Siberian Development Vector

 In a report at the St. #Petersburg International #Economic #Forum on June 7, 2019, President of the Russian Federation V.V. #Putin emphasized: “Today we need to think about raising the vast territories of Central and Eastern Siberia, carefully prepare and calculate, and coordinate a development plan. This macroregion is rich in natural resources, it holds about a quarter of the forest reserves, more than half of the coal reserves, significant deposits of copper and nickel, huge energy reserves, many of which are already available”

We don’t know it all

Russia has invested heavily in Arctic infrastructure and touted its Northern Sea Route along the coast of northern Siberia as a faster, cheaper shipping route between Asia and Europe as the region’s ice rapidly shrinks. In 2020, a total of 32.97 million tons of goods were shipped on the Northern Sea Route, up 1.5 million tons in 2019.
On the other hand, Siberia’s attractiveness for potential migrants/settlers is questionable, to say the least. Namely, since the breakup of the Soviet Union, this macro-region, which occupies one quarter of the Russian Federation’s overall territory, has lost almost 19 percent of its already-scarce population. The current number of residents is somewhere between 17 million and 21 million (roughly 11.6 percent of Russia’s total population) (Kapital-rus.ru, August 5). Moreover, Russian experts contend that given the extremely low level of internal mobility in the country—in fact, the year 2020 witnessed the lowest level of internal migration in almost a decade—Siberia is highly unlikely to become a “magnet” that will draw large masses of qualified professionals and their families. In fact, given the current demographic dynamic—a clear “western current” of people moving to the Northwestern and South Federal Districts of Russia—Siberia’s population is likely to dwindle even more in the coming decades (Gazeta.ru, September 6). It is quite interesting that in addition to the expert community and journalists, the idea has also created a rift within Russia’s political establishment. For instance, Sergey Mironov, a former chair of the Federation Council (upper chamber of the Russian parliament) and the leader of the political party A Just Russia, dismissed the project. “[W]e have already been there,” he declared, pointing to the largely unsuccessful Soviet experience of developing Siberia and the Far East (Kapital-rus.ru, September 18). Nonetheless, the mainstream Russian political elite seems determined—at least rhetorically—to move forward with this highly ambitious (if somewhat dubious) initiative. Most likely, Moscow will mainly rely on the Soviet legacy of “exploring” the Urals and Siberia, referencing cases of Komsomolsk-on-Amur (current population is 240,000), Bratsk (230,000), Norilsk (181,000), Magadan (90,000) and others as an example to emulate. However, if the government pursues the practical implementation of this idea, it will likely rely on two Soviet-style approaches. First, given the lack of foreign investments and scarcity of public funds, the state may opt to apply pressure on the private sector for the purpose of extracting necessary funds. This policy would have a profoundly negative effect on Russia’s domestic business climate. Second, akin to the Soviet-era experience of forced labor, talk is growing louder about utilizing prisoners on some of the most labor-intensive and hazardous mega-projects in the Arctic region and Siberia, thus avoiding having to rely on dwindling numbers of foreign migrants (RIA Novosti, May 20; Na-slovo.ru, accessed October 3; see EDM, October 21).  A final important development that points to the apparent seriousness of Russia’s plans with regard to Siberia is also worth mentioning. Namely, on September 27, the Kremlin official put Defense Minister Shoigu in charge of the development of the entire Eastern Siberia (RBC, September 27). This will de facto make him responsible for the entire program of social-economic revitalization of that Russian macro-region.

Russia’s competitive advantage

Bitcoin use is limited in Russia due to the country’s restrictive laws on cryptocurrencies, including President Vladimir Putin’s 2020 law on digital financial assets that legalized cryptocurrencies but banned their use as payment for goods and services.
Still, Russia is the world’s third-largest Bitcoin mining country at over 11% of average monthly shares, according to the Cambridge Bitcoin Electricity Consumption Index (CBECI).
The use of blockchain is spreading rapidly in most countries, but some believe it has a particularly bright future in Russia. #Technical and #mathematical #education # standards in the #Soviet Union were some of the highest in the world, and this tradition has persisted in modern Russia. 
The founder of #Ethereum, the second most popular cryptocurrency in the world after bitcoin, is Russian-born citizen. The world’s largest bitcoin manufacturer, or “miner,” Bitfury, was created by another Russian citizen. 
#Cryptocurrencies were always popular in Russia, Russian-language #developers are the most visible among developers working with blockchain technology.
 Founders of several blockchain projects, says that Russia and other former Soviet Union countries are drivers of blockchain growth. The trend is driven, they say, by high technical education standards, a lack of heavy-handed regulation and the attractiveness of an investment opportunity not tied to a volatile ruble or low-interest deposit accounts.
Additionally, cryptocurrencies can give access to investment to many Russian #businesses ineligible for state support or unable to afford the high-interest loans on offer from domestic banks.
Irkutsk (Ciberia) too, has embraced the digital gold rush. Awash in electricity from hydroelectric plants, the region charges 2.1 roubles ($0.04) per kilowatt-hour, compared with 5.3 roubles in #Moscow. That makes “mining”, in which computers solve cryptographic challenges to generate currency, especially profitable. Seminars have proliferated. “ #Cybercurrency fever has swept Irkutsk,” declared a local television station this month. But #Siberia could suffer unpredictable power grid overloads due to an influx of #Bitcoin #miners from nearby #China, which has cracked down on virtual #currencies.