16.09.2003
Temptation of Uniqueness
№3 2003 July/September
Vyacheslav Nikonov

Doctor of History, President of the Polity Foundation,  Deputy Chairman of the Editorial Board of the Russia in Global Affairs journal.

In late January 1917 in Zuerich, Vladimir Lenin stood before an
assembly of young Swiss workers and declared: “We, old men, may not
live long enough to see the decisive battles of the future
revolution.” Lenin was mistaken. Only one month later in St.
Petersburg, a revolution put an end to the centuries-old Russian
monarchy. This one example proves that we should not place too much
trust in forecasts; history has disproved them too often. Indeed,
of the major historical events which succeeded in completely
changing life in Russia, and the rest of the world, not one of them
had been predicted in advance: the beginning of World War I, the
overthrow of the Romanovs, and the collapse of the Soviet Union
were all unexpected events.

It would probably prove to be no less futile to forward bold
predictions concerning Russia’s future at this time as well. The
country is passing through an unstable transitional period, while
the democratic rules of the game are fragile; the political
institutions have not yet developed sacred traditions. Moreover,
since Russia is now integrating itself into the global system,
forecasting its development necessarily becomes more difficult.
Today, more than ever before, Russia’s development depends on
external processes, as well as the situation in the world’s leading
countries. These cannot be fully predicted, either.

Actually, it is impossible to predict truly revolutionary
events, and these occur very rarely throughout history. Throughout
Russia’s long 1,000-year history they happened only during the
“times of trouble:” in the early 17th century, in 1917 and 1991.
Following each of those revolutions, stability was restored upon a
new foundation that was a combination of old and new elements. This
kept the nation’s genetic code preserved largely intact. In order
to fully assess Russia’s future prospects, it is necessary to first
understand its historical inertia, traditions in the organization
of its power apparatus, and the mentality of the Russian people.
Generally speaking, Russia is a slow-moving country, and its
everyday, non-revolutionary development can be analyzed on the
basis of current tendencies.

This statement has been proven by particular forecasts made in
previous years and already coming to fruition. In the book Russia
2010: And What It Means for the World (1993) by Daniel Yergin and
Thane Gustafson, the future prospects for Russia are described in
optimistic scenarios, depicted by the Two-Headed Eagle and Chudo
(The Russian Economic Miracle). Their forecasts are consistent with
modern life within the country, although Russia is already ahead of
their expectations which were put forth ten years ago.

Most forecasts for Russia’s development are not overly
optimistic or very specific. The U.S. National Intelligence
Community’s report Global Trends 2015 says: “Between now and 2015,
Russia will be challenged even more than today to adjust its
expectations for world leadership to the dramatically reduced
resources… The most likely outcome is a Russia that remains
internally weak and institutionally linked to the international
system primarily through its permanent seats on the UN Security
Council… Many Russian futures are possible, ranging from political
resurgence to dissolution.”

The most authoritative Russian forecast, made by the Institute
of the World Economy and International Relations, is moderately
optimistic: by the year 2015, Russia will have the world’s sixth
strongest economy, stronger than the economies of France, Italy or
Britain, but weaker than that of Germany. At the same time, in per
capita income terms, it will place 48th, next to Malaysia, Bulgaria
and Lithuania. The country will not disintegrate and will integrate
into the world economy.

Analysts, both optimists and pessimists, emphasize that the
options for Russia’s future development largely depend on the
quality of the country’s political governance, as well as on the
government’s ability to consolidate society. It will be necessary
for the state to display the will for realizing an adequate
national revival strategy. The supreme power in Russia – a country
with a czarist political tradition – can dramatically alter the
image of the state or, on the other hand, it could do nothing at
all to confront the present realities. This would bring about
debilitating stagnation that many people would wrongly interpret as
stability.

As an inhabitant of Russia it is difficult not to arrive at the
conclusion that everything is possible in this country. The future
options for Russia’s development are truly diverse: the predictions
have ranged from an authoritarian government with a mobilization
economy that has become dangerously isolated from the world, to a
model democracy that has achieved full integration into the world
economy; much of the success of such a model would derive from a
big inflow of international capital. Due to the low probabilities
of Russia conforming to these extreme prognostications, together
with space restraints of this article, it is not necessary to give
undue attention to these subjects. It will suffice to say that
authoritarianism and autarchy are unthinkable scenarios for a
country wishing to remain amongst the membership of the great
powers. At the same time, any best-case scenario for Russia’s
development would be totally uncharacteristic of this country for
such a thing has never happened throughout its history; only the
hopeless optimists can expect such a turn of events.
Therefore, I will dwell on the more probable scenario for Russia’s
development.

IDEOLOGY OF THE FUTURE OR IDEOLOGY OF THE PAST?

In sharp contrast with the 1990s when Russian society was
overwhelmed by the feelings of national humiliation, hopelessness
and retreat, as well as the pain of a lost empire, the country is
now being swept by an ideology of historical optimism. The ideas of
national revival and the growth of the national spirit are becoming
highlights of the 2003-2004 election season. “The only reason why
Russia cannot develop itself quickly is the irresponsible and
defeatist-minded elite who are afraid of setting serious goals to
itself and the country,” wrote a group of prominent TV journalists
and publishers united in the Serafim Club. “What is described in
the spiritual and metaphysical language as Russia’s revival, is
called modernization and powerful economic growth in political
language.”

The Council on Foreign and Defense Policy is also working on a
strategy for Russia’s modernization, which it intends to offer as
the basis for the agenda of the next presidency (2004-2008).

Russian society has already fully realized the need for a
consolidating ideology, mythology and self-identity; it remains
unclear, however, what these will be based on.

The room for national consensus is much greater now than it was
in the 1990s. During that delicate period, Russian society was
engaged in heated debates concerning Communism and democracy, not
to mention the possibilities of avoiding a war, Yugoslav-style, or
even widespread famine. Today, few people would question the
principles of the market economy and democracy, yet they would
interpret those notions in various different ways. The watershed in
the political class (except for the orthodox Communists who will
probably remain a political force for quite some time) is
reminiscent of the traditional differences between the social
democrats, liberals, conservatives and far right political
affiliations predominant in the West.

It is already evident that Russia’s new identity will be built
on the foundation of its long and colorful history. This follows
from Russia’s present-day state symbols: the Byzantine state emblem
introduced by czar Ivan III in the late 15th century, the tricolor
borrowed by Peter the Great from Holland, and the national anthem
of the World War II era, complete with post-Soviet lyrics.
Different attitudes to various periods of Russian history
(particularly Stalinism), which are threatening to split Russian
society, will leave the sphere of politics and move into the sphere
of pure history. This has already occurred with Lenin and his
epoch.

The new national identity will be based on one essential
ingredient pointed out by Yergin and Gustafson: the country’s
transformation “from a four century-old empire to a nation-state.”
For the first time in its history, ethnic Russians now make an
overwhelming majority of the population; their numbers now stand at
about 85 percent of the total population.

The new state will consolidate largely as an ethnic state,
rather than as an advocate of some global idea. The following
factors will work for nationalism:

  • the mentality of the younger generation. They are more
    nationalistically-minded than the older generation who were brought
    up on the traditions of “proletarian internationalism”;
  • the growing “clash of civilizations” which will manifest itself
    in strained relations with the predominantly Moslem regions, for
    example, in Chechnya, where the process of lasting peace settlement
    may require several decades;
  • the growing trend of migration into Russia, which could,
    incidentally, result in increased cases of xenophobia;
  • the growing importance of the religious factor: over the last
    decade, the membership in the Russian Orthodox Church has increased
    from 51 to 58 percent, while the number of Moslems has increased
    from one to five percent. The Russian Orthodox Church has always
    been the main ethnos- and culture-forming element of the Russian
    state.

Nationalism seems to have good chances for becoming a major
component of the developing national idea. The patriotic cluster of
voters advocating a strong state has attracted the largest amount
of interest, which makes the concept of Russia’s “greatness” the
most popular and most likely to be accepted as the national
unifying idea.

Pure democracy cannot become a national idea in Russia since it
has been discredited through a decade of painful reforms. Yet it
can become part of a national idea if it is bound up with
patriotism.

NON-LIBERAL DEMOCRACY

Over the next ten years, Western-style democracy will not secure
a bridgehead into Russia. This country possesses a political regime
which transitologists most often describe as immature, or as being
a non-liberal democracy; such a system has rather good chances for
perpetuating itself. Many of the major components of democracy –
among them the rule of law and accountability of power – are now
carving out a path for themselves, yet as concepts which
occasionally bear little relation to reality.

The stability of a regime of non-liberal democracy is largely
guaranteed by the Constitution which provides far-reaching powers
to the head of state, and places him beyond the system of checks
and balances. Yet there are no expectations that major amendments
or revisions of the Constitution will be initiated with the purpose
of restricting the presidential powers, especially given the
traditions of the political culture, the ability of the head of
state to influence the political process, and the complexity of the
procedure for introducing amendments. Besides, no major political
force advocates amendments to the Constitution: all of them have
adapted themselves to the rules of the game.

At the same time, the existing model of the state system will
create ever more managerial problems: real political power has
become focused on one point (the president) while the functional
level of policymaking (the government and parliament) have found
themselves relatively powerless. The realization of this situation
may bring about changes in the power pattern within the
Constitution’s framework. This may take place according to either
of the following two models. According to the first one (the
American model and less probable option), the president will
simultaneously assume the duties of a prime minister in order to
combine power and responsibility. According to the second model
(French, and more probable), the government will assume power from
a parliamentary majority. This will increase the degree of
responsibility that the government reserves for its
constituents.

Changes in the legislative branch, apart from its participation
in the government’s formation, may take any of the following
directions: the two chambers of the Federal Assembly will receive
the right to conduct parliamentary investigations; deputies of the
upper chamber – the Federation Council – will again be elected by a
direct vote (now, for unknown reasons, they are delegated by the
governor and the legislative assembly of each Russian region); the
number of State Duma factions will decrease, and parliamentary
deputies will become more professional. Deputies will include more
prot?g?s of big business who are interested in restructuring the
State Duma into a counterbalance to the president’s absolute
power.

It should not be anticipated that there will be any marked
growth in independence of the judicial branch; at this time, there
are no independent court traditions in Russia. At the same time,
the prestige of the judicial system, together with the profession
of a judge, will begin to grow as the courts gradually become the
standard method for resolving conflicts between businesspeople;
this is more desirable, of course, than to have businessmen
arranging the assassination of the competitors. The threshold for
corruption within the Russian courts will continue to go up.
Actually, small-scale corruption has practically been eliminated
since big business began defending its interests in court.

The judicial system may also be improved by reforming the office
of the public prosecutor, which is a peculiar vestige of the
czarist and Soviet systems. It is both an “independent” body that
ensures an observance of the law, as well as a body that brings
charges against criminals on behalf of the state. As a result, law
and power are identical notions for the office of the public
prosecutor, which runs counter to the generally accepted idea of
justice. Proposals have already been made to delegate part of its
functions to the Ministry of Justice; this suggests that a reform
of the public prosecutor’s office is practicable.

The reform of the civil service is already in full swing. This
will be aimed at reforming the training methods of the civil
servants, as well as their selection and promotion. There will also
be mandatory competitions for the selection of candidates, as well
as a contractual system, which will determine the amount of
compensations by individual results. The number of bureaucrats will
decrease somewhat, while their salaries will multiply. Time will
change the nature of bureaucracy more than the new legislation: in
ten years, there will not remain a single bureaucrat from the
Soviet period (today, these comprise two-thirds of all
bureaucrats): all of them will have simply retired by that time.
They will be replaced by career-minded young people (the civil
service will become a more fashionable and patriotic job), as well
as by business advocates who will promote its interests. The
two-way flow of people between the state apparatus and the world of
business, a commonplace in the West, will eventually emerge in
Russia, too. The scope of bureaucracy will directly depend on the
degree of state regulation: excessive dirigisme will create an even
more attractive range of applications for the state apparatus,
while a liberal economy will slow down its growth. This reform will
hardly be completed by 2013, as there will likely appear a
“conflict of interests” concept which may actually prove helpful in
addressing the corruption problem more efficiently.

A more competent state apparatus will help solve one more
immediate problem confronting Russia’s statehood, and that is the
creation of an adequate decision-making mechanism for domestic and
foreign policies. The direction that these efforts will take is
already obvious: more research centers will be involved in the
expert assessment of decisions made; state bodies (ministries, the
Federal Assembly chambers, etc.) and private actors (corporations,
institutions of the civil society) will coordinate their efforts to
a larger extent. Today, the Ministry for Economic Development and
Trade coordinates economic policy; foreign policy is determined by
the Foreign Ministry. However, the logic of governance will demand
that these sectors be coordinated under the supervision of the
presidential staff.

Russia’s resources and potentialities may be boosted through its
anticipated military reform, but this has not yet yielded positive
results, due in large part to insufficient defense spending,
corruption, the unwillingness of the Ministry of Defense to change.
It has even been alleged that the experiments for transforming the
army into a contract-based service had been compromised.
Nevertheless, such a reform is inevitable, if only because of the
imminent “demographic decline” which will decrease the draft-age
group by 60 percent. The success of the military reform is solely
dependent on the government’s political will and its ability for
drafting the right international strategy.

Any attempts by the military to engage in independent games seem
unlikely due to their traditional lack of independent political
activities. The most they can do is pull off something like the
surprise entry of Russian troops into Kosovo’s provincial capital,
Pristina, in 1999.

Russia will no longer face the threat of disintegration;
mono-ethnic states (and Russia is now one of them) do not
disintegrate very easily. Yet, there will remain threats of
territorial breakaways, above all in Islamic regions of the North
Caucasus. The Chechen conflict has good chances to enter a sluggish
stage that will be mainly characterized not by separatism but by a
vendetta-styled feud between local groups and clans.

Russia will remain a federation. The Kremlin understands that
governing such a huge and heterogeneous country from one center is
irrational. Moreover, it is undesirable for the president to bear
responsibility for the hardships and outrages in every region. For
the same reason, governors will continue to be elected.

The entities within the Russian Federation will have to enlarge,
since the system of government in some of them is quite confused
due to an excessive number of sub-entities.

The recently launched municipal reform initiatives will produce
a system of local government, which the Constitution failed to
mention. Or rather, it replaced it by “local self-government”
separated from state government. This constitutional mistake will
be remedied and the local governments will become more financially
stable; they will be able to solve their problems at the grass
roots level.

CONTROLLED PLURALISM

There are prerequisites for the emergence of full-fledged
political parties, as well as an actual party system in Russia. The
main obstacle obstructing this development is the unwillingness of
the authorities to identify themselves with any particular party.
As a result of the struggle against the legacy of the Communist
Party, the president, ministries, Federation Council deputies, and
governors do not belong to any specific political affiliation. The
parties are struggling for only 50 percent of the seats in the
State Duma, and in the near future, in regional legislative
assemblies. The legislative ban on the participation of the top
officials in the activities of political parties is expected to be
lifted soon. Yet, true parties will emerge only after they receive
an exceptional right to nominate their candidates for president,
governors and senators. This may happen during Putin’s second term
of presidency.

The number of parties represented in the State Duma will
decrease. No doubt they will include the so-called “party of
power,” which is United Russia. When Putin’s term of presidency
concludes in 2008, it is difficult to imagine the present Kremlin
group losing its hold on power.  Therefore, it is plausible
that the present “party of power” (perhaps in a slightly modified
version) will retain its position inside the Kremlin under the next
president as well. Actually, the domination of one party is not an
exception for post-totalitarian countries (suffice it to recall the
decades of one-party rule in Germany, Italy and Japan after World
War II). This helped to consolidate the elite forces, while
ensuring the continuation of democratic reforms.

The expectations of those who cynically believed that the
Communist Party would automatically whither away, together with the
generation of pensioners of the 1990s who voted for it, have
obviously failed to materialize. This generation is being replaced
by pensioners of the early 21st century, whose living standards are
not higher than those of the previous generation. This factor makes
them automatically vote for the “advocates of have-nots.” The low
living rates in Russia, where the percentage of the old-age
population will only keep growing, will continue breeding the
pro-Communist electorate. It looks as if the Communist Party, like
the Italian Communists, can hope for 20-30 percent of the votes at
all elections, albeit without any chance for obtaining power except
in some of the provinces.

The pro-liberal electorate will not grow faster than the middle
class, and will thus remain too small to support both Boris
Nemtsov’s Union of Right Forces and Grigory Yavlinsky’s Yabloko
party. In the last decade, each of these parties gathered a mere
five percent of the total votes in the country; the chances are
high that before 2013 one of these parties will have left the
political stage for good. Vladimir Zhirinovsky’s Liberal Democratic
Party will qualify for the next State Duma, but after that its
future looks rather bleak as well.

The reduction in the number of political parties – a natural
process for any young democracy – is unlikely to produce new and
dynamic political actors. Yet there are electoral niches that are
capable of giving rise, under certain circumstances, to new
parties. The social democratic niche – packed with small
proto-parties (the parties led by Mikhail Gorbachev, Gennady
Seleznyov, Ivan Rybkin and others) – can attract more voters
following the emergence of the lower middle class, which is now all
but nonexistent due to increasing wealth inequality. Another
Chernobyl-scale ecological disaster, for example, may provide a
good political opportunity for the environmentally conscious
Greens. Finally, there is a social basis for a non-Communist
nationalist party, which may be established under the influence of
rising Chechen terrorism, or due to another major U.S. military
operation in a region that is deemed sensitive to Russia. However,
the establishment of off-mainstream influential, the more so mass
opposition movements and parties is unlikely: socially and
politically active groups of the population will prefer to realize
their interests within the existing system’s frameworks.

Furthermore, the chances for the alternative political forces
seem insignificant also because of the increasingly predictable
outcome of parliamentary elections, which will continue to attract
the attention of big business and its regional branches who view
election campaigns as business projects or investment
opportunities. However, the practice of selling seats in party
lists will become an archaic practice, and Duma deputies from
different factions will unite themselves into oil, energy and other
various lobbies. The interests of the business world and the
political Establishment will continue to merge. Businesspeople will
make it into the top echelons of power, and informal, yet very
influential, financial and political clans will form. They will
include the owners and top managers of large corporations, top
bureaucrats, party and parliament functionaries, and members of the
media elite. The role of these clans will only grow over the next
few years, adding something of an eastern tinge, and at the same
time, a sort of stability, to the political system. The clans will
seek to remove all outside sources of destabilization since they
are certainly not interested in such developments. Yet, inter-clan
feuds can bring about serious internal conflicts, as was the case
when the “St. Petersburg team” of former secret service officers
“attacked” the YUKOS company, or may be the case when it comes to
choosing Putin’s heir. In Russia, the main source of instability
has always been within the circle of the political elite.

A clash between these mighty clans will help the freedom of
speech to survive, and possibly even to thrive. The number of media
actors within non state-controlled newspapers, magazines, radio
stations and TV channels will increase, at least because political
and economic groups will be interested in their success. The
Kremlin will deem it sufficient to retain control over a few major
media resources, that is, one or two leading TV and radio
channels.

ECONOMY WITHOUT MIRACLES

According to the government’s estimates, in order for Russia to
maintain a favorable level of development in the next two decades
it will have to attract approximately two trillion U.S. dollars in
domestic and foreign investment. To this end, Russia must improve
its investment climate and create a fundamentally new
administrative environment.

According to the Ministry for Economic Development and Trade,
the investment climate in Russia will achieve European standards by
the year 2012. To achieve this goal, the government will need to
adopt a national program for Russia’s development that will
include, among other things, the implementation of anti-corruption
measures, an increase in ownership guarantees, the development of
the infrastructure and switching to Western accounting standards
throughout the country. The size of foreign investment that flows
into Russia will largely depend on its political sentiments;
whether it is in favor of, or opposed to, such investment is, of
course, a very crucial factor.

The mid-term programs already worked out by the government
suggest that the privatization of industrial enterprises will
continue, the share of the consolidated budget in the GDP will
decrease, and a government procurement system will be introduced on
a competitive basis. All of these measures, which are intended to
undermine the corrupt interests of the influential clans, will be
implemented with tremendous difficulties. The government-declared
institutional reforms, which are to ensure structural
transformation toward a post-industrial economy, will help develop
the educational and health systems, ensure an accelerated growth of
new-economy sectors, normalize the procedures for protecting
property and contracts, make the economy more open and the
accounting practices of the corporations more transparent.

The much publicized tax reform will be completed. The social
security tax will decrease, the sales tax will be abolished, and
the value-added tax will be made simpler and will decrease, too.
These measures will prompt businesses to make more of their incomes
transparent. The banking reform will make credit resources more
available and will create a deposit insurance system. The
capitalization of the economy and an increase of its monetization
(which now stands at only 20 percent of the GDP) will boost the
development of new sectors in the economy.

Some Russian companies – and not only those in the energy sector
– position themselves on the international market as transnational
corporations. They operate on foreign markets on a par with the
local companies and are capable of opening new production
facilities in these regions. The promotion of projects forwarded by
the Russian transnational corporations will begin to slow down due
in large part to the bureaucratic and political media in foreign
countries, especially in Europe.

Russia will be admitted to the World Trade Organization. The
lobbyists of exporters who are interested in an open economy and a
post-industrial breakthrough will win the struggle against the
producers who are oriented toward the domestic market.

The problem of Russia’s foreign debt will disappear: from 2000
to 2002, the foreign debt decreased from U.S. $158.4 billion (89.5
percent of the GDP) to $123.5 billion (36.2 percent).

Russia will continue to be a major energy supplier to the world
market where demand will increase 50 percent by the year 2015,
according to the U.S. National Intelligence Community. Russia,
which alone consumes 120-130 million tons of oil a year, can easily
increase its oil output to 400 million tons by merely improving oil
extracting capabilities. The president of Russia’s YUKOS oil
company, Mikhail Khodorkovsky, foresees oil output being increased
to 500 million tons by the year 2010, while LUKOIL president Vagit
Alekperov believes that this figure can increase to 560-610 million
in 2015-2020.

The Arctic Ocean’s continental shelf, where the oil resources
have been estimated at five billion tons, will begin to be actively
developed. Russia will start exporting oil from new oil fields in
the north of its European region, in Eastern Siberia and the
Caspian region. Gazprom and LUKOIL will be the main contractors for
oil extraction in the Turkmen and Kazakh sectors of the Caspian Sea
shelf. Russia will transport Kazakh oil to its terminals in the
Baltic, thus calling into question the demand for the Baku-Ceyhan
oil pipeline. At the same time, the participation of Russian
companies in the operation of the latter pipeline will reduce
political tensions over the extraction and transportation of Azeri
oil.

Russia will sharply strengthen its positions within the energy
markets of East Asia’s economic giants. It will build oil pipelines
from the Irkutsk Region to China’s Daqing, and to Russia’s port of
Nakhodka, from where oil will be transported to Japan, Korea
(perhaps by this time it will be reunified) and Southeast Asia. The
available oil resources in Eastern Siberia will not be enough for
both projects, so Russia will need to prospect for more oil
resources there.

Energy supplies to the West will grow at the same time. Russia
and its foreign partners will implement a multilateral agreement to
unite the Druzhba and Adria oil pipelines which will deliver
Russian oil to the port of Omisalj on the Adriatic coast. By 2007,
Russia will have completed an oil pipeline to Murmansk, from where
large-capacity tankers will transport oil to the U.S. Russia and
the United States will pool their efforts to develop new-generation
nuclear reactors, while finding new ways to utilize the spent
fuel.

Transport corridors throughout Eurasia will continue to largely
depend on Russia. The most promising areas of transit
transportation will be: air transit, which includes air transit
across the North Pole; trans-Siberian railroad shipments, which
would prove to be especially critical in case of the quick
development of the northern and northeastern regions of China, not
to mention a potential post-crisis situation in Korea, together
with the natural growth of the Korean economy; the resumption of
navigation on the Northern Seaway which will require the renovation
of the icebreaking fleet; and the construction of new North-South
transport lines to the Middle East and South Asia. The government
continues to support its political commitment to build seaports in
Russia that will replace its Ukrainian and Baltic ports. At the
same time, in 2013 transit transportation will continue to be
restrained by Russia’s underdeveloped transport infrastructure, the
small number of express highways and modern airports. In terms of
its navigation of the high seas, it will have to replace its ageing
fleet.

The emergence in 2002 of the Concept for the Development of the
Venture Industry in Russia shows that the government is beginning
to understand the need for a breakthrough in the fields of
innovation, information technologies, telecommunications,
biotechnologies, and medicine. The cornerstone of this concept
includes the establishment of technology transfer agencies and new
state technology foundations, tax breaks for venture companies, and
a public relations campaign aimed at creating “histories of
business success.”

According to the Ministry of Industry and Science, by the year
2007 these agencies will help launch annually 3,000-5,000 new
venture companies on the basis of state research organizations;
this will create new jobs for some 150,000-200,000 people. It is
difficult to determine how realistic these forecasts are, since
such a rate of new companies would let Russia surpass Israel, thus
ranking second in the world after the U.S. Apart from manpower
resources, there will be an additional demand for new technologies.
Yet, even if the number of projected companies will be ten times
smaller, they will prove to be enough for the technology sector to
take root and blossom. Russia’s share in the technologies markets,
high-tech products and educational services will grow (now Russia
controls not more than one percent of these markets).

There are some very favorable forecasts for Russia’s economic
development even if Russia will take the line of least resistance
and will simply export its raw materials and low-processed products
without taking much effort to diversify production. Brunswick UBS
Warburg’s strategic report stated that by the year 2006 Russia’s
GDP will have increased by 77 percent (compared with its level in
2002), and by 160 percent by the year 2010. This growth will be
achieved solely through the export of raw materials, above all to
China. This development is reminiscent of the economic growth model
used by Australia after World War II, which emphasized the export
of its raw materials to Japan and Southeast Asia.

However, Russia seems to have set itself more ambitious goals,
as follows from Putin’s plans to double the GDP within ten years.
Actually, this is not an infeasible task, provided the present
economic growth rates are retained and the government refrains from
any unpredictable moves that could serve to undermine the market
(as recently occurred in case with YUKOS). Moreover, even higher
growth rates are possible if large international financial groups
begin to invest in Russia; this possibility largely depends on how
efficiently Russia positions itself within the global system.

GLOBALIZATION RUSSIAN-STYLE

Any favorable scenarios for Russia’s development can be achieved
if Russia makes the right geostrategic choice. However, rhetorical
disputes concerning where Russia belongs – to the West, the East or
itself; or to Europe, Asia or Eurasia – have not been resolved,
although they have become less fierce. How Russia projects its
“self-identity” may actually serve to prevent its dynamic
development. Moreover, it could draw itself into confrontation with
the more developed countries to the point of no return.

The probability of various scenarios largely depends on how well
the head of state understands the country’s national interests. It
is also dependent upon the dominating sentiments at the top of the
political class and business. Finally, to a lesser degree, it is
dependent on how active the social forces that support them
are.

Putin once described Russia as a country of not just European,
but West European culture. This is a rather questionable idea,
considering that the West European civilization was built on
Catholicism rather than Orthodoxy, yet the direction of his thought
is symptomatic. The president understands perfectly well the real
situation in his country and what is required for its economic
growth: an economic breakthrough resting on investment and
technologies that Russia can expect, above all, from the West; this
can be realized only in a favorable foreign-policy environment. The
wish to modernize the country will motivate any Russian leadership
to minimize political tensions with the rest of the world in order
to maximize the political dividends.

The Russian Establishment is beginning to realize that there is
no alternative in choosing a model for the country’s development.
In reality, there is no Western, Eastern, Russian or some other
model, but there is the successful model that has been realized in
Western and Eastern civilized countries, and the unsuccessful
models used by some Southern states. The wish to succeed
presupposes following universal, Western-based formulas, which will
make irrelevant the ongoing disputes between the ‘Westernizers’ and
the Slavophiles. Proponents of integration into the global world
include the most dynamic yet sluggish social groups. These are
particular businesses that are export-oriented, the most advanced
part of the intellectuals, and the middle class.

However, the prospect of Russia actually becoming a Western
country by the year 2013 will be hampered by a number of objective
factors, such as its size, geopolitical environment, and the simple
force of inertia. Russia is too large and too “Russian” (meaning
non-Western) to be organically integrated into the main
Euro-Atlantic organizations. Russia’s interests with regard to the
post-Soviet space, China or the Caspian Sea region will not fully
coincide with American or European interests. Thus, the inertia of
the Russian matrix will cause it to search for its own way, as will
the inertia of the political class’s strategic culture. This has
retained some vestiges from the Soviet times, among them the
predilection to react to short-term or former threats, as well as
ignoring long-term, non-military challenges. The forces opposing
Russia’s pro-Western policy should not be underestimated. These
include the larger part of the bureaucratic apparatus, a part of
security agencies that cannot exist without a “super-enemy,” the
Russian Orthodox Church, and all leftist political forces and their
numerous voters.

In ten years, Russia will be following the road toward the
universal, Western model of development, but it will not be the
West.

Russia cannot permit itself any more confrontation with the
U.S.; even the harshest critics of the U.S. policy have come to
this conclusion. After all, a close Russian-U.S. partnership in the
21st century is quite thinkable. I absolutely agree with Robert
Legvold of Columbia University who wrote: “Consider how different
the world would be in twenty years if a democratic and economically
revitalized Russia is a genuine partner of the United States,
addressing side by side fundamental threats of international comity
and welfare.” The U.S. and Russia, for the first time in decades,
now share an in-depth common agenda. This includes the struggle
against international terrorism and proliferation of weapons of
mass destruction, as well as cooperation in the energy field. The
rapprochement between the two countries can be facilitated by the
difficulties they both have in relations with Europe and the
East-Asian centers of power.

Yet, I have fears that the Russian-U.S. partnership will not
evolve into a close and binding alliance any time soon. Obstacles
to such an alliance include Washington’s unilateralist foreign
policy, not to mention the obvious disproportion in the two
countries’ potentials, which will inevitably prompt the U.S. to
ignore Moscow’s concerns and will thus add to the reflex
anti-Americanism persistent among the Russian elites and voters.
Besides, Russia’s economic system and political institutions will
continue to be in disagreement with U.S. perceptions of what
constitutes a true market economy and democracy.

In Russia’s relations with the European Union, this will be
determined by several basic factors. On the one hand, Russia and
the EU enjoy a close proximity with each other, as well as a high
level of economic ties: after the expansion of the EU it will
account for over 50 percent of Russia’s foreign trade. On the other
hand, Russia cannot expect to be admitted into the EU because of
the sheer size and scale of its economic problems. In Moscow,
sentiments are beginning to change toward the idea of EU membership
for fear of becoming overly dependent on Brussels’ bureaucracy and
burdensome regulatory rules. Russian businesses consider them to be
overly “socialist” and not in step with a market economy.

Russia’s future EU membership, or an associated partnership
agreement (as is the case with East European candidate countries),
is out of the question. “Considering that Russia’s membership in
the European Union cannot be considered in earnest for at least
twenty years, there arises the issue of a functioning replacement,”
writes Dmitry Trenin. “The Russians would prefer a free system of
relations, consisting of a free trade zone, partnership in the
energy sector, visa-free travel, a mechanism of consultations in
the political field, and security agreements on a large number of
issues, from anticrime struggle to peace-keeping efforts.”
Relations with the EU will largely depend on its viability in the
future. The events surrounding Iraq, which actually split the
European Union, caused some EU members to renationalize their
foreign policy. This tendency may prompt Russia to reorient itself
to the establishment of partnerships with individual EU states,
rather than directly with Brussels.

The same conditions apply to NATO, which could not agree on an
appropriate course for itself following September 11, and was with
disagreements over Iraq. In addition to these problems, it seems to
be losing its significance as a military organization as a result
of its continual enlargement and admission of several weak,
security-consuming countries. The future of Russia-NATO ties will
be determined by the atmosphere of Russian-U.S. relations and by
the Alliance’s evolution. “It seems that NATO now is evolving into
a political institution with less operational military
significance, something the Russians have long advocated,” writes
Andrew Kuchins of the Carnegie Endowment. “NATO may no longer exist
twenty years from now, but if it does, I would venture that Russia
will be a full member.” In my view, the probability of Russia
joining NATO is inversely proportional to the Alliance’s
significance as a military organization in the future. Any interest
in NATO membership will also decrease in Russia as it grows
stronger and begins to feel more reluctant about having its hands
tied in the military-political field.

There is even less chance that Russia will be included into a
system of integration in the Asia-Pacific region, at least because
of the slower rates of integration there. For political and
demographic reasons, Russia is destined to maintain good-neighborly
relations with China, but the formation of a close union between
the two countries is unlikely. Moscow, which objects to being
assigned the role of a junior partner of the U.S., has even less
reasons to agree to such a role in its relations with China.
However, the economic and manpower potential of fast-developing
China makes such a scenario possibly inevitable for Russia.

Russia would greatly benefit if it intensifies its relations
with Japan, since the Pacific nation can help boost economic
development across Russia’s Far East. This will become reality only
after the two countries resolve their territorial dispute. However,
neither state displays any readiness for a compromise at the
moment.

Russia will seek to play a more active role on the Korean
Peninsula, advocating a peaceful settlement of conflicts between
the two Korean states and supporting the idea of their
reunification. However, these attempts will be impeded by Russia’s
limited ability to influence their conduct, in contrast to the
abilities of the U.S. and China.

In the post-Soviet space, Russia will give up attempts to
reanimate the U.S.S.R. or integrate itself with the former Soviet
republics, which are now dominated by Moscow. Rather, it will
choose to integrate with individual CIS countries even though at
different speed. Russia will attempt to expand the common market
and develop a system of sincere relations amongst allies. The
Russia-Belarus Union may finally evolve into a single state, or
they may continue developing as independent countries, considering
that the Belarusian elite has no wish to forgo their country’s
sovereignty. Russia will never tolerate the U.S. interference in
the affairs of a region that Moscow regards as encompassing its
sphere of vital interests. But I do not foresee any clashes in this
regard, especially if Russian-U.S. relations continue to develop in
a constructive way.

By 2013, Russia will sharply intensify its international PR
campaign for the nation, as well as its individual cities, regions
and economic actors. The state and business sectors will cooperate
in these activities, and will spend a lot to hire major consultants
and promoters from the West, while several Russian advertising and
PR companies will receive their transnational status. There will
appear a Russian-language global TV broadcasting system, as well as
a Russian TV network broadcast in English. Resources for Russian
cultural influence will remain rather limited. The number of people
in the world using the Russian language will decrease (presently,
this number stands at 284 million people; Russian is the world’s
fifth most spoken language). Russia will remain a dominant cultural
factor in the Commonwealth of Independent States but not the only
one.

Moscow will have lobbies of its own in the world’s leading
countries, including the U.S. For the first time this task now
seems feasible, considering the post-Soviet wave of Russian
emigrants, as distinct from all of the previous waves, have
positive feelings toward Russia and maintain close ties with it.
Funds will be allocated for attracting professional lobbyist
organizations in respective countries.

***

What model for development will Russia accept in the long run?
It will be neither American nor European; it will remain uniquely
Russian. The country will have democratic and market-economy
institutions and, at the same time, a largely token division of
powers. Informal law will prevail over formal; the scale of
business performed by state officials and the level of state
regulation will remain high. Russia will continue to integrate into
the global system but, at the same time, will be constantly tempted
to follow its own way. This temptation will be strengthened by some
members of the political elite who entertain a certain degree of
resentment against major international actors for ignoring Russian
interests. It will also stem from the mighty clans inside of the
country who are not interested in making Russia and its economy
open, who will therefore seek to play the card of Russia’s
“uniqueness.”

However, such a temptation will hardly be irresistible.
Self-isolation under the present conditions of globalization can
only be possible if a country falls very far behind the world
system and, ultimately, falls out of it – and out of history.