Why Tatarstan no longer leader in business competitiveness

The Republic of Tatarstan has fallen from the 1st place to the 11th (or 6th), being inferior to Udmurtia and Mordovia in the federal ranking. The first — depressive Omsk

Why Tatarstan no longer leader in business competitiveness
Photo: Maksim Platonov

Tatarstan has unexpectedly sunk in the ranking of regions in terms of promoting competition — only the 11th position (after adjusting the indicators — the sixth). And this is after two years of leadership and despite the huge attention to the development of competitive procedures. Data on the results of the year 2018 was published by the ministry of economic development of Russia, and there are many questions to them. Why the republic, which has been occupying the first line in this rating for 2 years in a row, suddenly sharply lost leadership positions — the drafters of the rating have not provided clear explanations. As well as the reasons why subsidized and depressed from an economic point of view regions have paradoxically become leaders. However, such a low assessment will clearly not hurt of Tatarstan — perhaps, local officials and antitrust officials should pay more attention to the policy of competition development in the republic, including in public procurement.

The most competitive region

The rating of regions on the level of competition promotion is intended to show how in a particular subject of Russia the standard of competition development adopted by the government in 2015 is fulfilled. The standard itself, according to its authors, is needed to help the regional authorities to form an understandable policy in the field of competition development, and, as a result, to reduce administrative barriers to business, increase the transparency of public procurement and generally create favourable conditions for entrepreneurship. Ultimately, the stronger the competition among business organizations, the healthier the economy and the higher the standard of living.

The more incredible is that Tatarstan, which has achieved success in many of these areas, which has been confirmed by repeated studies, has been ranked so lowly — only the 11th line. The failure is even more insulting because for 2 years in a row the republic has been leading, taking the first position among all subjects.

Realnoe Vremya turned to the curator of the study — the republican ministry of economy — for explanations of the reasons for such a sharp decline in the position of Tatarstan. As explained in the department, the position of the region in the ranking does not affect the distribution of subsidies from the federal budget. The ministry of economic development of the Russian Federation added that the rating is not included in the system of assessing the effectiveness of the heads of the regions but serves to motivate governors to work more intensely to promote competition.

The press service of the ministry of economic development of the Russian Federation in response to the request of Realnoe Vremya reported: “In terms of the implementation of the components of the standard of competition development, the Republic of Tatarstan has improved the indicator compared to 2017.” Photo: economy.gov.ru

Indicators have improved, but the position is lost

Nevertheless, why is Tatarstan's position so radically “plummeted”?

According to the official representative of the Kazan Kremlin, Lilia Galimova, the presidential administration is aware of changes in the position of the republic in the rating.

“We turned to the ministry of economy of the republic for an explanation and we were told that the problem was associated with the use of incorrect data. It is better to request more detailed explanations in the ministry of economy,” Galimova prompted.

The press service of the ministry of economic development of the Russian Federation in response to the request of Realnoe Vremya reported: “In terms of the implementation of the components of the standard of competition development, the Republic of Tatarstan has improved the indicator compared to 2017.” For example, for the road map (plan) to promote competition, the republic received 23,9 points out of 30 possible — the same as Omsk Oblast, which has been the first in the rating. Moreover, it is unclear: the indicators have improved but the position in the rating has deteriorated dramatically? What is the reason? As it turned out, the thing is in the bureaucracy.

The wrong information was provided

It turned out that Tatarstan has turned out to be among the regions that indicated an incorrect value in the plan to “achieve the established targets” as the initial value: last year's “plan” instead of “fact”, which turned out to be higher. Sounds complicated. In other words, Kazan sent the wrong figure to Moscow. Hence mistakes in calculations and unfairly low place in the ranking.

When the data were corrected, it turned out that the situation of Tatarstan is not so deplorable: not the 11th place, but the 6th. However, the timing of providing information was violated, and the drafters decided not to correct the position in the final version of the rating, promising that information about the conditional 6th place of Tatarstan will still be included in the report of the ministry of economic development to the government of the Russian Federation.

The Tatarstan ministry of economy explained the “plummeted” positions of the region by two factors: a high base (initial values used in the calculations) and the peculiarities of the rating methodology. Photo: kazanreporter.ru

“The high base of previous years did not allow to shoot”

However, even the sixth place after a two-year lead looks insulting. The Tatarstan ministry of economy explained the “plummeting” positions of Tatarstan by two factors: a high base (initial values used in the calculations) and the peculiarities of the rating methodology.

The roadmap lists the markets (industries — editor’s note), in which it was necessary to achieve certain indicators on the level of development of competition. These indicators have a numerical value. Last year and the year before, the republic was the first, the numerical value was high, and the effect of the high base of last year did not allow to “take off” even this year, the ministry of economy explained to Realnoe Vremya.

Another factor is the peculiarities of the rating methodology. For example, it is estimated the number of municipalities that have developed their own road map. There are only 45 municipalities in Tatarstan, and each of them has already developed this roadmap, that is, the republic cannot improve this indicator because the total number of districts does not change. In other regions, roadmaps were developed in 2017, for example, in 25 districts, and in 2018 — in 30. As a result, the region shows an increase in the corresponding indicator even if the total number of districts is 50.

The ministry of economic development is working on a new rating methodology, which will try to take into account such features. The rating has been compiled for the third year, and the approach to its compilation is constantly being improved. At the same time, despite some peculiarities of the methodology, the rating is a useful tool for assessing the effectiveness of regional officials in competition development.

“Maybe Ak Bars offended CSKA, of which Oreshkin is a fan?”

Economist Nikita Krichevsky believes that the reason for the drop of Tatarstan in the rating could only be a subjective approach of the rating compilers.

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“In vain the ministry of economic development sent Tatarstan to the 11th position. Great attention is paid to the development of Tatarstan. The republic rightfully occupies a leading position in many ratings. The fact that Mordovia and Omsk Oblast turned out to be ahead of Tatarstan suggests that there were subjective sentiments of the rating authors when compiling the rating, I do not see any other explanations. I’m not sure if the problem is methodology. Because Udmurtia suddenly out of the blue finds itself in the top ten, although there is by and large nothing but defence sector there. But Tatarstan, unlike Udmurtia, is a high-tech platform, on the territory of which there are several special economic zones, and small businesses are well developed. At the same time, a leader is ultra-depressive Omsk Oblast. It’s nonsense for us. Because even Omsk citizens themselves are fleeing the city. Not to mention the whole region. But suddenly the region is in the lead. But leadership must be backed by appropriate economic indicators, but they are not. Tatarstan has them, but suddenly it is outside the top ten. It can only be subjective reasons. Somewhere someone misunderstood something, was not polite enough, incorrectly put someone from the ministry of economic development, did not find a common language in something. You won’t believe it, but this is a very serious factor that affects the distribution of seats. Fortunately, the country's leadership looks not at the distribution of regions in such ratings, but at real affairs, real economic indicators, and they are much better in Tatarstan than those who were above it. I do not understand why this rating is compiled. Basing on references? I do not know, maybe football Rubin, hockey Ak Bars or volleyball Zenit offended CSKA, of which Oreshkin is a fan?” the expert said ironically.

“Any rating is subjective”

In the opinion of Professor of Economics at Ufa State Petroleum Technological University (Ufa, Russia) Rustem Shayahmetov, any rating is subjective and one should treat it accordingly.

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“Any rating is subjective. I have not seen this one yet, but it is quite possible that the method of determining certain indicators has changed, which is why Tatarstan has sunk. I admit that the representative of the ministry of economy of Tatarstan is right, believing that the situation was influenced by the methodology. But I cannot say for sure because I have seen neither the rating nor its methodology,” said Shayakhmetov. “As for the improvement of the position of Bashkortostan (the neighbouring republic has risen from seventh to the fourth position in the ranking — editor’s note), then in this region, with the arrival of the new leader, many measures have been taken to improve the economic situation. From the very top the command to attract investors to municipalities has been given, and this command is executed, and the new leader rigidly controls it. The regular investment hours he spends have allowed many businesses to bypass the administrative barriers that had been previously built. That is, I do not exclude that in the case of Bashkortostan the improvement in the ranking is justified. This does not mean that we are doing well, but there are changes for the better. Moreover, the post of prime minister was taken by a person from business who knows the problem points of businesses and can effectively work on them. As a disadvantage, I will name the fact that the region is managed manually, but we need to create a system.

Anyway, such a severe drop in the federal rating is a convenient moment and an occasion for the leadership of the republic to pay attention to the improvement of competitive procedures. And the question should be addressed not so much to the ministry of economy as to the Tatarstan UFAS of Russia (Federal Antimonopoly Service). So that the state and large corporate orders went not only to one and the same “lucky” businessmen but also to real small businesses. Then, perhaps, there will be no such offensive defeats. And the number of SMEs, even if it declines, at least not as rapidly as this year. In August, the Federal Tax Service conducted an annual cleaning of the register of SMEs, removing from it information about 10,000(!) small and medium-sized businesses. While there are about 156,000 of them in the republic...

By Vitaly Akhmerov
Tatarstan