Sanctions risks and regional development

Russian case

Bibliographic Data

ID13079768
AuthorsСтепан Земцов (0000-0003-1283-0362, The Russian Presidential Academy of National Economy and Public Administration, corresponding author), Stepan P Zemtsov
Year2024
Volume16
Issue1
Pages23-45
Publication date2024-01-01
Open AccessYes
TypeARTICLE
VenueBaltic Region (JOURNAL)
Journal identifiersISSN: 2310-0524 • E-ISSN: 2079-8555
PublisherImmanuel Kant Baltic Federal University (PUBLISHER • RU)
DOI10.5922/2079-8555-2024-1-2
OpenAlexW4394997468
LanguageEN
Citations received7
References cited36

Economic sanctions and countersanctions are expanding worldwide, posing spatially heterogeneous threats to most countries. The study aims to develop and test a methodology for assessing regional exposure to sanctions risks using Russian data. The share of foreign trade with the countries that introduced restrictions can be used to evaluate the exposure to new trade barriers. In several cases, this share exceeded 50 %, necessitating a rapid reorientation of product flows in Nenets, Khanty-Mansiysk Autonomous Areas, Komi, and Murmansk region. The Kaliningrad, Kaluga, and Leningrad regions exhibit high import dependence in the production sector, particularly in the automotive industry, due to their active involvement in global supply chains. Sanctions against large legal entities created risks for the stability of regional economies but the increase in demand for domestic products offset this impact. Foreign enterprises exiting the market posed risks of disrupting production chains but also provided opportunities for local business development. Before some countries introduced sanctions, their companies had held more than 20 % of the market share in Kaluga, Moscow region, and the city of Moscow. However, the share of foreign firms that announced complete withdrawal exceeded 5 % of the market only in the Komi, Samara, Leningrad, and Moscow regions. An integral index of exposure was proposed based on the mentioned indicators. Its value is lower for the regions with a more diversified economy and foreign trade. The greatest risks were observed in the closely connected to the European Union northwestern territories of Russia: Karelia, Komi, Kaliningrad, Leningrad, and Arkhangelsk regions. In 2022, regions with a high index value were more likely to experience a decline in economic activity, but in 2023, this impact was less explicit due to economic adaptation and transformation. Based on the results of the study, some recommendations can be formulated

Business · Economic policy · Economics · International trade · Political science · Russian federation · Sanctions · Arctic and Russian Policy Studies · Economic and Technological Developments in Russia · Law · Regional resilience and development

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