The Import Substitution of Agricultural Products in Russia

Abstract

ABSTRACT The article considers Russia’s import substitution strategy, which has faced criticism in the twentieth and twenty-first century. However, after the financial and economic crisis of 2008–2009, and in the context of a new phase of globalization in the 2010s, the import substitution strategy gained a renewed interest among developed economies. Unlike most countries that adopted import substitution strategies in the industrial sector to accelerate industrialization, Russia implemented import substitution most successfully in its agricultural sector, which makes the Russian case unique. The article considers the theoretical aspects of the import substitution strategy and examines the current state and future prospects of Russia’s agricultural import substitution policy. The analysis of Russia’s foreign trade in agricultural products has shown that following the implementation of the import substitution strategy, the negative trade balance of agricultural products fell significantly, while the share of agricultural exports expanded. With the implementation of import substitution, the development of agricultural production in Russia has shown positive dynamics. Based on the statistical analysis of Russia’s foreign trade for 2001–2017, there is a clear trend toward an increase in the share of agricultural products in the total volume of exports. The major problems and prospects of agricultural import substitution in Russia are identified. The main task of import substitution in Russia’s agricultural sector is not only to increase production volumes, but to improve competitiveness in both the domestic and foreign markets, which will facilitate the transition to a diversified export-oriented economy.