Build-Up of Prescheduled Social-Economic Development of the Region Strategy: State-Of-The-Art Technologies and Practical Experience (Taken Samara Oblast for an Example)
Development Strategy: Technologies and Experience
Requisite conditions
Each region being part of the whole country can be also viewed as a comprehensive system, which strives for its own interests, enjoys its own unique potential and certain capabilities. Given the above, a region operates as an independent object of developing long-term social-economic development strategy.
Sustainable regional development is impossible without balancing of regional and national interests, without resolution of crisis and conflict situations in the process of planning the future, as well as without consideration of two dominating tendencies of the present time: globalization and regionalization. Today the regional authorities’ top-priority task is ensuring conditions of concentrating limited resources in carefully selected realms, which make it possible for some of the regions to maintain leading positions, and for some others – create preconditions of economic growth. In its turn, it dictates necessity of creating public infrastructure with the purpose of elaborating regional development strategy, in which regions operate as basic units. Creation of such an infrastructure requires from governmental coordinating bodies to come up with a qualitatively new management culture, and from regional authorities – to develop a new project-specific culture, scientifically justified forecasts and programs, as well as to have corresponding means of informational support provided to administrative decisions (solutions).
Methodological and informational support is crucial for strategic developments. But exactly these positions generate the biggest number of problems in the regional administration practice.
As a negative factor is viewed country-wide absence of a unified methodological basis and technology of regional forecasting. All regions forecast “each in its own way”. The scope of forecast-related information required by the federal governmental bodies is growing with every passed year, though there is almost no feedback.
Currently recommended methodological approaches to developing forecast indicators are mainly based on a system of direct calculations and expert opinions. Methodology underlying forecast calculations is for the time being rather fragmentary and does not enable systemic in-depth perception of regional reproduction process. It does not ensure mutual integration of macro-economic, branch- and sector-related indicators of economic development. Calculations under consideration of these indicators are made in a separate way; their balancing is carried out not in all cases. The bulk of forecast parameters are generated from expert opinions. As there is no formal procedure of producing these indicators, there is a likely event of their random and non-coordinated change, which degrades reliability of the forecasts.
Only some indicator sets are used for model calculations under application of production functions of various types and complexity as well as systems of small dimension econometric models.
Another serious problem is linked to imbalance of statistical data and middle-of-the-road reforms in statistical reporting. For example, gross output, interim consumption and GRP are calculated within the system of national accounts, while capital assets and labor resources – within the system of national economics balance. This keeps from comparing the output with production and labor potentials by sectors of economics.
As a rule, official data developed by the governmental statistics bodies are characterized by term lag (gross indicators by regions are calculated in one and a half-two years after the accounting period end), while such corrections of regional statistics are sometimes introduced in two-three years after the accounting period end. To crown it all, many indicators playing major part in assessing the level of social-economic development are formed on the basis of defective methodologies.
Above all, it is true with regard to the Gross Regional Product, indicators of the aggregate bankroll balance and a number of other indicators.
What is on the schedule, and what has been achieved?
A natural question emerges: What measures must be taken?
We think that it is necessary to develop a new toolkit of integrated regional forecasting as a foundation of determining goals, elaborating strategy and policy (tactics) of social-economic development.
Comprehensive (complex) forecast of regional development must be formed on the basis of integrated model of social-economic activities of the region, which combines all the subjects of the region into a single whole under utilization of national accounts methodology. The forecast calculations must reflect the key reproduction stages: production, distribution and utilization of products under consideration of limitations on the part of labor resources and capital assets. Assets forecasting is supposed to show the processes of their generation, redistribution and utilization of their interrelation with the state of affairs in the real sector and strategies of behavior of the region’s subjects. Similarly shall be made the forecasts with regard to other resources – labor and capital.
Integrant forecast indicators merging all types of forecasts into one single whole must be perceived as calculations of GRP by three methods: production method (showing generation of value added by economics sectors); distribution method (determining the general structure of value added and revenues) and method of qualitative utilization (characterizing directions and volumes of utilization of gross value added). Structure of value added, directions and volumes of its utilization are connected with the income and expenditure balances of the population and consumer market.
As each Russian Federation entity drafts its own budget, then, under consideration of some adjustments, it can become a kind of groundwork for calculating revenues and expenditures of the regional public authorities. Balance of this account characterizes surplus or deficit of funds at the disposal of the regional public authorities.
The Samara Oblast Administration – within the framework of the projects known as “AIS-Region” and “TAIS” – undertook an attempt of developing new forecast tooling, which enables an integrated forecast of regional development. Department for Economic Development and Investments” in cooperation with OAO “Volgoinformset” has been involved since 1994 into works related to creation of a territorial automated info system to be used for automation of reporting and forecast-analytical activity with the purpose of information-related support rendered to the process of preparation and making administrative decisions (solutions).
Our Department has developed necessary infrastructure, which supports team-style work of specialists in working out strategies and programs of regional development. This implies a local computational net; common info resources (normative, statistical, forecast-analytical and other databases and documents); toolkit to be used in automation of forecast-analytical activities; representation in the Internet.
The “TAIS” project lead to development of technology of solving major problem of regional statistics, i.e. proper equilibrium of statistical materials in general. Algorithms of verification and amendment of social-economic info based upon the idea of balancing the generated and utilized regional resources (material, financial, labor) has been developed and are in application stage. The developed technology was improved and adjusted in the process of long-term practical application in the Oblast Administration.
Computer-based model of social-economic activity of the region described as the “Samara Oblast” has been developed. The core of the regional activities simulation is built by the concept described as “balance of balances”, which brings into one single whole the processes of generation and utilization of material resources, funds and labor resources of the said region pursuant to the logical setup of cause-effect relations and behavior of the region’s subjects (entities). The model (simulation) is structured by branches and territories (municipal entities). The latest version of the model incorporates over 3000 parameters and enables simultaneous obtaining of more than 1000 balanced forecast documents in all realms of social-economic activity of the region.
Within the “TAIS” project framework the technology of forming administrative decisions and regional development strategies has been also worked out; the format of depicting them is also available – these are the so-called “scenario maps”. Technology has been developed for team-style work of the department specialists in terms of managing regional development scenarios and forecast-analytical documents. Program means are available to be used for testing-and-improving simulations of regional development alternative versions, which make it possible (as a result of purpose-specific simulation experiments) to evaluate both strengths and weaknesses of these versions and select really the best administrative solutions. For example, while developing the 2002-2004 years forecast we produced 46 iterates of the first forecast version and over 20 iterations – of the second one.
The work as to developing and improving the system in question goes on.
By today we have developed a purpose-specific development program “TAIS” for the term of up to the year 2004 involving creation of a Situation Center to be used in forming (generating) and adjusting alternative versions of regional development on basis of situation-specific simulation, assessing risks of relative administrative decisions (solutions) and many-dimensional visualization of forecast-analytical materials; this program incorporates analytical system of the latest generation MineSet and geoinformation technologies.
The generally valuable nature of the developed technologies and software products and orientation toward standard public statistics enables replication of “TAIS” as a basic element of the forecast-analytic infrastructure in other Russian Federation regions.
“Tree” of goals
It is considered necessary to launch the work as to forming (within the framework of the Privolzhsky Federal District) a unified methodological groundwork of analysis, rating evaluations and forecasting of regions’ social-economic development. In this connection, organizational and methodological experience available in the Samara Oblast and high potential of the District researchers can be used.
In the process of developing strategy of the Samara Oblast social-and-economic development for the period up to the year 2015 we proceeded from the following major provisions:
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The long-term development prospect shall not contain broad spectrum of goals.
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Sustainable development of the region enjoying high level of concentration of industrial production is impossible without finding acceptable balance between economic development, social welfare and environment protection.
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Science must be given high priority in providing the basis of sustainable development.
On the assumption of the above, a “tree” of goals was developed and substantiated with regard to long-term development of the Oblast; each goal here has been attached its own rank and urgency level.
The general (major) goal of the regional development (top of the “tree”) is sustainable growth of the regional population’s well-being.
Below are goals of the first level:
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Create sustainable-style developing economics and ensure efficient utilization of the territorial natural-and-recourses potential.
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Create competitive business climate.
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Ensure social stability.
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Maintain environmental safety.
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Preserve and reinforce the Samara Oblast leading positions among the RF regions.
The second level goals are related to more detailed indicators, which breakdown goals of the first level, etc. All these goals – in aggregate with the general one – constitute hierarchy of goals (“tree” of goals). Any goal of governmental regulation can be established and achieved only by interplay with the other goals.
Each goal is related to certain (absolutely definite) tools of influencing the social-and-economic processes within framework of competence of regional machinery of government. It is the pool of the events and measures conformably to using these tools in the course of selected strategy that makes up the regional policy.
Pursuing efficient regional policy requires skillful governmental administration. The Samara Oblast priorities here are as follows:
In the first place, the matter concerns building of economic clusters of interconnected branches with a significant growth potential and high multiplicative effect. In the economic growth the leading part is played by the branch-related structure of economics, primarily – by leading branches creating competitive goods and services. Areals of economic space, in which companies of the leading branches are deployed, tend to be “poles of attraction” of production factors, because they ensure their most efficient utilization. That leads to concentration of companies and formation of poles of economic growth.
Catering of the industry for national and international demand increases the region’s export and import of goods, developing thereby its infrastructure.
Advantageous transport-geographic location of the Samara Oblast provides for additional growth impetus owing to increase of freight traffic, propagation of innovations and communications development.
In modern practice of spatial economic development the concept of poles is actualized through creation of free economic zones, “techno-city-states”, and technoparks.
In the second place, the matter concerns identification of interregional integration projects, potential partnership regions, analysis of investment climate in the partnership regions, utilization of various forms of interregional economic relations to be used as means of solving problems of production forces deployment, reduction of competition in the goods and services and capital markets, substantiation of real mechanisms of promoting implementation of such projects on the part of the Federal Government. Such are indeed the significance properties and criteria, which in our opinion must possess the lead projects of the Privolzhsky Federal District; and in this connection importance of the facilitating role of the Interregional Economic Interaction Association and steering role of the President’s Plenipotentiary in the District (Okrug) office cannot be overestimated. Without high level of vertical and horizontal integration, cooperation and coordination of regional development coming-to-be of the region as a growth center is impossible.
In the third place, over the years of reform the government “overlooked” the social sphere, underestimated pollution of the environment. As a consequence, we face dangerous property-related stratification of the population, futureless demography, impendent deficit of labor resources, problems in the health care sector and in public education. Therefore, reproduction of social life is being brought to the forefront.
The objective of keeping the Samara Oblast’s leading positions implies reinforcement of the central role of innovative motivation in the economic policy of the region. By this reason, transfer onto the innovative track of economic development becomes first-rate and prepotent program task facing the Samara Oblast.
The Samara Oblast economics – being an independent object of strategic designing and element of higher level economic systems (namely – national and world economics) – depends to a great extent on the rules of the game in form of public economic policy and market opportunities for backbone-type enterprises and branches. The same rules of the game determine also the flow of national and transnational capital, which finally goes to places with available comfortable and competitive business environment and good return on investments, which is ensured (among other factors) by the agglomeration effect – effect of regional infrastructure development and economic potential concentrated in the agglomeration.
Thereupon, it is fundamentally important to have a clear defined economic strategy of developing national economics, an in-service model of interplay of national and regional economics with the purpose of justification of regional development strategy and ways of its actualization.
The report was given at the workshop “Competitiveness”
by the Director of the Department for Economics
of the Samara Oblast Administration – G. Khasayev.
