia supplied mineral resources and primary processing products, as well as special industrial equipment and military hardware. The very logic of development dictated by Moscow rendered Siberia unable to compete on international markets or act as a global economic player. This explains why California’s gross regional product exceeds Russia’s gross domestic product, and why Siberia’s GRP is only two-thirds as large as Belgium’s GDP.

SIBERIA IN THE 20TH CENTURY: RISE AND FALL

“Russia’s strength will grow with Siberia and the Arctic Ocean,” Mikhail Lomonosov wrote in the 18th century. This thesis was proven correct in the second half of the 20th century, when the rapid growth of mineral production and primary processing largely sustained the Soviet economy. From 1960-1986, oil production in the Soviet Union increased 320%, gas production jumped 1,410%, aluminum production rose 340%, nickel output went up 430%, and electricity production soared 450%. Siberia accounted for 60-95% of this growth. As a result, in Soviet GNP the share of the territory east of the Urals rose from 12.3% in 1960 to 18.2% in 1986, and the average economic growth rate in the region was as high as 5.1%–6.5% per year. In the same period, thousands of kilometers of roads and railroads were built in Siberia. For the first time Siberian cities became suitable for living and people started moving to the region. The population increased by one-third in Western Siberia, by 42% in Eastern Siberia, and by 25% in Russia as a whole from 1959-1989. An attempt was made to correct “centripetal” tendencies in science. The creation of the Siberian, and later Far Eastern, branches of the Soviet Academy of Sciences, as well as a large number of research centers helped to increase rapidly the number of scientists in the region and thus bridge the gap with the rest of the country.

However, the development of productive forces in Siberia was still based on the mobilization principles established during World War II. Defense and heavy industries dominated the economy and were additionally buttressed by the development of large mineral deposits in the last decades of the Soviet era. In 1986, the share of heavy industry in the gross regional product (GRP) exceeded 30%, and mineral production went above 20% (the latter is somewhat understated due to non-market price regulation in the domestic market). Up to 85% of all Siberian enterprises were incorporated into ambitious division of labor schemes and depended critically on related industries in the European part of Russia or in other Soviet republics. The Soviet Union’s strained relations with virtually all of its “natural” trade partners in the East – China, South Korea, and Japan –also contributed to Siberia’s focus on Europe. These relations only began to improve with the beginning of perestroika, but could still not compensate even in part for the crisis that had swept the Soviet economy by then. It is for that reason that the effect of market reforms was more pronounced in the eastern regions of Russia.

First, many large enterprises had stopped or were about to stop production, including Krasnoyarsk Heavy Machine-Building Plant, Krasnoyarsk Television Plant, Krasnoyarsk Pulp-and-Paper Plant, Krasnoyarsk Medical Preparation Plant, Krasnoyarsk Harvester Plant, several large defense enterprises in Biisk and Rubtsovsk in Altai, Rubtsovsk Tractor Plant, Altaiselmash, and others.

Second, the crisis hit the region’s infrastructure systems hard: construction of roads and engineering structures nearly came to a halt; Soviet roads and bridges fell into decay; railway freight decreased 1.72 times in the Siberian Federal District and 2.65 times in the Far Eastern Federal District in 1990-2000, and passenger air service plunged fourfold. In 1990-2009, the number of operating airfields decreased from 200 to 108 in Krasnoyarsk Territory, from 60 to 25 in Khabarovsk Territory, and from 67 to 16 in Tomsk region. Passenger turnover on airlines operating 15-19-seat planes dropped 40 times from 1990, and the fleet of 12-seaters shrank by almost 60 times.

Third, mineral production was diversified: only those products that were profitable went directly to foreign markets and the share of exports in mineral production grew steadily. As a result, Siberia plunged back into the past with a resource-based economy and a rapid revival of the colonial concept of development.

Deindustrialization strengthened the resource-based development model in Siberia. In January-September 2012, ore, coal, and metals accounted for 90.6% of exports in Kemerovo region, oil and gas for 90.2% on Sakhalin, ferrous and non-ferrous metals for 76.9% in Krasnoyarsk Territory, and metals and timber for 86.6% in Irkutsk region. It is worth mentioning that Yakutia exports coal (nearly 100%) instead of diamonds, and Magadan Region sells slag and scrap ferrous metals (over 76%) rather than gold, while more precious commodities are traded through Moscow. Overall, 95% of Siberian exports consist of products manufactured by three enlarged industries: energy resources; metals, and ores, as well as timber and primary wood processing products. As Siberia’s raw material specialization increased, investment and financial resources started flowing to certain points of growth, with infrastructure and municipal services, which were far from ideal as it was, gradually falling into decay. As a result, people started leaving the region and those who remained moved to large cities where they could find employment. From 1989-2010, a total of 2.2 million people left the area that lies beyond the Urals and the overall population of Siberia and the Russian Far East dropped by 3.57 million. The urban drift is continuing. The share of people living in cities with a population of over 100,000 in the Siberian Federal District increased by 1.3 percentage points from 2002 and exceeded 65% (71% of them lived in cities with a population of 500,000 and more, compared to 57% in 2002).

The federal government became stronger in the 2000s, but Siberia did not develop a strong competitive advantage. In fact, 69% and 83% of investment in railways and road construction respectively was concentrated in the European part of the country in 2001–2010, where 84% of Russia’s new housing was built. The share of housing construction in Siberia and the Far East shrank from 18.1% in 2000 to 13.9% in 2010.

Siberia’s main problem is that before these resources can be invested, they have to be obtained by the state. The budget “vertical” created during Vladimir Putin’s presidency resulted in an unprecedented concentration of financial resources. While in the mid-1990s the share of Siberian regional budgets in Russia’s overall budget system was about 35.1%, the percentage had decreased to 30.9% by 2010. As oil and gas revenues make up 52% of the federal budget and Siberia produces 76% of Russian oil and 87% of gas, this region is a major source of federal budget revenue. However, the region gets back a disproportionately small amount of resources.

In fact, the 20th century was an era of both hope and disappointment for Siberia. Having begun the century with rapid development and population growth, when Prime Minister Pyotr Stolypin (in office from 1906-1911) resettled peasants from the overpopulated European part of the country, and having turned by mid-century into one of the main industrial – and later educational and scientific – centers in the Soviet Union, Siberia failed to face up to reality at the turn of the millennium. While Russia was moving steadily along the road of industrialization, Siberia was outperforming the rest of the country. But when the situation reversed, the crisis in the region turned out to be much deeper than elsewhere in Russia. Today those who care about the future of Siberia and Russia are faced with the crucial task of charting a path for further development. This path can only be unifying since the region, which is dependent mainly on resources, cannot be a political entity in its own right.

FROM COLONY TO MODERN SOCIETY

In assessing the prospects for reviving Siberia - and the whole of Russia – it is important to keep in mind at least three aspects: financial and economic, social, and geopolitical.

Russian politicians keep talking about the need to wean the country off of its dependence on raw materials exports. The politicians are absolutely right; they only need to specify who exactly is dependent. This concerns the European part of Russia in the first place. In 1999, before the government introduced the oil export duty, which is now one of the main sources of federal budget revenue, Moscow’s revenue stood at 72 billion rubles ($2.9 billion). The capital city grossed 1.46 trillion rubles ($48 billion) in 2012, a 16.5-fold increase in terms of U.S. dollars. However, Novosibirsk region’s revenue grew only nine-fold over the same time period.

Major corporations registered in Moscow and St. Petersburg fill the regional coffers by exporting Siberian resources. As a result, the gross regional product of Moscow and Moscow region in 2010 was 8% larger (!) than that of the entire territory east of the Urals, even though there is virtually no material production in Moscow region. Additionally, customs statistics indicate that Siberia provides for only 5.97% of Russian exports, since companies in Moscow and St. Petersburg export oil and gas.

The situation is getting worse, but the only solution Moscow has proposed so far is to create a corporation for the development of Siberia and the Russian Far East. When the initiative was put forth this past spring, public and private investment in the project was estimated at up to one trillion rubles. If the federal government invests two-thirds of this amount, it would still amount to less than $20 billion. Russian exports totaled $516 billion in 2011, with at least $350 billion coming from Siberia, provided that the resources produced in Siberia are exported in the same proportion as those extracted in the country as a whole. This example shows that no redistribution of income through the federal budget can remedy the situation created by the overexploitation of Siberian resources.

Our proposal looks simple and obvious: to give up such a redistribution gradually, but within a reasonable timeframe, and move on to a modern “territorial cost-accounting system.” Under such a system, exporting parent companies would put extracted resources on their books at half the global price (at least), thus increasing both the profit of their units that operate in Siberia and profit tax payments to local budgets. The mineral extraction tax, which is currently paid to the federal budget (the tax is expected to amount to 2.08 trillion rubles in 2012), should simultaneously be divided into equal parts, with one part sent to regions that actually produce mineral resources. Finally, the oil and gas export duty (projected at over 2.57 trillion rubles in 2012) could also be divided equally between the federal and regional budgets. According to the most conservative estimates, these three measures could give Siberian regions no less than 2.5 trillion rubles in additional revenue annually. This would boost potential investment in Siberia and the Russian Far East at least six-fold and would make a hole of 5%-6% of GDP in the federal budget. In our opinion, there is no better way to both spur economic recovery in Siberia and compel the government to modernize the economy. The financial self-determination of Siberia can make it more attractive for people and Russia for business. In fact, this would be a needed injection to overcome the country’s dependence on raw materials.

The social aspect is just as important. Some people usually say that Siberia’s problems stem from its size and complex conditions for doing business on this “continent.” We think that these assertions do not stand up to criticism. The population density beyond the Urals (2.24 people per square kilometer) is comparable to that of Australia (2.81 people per square kilometer) or Canada (3.4 people per square kilometer) but is four times that of Alaska (0.49 people per square kilometer). At the same time, the railroad network density in Australia is three times higher than in Siberia. The density of roads is 10 times higher and the number of airports per 100,000 people is 14 times larger (4.7 and 19 times, respectively, in Canada). In both countries, per capita GDP is $40,000-$42,000 compared to 241,000 rubles ($8,200) beyond the Urals. In Alaska, per capita income was $64,400 in 2010, and exceeded that of California and New York. Unfortunately, Siberia is not becoming a more attractive place for living due to the lack of a well-considered social policy.

First, life and work in the harsh Siberian environment brings no additional income, but the cost of living is higher than in the central parts of Russia. As a result, the number of Siberians with incomes below the subsistence level is much larger than the national average (15.5% versus 12.6% of the total population). Second, some parts of Siberia are poorly connected: air passenger traffic in the region did not exceed 2.8 million in 2010, compared to over four million passengers in Alaska alone. There are no paved roads to 54% of populated areas in Siberia and the Far East. Third, environmental problems raise serious concerns. The city of Norilsk, the region’s metallurgical center, discharges 20 times more pollutants into the environment than Moscow with its population of more than 11 million. Six other Siberian cities are also major polluters.

Siberia falls markedly behind the rest of Russia in terms of healthcare institutions, sport facilities, and child care centers. The mortality rate per 100,000 people beyond the Urals increased from 110.9% of Russia’s average in 1990 to 135.2% in 2010 (the highest growth was registered in the Siberian Federal District: from 117.1% to 159.7% of the national average).

Investment in polyclinics and hospitals, stadiums and sport facilities, kindergartens and new university buildings, indoor swimming pools and modern recreation places, including skiing resorts, such as Belokurikha in Altai, should have priority in receiving funding earmarked for the development of Siberia and the Russian Far East. Siberia needs to stop being a symbol of abominable living conditions and gain the reputation of a nice, modern, and comfortable place to live and play. The region already has several world-class tourist destinations such as Lake Baikal, Altai, and Kamchatka. The Yenisei, Lena, and Amur rivers, Buryatia, and the historical centers of Irkutsk, Tomsk, Tobolsk, Tyumen, Barnaul, and other old Siberian cities all have the potential to attract tourists. The social and tourist potential of Siberia is limitless, but it needs investment and updated organization.

The geopolitical position of Siberia deserves a separate section. The Russian government considers the region a de-facto supplier of raw materials to China (the agreement on cross-border cooperation signed in 2008 calls for developing the mining industry in Russia and processing enterprises in China) and plans to “diversify” trade by moving from energy supplies to the sale of timber and water, and the leasing of farmland. Another important resource in Siberia is its territory, which can be used to transport freight from Asia to Europe. Russian Railways has requested over one trillion rubles from the government to renovate the BAM railroad and the Trans-Siberian Railway in order to increase their throughput capacity by 20 million tonnes a year. Thus, Siberia is considered an “auxiliary territory” for China and Southeast Asian countries.

We are convinced that Siberia’s progress can be achieved only through active industrialization and the development of the service sector, and China is an obvious competitor in this respect. Further progress in the region is also associated with major infrastructure projects and new technologies, and China now is their customer and consumer rather than contractor or manufacturer. Finally, Siberia should remain the embodiment of the Russian version of European culture, not a potential recipient of Chinese norms and practices (especially since the Chinese consider Russian and Siberian culture a part of European culture). We think, therefore, that Russia’s main partners in exploring and developing Siberia should be countries that want to preserve the stable geopolitical balance in the Pacific: the U.S., South Korea, Japan, and maybe even Taiwan. Russia’s historical mission in this region is to sort of “close up” the so-called Northern Ring – a union of modern democratic market economies from Europe to the U.S. via Russia and Japan (or in the opposite direction, whichever is more preferable), while developing the friendliest and closest ties with China. Only then will the development of Siberia receive a powerful boost. Revenue from raw materials, which will remain in the region in increasingly large amounts, should not be used to buy Chinese consumer goods, but rather Japanese and Korean equipment and U.S. technologies. Siberia needs to offer finished products on global markets.

The general agenda looks clear: Siberia must have a strong source of funding for development, which can only be achieved through redistributing revenue from the sale of raw materials. Once achieved, Russia will be able to develop Siberia and force the federal government to start significant reforms that will create new possibilities for the national economy and generate new budget revenue. These funds should be invested in infrastructure and social projects, thereby providing better employment opportunities, giving more power to the local authorities, attracting private investment, and improving the business environment. In parallel to that, it is important to increase social allowances and make businesses comply with modern environmental requirements. Investors from industrialized countries in the region can and should provide technology for both industrialization and development of key innovation centers in Siberia. The region should be positioned as “Europe in Asia,” as a bridge linking Europe to America. It is noteworthy that the first Russian trailblazers used the remotest parts of Eurasia to get to America rather than to the Yellow Sea (even though Russia later actively moved southward). This movement needs to be continued using economic methods this time. Siberia should not be regarded in the 21st century solely as a transit landmass or an exporter of water and timber. The region should become a new center of industrial growth and an innovation economy, which can compete with Central Russia for leadership. A “new California” should appear from the Urals to the Pacific.

“THE ROAD MAP”

The transition from a quasi-colonial Siberia to a Siberia that is incorporated into the global economy and international community has several key stages.

During the initial stage, it will be necessary to draw up a transformation plan, define existing natural restrictions that limit Siberia’s development, determine the amount of financial and material resources needed for a leap, and set clear objectives with definite deadlines. Key elements of this stage should include: drafting a “budget maneuver” strategy based on the redistribution of a considerable part of natural resource revenue from the federal to regional budgets; preparing proposals and determining the requirements for the creation of special investment funds in Siberia, which would accumulate additional revenue; selecting critical investment projects that need to be commenced immediately; and drawing up a development plan and strategy for Siberia, approved by all of its regions. Such a plan and strategy should set clear goals and deadlines rather than contain a variety of options, as current concepts do. In other words, the first step should be the drafting of “the National Project Siberia” as an essential part of the overall integral development strategy for Russia as a key country in the new century.

The second stage will require serious political reform in order to bring genuine federalism back to Russia. Siberian regions could act as the main driving force for development of the country by concentrating their lobbying efforts in several concrete areas: pressing for the right to set their own rates for a number of taxes (similarly to the sales tax in the U.S.); legalizing regional investment funds that accumulate revenue from the sale of natural resources; seeking the right to have their own rules regulating ownership by private investors of infrastructure and “strategic” facilities; and creating conditions for joint federal and regional control over customs and interior agencies, without which the local authorities have limited regulatory influence over economic operations. These measures can lead to the signing of a new federation treaty in the future (or separate treaties between the federal government and Siberian regions) and meaningful nationwide constitutional reform, without which Russia can hardly become a modern state.

The third stage will implement the chosen strategy using consolidated funding and technologies available in neighboring countries. Siberia should eventually become a global industrial and intellectual center that does not meet the needs of the federal authorities, but rather facilitates its own development that, in turn, fuels the development of the entire country. Rather than develop transit between Asia and Europe via Siberia, it is necessary to foster trade in hi-tech industrial products between the part of Russia that lies beyond the Urals and leading Pacific economies. Instead of developing increasingly more new deposits, it is necessary to pursue a reasonable policy of limiting production or even conserving natural resources similar to what the U.S. does. The region needs to step up environmental controls and adopt stricter environmental regulations, develop intensive farming practices, and turn itself into an exporter of organic food. Siberia should develop utilities, communications, and transport that will undoubtedly bring in more monetary resources, while thoroughly calculating the economic efficiency of infrastructure investment, focusing on the development of highway and air transport rather than railways, and modern data transmission technologies. The tremendous tourist potential of Siberia and the Russian Far East needs to be tapped. The region needs to reconsider the Soviet ideology of “conquering nature” and make the region a place where the most environmentally friendly technologies are used. Siberia should be a comfortable place to live for the current generation of Russians and made an even better and more attractive place for future generations.

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For centuries Siberia was the lifeblood of Russian development. Further exploitation of the territory’s potential in the former manner will benefit neither Siberia nor Russia. The federal government’s colonial treatment of its eastern provinces depletes them and corrupts the Russian government and a considerable number of Russians living in large cities west of the Urals. Siberia should re-evaluate its place and role, and start developing itself as an element of the global economy, similar to what the eastern U.S. states did several decades ago and Chin‡’s coastal provinces did recently. Only such a re-evaluation can reinvigorate Russia after the last fifteen years. Siberia is a region populated by the descendants of many generations of active Russians. It is a territory with dozens of intertwined cultures and traditions, and includes vast expanses opening up to a huge ocean. Siberia can give rise to a new Russian identity; an identity that will not appeal to imperial traditions or promote the state’s domineering role, but that will be open to the modern world and present-day challenges. This new identity will prioritize independence and risk, and declare its readiness for mutually advantageous cooperation with all those who are worthy of it. This is an identity that is European in nature, and global and cosmopolitan in scope. Unless the region changes today and demands more rights from the rest of the country, Siberia will lose an opportunity to change Russia. In this case, both Siberia and Russia will fall victim to the decline that inevitably affects any country unable to overcome a colonial attitude towards its wealthiest and deserving regions.

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