IRINA STARODUBROVSKAYA: “FOR THE LEGALIZATION OF BUSINESS ACTIVITY IN THE NORTHERN CAUCASUS, FINANCIAL INCENTIVES ARE NEEDED”

At the end of June, Russia’s Prime Minister Mikhail Mishustin instructed the RF Ministry of Finance and the RF Ministry of Economic Development to prepare, by August 1, al the necessary measures designed to reduce the shadow sector’s share in the regional economies of the North Caucasus. Irina Starodubrovskaya, Head of the Gaidar Institute’s Center for Political Economy and Regional Development, believes that the issuance of grants for the legalization of entrepreneurial activity can become an effective initiative to support local businesses. TASS quotes the expert’s opinion as follows.

“We need to start by getting an understanding of what the entrepreneurs in the North Caucasus want, and what are their needs for support. This should be the starting point for unwinding everything else,” the expert stated.

The business incentives, including grants for legalizing the activity of businesses, supporting them in their entry on the markets and creating opportunities for their cooperation, will help the small and medium-sized businesses operating across the regions of the North Caucasus to move out of the shadow sector. Meanwhile, the expert believes that by imposing tough measures on illegal entrepreneurs we would only worsen the situation.

“To support cooperation not only in its classic version of agricultural cooperation, but also the way it has been done in Italy: to support the joint production of any goods,” added Irina Starodubrovskaya.