30 years ago, Boris Yeltsin signed a package of decrees and resolutions on Russia’s transition to a market economy. Kommersant asked economists and entrepreneurs what came of the plan.
Evgeny Chichvarkin, entrepreneur, co-founder of the Euroset network of cellular salons in 1997, has been living in the UK since 2008:
– Yes, Yeltsin succeeded, at least it began to succeed. There were mistakes, some reforms were not completed, but on the whole the market economy was extremely important, and I believe that it saved Russia. It was a time made for business for me.
And the main mistakes were that there was no normal reform of the Ministry of Internal Affairs, the FSB. The state disappeared too much, there was no normal judicial reform. And the transition to a market economy, albeit a curve, albeit any kind of voucher-loans-for-shares auction, was the right decision that had to be made quickly. To our great regret, the current government is again switching over to the state economy, which, apparently, will plunge our country into big economic problems and lag behind the world.
Gennady Burbulis, President of the Humanitarian and Political Science Center “Strategy”, in 1991-1992, First Deputy Prime Minister and Secretary of State:
– Not all decisions have stood the test of time, but for the most part these decrees remain fundamental. For the most part, it worked out. This saved the country from hunger and devastation, created a new economy.
Mikhail Kasyanov, chairman of PARNAS, in 2000-2004, chairman of the government of the Russian Federation, in November 1991 – head of a department in the united Ministry of Economy and Finance of the RSFSR:
– In general, it worked out, but extremely tough. At that time, there was not enough food in the country, and there was no money in the budget at all. Therefore, the government’s primary measures saved the country from starvation. And the most important thing is that the concept of private property was laid in the minds of people, in the Constitution and laws. And in everyday life, an atmosphere of support and encouragement of private entrepreneurship has been created, competition has become a reality and a systemic transformation of the economy has taken place. This is what ultimately became the source of economic growth in 1997, when GDP did not fall, but grew by 1.8%.
Of course, some measures were half-hearted or erroneous: not very transparent privatization, decommunization of the country, liquidation of the KGB and lustration of persons involved in the totalitarian regime. These mistakes continue to affect our lives today, stifling personal freedom and threatening the inviolability of private property.
Sergey Filatov, President of the Foundation for Socio-Economic and Intellectual Programs, in 1993-1996, head of the presidential administration Boris Yeltsin:
– It was difficult to count on the full implementation of the program, we were ahead of the events: neither society, nor the economy, nor production were ready to immediately switch to market rails. But a serious step was taken, the structure of a market economy and a banking system were created, laws on entrepreneurship, a bankruptcy law were adopted, and the foundations of the market were laid.
What they did not achieve was a developed system of medium and small business, which was supposed to occupy the main niche of the market. Unfortunately, after the Yeltsin era, the state did everything possible to make big business prevail, and on this they lost a lot, primarily in the production of goods and the provision of services.
Grigory Yavlinsky, politician, economist, from July to November 1990, Deputy Chairman of the Council of Ministers of the RSFSR, one of the authors of the program of economic reforms “500 days”:
– To assess the effectiveness of Yeltsin’s reforms, you can look at what happened a year later. First, there was hyperinflation of 2600%, second, the volume of industrial production in 1992 fell by 18%, investments fell dramatically and the structure of production changed dramatically in favor of the extractive industries. Third, as a result of the rejection of the economic agreement with the former republics of the USSR, there was a complete loss of the sales markets of the CIS countries. As a result of all this, unemployment, crime increased, and incomes of the population fell by half.
As a result, the implementation of decrees on the transition to a market economy led to the confiscation of money savings through hyperinflation, and, consequently, to semi-criminal privatization. Then the foundation was laid for a system in which there is no separation of powers, independent media and a true parliamentary system. So we are reaping the fruits of the mistakes of those reforms.
Abel Aganbegyan, Academician of the Russian Academy of Sciences, in 1989-2002 Rector of the Academy of National Economy under the Council of Ministers of the USSR / Government of the Russian Federation:
– According to the Hamburg score, the main thing was succeeded: to preserve the disintegrating Russia and prevent a complete economic catastrophe. But this was achieved at a very high cost: a halving of the standard of living, the loss of all the savings of the population, a huge increase in unemployment of 13% and depopulation of the population. We have not moved to a normal market economy, we have not created a mechanism for socio-economic growth. For 30 years, our country has been marking time, although with significant better changes in a number of areas: there is a choice of goods, services, jobs, the opportunity to travel abroad, etc.
Mikhail Delyagin, economist, State Duma deputy, adviser to First Deputy Prime Minister Yuri Maslyukov in 1998-1999:
– We switched to a market economy, but not quite to the market we dreamed of. He was not civilized, as in the Scandinavian countries, but turned out to be wild, as at best in Latin America. Then it gradually developed into thug feudalism and self-denial. The principal reason why this happened is bad faith. At that time, the transition to the market was officially viewed as a way to provide good for the people, but in reality for Yeltsin it was a way of fighting for power, for other reformers it was personal enrichment.
The main course of action, which was ensured by market reforms, was the plundering of the Soviet legacy, into which Russian statehood subsequently took shape. In this capacity, it still remains, only in the 90s was the material heritage robbed, and now – the social one.
Sergey Aleksashenko, economist, in 1995-1998 Deputy Minister of Finance of the Russian Federation and first deputy chairman of the Central Bank of Russia, in 1991 – employee of the State Commission of the Council of Ministers of the USSR for Economic Reform under the leadership of Academician L. I. Abalkin:
– Yes, this transition took place in the first half of the 90s. In a planned economy, the balance was established by officials by their own orders, while in a market economy this function is performed by free prices and the ruble exchange rate. The transition from state prices to market prices brought supply and demand into balance. At this time, everything was changing in the country, and the transition turned out to be very painful. And as usual, the population paid for all the mistakes of the authorities.
Now market mechanisms work in Russia regardless of what the president, government, State Duma or Central Bank think about them. Like all market players, the state makes independent decisions, influencing the situation as a whole: raising or lowering taxes, transferring financial resources from one sector to another, encouraging or restricting the export and import of certain goods. After the mid-90s, Russia went through all crises without falling into chaos, thanks to the fact that market forces helped the economy find a new equilibrium. In 2008-2009, the government and the Central Bank allocated money to support the oligarchs and the population. And in 2014 and now, during the covid-pandemic crisis, the balance was restored due to a real decrease in the income of the population.
Pavel Titov, President of Business Russia, President of PJSC Abrau-Dyurso:
– I do not consider myself an expert on that era, but at the moment we live in a market economy. We have a significant state participation, but nevertheless it is also guided not only by Russian, but also by global market principles. Our economy still relies too much on the commodity sector. And less for those industries where higher added value is created. And although the private sector is very dependent on government orders and contracts from state monopolies, even this supports the market situation as a whole.
Andrey Nechaev, economist, Minister of Economy of the Russian Federation in 1992-1993:
– Then there was a more difficult task: not only the transition to a market economy, but also overcoming the absolutely real threat of chaos and the collapse of Russia after the USSR. The country found itself without basic state institutions: there was no army, borders, customs, a full-fledged Central Bank. Therefore, it was necessary to solve much more complex problems than in the countries of Eastern Europe. But on the whole, they managed to be solved, and the basic foundations of a market economy were created.
Unfortunately, in the last 10 years there has been a significant rollback. It seems to me that its reason lies in the field of managerial psychology. For the current leaders of the country, managing direct teams is more understandable and familiar than indirect methods using laws and regulations. Now our market economy is on the periphery, because state-owned companies account for 70% of GDP. They are often monopolists and, unfortunately, the relationship between business and government is far from equal. In private business, some basic foundations are still preserved – free prices, the convertibility of the ruble, contractual relations between producers and consumers, although they are occasionally revised.
Oksana Dmitrieva, economist, in 1998 Minister of Labor and Social Development in the government of Kiriyenko, deputy of the State Duma of I-VI and VIII convocations:
– The market economy in the country is, however, not the same as the “revolutionary romantics” expected, who stood at the origins of the decisions taken then. If they were told what would happen in the end, I think they would be horrified. The market turned out to be both non-free and non-competitive …
Oleg Sysuev, First Deputy Chairman of the Board of Directors of Alfa-Bank, in 1997-1998 Deputy Prime Minister:
– Absolutely succeeded, although in a completely distorted form – with a very large participation of the state and state regulation. But still, this is one of the main achievements of recent times, albeit with many sores and acne. It is important that the market is now completely saturated with goods and services, everyone has a choice.
David Yakobashvili, Vice President of the Russian Union of Industrialists and Entrepreneurs, President of Orion Heritage LLC, in 1993 co-founder of Wimm-Bill-Dann:
– Until the early 2000s, the market economy was present, and it is still present, albeit in some truncated forms. At that time it was not bad at all, nevertheless, they saw what the growth was. My colleagues and I remember those years with joy, although at first it was difficult. The turn of the late 1990s – early 2000s was generally remarkable, both companies and people made money, the country’s economy was growing. Then, however, it became different.
When the state grows stronger, and this is happening in all countries, tightening of the screws begins, the authorities begin to think that people earn a lot, eat a lot, and it is worth cutting back … This is probably, if not normal, then habitual. And the period of rise is followed by a period of decline, stagnation, and again rise. This is how generation after generation will have to live.
Igor Rybakov, co-owner of Technonikol corporation:
– Today in Russia there is a quasi-market economy, and I have a lot of questions about how to regulate it. After all, it is she who tightens the stranglehold, deprives the country of the necessary maneuver. But I see the way out not in criticizing the government, but in the fact that each economic entity in its place should see what it can do for a legislative initiative aimed at the emergence of more interesting, viable and sustainable forms of interaction in the country.