Alexander Firanchuk, Senior Researcher of the International Trade Department at the Gaidar Institute, told RBC, why resource specialization does not always hinder the innovative development of the economy and what determines the efficiency of using resource revenues.
According to the expert, many countries focused on raw material extraction, use the revenues they receive to develop technology and modernize their economies. However, the results of such policies vary greatly depending on the quality of institutions and the effectiveness of investment management.
"It is perfectly natural for resource-rich countries to try to invest their resource revenues in technological development. The question is how effectively these funds are used. There are examples of countries like Canada and Norway that have achieved significant progress largely thanks to their resource-based economies. But there are also other examples, such as Venezuela, where potential of resource revenues has been untapped," noted Alexander Firanchuk
He believes, the availability of raw materials alone does not determine the path of economic development: the key role is played by the quality of economic policy, investment in technology, and the ability of the state to create conditions for innovative growth.