The Regional Dimensions of Barriers to Business Transactions in Russia

Abstract

This analysis, based on more than 70 company case studies across 13 Russian regions during the spring, summer and fall of 2000 and the summer of 2001, examines four key issues that Russian firms face in carrying out business transactions in Russia's regional markets: (i) the state of inter-enterprise competition; (ii) the regulatory regime governing the delivery of infrastructure services (with a focus on the telecom and Internet sector); (iii) the sources and use of corporate finance; and (iv) the efficacy of the court system in fostering the settlement of commercial disputes. The study formulates policy recommendations for each of the areas analyzed. In so doing it sheds light on salient inter-regional differences in existing policy frameworks and in the structure and nature of the country's enterprise sector, as well as on how regional governments and firms both respond to and shape these differences. The study also highlights the evolution of inter-regional policy and economic changes over time, assessing the extent to which, two years after the 1998 crisis, enterprise restructuring at the local level has been affected by the devaluation of the ruble.