Russia’s Economic Modernization Policy and Implications for Cooperation between Korea and Russia

Abstract

Russia’s economic growth model, which backed high economic growth until the mid-2000s, was reaching its limit. Thus, securing a new engine of growth has come to the forefront of Russia’s economic policy agenda. Against this backdrop, then-president Medvedev announced an economic modernization policy as part of the industrial policy aimed at the structural diversification of the economy. The five industries selected as key priority sectors include energy efficiency, nuclear technology, ICT, space technology, and medical and pharmaceutical technology. The goal of Russia’s economic modernization policy is to transform the economy, heavily dependent on energy exports, into an innovation-based economy. For this, the Russian government set up an advanced development strategy, intended to secure the lead in technology sectors where Russia holds a comparative advantage or development potential. At the same time, a catch-up development strategy - developing technologies through imports or technology-transfer – was adopted. This study analyzes and evaluates the main contents and implementing processes of Russia’s economic modernization policy and proposes Korea-Russia cooperation measures in response to the findings.