The Gaidar Institute Was Represented at the Krasnoyarsk Economic Forum 2017

On 20 April, Senior Researcher of the Innovation Economics Department Stepan Zemtsov took part in the Krasnoyarsk Economic Forum 2017.

In the Forum's framework, a round table that addressed the issue of supporting fast-growing small and medium-sized companies was held (How to Create Conditions for Fast Growth of Medium-sized Technological Businesses?), where Stepan Zemtsov delivered his report titled 'Hi-tech Business in Russia's Regions'.

In his report it was noted that one of the problems that make it difficult to support hi-tech businesses in Russia is the lack of properly elaborated statistical indicators. Bearing in mind the absence of proper statistical backing and goal-setting, it is not clear how a promotional policy can actually be implemented. Which is the exact reason why the research staff of the Gaidar Institute, the RANEPA and the AIRR are developing a hi-tech business monitoring system across Russian regions, based on the rating presented at the Gaidar Forum. It was found that approximately 67% of all financial resources available for the development of hi-tech businesses in Russia is concentrated in Moscow. In fact, today the majority of regional venture funds are inactive. Although the five-mile rule — that a venture investor must be situated within 25-minutes travel time from the supported company in order to provide it with consulting services — is well-known.

The author has established that that the number of the so-called scale-up companies in Russia (rated by their proceeds) is just under 2,500. At the same time, the top 10 regions host about 50% of such companies. However, of these, only approximately 35% operate in processing industries, while the share of hi-tech ones is even lower.

The researchers wanted to identify the factors that influence the growth and concentration of fact-growing companies in the regions. It turned out that the nearer the big regional markets (Moscow, St. Petersburg, or major urban agglomerations) or international markets (as, for example, in Krasnodar Krai), the higher the concentration of fast-growing companies. The factors of availability of human capital in a region and high innovative potential were also of importance.

By way of summing up, it can be said that in Russia, a high concentration of resources for hi-tech businesses can be observed in 10-12 regions. Those same regions account for about 60% of all hi-tech startups and fact-growing companies in Russia. Successful regional innovative ecosystems have been created in St. Petersburg, Tatarstan, Tomsk Oblast, Novosibirsk Oblast, Kaluga Oblast, Ulyanovsk Oblast, Samara Oblast, and Kaliningrad Oblast.

The authors of the report believe that it is important to identify different types of regions on the basis of smart specialization principles and to support various types of businesses operating there. The leader regions must implement appropriate stimulatory policies aimed at developing hi-tech businesses. In those regions, it is necessary to set up regional venture funds and other financial support mechanisms. Entrepreneurial higher education institutions must be created. Instruments like tied grants and innovation vouchers should be actively implemented. In other words, differentiated regional policy approaches are required, for which appropriate monitoring and goal-setting instruments must be elaborated.