Russian Manufacturing Industry in the Mirror of its Exports to the European Union

Abstract

The purpose of this study is to shed some light on structural changes in the manufacturing industry of Russia and eight other transition countries during the last decade. The export performance of countries in one and the same market can under certain conditions be used to compare the state of the art in national industries. On the basis of full and comparable trade data from Eurostat, we perform comparative analysis of the development of manufacturing exports to the European Union by Russia and eight other transition countries over the period 1993–2000. The transition countries selected for comparison are Hungary, the Czech Republic, Poland, Romania, Bulgaria, Estonia, Latvia, and Ukraine. For all these countries, as well as for Russia, the European Union is the most important trade partner. The paper provides a comparative analysis of the breakdown of manufacturing exports by factor intensities, export concentration and specialisation, and relative price positions in the European market. All these approaches give a rather unfavourable picture of Russia’s performance. We observe a relative shrinking in exports of labour–intensive, specialised–supplier and science–based sectors. At the same time the role of the sector based on natural resources, which was traditionally predominant in Russia’s exports, is strengthening further. We also observe an alarmingly high level of concentration in Russia’s manufacturing exports and their growing specialisation in base metals, together with an intense de–specialisation in engineering products.

The Common European Economic Space Between Russia and the EU: an Institutional Anchor for Accelerating Russian Reform

“…4 It requires change in the behaviour of enterprises, producers and con- ........................................ 2 See Fontagné, Freudenberg and Pajot (1999) and Busch and Piazolo (2001). 3 Soos, Ivleva, and Levina (2002). 4 On institutional development in Russia, see Samson (1994) and Jordan and Samson (2000).…”

After the Economic Rebound in Russia — the Importance of a Pro–Active Policy

“…9 Looking at growth in car numbers (108 per 1000 people in 1992, 202 per 1000 in 1999), the number of cell phones (an index based at 100 in 1992 now stands at 23 000), it is impossible to doubt the strong dynamics of Russia's consumer society. But this observation should not divert the country from its industrial future and an objective analysis of its competitive advantages in the framework of an open economy (see Soos, Ivleva and Levina (2002)). The future of major world economies remains industrial.…”

“…These results are not only due to political instability (this is frequently referred to as a factor, but the country is currently quite stable) or absence of a clear and respected legal framework. They are mainly due to the fact that Russia is a country with low productivity (Soos, Ivleva and Levina (2002)) and high transaction costs. The Government needs to take steps to eliminate specific least-adapted assets (an effective bankruptcy law is needed, with social back-up) and to encourage modernisation of those assets, which are resistant to market forces but have social and economic potential.…”

“…Their aim is to measure the mutual impact of these structural changes on the economy, including highly disaggregated levels of the economy, and to identify Russia's comparative and competitive advantages in the international environment. See first articles by Samson (2002) and Soos, Ivleva and Levina (2002).Concerning Russian relations with the CIS see Shagalov, Kivikari and Brunat (2002). The topic has also been discussed in Sitaryan et al (1999).…”