ISSN 0798 1015

Vol. 41 (Issue 07) Year 2020. Page 29

Economic Security Problems of the Sakha Republic (Yakutia)

Problemas de Seguridad Económica de la República de Sakha (Yakutia)

KARATAEVA, Tamara 1; ELYAKOVA, Isabella 2; DANILOVA, Elena 3; FYODOROV, Afanasiy 4 & ALEKSEEVA, Natal’ya 5

Received: 28/10/2019 • Approved: 24/02/2020 • Published 05/03/2020

Contents

1. Introduction

2. Research methods

3. Results and discussion

4. Conclusion

Bibliographic references

1. Introduction

In the context of the development of the digital economy, economic security is a component of national security (Golovina, Avdeeva, and Parahina, 2014; Mhana, Mohammed, and Jabor, 2019; Balynskaya and Ponomarev, 2018; Abdullaev, Khamraev, Arzuova, and Abdukayumov, 2019; Mikhaylov, Mikhaylova, and Savchina, 2018). Economic security represents the protection of the national economic and social interests of the state and society based on achieving stable economic development, considering the social needs of society for protection against the effects of adverse external and internal threats (Prause, Tuisk, and Olaniyi, 2019).

The following levels of economic security are distinguished: international, national, regional, industrial, and microeconomic (the level of an individual business entity), family and personal (Government of the RF, 2006).

In the Sakha Republic, research on the issue of ensuring the economic security of the region has been conducted by the Institute of Regional Economics of the Academy of Sciences of the Sakha Republic (Yakutia) from 1998 to the present time as evidenced by the publication of a joint monograph in 2019 (Pakhomov, 2019). Therefore, there are some conclusions and recommendations of a preliminary nature. Creating a regional theory and practice of economic security requires more extensive and more systematic research.

In this connection, a comprehensive study of the problem of the economic security of the Sakha Republic seems relevant.

The purpose of this work is an in-depth theoretical and practical study of the region’s economic security and the identification of the problems of non-compliance with the threshold values, which leads to the formation of negative, destructive trends for the region’s economy.

The study is based on statistical data, materials from the Federal State Statistics Service, the Ministry of Finance of the Sakha Republic (Yakutia), data from the Ministry of Internal Affairs of the Russian Federation, the materials published in periodicals and special publications, materials posted on the Internet, as well as authors’ own research.

The theoretical and methodological basis of the study is the analysis of historical, socio-economic and state-legal aspects of the economic security of the Sakha Republic and possible solutions at the level of modern requirements. General scientific and empirical research methods were used in the study: system-structural, formal-legal, and statistical research procedures, through which a theoretical interpretation of the scientific and empirical material underlying the conclusions and proposals was carried out.

The Sakha Republic is a unique region of the Russian Federation with an area of over 3.1 million km2. The region has a harsh climate and huge mineral reserves that include almost all of the diamonds mined in the country and one-fifth of the gold: 95% of the Russian gold is mined in fifteen regions right now, six of these regions are in the Far Eastern District (the Chukotka Autonomous Region, the Amur Region, the Sakha Republic, the Magadan Region, the Khabarovsk Territory, the Kamchatka Territory, and the Sakhalin Region) (Nikolayev, 2018). Roughly 1 million people live there, extracting natural resources in the most difficult natural and climatic conditions. The supreme bodies of state power in the Sakha Republic are the President of the Republic, the state assembly (Il Tyumen) and the Constitutional Court of the Republic.

The needs and level of economic security for the Republic is determined by the presence and degree of external and internal aspects (threats) influencing economic independence and economic interests’ security. Security threats are understood as the totality of conditions and factors of social production that have an extremely negative impact on the normal functioning of the socio-economic system of the Republic as a whole (Karataeva, 2016).

Since the economic security of the region is characterized by the state of various spheres of life and activities of the region, the components of the region’s economic security of the region are distinguished as follows: industrial, financial, socio-demographic, food, environmental and other complex types of security (Egorov, Tarasov, and Fyodorova, 2005). The economic security assessment is a factor of the financial and socio-economic stability of the country and its regions. For the assessment, threshold values are used — limit values, the non-compliance of which leads to the formation of negative and destructive trends of the regional economics’ development. It is necessary to consider the specific conditions and characteristics of the regional economy while using the threshold values (Buyanova and Dyatlov, 2008; Glaz’ev, 1997; Karataeva, 2016). Exceedance of the threshold values that violates the normal state of the region is characterized as a crisis.

For the analyzed period (2012–2017), normative security in terms of material and financial indicators dynamically reflects the absence or minimization of the threats. According to certain indicators of the threshold values, the economic security of the Republic in the sphere of production is improving, growing over time. This growth is due solely to the primary industries. However, there is still some non-compliance with the threshold values of individual groups. Considering the national average indicator, the share of the GRP per capita does not reach the threshold values of 200% (Table 1).

Table 1
Dynamics of the economic security indicators in the production
sector of the Sakha Republic, 2011-2017. Values are stated in %

Complied according to Federal State Statistics Service data (2018).
Regions of Russia. Socio-Economic Indicators. Statistical Compilation.
** Egorov et al. 2005.

The reduction in the share of expenses on science and new technologies to GRP reached 60% during this period, but the investment situation of the Republic has improved significantly. Local food supply indicators exceeded 100% for dairy products, eggs, and potatoes, while other product groups, such as meat products and vegetables, failed to reach their threshold values. Hence, the availability of local food products by groups is uneven (FSS, 2009).

The economic security of the Republic in the field of production is related directly to the region’s mineral resource base (Krivoshapkin, 2011), which, in turn, ensures Russian economic security. In the future, the economy of the Sakha Republic will be focused primarily on the mining, oil and gas complexes (Pakhomov, 2019). The implementation of large projects in the Republic has significantly improved the investment position of the region—it began to meet the requirements of economic security, which was favorable during the period of active development of natural resources in Yakutia (Krivoshapkin, 2011).

Financial security reflects the state and readiness of the financial system to provide timely and reliable financial support for economic needs in sufficient amounts for maintaining the necessary level of economic security for the country and its regions. In the economic literature, different approaches to assessing financial security are highlighted with due consideration of the dominant regional factors and the actual socio-economic trends in the region (Gavril’eva, Doktorova, and Pavlova, 2009; Glaz’ev, 2007; Edronova and Kavinov, 2005; Ermakova, 2008).

Table 2 shows indicators calculated according to the method by Buyanova and Dyatlova (2008). The security of the financial system of the Republic was characterized at a level closer to the average, since the average annual growth rate of indicators fluctuated around 100%. The growth rate of the balanced result of enterprises has decreased, especially in 2014 and 2017. Changes in the mineral resources’ world market, which plays a major role in the regional economy, were the main risk factors for the Republic. As a result, the Republic lost a significant amount of its budget revenues (hence the reduction of the government revenues).

Table 2
Dynamics of basic indicators for assessing the financial
security of the Sakha Republic, 2011–2017

Complied according to Federal State
Statistics Service data (2018)

The financial security of the region depends on the degree of the state budget replenishment, which in turn affects the level of socio-economic development of the Republic.

The provision of the Republic’s budget with own revenues for the period of 2011-2017 averaged at 54.9%. Under the conditions of fiscal federalism, the tax revenues of the regional budget do not cover its expenses at all. This raises the issue of the financial stability of the Republic even more. The problem is that today the level of financing transferred to the Republic to exercise its expenditure powers is insufficient (Ministry of Finance of the Sakha Republic (Yakutia), 2017).

Analysis of socio-demographic security allows us to establish only a slight improvement in its individual indicators. The main risks and threats to the demographic security are identified: high losses of the able-bodied population because of premature mortality from external causes, the relatively low level of life expectancy and migration outflow in the formation of the total population of the Republic (Bushuev, Voropay, and Mastepanov, 1998).

However, a deterioration in social security indicators is possible, if measures are not implemented in the social policy of the Republic in the future (Table 3).

Table 3
Economic security indicators in the socio-demographic
sphere of the Sakha Republic, 2011–2017

Complied according to Federal State
Statistics Service data (2018).
Economic Security of the Sakha Republic:
Industry Aspects. (Egorov et al., 2005).

The dynamics of the population of the Republic is significantly affected by another source of population formation – migration outflow from the region. Migration, which in the previous period was the main source of growth in the region’s population, acquired a different meaning. There has been an intensive outflow of the population beyond the borders of the Republic since 1991. The migration balance in its absolute amount exceeded the natural increase up to 2013. Now migration outflows remain almost 1.5 times greater than in the Far Eastern Federal District, which is a serious demographic threat in terms of its impact on population dynamics. Unlike the Federation as a whole, the Far East has continued to lose its population for many years (Pakhomov, 2019).

The search for new services, goods and new markets is necessary for the region’s economic growth. In this process, the main thing is to reduce regional costs and ensure the competitiveness of goods and services (Pakhomov, 2019; Fedorenko, Persteneva, Konovalova, and Tokarev, 2016).

At the same time, one cannot help but note the negative processes caused by the growth of the organized crime in Russia and in its individual regions, the fight against which is an element of economic security. The legal criterion of economic security is the corpus delicti and, accordingly, the possible or caused harm (damage). It is approximately estimated that the annual economic damage caused by the economic crimes reaches about 500-700 million rubles. According to the Ministry of Internal Affairs of the Russian Federation, the share of crimes committed using computer technology in the total number of economic crimes in 2017 amounted to about 9.5%. Unfortunately, the growing scale of the criminalization of the society is turning crime into one of the most serious negative phenomena of today (Karataeva, 2016).

Prevention of the economic crimes and the fight against the shadow economy have not yet become a significant field in the activities of the law enforcement agencies. One of the problems in the fight against corruption and bribery is their low detection rate (Zybareva and Shinkaryuk, 2013).

The existing statistical information does not allow us to adequately contemplate the indicators of the shadow economy. Meanwhile, the results of our study indicate that it accounts for a very significant part of income that is not displayed in the official statistics of the Republic; its estimate is about 28% from the GRP (Table 4).

Table 4
Summary assessment of the size of the
shadow economy in the Sakha Republic

Compiled according to the results of the surveys of experts and
the materials of the regulatory bodies of the Republic of Sakha.

The shadow economy, unfortunately, has become a reality in our life, and we must not underestimate its scale and impact on the real economy and society. The situation in this area requires the adoption of immediate comprehensive measures to ensure an acceptable standard of living for the population, guaranteeing its protection from criminal activity and the ability of the economy to function effectively in the market environment.

In the combination of these measures, the leading role belongs to the development and creation of the economic and legal conditions that supplant shadow activity from all spheres of economic and financial activity, making it more profitable and reliable to engage in officially registered economic activity.

The legal basis for the activity of the government apparatuses to combat economic crime are primarily the Constitution of the Russian Federation and the Constitution of the Sakha Republic, which serve as the general legal framework, as well as the Tax, Budget and Criminal codes of the Russian Federation, the Law of the Russian Federation “On Operational Search Activity,” departmental normative acts of Russia and Yakutia, decrees of the government of the Russian Federation and other documents.

Within the framework of the “Guidelines for the Socio-Economic Development of the Sakha Republic (Yakutia),” the section “Prevention of Crimes and the Fight against Crime” was first introduced into the practice of work in the Republic. It should be said that ensuring economic security in the sphere of the diamond and gold mining complexes of the Republic largely depends on the existing regulatory framework, which does not fully correspond to the market of precious metals and precious stones. The procedures for conducting transactions between organizations, consumers of natural diamonds are not sufficiently regulated, the procedure and deadlines for the delivery of mined precious metals and precious stones have not been determined. In this regard, from an analysis of existing laws and by-laws, it can be concluded that there is a need to adopt a single legal act that fully regulates all operations with precious metals and stones, and the relevant norms of the criminal law should be put in an independent unit, since precious metals and precious stones can act as an object of assault on a number of crimes.

To increase the effectiveness of the fight against economic crime, it is necessary to introduce new information technologies. For this, a research laboratory should be organized in the Republic in order to study the problems of the internal affairs bodies’ activities and to predict their consequences. The need for such laboratory is due to the necessity of the coordinated comprehensive criminological, economic and legal studies by the scientific and educational systems of the Republic, which allow for systematic monitoring and prediction of crime, studying its causes and conditions, the characteristics of crime perpetrators, and developing measures to prevent and combat it and analyze the criminal situation in the Sakha Republic.

The results of the study provide evidence that may be used to demonstrate that the economic situation of the Republic is unstable.

The study identified some of the elements needed to ensure the economic security of the Sakha Republic. There is a need to establish effective government participation in economic processes and for state regulation related to the development of the digital economy.

This new digital economy is developing against the backdrop of large-scale industrial and infrastructural projects tied to the traditional economy. The management bodies, solving the problem of attracting investors to their territories to ensure the growth of the tax base and create jobs, are attempting to find a balance between the benefits from such cooperation and the associated environmental damage, which affects the interests of various social groups (Karataeva, 2016). At the same time, work should be carried out to detect threshold deviations and the causes of the unstable economic situation in the region accordingly; conditions for fair competition and the development of a new economy based on self-regulation should be created; other comprehensive transformations in accordance with the provisions of the state economic security strategy should be made.

The main direction of economic security should be an active state regulation with the use of targeted programs for the economic digital development of the region. Measures to reduce mortality from external causes remain a significant field of economic security. In the field of fertility, the focus should be on stimulating fertility. Migration attractiveness will help develop demographic and population growth of the Republic. In order to ensure food security, capital for the development and modernization of transport infrastructure in the context of public and private partnerships should be raised. Meanwhile, the population of the Republic should have reliable guarantees of social security in the conditions of the northern region. Today there is no single approach and universal solution to the problems of ensuring economic security; therefore, in modern conditions it remains one of the most promising areas for scientific research.

Based on the foregoing, it should be noted that to ensure the economic security of the Sakha Republic, a modern approach of a legal, economic and other nature is required. First, the economic security of the individual, family and society should be achieved.

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1. Financial and Economic Institute of the North-Eastern Federal University n.a. M.K. Ammosov, Yakutsk, Russia

2. Financial and Economic Institute of the North-Eastern Federal University n.a. M.K. Ammosov, Yakutsk, Russia, email: izabella.elyakova@yandex.ru

3. Financial and Economic Institute of the North-Eastern Federal University n.a. M.K. Ammosov, Yakutsk, Russia

4. Financial and Economic Institute of the North-Eastern Federal University n.a. M.K. Ammosov, Yakutsk, Russia

5. Financial and Economic Institute of the North-Eastern Federal University n.a. M.K. Ammosov, Yakutsk, Russia