In North Caucasus, There is a Lack of Real Institutions

In mid-May, the Ministry for Development of Regions of North Caucasus was established. Earlier, experts made forecasts that after the Olympic Games in Sochi the North Caucasian Federal District would be abolished and merged with the Southern Federal District. However, no aggregation of governing entities took place. On the contrary, in accordance with the model which has already been tested in the Far East and Crimea apart from the office of the special representative the Ministry for Development of Regions of North Caucasus was established.


The system of governance based on the principles of tough centralization has the logic of its own which does not necessarily meet the needs to achieve effectively the goals set. As early as in the late Soviet period, the following principle was formed: in the centralized system the first reaction to a failure to solve a problem was establishment of a new agency which was entrusted with a responsibility to solve that problem. However, in reality such a practice produced quite the opposite result: a new agency would start fighting for "the place in the sun" by trying to take over functions of the existing regulatory agencies and entering in conflicts for resources. As a result, efficiency of management would deteriorate, rather than improve.


It seems that the same principle is being followed in the case in question and the same results are likely to follow in the long run. The number of "players" engaged in governance of the North Caucasian Federal District has increased considerably. So far, it is unclear how authorities are going to be divided, funds distributed and interests agreed upon. The situation is made even more complicated due to the fact that along with the "intra-group" competition, that is, between governing entities which deal directly with the North Caucasian Federal District the "inter-group" competition -- in particular, for funds allocated for development of tourism – will intensify between North Caucasus and Crimea.


The new system of governance can hardly be created in accordance with the following model: the agency will be in charge of economic functions, while the office of the special representative is entrusted with law enforcement functions because the former is headed by a former governor and the latter, by a general. It is to be noted that the economic issues and security issues are closely interlinked in North Caucasus. To attract investors, particularly, in the recreation sector and then tourists, it is necessary to develop real mechanisms which would ensure civil peace and maintain a dialogue between different social forces which are at present "on the opposite sides of the barricades", rather than to carry out large-scale special operations and build up military presence there. It is unclear who in the new system is going to be responsible for fulfillment of such a function because it cannot be attributed either to economic functions or law enforcement ones. However, without solution of that matter serious progress can hardly be achieved in either line. In addition to the above, multiple agencies will accuse one another of inefficiency in achievement of the ultimate result.


So, in North Caucasus there is actually a lack of real institutions within whose frameworks a dialogue could be organized and conflicts resolved, rather than a shortage of centralized governing entities. Conflicts related to borders of municipal entities point to that. In the past few months, the situation around the most notorious conflicts has shown that despite administrative efforts taken by the authorities, no actual settlement of those conflicts was achieved. Most importantly, there is no "road map" to solve those conflicts, nor is it clear who can develop it (and how) with taking into account the positions of all the parties. It is to be noted that in spring 2013 representatives of regional authorities of North Caucasus made statements as regards the existing conflict situations in their republics, however, they did not propose any concrete ways to solve them.


Irina Starodubrovskaya, Head of the Center for Political Economy and Regional Development,
Konstantin Kazenin, Senior Researcher of the Center for Political Economy and Regional Development
For more details, see the Review of Economic Development of Russia, No.6, 2014.