Geography

Russia

June 15, 2013, 4:08 pm
Source: CIA World Factbook
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Russia (more formally the Russian Federation) is a nation of one hundred and twenty-eight million people in eastern Europe (west of the Ural mountains) and northern Asia (east of the Urals), bordering the Arctic Ocean, between Europe and the North Pacific Ocean.

Russia has an area of about 17 million square kilometers (6.5 million square miles); in geographic terms, this makes Russia the largest country in the world by more than 2.5 million square miles. But with a population density of about 22 persons per square mile (nine per square kilometre), it is sparsely populated, and most of its residents live in urban areas.

Russia borders fourteen other countries. However, it is unfavorably located in relation to major sea lanes of the world. Despite its size, much of the country lacks proper soils and climates (either too cold or too dry) for agriculture. Mount El'brus is Europe's tallest peak.

Its major environmental issues include:

  • Air pollution from heavy industry, emissions of coal-fired electric plants, and transportation in major cities;
  • Industrial, municipal, and agricultural pollution of inland waterways and seacoasts;
  • Deforestation;
  • Soil erosion;
  • Soil contamination from improper application of agricultural chemicals;
  • Localised areas of sometimes intense radioactive contamination;
  • Groundwater contamination from toxic waste;
  • Urban solid waste management; and,
  • Abandoned stocks of obsolete pesticides and herbicides

Permafrost cover over much of Siberia and is a major impediment to development.

Spring floods and summer/autumn forest fires throughout Siberia and parts of European Russia

Russia experiences significant volcanic activity on the Kamchatka Peninsula and Kuril Islands.

Founded in the 12th century, the Principality of Muscovy, was able to emerge from over 200 years of Mongol domination (13th-15th centuries) and to gradually conquer and absorb surrounding principalities.

In the early 17th century, a new Romanov Dynasty continued this policy of expansion across Siberia to the Pacific. Under Peter I (ruled 1682-1725), hegemony was extended to the Baltic Sea and the country was renamed the Russian Empire.

During the 19th century, more territorial acquisitions were made in Europe and Asia.

Defeat in the Russo-Japanese War of 1904-05 contributed to the Revolution of 1905, which resulted in the formation of a parliament and other reforms.

Repeated devastating defeats of the Russian army in World War I led to widespread rioting in the major cities of the Russian Empire and to the overthrow in 1917 of the imperial household.

The Communists under Vladimir Lenin seized power soon after and formed the USSR.

The brutal rule of Iosif Stalin (1928-53) strengthened Communist rule and Russian dominance of the Soviet Union at a cost of tens of millions of lives.

The Soviet economy and society stagnated in the following decades until General Secretary Mikhail Gorbachev (1985-91) introduced glasnost (openness) and perestroika (restructuring) in an attempt to modernize Communism, but his initiatives inadvertently released forces that by December 1991 splintered the USSR into Russia and 14 other independent republics.

Since then, Russia has shifted its post-Soviet democratic ambitions in favor of a centralized semi-authoritarian state in which the leadership seeks to legitimize its rule through managed national elections, populist appeals by former President Putin, and continued economic growth.

Russia has severely disabled a Chechen rebel movement, although violence still occurs throughout the North Caucasus.

Geography

Location: Northern Asia (the area west of the Urals is considered part of Europe), bordering the Arctic Ocean, between Europe and the North Pacific Ocean

Geographic Coordinates: 60 00 N, 100 00 E

Area: 17,098,242 sq km (land: 16,377,742 sq km; water: 720,500 sq km)

Land Boundaries: 20,241.5 km (Azerbaijan 284 km, Belarus 959 km, China (southeast) 3,605 km, China (south) 40 km, Estonia 290 km, Finland 1,313 km, Georgia 723 km, Kazakhstan 6,846 km, North Korea 17.5 km, Latvia 292 km, Lithuania (Kaliningrad Oblast) 227 km, Mongolia 3,441 km, Norway 196 km, Poland (Kaliningrad Oblast) 432 km, Ukraine 1,576 km)

Coastline:  37,653 km

Maritime Claims:

territorial sea: 12 nm
contiguous zone: 24 nm
exclusive economic zone: 200 nm
continental shelf: 200 m depth or to the depth of exploitation

Natural Hazards: permafrost over much of Siberia is a major impediment to development; volcanic activity in the Kuril Islands; volcanoes and earthquakes on the Kamchatka Peninsula; spring floods and summer/autumn forest fires throughout Siberia and parts of European Russia.

Terrain: broad plain with low hills west of Urals; vast coniferous forest and tundra in Siberia; uplands and mountains along southern border regions.  The highest point is Gora El'brus (Mount Erebus, 5,633 m) and the lowest point, the Caspian Sea (-28 m).

Climate:  ranges from steppes in the south through humid continental in much of European Russia; subarctic in Siberia to tundra climate in the polar north; winters vary from cool along the Black Sea coast to frigid in Siberia; summers vary from warm in the steppes to cool along the Arctic coast.

Topology of Russia. Source: Lencer/Wikimedia Commons.

Volcanism

Russia experiences significant volcanic activity on the Kamchatka Peninsula and Kuril Islands; the peninsula alone is home to some 29 historically active volcanoes, with dozens more in the Kuril Islands. Kliuchevskoi (elev. 4,835 m), which erupted in 2007 and 2010, is Kamchatka's most active volcano. Avachinsky and Koryaksky volcanoes, which pose a threat to the city of Petropavlovsk-Kamchatskiy, have been deemed "Decade Volcanoes" by the International Association of Volcanology and Chemistry of the Earth's Interior, worthy of study due to their explosive history and close proximity to human populations. Other notable historically active volcanoes include Bezymianny, Chikurachki, Ebeko, Gorely, Grozny, Karymsky, Ketoi, Kronotsky, Ksudach, Medvezhia, Mutnovsky, Sarychev Peak, Shiveluch, Tiatia, Tolbachik, and Zheltovsky.

Russia's eastern Kamchatka Peninsula is home to 160 volcanoes, 29 of which are active. The Volcanoes of Kamchatka together form a UNESCO World Heritage Site. While most are not actively erupting, many are considered dangerous due to their eruptive history and proximity to population centers and air travel corridors. This astronaut photo highlights the summit crater and snow-covered slopes of Avachinshy stratovolcano (2,741 m; 8,993 ft) as it pokes above a surrounding cloud deck. The volcano has an extensive historic and geological record of eruptions, the latest activity ocurring in 2008. To the southeast (image right), the large breached crater of Kozelsky volcano also appears above the clouds. Kozelsky is a parasitic cone, formed by the eruption of material from vents along the flank of Avachinsky. Photo courtesy of NASA.

The Kuril Island chain is built from a line of volcanoes, an island arc, that extends from Russia's Kamchatka Peninsula to northern Japan. Island arcs form along an active boundary between two tectonic plates, with one being driven beneath the other (subduction). Magma generated by subduction feeds volcanoes - and eventually volcanic islands - over the subduction boundary. Paramushir Island in the northern Kurils is an example of a large island built by several volcanoes over geologic time. This astronaut photograph shows the southern end of Paramushir Island after a snowfall. The western slopes of the mountains are brightly illuminated, while the eastern slopes are in shadow. Four major volcanic centers create this part of the island. Fuss Peak (image center left) is an isolated stratovolcano connected to the main island via an isthmus. Fuss Peak last erupted in 1854. The southern tip of the island is occupied by the Karpinsky Group of three volcanic centers. A minor eruption of ash following an earthquake occurred on this part of the island in 1952. The Lomonosov Group to the northeast (image center) includes four cinder cones and a lava dome. The most recent volcanic activity on Paramushir Island occurred in 2008 at the Chikurachki cone located along the northern coastline of the island at image top center. The summit of this volcano, 1,816 m (5,958 ft) above sea level, is the highest on Paramushir Island. Much of the Sea of Okhotsk visible in the image is covered with low clouds that often form around the islands in the Kuril chain. The clouds are generated by moisture-laden air passing over the cool sea/ocean water, and they typically wrap around the volcanic islands. Image courtesy of NASA.
 

Ecology and Biodiversity

The following ecoregions (as defined by the World Wildlife Fund) occur in Russia:

1. Central European mixed forests
2. Sarmatic mixed forests
3. Scandinavian and Russian taiga
4. Kola Peninsula tundra
5. Northwest Russian-Noraya Zelma Tundra
6. Arctic Desert (Polar desert)
7. Yamal-Gydan tundra
8. East European Forest Steppe
9. Pontic Steppe
10. Crimean submediterranean forest complex
11. Caucasus mixed forests
12. Caspian lowland desert
13. -
14. Kazakh semi-desert
15. Kazakh steppe
16. Kazahk upland
17. Kazakh forest steppe
18. Ural montane forests and tundra
19. Western Siberian hemiboreal forests
20. West Siberian taiga/West Siberian broadleaf and mixed forests
21. Altai montane forest and forest steppe
22. Altai alpine meadow and tundra
23. Sayan Alpine meadows and tundra
24. Sayan intermontane steppe
24a. Sayan montane conifer forests
25. South Siberian forest steppe

26. Great Lakes Basin desert steppe
27. Salenge-Orkhon forest steppe
28. Trans-Baikal conifer forests
29. Daurian forest steppe
30. Trans-Baikal Bald Mountain tundra
31. East Siberian taiga
32. Taimyr-Central Siberian tundra
33. Novosibirsk Islands arctic desert
34. Northeast Siberian coastal tundra
35. Cherskij-Kolyma mountain tundra
36. Northeast Siberian taiga
37. Chukchi Peninsula tundra
38. Wrangel Island arctic desert
39. Bering tundra
40. Kamchatka Mountain tundra and forest tundra
41. Kamchatka-Kurile meadows and sparse forests
42. Kamchatka-Kurile taiga
43. Sakhalin Island taiga
44. South Sakhalin-Kurile mixed forests
45. Okhotsk-Manchurian taiga
46. Ussuri broadleaf and mixed forest/Ussuri-Wusuli meadow and forest meadow
47. Suiphun-Khanka meadows and forest meadows
48. Manchurian mixed forests
49. Amur meadow steppe
50. Da Hinggan-Dzhagdy mountains conifer forests

See also:

World Heritage Sites:

 

The Lena River, some 4,500 km (2,800 mi) long, is one of the longest rivers in the world. The Lena Delta Reserve, shown in this enhanced satellite photo, is the most extensive protected wilderness area in Russia; it serves as an important refuge and breeding ground for many species of Siberian wildlife. The wave-dominated delta of the Lena River is 30,000 sq km (11,580 sq mi) making it one of the largest of its kind in the world. Image courtesy of USGS.

People and Society

Population: 138,082,178 (July 2012 est.)

Russia’s citizens descend from more than 100 ethnic groups. Russian is the official language of Russia and is one of the six official languages of the United Nations. Russian is also the language of such giants of world literature as Pushkin, Tolstoy, Dostoevsky, Chekhov, Pasternak, and Solzhenitsyn.

The unraveling of the Soviet state in its last decades and the physical and psychological traumas of transition during the 1990s resulted in a steady decline in the health of the Russian people. Currently Russia faces a demographic crisis as births lag far behind deaths. While its population is aging, the high number of deaths of working-age males due to cardiovascular disease is a major cause of Russia's demographic woes. A rapid increase in HIV/AIDS infections and tuberculosis, added to rising deaths from cancer, compounds the problem. In 2011, life expectancy at birth was estimated at 63.03 years for men and 74.87 years for women. The large annual excess of deaths over births, if unabated, could cut Russia's population by 30% over the next 50 years, though inward migration could change this picture.

Cardiovascular diseases, cancer, traffic accidents, and violence continue to be major causes of death among working age men. Many premature deaths are attributed to excessive alcohol consumption and smoking. A truly healthy Russia will require serious improvements in the health sector and some major changes in current cultural norms. To combat the looming demographic crisis, in October 2007 then-President Putin approved the concept of demographic policy for the years 2008-2025. The program aims to increase life expectancy, reduce mortality, increase the birth rate, improve the population's health, and develop a sound migration policy. The government instituted the National Priority Health Project and "mother's capital" in order to slow the population decline. These programs had short-term success; Russia's natural population decline, the absolute difference between births and deaths, diminished from more than 800,000 in 2005 to roughly 200.000 in 2010, as the birthrate grew from 10.2 to 12.5 per 1,000 in the same period. In April 2008, the government signed the World Health Organization's Framework Convention on Tobacco Control, then approved a tobacco control policy in September 2010 designed to reduce extremely high smoking rates. Results of the 2010 Global Adult Tobacco Survey showed tobacco is the third-leading cause of premature death in Russia, amounting to 17% of all deaths. Nearly 40% of Russia's adult population, or nearly 44 million people, are smokers, more than any other country surveyed on a per capita basis.

Russia's educational system has produced nearly 100% literacy. About 8.1 million students attended Russia's 1,108 institutions of higher education in 2008, but continued reform is critical to producing students with skills to adapt to a market economy. Because great emphasis is placed on science and technology in education, Russian mathematical, scientific, and space and aviation research is still generally of a high order. The number of doctors in relation to the population is high by American standards, although medical care in Russia, even in major cities, is generally far below Western standards.

The Russian labor force, amounting to nearly 76 million workers in 2010, is undergoing tremendous changes. Although well educated and skilled, it is largely mismatched to the rapidly changing needs of the Russian economy. Official unemployment dropped to its lowest rate of 5.4% in May 2008, and labor shortages appeared in some high-skilled job markets. The economic crisis that began in late 2008, however, quickly reversed this trend and the ranks of unemployed swelled to an International Labor Organization (ILO)-estimated 8.2% in 2009; 1.8 million Russians lost their jobs in the first quarter of 2009 alone. By the end of 2010, the Russian economy showed signs of recovery, with the unemployment rate falling to 7.4% by the end of the second quarter, according to the Russian Government statistics agency, Rosstat.

Following the 1991 collapse of the Soviet Union and the economic dislocation it engendered, the standard of living fell dramatically. Real disposable incomes then doubled between 1999 and 2009, and experts estimate that the middle class constitutes approximately one-fourth of the population. The economic crisis, however, interrupted this trend, as real disposable incomes grew by only 1.9% in 2009 and wages fell by 2.8% during the same period. The stock of wage arrears, which peaked during the crisis at almost 9 billion rubles, had fallen by almost half by February 2010. Government anti-crisis measures to bolster wages, pensions, and other benefits helped reduce the poverty rate in 2009 to an estimated 14%, bringing the number of people living below the subsistence minimum (equivalent to about $169 per month) to below 20 million. The official poverty rate was estimated as 13.1% by the World Bank at the end of 2010. According to Russian statistics, the poverty level increased to 14.9% of the population in the first half of 2011 because of an increase in the official poverty threshold and because average real income fell slightly in 2011.

At the end of 2010, there were 60 million Internet users in Russia, with the number growing by 15% a year. Industry watchers forecast that Russia will be Europe’s largest Internet market within the next 2 years.

Ethnic Groups: Russian 79.8%, Tatar 3.8%, Ukrainian 2%, Bashkir 1.2%, Chuvash 1.1%, other or unspecified 12.1% (2002 census)

Age Structure:

0-14 years: 15.2% (male 10,818,203/female 10,256,611)
15-64 years: 71.8% (male 47,480,851/female 52,113,279)
65 years and over: 13% (male 5,456,639/female 12,614,309) (2011 est.)

Population Growth Rate: -0.48% (2012 est.)

Birthrate: 10.94 births/1,000 population (2012 est.)

Death Rate: 16.03 deaths/1,000 population (July 2012 est.)

Net Migration Rate: 0.29 migrant(s)/1,000 population (2012 est.)

Life Expectancy at Birth: 66.46 years

male: 60.11 years
female: 73.18 years (2012 est.)

Total Fertility Rate: 1.43 children born/woman (2012 est.)

Languages: Russian (official), many minority languages

Literacy (age 15 and over can read and write)99.4% (2002 census)

Urbanization: 73% of total population (2010) declining at an annual rate of change of 0.2% (2010-15 est.)

History

Although human experience on the territory of present-day Russia dates back to Paleolithic times, the first lineal predecessor of the modern Russian state was founded in 862. The political entity known as Kievan Rus was established in Kiev in 962 and lasted until the 12th century. In the 10th century, Christianity became the state religion under Vladimir, who adopted Greek Orthodox rites. Consequently, Byzantine culture predominated, as is evident in much of Russia's architectural, musical, and artistic heritage. Over the next centuries, various invaders assaulted the Kievan state and, finally, Mongols under Batu Khan destroyed the main population centers except for Novgorod and Pskov in the 13th century and prevailed over the region until 1480. Some historians believe that the Mongol period had a lasting impact on Russian political culture.

In the post-Mongol period, Muscovy gradually became the dominant principality and was able, through diplomacy and conquest, to establish suzerainty over European Russia. Ivan III (1462-1505) referred to his empire as "the Third Rome" and considered it heir to the Byzantine tradition. Ivan IV (the Terrible) (1530-1584) was the first Russian ruler to call himself tsar, a word derived from the Old Russian term for Caesar. He pushed Russia eastward with his conquests but his later reign was marked by the cruelty that earned him his familiar epithet. He was succeeded by Boris Godunov, whose reign commenced the so-called Time of Troubles. Relative stability was achieved when Mikhail Romanov established the dynasty that bore his name in 1613.

During the reign of Peter the Great (1689-1725), modernization and European influences spread in Russia. Peter created Western-style military forces, subordinated the Russian Orthodox Church hierarchy to the tsar, reformed the entire governmental structure, and established the beginnings of a Western-style education system. He moved the capital westward from Moscow to St. Petersburg, his newly-established city on the Baltic. His introduction of European customs generated nationalistic resentments in society and spawned the philosophical rivalry between "Westernizers" and "Slavophiles" that remains a key dynamic of current Russian social and political thought.

Catherine the Great continued Peter's expansionist policies and established Russia as a European power. During her reign (1762-96), power was centralized in the monarchy, and administrative reforms concentrated great wealth and privilege in the hands of the Russian nobility. Catherine was also known as an enthusiastic patron of art, literature and education and for her correspondence with Voltaire and other Enlightenment figures. Catherine segregated the large Jewish population Russia inherited during the partitions of Poland (1772-95) into an area known as "The Pale of Settlement," where great numbers of Jews were concentrated and later subject to vicious attacks known as pogroms.

Alexander I (1801-1825) began his reign as a reformer, but after defeating Napoleon's 1812 attempt to conquer Russia, he became much more conservative and rolled back many of his early reforms. During this era, Russia gained control of Georgia and much of the Caucasus. Throughout the 19th century, the Russian Government sought to suppress repeated attempts at reform and attempts at liberation by various national movements, particularly under the reign of Nicholas I (1825-1855). Its economy failed to compete with those of Western countries. Russian cities were growing without an industrial base to generate employment, although emancipation of the serfs in 1861 foreshadowed urbanization and rapid industrialization late in the century. At the same time, Russia expanded into the rest of the Caucasus, Central Asia and across Siberia. The port of Vladivostok was opened on the Pacific coast in 1860. The Trans-Siberian Railroad opened vast frontiers to development late in the century. In the 19th century, Russian culture flourished as Russian artists made significant contributions to world literature, visual arts, dance, and music. The names of Dostoyevsky, Tolstoy, Gogol, Repin, and Tchaikovsky became known to the world.

Alexander II (1855-1881), a relatively liberal tsar, emancipated the serfs, reformed the judiciary, and established elected local councils (zemstvos). His 1881 assassination, however, prompted the reactionary rule of Alexander III (1881-1894). At the turn of the century, imperial decline became evident. Russia was defeated in the unpopular Russo-Japanese war in 1905. The Russian Revolution of 1905 forced Tsar Nicholas II (1894-1917) to grant a constitution and introduce limited democratic reforms. The government suppressed opposition and abetted anti-Semitic pogroms. Attempts at economic change, such as land reform, were incomplete.

1917 Revolution and the U.S.S.R.
The ruinous effects of World War I, combined with internal pressures, sparked the March 1917 uprising that led Tsar Nicholas II to abdicate the throne. A provisional government came to power, headed by Aleksandr Kerenskiy. On November 7, 1917, the Bolshevik Party, led by Vladimir Lenin, seized control and established the Russian Soviet Federated Socialist Republic. Civil war broke out in 1918 between Lenin's "Red" army and various "White" forces and lasted until 1920, when, despite foreign interventions and a war with Poland, the Bolsheviks triumphed. After the Red army conquered Ukraine, Belarus, Azerbaijan, Georgia, and Armenia, a new nation, the Union of Soviet Socialist Republics (U.S.S.R.), was formed in 1922.

First among its political figures was Lenin, leader of the Bolshevik Party and head of the first Soviet Government, who died in 1924. In the late 1920s, General Secretary of the Communist Party of the Soviet Union (CPSU) Josef Stalin emerged as the dominant figure in the aftermath of intra-party rivalries; he maintained complete control over Soviet domestic and international policy until his death in 1953. In the 1930s, Stalin oversaw the forced collectivization of tens of millions of its citizens in state agricultural and industrial enterprises. Millions died in the process from state-created famines. Millions more were executed or died in the vast penal and labor system known as the Gulag. Initially allied to Nazi Germany, which resulted in significant territorial additions on its western border, the U.S.S.R. was attacked by the Axis on June 22, 1941. More than twenty million Soviet citizens died during World War II in the successful effort to defeat the Axis, in addition to over two million Soviet Jews who perished in the Holocaust. After the war, the U.S.S.R. became one of the Permanent Members of the UN Security Council. In 1949, the U.S.S.R. developed its own nuclear arsenal.

Stalin's successor, Nikita Khrushchev, served as Communist Party leader until he was ousted in 1964, and presided over an era of cautious liberalization known as the Thaw. Aleksey Kosygin became Chairman of the Council of Ministers, and Leonid Brezhnev was made First Secretary of the CPSU Central Committee in 1964. In 1971, Brezhnev rose to become "first among equals" in a collective leadership. During this period, the Soviet economy entered a period of stagnation from which it never recovered. Brezhnev died in 1982 and was succeeded by Yuriy Andropov (1982-84) and Konstantin Chernenko (1984-85). In 1985, Mikhail Gorbachev became the next (and last) General Secretary of the CPSU. Gorbachev introduced policies of perestroika (restructuring) and glasnost (openness). But his efforts to reform the creaky Communist system from within failed. The people of the Soviet Union were not content with half-freedoms granted by Moscow; they demanded more and the system collapsed. Boris Yeltsin was elected the first president of the Russian Federation in 1991. Russia, Ukraine, and Belarus formed the Commonwealth of Independent States in December 1991. Gorbachev resigned as Soviet President on December 25, 1991.

The Russian Federation
After the December 1991 dissolution of the Soviet Union, the Russian Federation became its successor state, inheriting its permanent seat on the UN Security Council, most of its military assets, as well as the bulk of its foreign assets and debt. By the fall of 1993, politics in Russia reached a stalemate between President Yeltsin and the parliament elected in the waning days of the Soviet Union. The parliament had succeeded in blocking, overturning, or ignoring the President's initiatives on drafting a new constitution, conducting new elections, and making further progress on democratic and economic reforms.

In a dramatic speech in September 1993, President Yeltsin dissolved the Russian parliament in contravention of the existing constitution, and called for new national elections and a new constitution. In response, the parliament sought to depose Yeltsin and instigate an armed insurrection. Yeltsin ordered the army to respond with force to capture the parliament building and crush the insurrection. In December 1993, voters elected a new parliament and approved a new constitution that had been drafted by the Yeltsin government. Yeltsin remained the dominant political figure, although a broad array of parties, including ultra-nationalists, liberals, agrarians, and communists, had substantial representation in the parliament and competed actively in elections at all levels of government.

In late 1994, the Russian security forces launched a brutal operation in the Republic of Chechnya against rebels who were intent on separation from Russia. The protracted conflict, which received close scrutiny in the Russian media, raised serious human rights and humanitarian concerns abroad as well as within Russia, with violations committed on both sides of the fighting. After numerous unsuccessful attempts to institute a cease-fire, in August 1996 the Russian and Chechen authorities negotiated a settlement that resulted in a complete withdrawal of Russian troops and the holding of elections in January 1997. A peace treaty was concluded in May 1997. Following a number of terrorist incidents blamed on Chechen separatists, the Russian Government launched a new military campaign into Chechnya in 1999. By spring 2000, federal forces claimed control over Chechen territory, but fighting continued as rebel fighters regularly ambushed Russian forces in the region. Throughout 2002 and 2003, the ability of Chechen separatists to battle the Russian forces waned but they claimed responsibility for numerous terrorist acts. In 2005 and 2006, key separatist leaders were killed by Russian forces. Large-scale violence was quelled after Ramzan Kadyrov was confirmed as Chechen President in 2007, though many human rights groups accused him of committing serious human rights violations. In April 2009, the Russian Government announced the end of counterterrorism operations in Chechnya; however, the specter of potential conflict in the North Caucasus was raised again by the March 2010 bombing of the Moscow Metro, the January 2011 explosion in Moscow’s Domodedovo airport, and the continuing violence in the republic of Dagestan.

On December 31, 1999 Boris Yeltsin resigned, and Vladimir Putin was named Acting President. In March 2000, he won election in his own right as Russia's second president with 53% of the vote. Putin moved quickly to reassert Moscow's control over the regions, whose governors had confidently ignored edicts from Boris Yeltsin. He ended direct elections for regional leaders and sent his own "plenipotentiary representatives" (commonly called 'polpred' in Russian) to ensure that Moscow's policies were followed in recalcitrant regions and republics. He won enactment of liberal economic reforms that rescued a faltering economy and stopped a spiral of hyperinflation. Putin achieved wide popularity by stabilizing the government, especially in marked contrast to what many Russians saw as the chaos of the latter Yeltsin years. The economy grew both because of rising oil prices and, in part, because Putin was able to achieve reforms in banking, labor, and private property. During this time, Russia also moved closer to the U.S., especially after the terrorist attacks of September 11, 2001. In 2002, the NATO-Russia Council was established, giving Russia a voice in NATO discussions.

U.S.-Russian relations cooled over the ensuing years given concerns over domestic developments in Russia, including political freedoms and human rights, as well as over foreign policy differences. Dmitriy Medvedev was elected President in March 2008 and inaugurated in May. Relations during the first few months of his presidency were affected by the August 2008 Russia-Georgia war and subsequent decision by Russia to recognize the territories of South Ossetia and Abkhazia. As a result, U.S.-Russian contact decreased significantly and the NATO-Russia Council was suspended temporarily.

With the change of U.S. administration in January 2009, U.S.-Russian relations have markedly improved as both sides sought to change the tone of the relationship and to cooperate in areas of mutual interest. At a July 2009 summit in Moscow, Presidents Barack Obama and Medvedev created the U.S.-Russia Bilateral Presidential Commission to pursue joint projects and improve cooperation between the two countries. Recent years have also seen increased cooperation with U.S. and NATO, leading to a new strategic concept proposed at the November 2010 Lisbon Summit that strives to develop a “true strategic partnership between NATO and Russia.” In February 2011, the New START Treaty, which significantly reduced each country’s deployable nuclear weapons, came into effect. The new 123 Agreement between the U.S. and Russia establishes a legal framework for advancing joint work on peaceful uses of nuclear energy. The U.S., NATO, and Russia have also worked closely together to bring stability to Afghanistan. To address Iran’s failure to abide by its international commitments regarding its nuclear program, the U.S. and Russia coordinated multilateral approaches to demonstrate to Iran the consequences of its intransigence.

On September 24, 2011 Prime Minister Vladimir Putin announced his intention to seek a new term as Russia’s president. Putin was elected to a third term – he served the constitutional maximum two consecutive terms from 2000-2008 – as Russia’s president on March 4, 2012. He officially garnered 63.4 percent of the vote against four rivals, including leaders of the minority parties in the Duma and a self-nominated candidate, Mikhail Prokhorov. The OSCE/ODIHR observed the election and noted similar shortcomings to those noted in the Duma elections, including the lack of genuine competition and biased media coverage affecting the fairness of the election. The December 2008 law that extended the Duma’s mandate also lengthened the term of Russia’s president, beginning with the 2012 election, to six years, so the next presidential election is scheduled for 2018.

Government

Government Type: Federation

In the political system established by the 1993 constitution, the president wields considerable executive power. There is no vice president, and the legislative branch is far weaker than the executive. The bicameral legislature consists of the lower house (State Duma) and the upper house (the Federation Council). The president nominates the highest state officials, including the prime minister, who must be approved by the Duma. The president can pass decrees without consent from the Duma. He also is head of the armed forces and of the Security Council.

Elections to the Duma, the 450-seat lower house of parliament, were held most recently on December 4, 2011, and presidential elections on March 4, 2012. The pro-government party, United Russia, polled 49 percent of the Duma vote, which translated to 53 percent of seats under Russia’s proportional representation system. This was a much weaker result than in 2007, when the party won more than two thirds of seats, enabling it to change the Constitution at will. The three minority parties elected to the Duma in 2007- the Communists, Just Russia and the Liberal Democratic Party – all increased their representation in the 2011 election. Three other parties – Yabloko, Right Cause, and Patriots of Russia – contested the elections but did not meet the 7 percent threshold for representation. The Party of People’s Freedom, a liberal opposition party, had its party registration invalidated and could not participate in the elections. In contrast to 2007, the Organization for Security and Cooperation in Europe's (OSCE) Office of Democratic Institutions and Human Rights (ODIHR) sent a mission to observe the Duma elections. The ODIHR mission’s post-election statement identified discrepancies in voting, counting, and tabulation procedures, and noted that the elections took place in an atmosphere which seriously limited political competition. Frequent abuses of administrative resources and media coverage strongly in favor of United Russia combined to hinder political pluralism. The next Duma election must occur before December 2016, as a December 2008 law extended the mandate of the Duma, beginning with the 2011 elections, to five years from four.

Capital: Moscow - 10.523 million  (2009)

Moscow is Russia's capital and largest city. Moscow is also increasingly important as an economic and business center; it has become Russia's principal magnet for foreign investment and business presence. Its cultural tradition is rich, and there are many museums devoted to art, literature, music, dance, history, and science, as well as hundreds of churches and dozens of notable cathedrals.

Other Major Cities: Saint Petersburg 4.575 million; Novosibirsk 1.397 million; Yekaterinburg 1.344 million; Nizhniy Novgorod 1.267 million (2009)

The second-largest city in Russia is St. Petersburg, which was established by Peter the Great in 1703 to be the capital of the Russian Empire as part of his Western-looking reforms. The city was called Petrograd during World War I and Leningrad after 1924. In 1991, as the result of a city referendum, it was renamed St. Petersburg. Under the tsars, the city was Russia's cultural, intellectual, commercial, financial, and industrial center. After Lenin moved the capital back to Moscow in 1918, the city's political significance declined, but it remained a cultural, scientific, and military-industrial center. The Hermitage, formerly the Winter Palace of the tsars, is one of the world's great fine arts museums.

Administrative divisions:   Russia is a federation, but the precise distribution of powers between the central government and the regional and local authorities is still evolving. The Russian Federation consists of 83 administrative units, including two federal cities, Moscow and St. Petersburg. The constitution explicitly defines the federal government's exclusive powers, but it also describes most key regional issues as the joint responsibility of the federal government and the regional administrative units. In 2000, President Putin grouped the regions into seven federal districts, with presidential appointees established in Moscow and six provincial capitals. In March 2004, the constitution was amended to permit the merger of some regional administrative units. A law enacted in December 2004 eliminated the direct election of the country's regional leaders. Governors are now nominated by the president and subject to confirmation by regional legislatures.

46 provinces (oblastey, singular - oblast), 21 republics (respublik, singular - respublika), 4 autonomous okrugs (avtonomnykh okrugov, singular - avtonomnyy okrug), 9 krays (krayev, singular - kray), 2 federal cities (goroda, singular - gorod), and 1 autonomous oblast (avtonomnaya oblast')

oblasts:

  1. Amur (Blagoveshchensk)
  2. Arkhangel'sk
  3. Astrakhan'
  4. Belgorod
  5. Bryansk
  6. Chelyabinsk
  7.  
  8. Irkutsk
  9. Ivanovo
  10. Kaliningrad
  11. Kaluga
  12. Kemerovo
  1. Kirov
  2. Kostroma
  3. Kurgan
  4. Kursk
  5. Leningrad
  6. Lipetsk
  7. Magadan
  8. Moscow
  9. Murmansk
  10. Nizhniy Novgorod
  11. Novgorod
  12. Novosibirsk
  1. Omsk
  2. Orenburg
  3. Orel
  4. Penza
  5. Pskov
  6. Rostov
  7. Ryazan'
  8. Sakhalin (Yuzhno-Sakhalinsk)
  9. Samara
  10. Saratov
  11. Smolensk
  12. Sverdlovsk (Yekaterinburg)
  1. Tambov
  2. Tomsk
  3. Tula
  4. Tver'
  5. Tyumen'
  6. Ul'yanovsk
  7. Vladimir
  8. Volgograd
  9. Vologda
  10. Voronezh
  11. Yaroslavl'

 

Republics:

1. Adygeya (Maykop)
2. Altay (Gorno-Altaysk)
3. Bashkortostan (Ufa)
4. Buryatiya (Ulan-Ude)
5. Dagestan (Makhachkala)
6. Ingushetiya (Magas)
7. Kabardino-Balkariya (Nal'chik)
8. Kalmykiya (Elista)
9. Karachayevo-Cherkesiya (Cherkessk)
10. Kareliya (Petrozavodsk)
11. Komi (Syktyvkar)
12. Mariy-El (Yoshkar-Ola)
13. Mordoviya (Saransk)
14. Sakha [Yakutiya] (Yakutsk)
15. North Ossetia (Vladikavkaz)
16. Tatarstan (Kazan')
17. Tyva (Kyzyl)
18. Udmurtiya (Izhevsk)
19. Khakasiya (Abakan)
20. Chechnya (Groznyy)
21. Chuvashiya (Cheboksary)

krays:

  1. Altay (Barnaul)
  2. Kamchatka (Petropavlovsk-Kamchatskiy)
  3. Khabarovsk
  4. Krasnodar
  5. Krasnoyarsk
  6. Perm'
  7. Primorskiy [Maritime] (Vladivostok)
  8. Stavropol'
  9. Zabaykal'sk (Chita)

autonomous okrugs:

  1. Chukotka (Anadyr')
  2. Khanty-Mansi (Khanty-Mansiysk)
  3. Nenets (Nar'yan-Mar)
  4. Yamalo-Nenets (Salekhard)

federal cities: Moscow [Moskva], Saint Petersburg [Sankt-Peterburg]

autonomous oblast: Yevrey [Jewish] (Birobidzhan)

Note: administrative divisions have the same names as their administrative centers (exceptions have the administrative center name following in parentheses)

Independence Date: 24 August 1991 (from the Soviet Union)

Notable earlier dates:

  • 1157 (Principality of Vladimir-Suzdal created);
  • 16 January 1547 (Tsardom of Muscovy established);
  • 22 October 1721 (Russian Empire proclaimed);
  • 30 December 1922 (Soviet Union established)

Legal System:  The Russian judicial system consists of the Constitutional Court, courts of general jurisdiction, military courts, and arbitrage courts (which hear commercial disputes). The Constitutional Court of the Russian Federation is a court of limited subject matter jurisdiction. The 1993 constitution empowers the Constitutional Court to arbitrate disputes between the executive and legislative branches and between Moscow and the regional and local governments. The court also is authorized to rule on violations of constitutional rights, to examine appeals from various bodies, and to participate in impeachment proceedings against the president. The July 1994 Law on the Constitutional Court prohibits the court from examining cases on its own initiative and limits the scope of issues the court can hear. The system of general jurisdiction courts includes the Supreme Court of the Russian Federation, regional level courts, district level courts and justices of the peace.

The Duma passed a Criminal Procedure Code and other judicial reforms during its 2001 session. These reforms help make the Russian judicial system more compatible with its Western counterparts. The reforms reintroduced jury trials in certain criminal cases and created a more adversarial system of criminal trials that protect the rights of defendants more adequately. Another significant advance in the Code is the transfer, from the Procuracy to the courts, of authority to issue search and arrest warrants. There are concerns, however, that prosecutors have selectively targeted individuals for political reasons, as in the prosecution of Yukos Oil CEO Mikhail Khodorkovskiy.

In spite of some efforts to increase judicial independence (for example, through a considerable salary increase for judges several years ago), many judges still see their role not as impartial and independent arbiters, but as government officials protecting state interests. See below for more information on the commercial court/business law.

Summary: civil law system; judicial review of legislative acts. Russia has not submitted an International Court of Justice (ICJ) jurisdiction declaration; and it is a non-party state to the International criminal court (ICCt) jurisdiction.

International Environmental Agreements

Russia is party to international agreements on: Air Pollution, Air Pollution-Nitrogen Oxides, Air Pollution-Sulfur 85, Antarctic-Environmental Protocol, Antarctic-Marine Living Resources, Antarctic Seals, Antarctic Treaty, Biodiversity, Climate Change (see Greenhouse Gas Control Policies in Russia), Climate Change-Kyoto Protocol, Desertification, Endangered Species, Environmental Modification, Hazardous Wastes, Law of the Sea, Marine Dumping, Ozone Layer Protection, Ship Pollution, Tropical Timber 83, Wetlands, and Whaling. Russia has signed, but not ratified an international agreement on Air Pollution-Sulfur 94.

Water

Total Renewable Water Resources: 4,498 cu km (1997)

Freshwater Withdrawal76.68 cu km/yr  (19% domestic, 63% industrial, 18% agricultural)

Per Capita Freshwater Withdrawal: 535 cu m/yr (2000)

See: Water profile of Russian Federation

Agriculture

Although Russia has 9% of the world’s arable land and abundant fresh water, the relative lack of investment and modernization has made agriculture one of Russia’s lagging economic sectors. But significant change has occurred in recent years. Grain production for export is concentrated in the south of European Russia, with additional grain for domestic consumption grown throughout the rest of non-Arctic Russia west of the Urals as well as western Siberia. Over the past 5 years Russia has improved its competitive position and is now the world’s third-largest exporter of wheat. Livestock production was in decline from 1990 to 2006, when new government support policies were instituted to stimulate domestic meat production. Since the start of the National Priority Program in 2006 the Russian Government has invested to increase poultry, pork, beef, and milk production in Russia, primarily through subsidized loans (worth approximately $3 billion from 2006-2010) to large private enterprises. In January 2010, President Medvedev signed the Food Security Doctrine, which sets targets for domestic production of meat, dairy, oilseeds, grain, fruit, and vegetables and provides a justification for sustained government subsidies to agriculture. One of the main continuing constraints to both agricultural investment and productivity, however, is the absence of clearly defined agricultural property rights and the lack of private land ownership.

In 2011, agriculture priorities continued to be subsidizing livestock and poultry production.

Agricultural products: grain, sugar beets, sunflower seed, vegetables, fruits; beef, milk

Irrigated Land: 43,460 sq km (2008)

Resources

The mineral-rich Ural Mountains and the vast oil, gas, coal, and timber reserves of Siberia and the Russian Far East make Russia rich in natural resources. However, most resources are located in remote and climatically unfavorable areas that are difficult to develop and far from Russian ports. Nevertheless, Russia is a leading producer and exporter of minerals, gold, and all major fuels. Natural resources, especially energy, dominate Russian exports. Over two-thirds of Russian exports to the United States are fuels, mineral oil, or metals.

Natural Resources: wide natural resource base including major deposits of oil, natural gas, coal, and many strategic minerals, reserves of rare earth elements, timber. Note: formidable obstacles of climate, terrain, and distance hinder exploitation of natural resources.

Land Use:

arable land: 7.17%
permanent crops: 0.11%
other: 92.72% (2005)

Economy

The Russian economy underwent tremendous stress in the 1990s as it moved from a centrally planned economy to a free market system. Difficulties in implementing fiscal reforms aimed at raising government revenues and a dependence on short-term borrowing to finance budget deficits led to a serious financial crisis in 1998. Lower prices for Russia's major export earners (oil and minerals) and a loss of investor confidence due to the Asian financial crisis exacerbated financial problems. The result was a rapid and steep decline (60%) in the value of the ruble, flight of foreign investment, delayed payments on sovereign and private debts, a breakdown of commercial transactions through the banking system, and the threat of runaway inflation.

Economic reforms in the 1990s privatized most industry, with notable exceptions in the energy and defense-related sectors. The protection of property rights is still weak and the private sector remains subject to heavy state interference.

The Russian economy bounced back quickly from the 1998 crisis and enjoyed over 9 years of sustained growth averaging about 7% due to a devalued ruble, implementation of key economic reforms (tax, banking, labor and land codes), tight fiscal policy, and favorable commodities prices. Household consumption and fixed capital investments both grew by about 10% per year during this period and replaced net exports as the main drivers of demand. Inflation and exchange rates stabilized due to a prudent fiscal policy (Russia ran a budget surplus from 2001-2008). Foreign exchange reserves grew to almost $600 billion by mid-2008, the third-largest in the world, of which more than $200 billion were classified as stabilization funds designed to shelter the budget from commodity price shocks. The balance of payments experienced twin surpluses until mid-2008 in the current and capital accounts, which accounted for the phenomenal growth of reserves. As of July 1, 2006, the ruble became convertible for both current and capital transactions. Russia repaid its entire Soviet-era Paris Club debt of $22 billion in late 2006, but by October 2008 foreign external debt totaled $540 billion, of which $500 billion was owed by banks and corporations, including state-owned enterprises.

The global economic crisis hit Russia hard, starting with heavy capital flight in September 2008, which caused a crisis in its stock market. Several high-profile business disputes earlier in 2008, such as TNK-BP and Mechel, as well as the Georgian war helped drive capital out of Russia. By mid-September, Russia’s stock market had collapsed, as businesses sold shares to raise collateral for margin calls required by international lending institutions. As the global financial crisis gathered steam in the fall of 2008, the accompanying steep fall in global demand, commodity prices, and tightening of credit served to almost bring Russia’s economic growth to a halt in the fourth quarter of 2008, to 1.1% down from 9.5% during the same period in 2007. The Central Bank of Russia responded by pumping liquidity into Russian banks, which helped avert a banking crisis. At the same time, the government attempted a managed devaluation, which successfully avoided a run on the ruble and bank deposits but at the cost of a steep decline in foreign exchange reserves to $387 billion by mid-February 2009. This in turn prompted the S&P and Fitch rating agencies to downgrade Russia’s sovereign debt to the lowest investment grade. By 2010, however, the Russian economy had begun a modest recovery, bolstered by government anti-crisis policies, the global rebound, and a rise in oil prices. Russia’s leaders put renewed emphasis on promoting innovation as key to economic modernization as well as on the need to diversify the economy away from oil and gas.

See:  Energy profile of Russia, Energy profile of Sakhalin Island, and Energy profile of the Caspian Sea region

Gross Domestic Product
Tighter credit, collapsing global demand, global uncertainty, and rising unemployment hurt investment and consumption, and led Russia to have -7.9% GDP growth in 2009--a sharp contrast to the pre-crisis performance of 8.1% in 2007. However, 2010 saw Russia’s economy return to growth with a 3.8% increase in GDP. Russia’s Economic Development Ministry predicted that the nation’s GDP would grow 4.0% in 2011.

Monetary Policy
For most of the past decade, Russia experienced persistent inflation, gradually declining from 85% in late 1998 to 9% by end-2006. However, a combination of surging international food and energy prices and looser monetary and fiscal policy pushed the Consumer Price Index (CPI) to 11.9% by the end of 2007, and up to 15% in early 2008. The Central Bank of Russia (CBR) monetary policy tended to be limited to managing the ruble’s exchange rate against a bi-currency basket of dollars and euros. The CBR intervened to keep the ruble stable during times of volatile international commodity prices and to manage inflation. In years of record high oil prices, the Central Bank typically purchased dollars to prevent real appreciation of the ruble. These interventions initially had limited effect on inflation, as they were mostly sterilized by budget surpluses and demand for rubles grew in a robust era of economic growth. By 2007, fiscal policy and the balance of payments were the actual drivers of monetary policy, particularly as large capital inflows due to increased borrowing by Russian banks and corporations caused the money supply to swell and added to inflationary pressures. Inflationary pressures eased in late 2008 as energy and commodity prices collapsed and international credit flows virtually stopped, causing money supply growth to halt. Inflation decelerated in 2009 to about 8.8% compared with 13.3% the previous year, owing to residual effects of the economic downturn, and remained stable at 8.8% in 2010. Inflation rose again in 2011, hitting 9.5% in June, but since then has started a downward trend and was 8.2% at the end of August 2011. While the CBR continues to intervene in the exchange rate, it allows the ruble more flexibility and volatility than previously.

Government Spending/Taxation
The Russian federal budget ran growing surpluses from 2001-2007, as the government taxed and saved much of the rapidly increasing oil revenues. The government overhauled its tax system for both corporations and individuals in 2000-2001, introducing a 13% flat tax for individuals and a unified tax for corporations, which improved overall collection. Responding to demands from the oil sector, the government reduced the tax burden on oil production and exports, but only marginally. Tax enforcement of disputes continues to be uneven and unpredictable. In 2007 the federal budget surplus was 5.5% of GDP, and in 2008 the government ended the year with a surplus of 4.1% of GDP. Although the government revised its budget projections during 2009 to reflect lower oil prices and the effects of the economic crisis, it ended the year with a budget deficit amounting to 7.9% of GDP, which it financed from the Reserve Fund, one of the government’s two stabilization funds. The government’s anti-crisis package in 2008 and 2009 amounted to about 6.7% of GDP, according to World Bank estimates. The package provided support to the financial sector and enterprises--through liquidity injections to banks and tax cuts/fiscal support to enterprises--as well as modest support for households and small and medium enterprises (SMEs) and increased unemployment benefits. By the end of 2010, due to improving economic conditions, Russia had lowered its budget deficit to 3.9% of GDP. Due to relatively high oil prices through the first half of the year, many officials believed there would not be a budget deficit for 2011.

Russia's long-term challenges include a shrinking workforce, a high level of corruption, difficulty in accessing capital for smaller, non-energy companies, and poor infrastructure in need of large investments.

GDP: (Purchasing Power Parity): $2.38 trillion (2011 est.)

GDP: (Official Exchange Rate): $1.791 trillion (2011 est.)

GDP- per capita (PPP): $16,700 (2011 est.)

GDP- composition by sector:

agriculture: 4.2%
industry: 37%
services: 58.9% (2011 est.)

Industries:
Russia is one of the most industrialized of the former Soviet republics. However, years of very low investment have left much of Russian industry antiquated and highly inefficient. Besides its resource-based industries, it has developed large manufacturing capacities, notably in metals, food products, and transport equipment. Russia is now the world's third-largest exporter of steel and primary aluminum. Russia inherited most of the defense industrial base of the Soviet Union, so armaments remain an important export category for Russia. Efforts have been made with varying success over the past few years to convert defense industries to civilian use, and the Russian Government is engaged in an ongoing process to privatize many of the state-owned enterprises.

Summary: complete range of mining and extractive industries producing coal, oil, gas, chemicals, and metals; all forms of machine building from rolling mills to high-performance aircraft and space vehicles; defense industries including radar, missile production, and advanced electronic components, shipbuilding; road and rail transportation equipment; communications equipment; agricultural machinery, tractors, and construction equipment; electric power generating and transmitting equipment; medical and scientific instruments; consumer durables, textiles, foodstuffs, handicrafts.

Currency: Russian rubles (RUB)


Investment/Banking
Foreign direct investment (FDI) in 2009 fell to less than $40 billion after reaching an all-time high of $75 billion in 2008. Much of the FDI in recent years was Russian capital “returning home,” from havens like Cyprus and Gibraltar, and these flows reversed during the economic downturn. Moreover, although the annual flow of FDI into Russia was in line with those of China, India, and Brazil, Russia's per capita cumulative FDI lagged far behind such countries as Hungary, Poland, and the Czech Republic. In 2010, net FDI inflow rose to $43 billion, still well below the levels seen in 2008. In the first quarter of 2011, it amounted to $12.8 billion, the CBR reported.

Although still small by international standards, the Russian banking sector before the crisis was growing fast and becoming a larger source of investment funds. To meet a growing demand for loans, which they were unable to cover with domestic deposits, Russian banks borrowed heavily abroad in 2007-2008, accounting for 57% of the private-sector capital inflows in 2007. Ruble lending has increased since the October 1998 financial crisis, and in 2007 loans were 66% of total bank assets, with consumer loans posting the fastest growth at 57% that same year. In 2004, Russia enacted a deposit insurance law to protect deposits up to 100,000 rubles (about $3,700) per depositor. Amendments to the law in the fall of 2008 increased the Deposit Insurance Agency's 100%-coverage for deposits up to 700,000 rubles. The vast majority of Russians keep their money in the banking sector. The combination of liberalized capital controls and ruble appreciation against the dollar in 2005-2008 persuaded many Russians to keep their money in ruble- or other currency-denominated bank deposits. In 2010 private deposits grew by 31.2% and corporate deposits and accounts by 16.4%. In 2011 private deposit growth slowed down such that over the first 8 months of the year, private deposits went up 9.2% (versus 16.5% in the first 8 months of 2010) while corporate deposits and accounts were up by 9.1% (versus 5.0%).

Even with the banking sector’s recent growth, financial intermediation in the overall economy remains underdeveloped. Contradictory regulations across the banking and securities markets have hindered efforts to transfer resources from capital-rich sectors, such as energy, to capital-poor sectors, such as agriculture and manufacturing. The sector is dominated by large state banks, and concentrated geographically in Moscow and the Moscow region. Thus financial service providers face little competition for resources and charge relatively high interest rates for favored, large corporate borrowers.

This state of affairs makes it difficult for entrepreneurs to raise capital, and banks generally perceive small and medium commercial lending as risky. Most of the country’s financial institutions are inexperienced with assessing credit risk, though the situation is improving. The low level of trust, both between the general public and banks as well as among banks, makes the system highly susceptible to crises. After an uncertain year in 2009, by spring 2010 Russian officials announced an end to anti-crisis bank support, and a World Bank report said that “a systemic banking crisis had been averted, the liquidity crunch eased and depositor confidence reestablished.” The report cautioned, however, that systemic weaknesses exposed during the crisis--especially excessive dependence on foreign borrowing and non-performing loans--still needed to be addressed.

Trade
After hitting lows in 2009, trade between the U.S. and Russia grew to $31.7 billion in 2010, an increase of 35% from 2009. U.S. imports from Russia grew 41% year over year to $25.7 billion while exports to Russia increased just 13% to $6.0 billion. The rapid increase in U.S. imports from Russia from 2009 to 2010 can be attributed to the low base year and nascent economic recovery in the United States, but also to the rising price of oil and other commodities. Oil and oil products represent over two-thirds of the value of all U.S. imports from Russia. Russia is currently the 37th-largest export market for U.S. goods. Russian exports to the U.S. were fuel oil, inorganic chemicals, aluminum, and precious stones. U.S. exports to Russia were machinery, vehicles, meat (mostly poultry), aircraft, electrical equipment, and high-tech products.

Russia's overall trade surplus in 2009 was $112 billion--compared with $180 billion in 2008 and $129 billion in 2007. In 2010 the trade surplus increased to $152 billion and continued to grow in 2011 to reach $118 billion by July 2011 (versus $96.4 billion at the same time in 2010), although import growth was beginning to outpace export growth. World prices continue to have a major effect on export performance, since commodities--particularly oil, natural gas, metals, and timber--comprise nearly 90% of Russian exports. Russian GDP growth and the surplus/deficit in the Russian Federation state budget are closely linked to world oil prices.

Russia is in the process of negotiating terms of accession to the World Trade Organization (WTO). The U.S. and Russia concluded a bilateral WTO accession agreement in late 2006, and negotiations continue on meeting WTO requirements for accession. Both Prime Minister Vladimir Putin and the General Director of the WTO, Pascal Lamy, stated in early 2011 that they felt Russia would join within the year.

According to the 2010 U.S. Trade Representative's National Trade Estimate, Russia continues to maintain a number of barriers with respect to imports, including tariffs and tariff-rate quotas; discriminatory and prohibitive charges and fees; and discriminatory licensing, registration, and certification regimes. Discussions continue within the context of Russia's WTO accession to eliminate these measures or modify them to be consistent with internationally accepted trade policy practices. Non-tariff barriers are frequently used to restrict foreign access to the market and are also a significant topic in Russia's WTO negotiations. In addition, Russia’s lax enforcement of intellectual property rights had led to large losses for U.S. audiovisual and other companies and is an ongoing irritant in U.S.-Russia trade relations. Russia continues to work to bring its technical regulations, including those related to product and food safety, into conformity with international standards.

Foreign Relations

In the years after the dissolution of the Soviet Union, Russia took important steps to become a full partner in the world's principal political groupings. On December 27, 1991, Russia assumed the permanent UN Security Council seat formerly held by the Soviet Union. Russia also is a member of the Organization for Security and Cooperation in Europe (OSCE) and the Euro-Atlantic Partnership Council (EAPC). Russia and the European Union (EU) signed a Partnership and Cooperation Agreement in 1994. Russia also joined the North Atlantic Treaty Organization (NATO) Partnership for Peace initiative in 1994. The NATO-Russia Founding Act established the Permanent Joint Council (PJC) in 1997, with the NATO-Russia Council superseding the PJC in 2002. Russia, despite misgivings, did not actively oppose enlargement of NATO by members of the former Warsaw Pact and the Baltic states, which had been forcibly integrated into the Soviet Union. However, Russia has stressed its strong opposition to the membership aspirations of Ukraine and Georgia.

Over the past several years Russia has increased its international profile, played an increasing role in regional issues, and been more assertive in dealing with its neighbors. In recent years, Russia has not shied from using its significant oil and gas exports as sources of political influence. The August 2008 conflict between Russia and Georgia marked a new low point in relations between the two countries, with Russia unilaterally recognizing the Georgian breakaway regions of Abkhazia and South Ossetia as independent countries. Russia continues to support separatist regimes in Georgia and Moldova.

International Disputes:

  • Russia remains concerned about the smuggling of poppy derivatives from Afghanistan through Central Asian countries

  • China and Russia have demarcated the once disputed islands at the Amur and Ussuri confluence and in the Argun River in accordance with the 2004 Agreement, ending their centuries-long border disputes

  • Tthe sovereignty dispute over the islands of Etorofu, Kunashiri, Shikotan, and the Habomai group, known in Japan as the "Northern Territories" and in Russia as the "Southern Kurils," occupied by the Soviet Union in 1945, now administered by Russia, and claimed by Japan, remains the primary sticking point to signing a peace treaty formally ending World War II hostilities.

  • Russia's military support and subsequent recognition of Abkhazia and South Ossetia independence in 2008 continue to sour relations with Georgia.

  • Azerbaijan, Kazakhstan, and Russia ratified Caspian seabed delimitation treaties based on equidistance, while Iran continues to insist on a one-fifth slice of the lake.

  • Norway and Russia signed a comprehensive maritime boundary agreement in 2010.

  • Various groups in Finland advocate restoration of Karelia (Kareliya) and other areas ceded to the Soviet Union following the Second World War but the Finnish Government asserts no territorial demands.

  • In May 2005, Russia recalled its signatures to the 1996 border agreements with Estonia (1996) and Latvia (1997), when the two Baltic states announced issuance of unilateral declarations referencing Soviet occupation and ensuing territorial losses.Russia demands better treatment of ethnic Russians in Estonia and Latvia. Estonian citizen groups continue to press for realignment of the boundary based on the 1920 Tartu Peace Treaty that would bring the now divided ethnic Setu people and parts of the Narva region within Estonia.

  • Lithuania and Russia committed to demarcating their boundary in 2006 in accordance with the land and maritime treaty ratified by Russia in May 2003 and by Lithuania in 1999.

  • Lithuania operates a simplified transit regime for Russian nationals traveling from the Kaliningrad coastal exclave into Russia, while still conforming, as an EU member state with an EU external border, where strict Schengen border rules apply.

  • Preparations for the demarcation delimitation of land boundary with Ukraine have commenced.

  • Tthe dispute over the boundary between Russia and Ukraine through the Kerch Strait and Sea of Azov remains unresolved despite a December 2003 framework agreement and on-going expert-level discussions.

  • Kazakhstan and Russia boundary delimitation was ratified on November 2005 and field demarcation should commence in 2007.

  • The Russian Duma has not yet ratified 1990 Bering Sea Maritime Boundary Agreement with the US.

  • Denmark (Greenland) and Norway have made submissions to the Commission on the Limits of the Continental shelf (CLCS) and Russia is collecting additional data to augment its 2001 CLCS submission

 

Glossary

Citation

Agency, C., Fund, W., & Department, U. (2013). Russia. Retrieved from http://www.eoearth.org/view/article/172699

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