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Who owns Russia

Кому принадлежит Россия

Our state, like the state corporations and monopolies, is increasingly becoming the private property of their “top managers”.

Speaking this week at the forum “Russia calling!”, the head of audit chamber of the Russian Federation Alexey Kudrin said that over the past ten years the state’s share in the Russian economy increased to 47-48%, which, in his opinion, is not good.

Meanwhile, according to the Handbook of Rosstat “Socio-economic situation of Russia” for January—November 2018, 94.4% of all organizations in Russia are in private ownership and only 5.6% — state and municipal. And in recent years about the nationalization of enterprises and companies in Russia that we never heard of.

However, it is clear that the former “the best Minister of Finance in the emerging economies” was not talking about ownership, but about the somewhat more abstract matter — “the share of the state in the economy”. What’s the point, he explained thus: the share of government in the economy is reflected in particular in the presence of large state-owned companies, state corporations that had not made a turn (to greater adaptability, motivation). “That is, apparently, state-owned companies have little incentive for such development. So today, with the first, I believe the demand,” he concluded.

Apparently, such a category as “share of government in the economy” — it’s so tricky that the officials of the state unable any to accurately count her “grams”, that is, in absolute terms. For example, if the head of the audit chamber of the Russian Federation, as we have seen, says the numbers are 47-48%, the Federal Antimonopoly service (FAS) in their report on the state of competition in the Russian Federation, published in may 2019, says that this percentage is as high as 70%. The source of this knowledge is not difficult to guess, are the approval of experts.

In particular, the FAS in their estimates of the share of the state in the economy refers to “peer review” of the staff of the Institute for economic policy E. T. Gaidar. Those, in turn, calculate the amount of state involvement in the economy of such a criterion as “the revenue share of state-owned companies”.

The FAS report on this issue States that “the revenue share of state-owned companies in the total revenue of the 100 largest companies in each sector (energy, transport, mining and Finance) is close to or exceeds 50%. 100 largest companies, these four sectors (a total of 400 companies) make up more than 30% of the revenues of all Russian companies.”

This wording is not right. Even touching such a delicate topic as the one that the current Russian state-owned company to a significant extent, even on its face, does not state (for example, the state’s share in the equity of the largest monopolies in the Russian economy hardly exceeds 50%, the rest of their capital — ownership of private companies and individuals), note the FAS report here. This passage is about the one hundred largest companies, most of which are still not public but private. “According to experts, only two companies (JSC “Gazprom” and JSC “Rosneft”) provide the contribution to GDP in the amount of 12-14%,” — said the FAS report.

This thesis should also demonstrate the level of state involvement in the economy. But if you remember that, formally, the state these monopolies owned only 50% of the capital, these 12-14% should be divided in two. That is, the contribution of the state in Russia’s GDP by possession of “Gazprom” and “Rosneft” only 6-7%.

The report of the FAS is even more ingenuous confession. “The total share of state corporations in the Russian economy is, according to various estimates 7-10% of GDP.” And this despite the fact that “public” companies operate on the market quite as private, as the level of salaries of their top managers, says that it is “wages” in name only. If they run into millions of dollars a year, in fact we are talking about raspadenie profit of the company among its top managers in the form of “wages.” That in fact also characterizes such a “state monopoly” more like private, not public enterprises. However, the characterization of Russia today as one of the big AO, which is in private ownership of a narrow circle of persons, has already become common place.

Monopoly, of course, is not conducive to competition, just as the fact that, when the main competitive advantage is the proximity of the businessman to the authorities, it does not promote its production efficiency. In this case all the flaws of this production is always possible to cover budgetary infusions, knocked out in the offices of the authorities under those or other pretexts (e.g. the need to develop new fields).

However, in this case we are talking about something else — about the actual share of the state in the Russian economy. Vladimir Putin, note, on the side of those who want to umenshenie this share and makes appropriate policy. So in the same report FAS the following quote is from his address to the Federal Assembly on March 1, 2018: “the Share of government in the economy should gradually decline.” And this is not an empty phrase. In the same report, the FAS said: “According to the Ministry of economic development over the last 5 years structure of Federal property has undergone quantitative changes. The number of FSUE and institutions decreased by 44.34% and the number of JSC with a share of state participation has decreased in 2 times”. The program of privatization of state unitary enterprises, and also continues, and the number of business inspections by government agencies (another tool of “participation” of the state in the economy) is shrinking, which is also stated in the report of FAS.

Another thing is that such a thing as a “coalescence of monopolies with the state,” which is also indicated by the FAS, and that probably meant in his speech at the forum VTB and Alexey Kudrin, of course, in Russia, too, continues. It’s the classic formula leads the economy to “stagnation and decay”, however, does not negate the fact that the state becomes the private property of his top managers. Yes, the market mechanisms, this does not negate, but admittedly, this is a very strange market…

© 2019, z-news.link. All rights reserved.

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Home / economy / Who owns Russia

Who owns Russia

Кому принадлежит Россия

Our state, like the state corporations and monopolies, is increasingly becoming the private property of their “top managers”.

Speaking this week at the forum “Russia calling!”, the head of audit chamber of the Russian Federation Alexey Kudrin said that over the past ten years the state’s share in the Russian economy increased to 47-48%, which, in his opinion, is not good.

Meanwhile, according to the Handbook of Rosstat “Socio-economic situation of Russia” for January—November 2018, 94.4% of all organizations in Russia are in private ownership and only 5.6% — state and municipal. And in recent years about the nationalization of enterprises and companies in Russia that we never heard of.

However, it is clear that the former “the best Minister of Finance in the emerging economies” was not talking about ownership, but about the somewhat more abstract matter — “the share of the state in the economy”. What’s the point, he explained thus: the share of government in the economy is reflected in particular in the presence of large state-owned companies, state corporations that had not made a turn (to greater adaptability, motivation). “That is, apparently, state-owned companies have little incentive for such development. So today, with the first, I believe the demand,” he concluded.

Apparently, such a category as “share of government in the economy” — it’s so tricky that the officials of the state unable any to accurately count her “grams”, that is, in absolute terms. For example, if the head of the audit chamber of the Russian Federation, as we have seen, says the numbers are 47-48%, the Federal Antimonopoly service (FAS) in their report on the state of competition in the Russian Federation, published in may 2019, says that this percentage is as high as 70%. The source of this knowledge is not difficult to guess, are the approval of experts.

In particular, the FAS in their estimates of the share of the state in the economy refers to “peer review” of the staff of the Institute for economic policy E. T. Gaidar. Those, in turn, calculate the amount of state involvement in the economy of such a criterion as “the revenue share of state-owned companies”.

The FAS report on this issue States that “the revenue share of state-owned companies in the total revenue of the 100 largest companies in each sector (energy, transport, mining and Finance) is close to or exceeds 50%. 100 largest companies, these four sectors (a total of 400 companies) make up more than 30% of the revenues of all Russian companies.”

This wording is not right. Even touching such a delicate topic as the one that the current Russian state-owned company to a significant extent, even on its face, does not state (for example, the state’s share in the equity of the largest monopolies in the Russian economy hardly exceeds 50%, the rest of their capital — ownership of private companies and individuals), note the FAS report here. This passage is about the one hundred largest companies, most of which are still not public but private. “According to experts, only two companies (JSC “Gazprom” and JSC “Rosneft”) provide the contribution to GDP in the amount of 12-14%,” — said the FAS report.

This thesis should also demonstrate the level of state involvement in the economy. But if you remember that, formally, the state these monopolies owned only 50% of the capital, these 12-14% should be divided in two. That is, the contribution of the state in Russia’s GDP by possession of “Gazprom” and “Rosneft” only 6-7%.

The report of the FAS is even more ingenuous confession. “The total share of state corporations in the Russian economy is, according to various estimates 7-10% of GDP.” And this despite the fact that “public” companies operate on the market quite as private, as the level of salaries of their top managers, says that it is “wages” in name only. If they run into millions of dollars a year, in fact we are talking about raspadenie profit of the company among its top managers in the form of “wages.” That in fact also characterizes such a “state monopoly” more like private, not public enterprises. However, the characterization of Russia today as one of the big AO, which is in private ownership of a narrow circle of persons, has already become common place.

Monopoly, of course, is not conducive to competition, just as the fact that, when the main competitive advantage is the proximity of the businessman to the authorities, it does not promote its production efficiency. In this case all the flaws of this production is always possible to cover budgetary infusions, knocked out in the offices of the authorities under those or other pretexts (e.g. the need to develop new fields).

However, in this case we are talking about something else — about the actual share of the state in the Russian economy. Vladimir Putin, note, on the side of those who want to umenshenie this share and makes appropriate policy. So in the same report FAS the following quote is from his address to the Federal Assembly on March 1, 2018: “the Share of government in the economy should gradually decline.” And this is not an empty phrase. In the same report, the FAS said: “According to the Ministry of economic development over the last 5 years structure of Federal property has undergone quantitative changes. The number of FSUE and institutions decreased by 44.34% and the number of JSC with a share of state participation has decreased in 2 times”. The program of privatization of state unitary enterprises, and also continues, and the number of business inspections by government agencies (another tool of “participation” of the state in the economy) is shrinking, which is also stated in the report of FAS.

Another thing is that such a thing as a “coalescence of monopolies with the state,” which is also indicated by the FAS, and that probably meant in his speech at the forum VTB and Alexey Kudrin, of course, in Russia, too, continues. It’s the classic formula leads the economy to “stagnation and decay”, however, does not negate the fact that the state becomes the private property of his top managers. Yes, the market mechanisms, this does not negate, but admittedly, this is a very strange market…

© 2019, z-news.link. All rights reserved.

Check Also

Ministry… Who?

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