ISSN 0798 1015

Vol. 41 (Issue 07) Year 2020. Page 24

Strategy of the Economic Security in the Russian Federation

La estrategia de seguridad económica en la Federación Rusa

RUDAKOVA, Elena Nikolaevna 1; SANGADZHIEV, Badma Vladimirovich 2; ERIASHVILI, Nodari Darchoevich 3; GUSHCHIN, Vasily Vasilyevich 4 & ZHUKOVA, Maria Yevgenievna 5

Received: 14/11/2019 • Approved: 14/02/2020 • Published 05/03/2020

Contents

1. Introduction

2. Methodology

3. Results

4. Conclusions

Acknowlegments

Bibliographic references

1. Introduction

Ensuring economic security is one of the most important functions of the state, since the emergence of numerous socio-economic problems in a country is usually due to the inability of the state to take a sensible assessment of the economic situation and take preventive measures or to stabilize the situation in time. The state needs to ensure and maintain internal and external stability, which is necessary for normal economic functioning and active participation of the country in the international arena and maintain the competitiveness.

It is necessary to understand that economic security is the basis of the national security of the state and its sustainable socio-economic development.

For the first time the concept of economic security in the world was originated in the twentieth century in the United States. US President Theodore Roosevelt in 1904 established the Federal Economic Security Committee (Kathleen, 2017). Since then, issues of economic security have begun to be considered at various levels of the government. A constantly developing economy is able to withstand internal and external threats and helps mitigate destabilizing factors.

First of all, it should be said, that there are different views on the concept of economic security. On the one hand, economic security means the ability of the economy of the state and its regions to ensure stable development and adequate protection of economic interests. In this case, economic security is considered from the point of view of the possibility of protecting the economic interests of individuals, economic entities, regions and the state, as a whole, from internal and external destabilizing factors.

A different, broader definition of economic security implies the achievement of such state of economic development, which ensures a sufficient steady economic growth, effective satisfaction of economic needs, state control over the movement and use of national resources, protection of the country's economic interests at the national and international levels (Dudin, 2016; Lewis, W.A., 2015).

That is, in the above definitions, pay much attention to the balance between the economic system and its sustainable development, which can be achieved in two ways: extensive and intensive.

The extensive development path is the least costly for the state and is realized through the active exploitation of available resources. It should be understood that the choice of such path already contains elements of a crisis in advance, the speed of the onset and movement of which depends solely on the exhaustion of available resources and on the change in market conditions. In the Russian Federation, since the collapse of the USSR, economic development has been extensive through the export of natural resources and raw materials.

An intensive development path is to increase the return on available resources, which can be achieved with the constant development of new technologies. Thus, the basis of the intensive development path implies innovative solutions in various areas: energy, environmental, medical and others. No less important is the role of human capital.

However, no matter what path of economic development was chosen, the issue of economic security does not lose its relevance, but it should be noted, that, in the first case, the economic security of the state is lost as the available resource is used (Мkrtchyan, 2015).

As a rule, the economic security of the state is a system which main functions are divided into five groups: protective, regulatory, warning, innovative and social (Timofeev, 2017).

The protective function is the ability to protect the state economic system from internal and external threats. The implementation of this function is directly related to the formation of the economic resource potential and its effective use.

The regulatory function appears in different economic subsystems by ensuring state economic security and applying functional and legal mechanisms aimed at neutralizing risks.

The warning function of economic security of the state is aimed at predicting the occurrence of potential crisis situations in the course of economic activity and at developing countermeasures.

The innovative function is realized by the government making any unconventional decisions within the economic process, that are focused on accelerating economic and technological development or neutralizing possible negative consequences of destabilizing factors.

The social function of the state system of economic security offers the complete satisfaction of the needs of all members of society. The implementation of this function contributes to the improvement of the level and quality of life and guarantees the protection of the rights and freedoms of citizens.

It should be noted, that such classification of the functions of the state in the field of ensuring economic security is conditional, since these functions are interrelated and interdependent. The effectiveness of ensuring the state’s economic security depends on the ability of these functions to work together fully (Gilpin, R., 2016).

The relevance of the research topic is that the Russian Federation is one of the most important participants in the global economic process. In addition, today, the Russian Federation is experiencing a period of economic crisis associated with new challenges and threats in the global economy, as well as with the sanctions policy of Western and European states. In this regard, the development of the Strategy of the economic security and its implementation is one of the most important issues not only from the point of view of economic development, but also from the point of view of national security.

The aim of the study is to reveal the manifestations of economic security in the Russian legal system and to analyze the modern Strategy of the economic security.

The object of the study is the economic security of the country.

By the present article author presents unique research results. For the research author formulated and researched the problem and accumulated the sources base for the collection of the information used. -

The research methods which were used: document analysis method was used to obtain information via qualitative analysis, exploring concepts, programs, strategic documents, current legislation of the Russian Federation in this field, scientific publications. The method of statistical data analysis was used to disclose the importance of economic security in the formation of a country's competitiveness. Logical analytical method was used to analyze information collected on the basis of the formation of intermediate and final conclusions.

In the Russian Federation, Presidential Decree No. 208 of May 13, 2017 adopted the Strategy of the economic security of the Russian Federation until 2030 (Presidential Decree No. 208 On the Strategy for the Economic Security of the Russian Federation for the Period until 2030, 2017) based on two federal laws of December 28, 2010 No. 390-FZ “On Security” and on June 28, 2014 No. 172-FZ “On Strategic Planning in the Russian Federation”. The previous strategy was adopted during the reign of Boris Yeltsin in 1996 and of course no longer reflected modern reality.

The decision to develop a new document was made at the meeting of the Security Council of the Russian Federation in July 2015 and since then the project has been repeatedly discussed. It was emphasized that in the period of increasing instability of the global economy and aggravation of global competition, new challenges and threats to the national security of Russia appeared and it necessitates the formation of conceptually new approaches to ensuring economic security.

From the point of view of the developed Strategy, economic security is understood as the condition of protection of the national economy from external and internal threats, which ensures the economic sovereignty of the country, the unity of its economic space, and the conditions for implementing strategic national priorities. The strategy is supposed to be implemented in two stages, the first of which should be completed in 2019. It includes an analysis of the economic condition of the state, its economic security, the development of regulatory measures and methodological measures to ensure economic security and their implementation. The second stage (2019-2030) is aimed at eliminating economic threats. The Strategy of the economic security itself is aimed at preventing the crisis in Russia in the resource, raw materials, production, scientific, technological and financial spheres, and at the same time preventing a decline in the quality of life of citizens.

The Strategy lists the main threats and challenges to economic security. The first is the desire of the developed countries of the world to use their advantages in the level of development of the economy and high technologies, as a tool for global competition. In addition, the top ten included: increased structural imbalances in the global economy, the use of discriminatory measures against key sectors of the Russian economy, increased conflict potential in areas of economic interests of the country and near its borders, increased fluctuations in world commodity and financial markets, changing the structure of global demand on energy resources, activities created without the participation of Russia in interstate economic associations, the vulnerability of the information infrastructure of financial and banking system, the exhaustion of the export-raw material development model and the absence of Russian non-resource companies among the global leaders of the world economy (Zlobin A., 2018).

In addition, there was a lack of investments in the real sectors of the economy, low non-resources export and a lag in technological development. This is an important point, because, as mentioned earlier, Russia is still following the path of extensive economic development, but the state is striving for development and a transition to an intensive path. As another important threat, low GDP growth is highlighted. Russia is among the 15 countries with the largest economies in the world and ranks among them in 11th place in terms of GDP. Today, GDP indicators in Russia correspond to the level of 2010, that is, lower than 2011-2014, but higher than in 2015 and 2016, while Russia's position in the ranking did not change dramatically (Pozdnyakova, 2017; International Monetary Fund, 2016).

On the basis of the analyzed Strategy, the state policy on ensuring economic security at the federal, regional, municipal and sectoral levels will be formed in the future. However, is this Strategy really able to help with this and indicate the right vector of development?

First of all, it is worth noting, the edge in this document of strategic planning of economic security, despite the fact that in paragraph 16 the main tasks in this area are listed. Among the first ones, one can see an increase in the investment climate and an increase in the attractiveness of Russia for business activities. Of course, these tasks play a very important role in the country's economy, but their role in ensuring economic security is mediated. At the same time, one of the most important issues of economic security in the Russian Federation is the fight against corruption and the black economy, which is recorded as the last of the tasks (Sunkel, 2016). That is, prioritization in this document raises big questions. It can be said, that the previous strategy of 1996 more substantively considered issues of economic security, and not any aspects of the state economy, as a whole. In addition, the personnel issue is not covered, although, as mentioned earlier, human resources play one of the most important roles in the intensive development of the economy. Just one of the tasks is called economic growth, which itself must be ensured by economic security.

Another important issue is improving Russia's competitiveness. In our opinion, for the formation of Russia's economic security, the most important is to ensure economic self-sufficiency and avoidance of excessive dependence on world markets.

The Strategy introduced the concept of “economic sovereignty” by which the objectively existing independence of the state in the conduct of domestic and foreign economic policies is understood. The introduction of this concept is connected with the recommendation of the Scientific Council of the Security Council of the Russian Federation to include in the definition of economic security the concept of national sovereignty in the economic sphere. Thus, from the point of view of the Strategy, sovereignty is an objectively existing reality, although from the point of view of the theory of sovereignty this is the result of the realization of the state’s subjective interests regardless of influence from outside (Aksenov S., 2017).

In addition, the Scientific Council of the Security Council of the Russian Federation was invited to give a detailed description of the tasks and threats to economic security, which was implemented in the final document. But, unfortunately, just a detailed description does not provide a strategy to eliminate these challenges and threats and to increase the level of economic security in the Russian Federation.

Currently, Russia is one of the leading economic powers in the world. The Russian Federation pursues an active foreign policy and consistently protects its interests abroad and is among the 15 largest economies in the world. However, the Russian Federation is lagging behind world leaders and best practices in many areas, including on the formation of the strategy of the economic security.

Of course, the document developed in 2017 has the character of a base and requires specification in the regulatory acts at both the federal and regional levels. However, despite the fact, that the deadline for the development of specific measures for the Government of the Russian Federation was 3 months, they were not developed. Less than half a year is left before the completion of the first stage of the Strategy implementation, but no serious innovations have occurred and the position of Russia on the world economic arena has not improved. After the presidential elections, in March 2018, there was a change in the staff of the government apparatus and perhaps the new staff would be more responsible in developing measures to improve the economic security of the Russian Federation.

In addition, as already mentioned, the transition from extensive economic development to intensive development is important for Russia, but, still, non-resources Russian companies are not among the world leaders.

Overcoming technological and innovative backwardness is a strategic task, that determines Russia's positioning in the world. Participation in globalization, the pursuit of foreign policy for development while maintaining strategic independence in security matters is a key content of the country's international activities. To achieve this goal, it is necessary to solve a whole complex of interrelated tasks. First of all, it is necessary to increase Russia's competitiveness in the global economy, by ensuring economic self-sufficiency and the formation of an internal economic complex. In the future, this makes it possible to act on the world market not only as an exporter of raw materials. In addition, despite the importance of strengthening the domestic market, Russia needs to increase its influence in solving common global problems. Such areas as global energy security, food security, cyber security, cooperation on climate and the environment have great potential.

In conclusion, it should be said, that the developed Strategy of the economic security needs serious revision on the part of the state in order to concretize it and develop concrete steps. It is envisaged, that the Strategy will be reviewed and concretized every 6 years, that is, changes will be made to it not earlier than 2023.

Acknowlegments

The base for the article preparation is the Stolypin International Institute of Information and Public Administration.

The publication has been prepared with the support of the ‘RUDN University Program 5-100’.

This paper financially supported by the Ministry of Education and Science of the Russian Federation on the program to improve the competitiveness of  Peoples Friendship University of Russia (RUDN University) among the worlds leading research and education centers in the 2016-2020.

Aksenov S. 2017. The economic security of the country is still in question, from https://svpressa.ru/economy/article/172386/

Dudin, M.N., Frolova, E.E., Lubents, N.A., Sekerin, V.D., Bank, S.V., Gorokhova, A.E. 2016. Methodology of the Operation and Development of Industrial Enterprises. Quality - Access to Success, 17 (153), 53-59.

Gilpin, R. 2016. The Political Economy of International Relations. Princeton, Princeton University Press, p. 472.

International Monetary Fund. 2016. IMF Annual Report for 2016, from

http://www.imf.org/external/russian/pubs/ft/ar/2016/pdf/ar16_rus.pdf

Kathleen J. McInnis, Analyst in International Security December 19, 2017 (IN10842), from https://fas.org/sgp/crs/natsec/IN10842.pdf

Lewis, W.A. 2015. The Evolution of the International Economic Order. Princeton University Press, p. 92

Pozdnyakova E., Russia's place in the world at the end of 2017, from https://newizv.ru/news/society/31-12-2017/mesto-rossii-v-mire-po-itogam-2017-0203b393-d6ec- 4786-8d0c-1d5e01a3fbae

Mkrtchyan T.M. State Economic Security System and Its Components. 4th International Conference on Humanities, Sociology & Corporate Social Responsibility (RHSCSR’15) Sept. 25-26, 2015 Penang (Malaysia)

Sunkel O., Inotai, A. 2016. Globalism and the New Regionalism, Vol. 1, London, Springer. p. 270

Timofeev, I.N. 2017. The World on the World. From http://csr.ru/wp-content/uploads/2017/06/Tezisy_po-vneshnei-politike.pdf

Presidential Decree of May 13, 2017 No. 208 “On the Strategy of Economic Security of the Russian Federation for the Period until 2030” http://www.consultant.ru/document/cons_doc_LAW_216629/

Zlobin A. 2018. 25 main threats to Russia's economic security: President Putin’s version http://www.forbes.ru/biznes/344319-25-glavnyh-ugroz-ekonomicheskoy-bezopasnosti-rossii-versiya-prezidenta-putina

1. Department of Humanitarian, Social, Economic and Information Law disciplines of the Stolypin International Institute of Information and Public Administration. Research and Education Center "Legal Research» of the RUDN University. E-mail: mail@miigu.ru

2. Department of the judiciary, law enforcement and human rights of the RUDN University. E-mail:   Lotos-75@mail.ru

3. Director of the Research Institute for Education and Science. E-mail: Professor60@mail.ru

4. Department of  Civil and Business Law of the Russian State University Of Justice (RPA of the Ministry of justice of Russia). E-mail: gvv100@bk.ru

5. Department of Administrative and Financial Law of the RUDN University. E-mail:  mzh.law@gmail.com