Putin blasts ‘super liberal’ economics

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The development of Russia’s various regions, especially the Far East, requires case-by-case treatment, the Russian president has said

Russia is too vast to expect equal progress from all regions if they are subject to the same economic conditions, President Vladimir Putin said on Thursday at a meeting with regional business leaders in the city of Khabarovsk. The president was commenting on a proposed preferential tax treatment regime for the country’s Far East.

The president noted that each region needs to be treated individually in order to reach its full potential.

I don’t want to criticize anyone, including our liberals, they are doing their job efficiently. But the general super-liberal approach requiring that everyone should be placed on equal terms, and the Far East too, as well as the European part [of Russia], would have led to continued depopulation here [in the Far East], and nothing would have changed. Because the conditions are different,” Putin stated, noting that targeted support measures are the most effective solution to the economic development of Russia’s various regions.

According to a recent report by RBK, citing government sources, Russia is finalizing legislation that would create a preferential tax regime in the Far East via establishing several international priority development areas in the region. In such areas, businesses would be exempt from both federal and regional income taxes for a period of ten years. The bill also stipulates a reduced rate of insurance premiums.

Putin earlier remarked that the Far East will play an enormous role in the country’s future, and that taking advantage of the region’s potential could help ensure Russia’s resource sovereignty.

Speaking at the Eastern Economic Forum (EEF) in Vladivostok in September, he noted that the region comprises 40% of the country’s landmass and contains almost half of Russia’s gold and forest reserves, as well as diamonds, titanium, copper deposits, etc.

Over the past several years, the Russian government has launched a slew of programs aimed at boosting the economy of the Far East. As a result, investments in the local economy have been growing three times faster than the national average, boosting production volumes and industrial growth. Over the past five years, most of the administrative regions in the Far East were among the nation’s top 20 in terms of GDP growth rates.

For more stories on economy & finance visit RT’s business section

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