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2.1: Country/Economy Profiles

Russian Federation
Key indicators, 2013
Population (millions) ...................................... 142.9 GDP (US$ billions) ..................................... 2,118.0 GDP per capita (US$) ................................. 14,819 GDP (PPP) as share (%) of world total ............ 2.94

GDP (PPP) per capita (int’l $), 1990–2013
20,000 15,000 10,000 5,000 0 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010

Russian Federation

Commonwealth of Independent States

2012

Global Competitiveness Index
Rank (out of 144) Score (1–7)

Stage of development 1
Factor driven Transition 1–2

GCI 2014–2015 ...................................................... 53 ..... 4.4
GCI 2013–2014 (out of 148) ..................................... 64 ......4.2 GCI 2012–2013 (out of 144) ..................................... 67 ......4.2 GCI 2011–2012 (out of 142) ..................................... 66 ......4.2

2
Efficiency driven

Transition 2–3

3
Innovation driven

Basic requirements (25.5%) .......................................44 ......4.9
Institutions ................................................................ 97 ......3.5 Infrastructure ............................................................ 39 ......4.8 Macroeconomic environment ................................... 31 ......5.5 Health and primary education ................................... 56 ......6.0
Innovation Business sophistication

Institutions
7 6 5 4 3 2

Infrastructure Macroeconomic environment Health and primary education Higher education and training Goods market efficiency

Efficiency enhancers (50.0%) .....................................41 ......4.5
Higher education and training ................................... 39 ......5.0 Goods market efficiency .......................................... 99 ......4.1 Labor market efficiency ............................................ 45 ......4.4 Financial market development ................................ 110 ......3.5 Technological readiness ............................................ 59 ......4.2 Market size ................................................................. 7 ......5.8

Market size

1

Technological readiness Financial market development Labor market efficiency

Innovation and sophistication factors (24.5%) ...........75 ......3.5
Business sophistication ........................................... 86 ......3.8 Innovation ................................................................. 65 ......3.3
Russian Federation Commonwealth of Independent States

The most problematic factors for doing business
Corruption .........................................................................14.3 Tax rates............................................................................12.3 Access to financing ...........................................................11.7 Tax regulations ..................................................................10.8 Inefficient government bureaucracy .....................................8.2 Inflation ................................................................................7.6 Inadequately educated workforce ........................................7.3 Poor work ethic in national labor force ................................4.8 Inadequate supply of infrastructure ......................................4.6 Insufficient capacity to innovate ...........................................4.0 Restrictive labor regulations .................................................3.6 Crime and theft ...................................................................2.8 Policy instability ...................................................................2.8 Foreign currency regulations ................................................2.2 Government instability/coups ..............................................2.0 Poor public health ...............................................................1.0
0 5 10 15 Percent of responses 20 25 30

Note:

From the list of factors above, respondents were asked to select the five most problematic for doing business in their country and to rank them between 1 (most problematic) and 5. The bars in the figure show the responses weighted according to their rankings.

320 | The Global Competitiveness Report 2014–2015

2.1: Country/Economy Profiles

Russian Federation
The Global Competitiveness Index in detail
INDICATOR VALUE RANK/144 6.06 6.07 6.08 6.09 6.10 6.11 6.12 6.13 6.14 6.15 6.16 INDICATOR VALUE RANK/144

1st pillar: Institutions
1.01 1.02 1.03 1.04 1.05 1.06 1.07 1.08 1.09 1.10 1.11 1.12 1.13 1.14 1.15 1.16 1.17 1.18 1.19 1.20 1.21 Property rights ....................................................... 3.3 ..........120 Intellectual property protection ............................... 3.0 ..........107 Diversion of public funds ........................................ 2.7 ..........102 Public trust in politicians ......................................... 3.0 ............74 Irregular payments and bribes ................................ 3.4 ..........102 Judicial independence............................................ 2.9 ..........109 Favoritism in decisions of government officials ....... 2.8 ............87 Wastefulness of government spending ................... 2.8 ............87 Burden of government regulation ........................... 2.9 ..........111 Efficiency of legal framework in settling disputes .... 3.2 ..........110 Efficiency of legal framework in challenging regs. ... 2.9 ............99 Transparency of government policymaking............. 4.0 ............68 Business costs of terrorism .................................... 4.6 ..........104 Business costs of crime and violence..................... 4.5 ............70 Organized crime ..................................................... 4.2 ..........101 Reliability of police services .................................... 3.2 ..........114 Ethical behavior of firms ......................................... 3.9 ............72 Strength of auditing and reporting standards ......... 4.1 ..........106 Efficacy of corporate boards .................................. 4.6 ............64 Protection of minority shareholders’ interests ......... 3.5 ..........118 Strength of investor protection, 0–10 (best)* .......... 4.7 ............98

6th pillar: Goods market efficiency (cont’d.)
No. procedures to start a business* .......................... 7 ............78 No. days to start a business* ............................... 15.0 ............75 Agricultural policy costs.......................................... 3.1 ..........125 Prevalence of trade barriers ................................... 4.0 ..........111 Trade tariffs, % duty* .............................................. 9.5 ..........102 Prevalence of foreign ownership............................. 3.4 ..........124 Business impact of rules on FDI ............................. 3.7 ..........118 Burden of customs procedures .............................. 3.6 ............95 Imports as a percentage of GDP* ........................ 22.1 ..........133 Degree of customer orientation .............................. 4.4 ............83 Buyer sophistication ............................................... 3.7 ............44

7th pillar: Labor market efficiency
7.01 7.02 7.03 7.04 7.05 7.06 7.07 7.08 7.09 7.10 Cooperation in labor-employer relations ................. 4.1 ............89 Flexibility of wage determination ............................. 5.6 ............28 Hiring and firing practices ....................................... 4.2 ............41 Redundancy costs, weeks of salary* .................... 17.3 ............83 Effect of taxation on incentives to work .................. 3.0 ..........115 Pay and productivity............................................... 4.6 ............24 Reliance on professional management ................... 4.0 ............85 Country capacity to retain talent............................. 2.9 ..........103 Country capacity to attract talent ........................... 3.1 ............92 Women in labor force, ratio to men* ..................... 0.87 ............41

2nd pillar: Infrastructure
2.01 2.02 2.03 2.04 2.05 2.06 2.07 2.08 2.09 Quality of overall infrastructure ............................... 4.1 ............74 Quality of roads ...................................................... 2.7 ..........124 Quality of railroad infrastructure .............................. 4.3 ............26 Quality of port infrastructure ................................... 3.9 ............81 Quality of air transport infrastructure....................... 4.1 ............79 Available airline seat km/week, millions* .......... 3,685.0 ............11 Quality of electricity supply ..................................... 4.8 ............73 Mobile telephone subscriptions/100 pop.* ......... 152.8 ............20 Fixed telephone lines/100 pop.* ........................... 28.5 ............39

8th pillar: Financial market development
8.01 8.02 8.03 8.04 8.05 8.06 8.07 8.08 Availability of financial services ............................... 4.4 ............71 Affordability of financial services ............................. 4.1 ............69 Financing through local equity market .................... 3.1 ............86 Ease of access to loans ......................................... 3.0 ............56 Venture capital availability ....................................... 2.7 ............61 Soundness of banks .............................................. 4.0 ..........118 Regulation of securities exchanges ........................ 3.7 ............91 Legal rights index, 0–10 (best)* ................................. 3 ..........113

3rd pillar: Macroeconomic environment
3.01 3.02 3.03 3.04 3.05 Government budget balance, % GDP* ................. –1.3 ............39 Gross national savings, % GDP* .......................... 25.3 ............41 Inflation, annual % change* .................................... 6.8 ..........115 General government debt, % GDP* ..................... 13.4 ............10 Country credit rating, 0–100 (best)* ...................... 67.7 ............37

9th pillar: Technological readiness
9.01 9.02 9.03 9.04 9.05 9.06 9.07 Availability of latest technologies ............................ 4.2 ..........108 Firm-level technology absorption ............................ 4.2 ............98 FDI and technology transfer ................................... 3.8 ..........123 Individuals using Internet, %* ............................... 61.4 ............49 Fixed broadband Internet subscriptions/100 pop.* . 16.6 ............43 Int’l Internet bandwidth, kb/s per user* ................ 41.2 ............61 Mobile broadband subscriptions/100 pop.*.......... 60.1 ............29

4th pillar: Health and primary education
4.01 4.02 4.03 4.04 4.05 4.06 4.07 4.08 4.09 4.10 Malaria cases/100,000 pop.* ................................ S.L. ...........n/a Business impact of malaria ............................. N/Appl. ...........n/a Tuberculosis cases/100,000 pop.* ....................... 91.0 ............89 Business impact of tuberculosis ............................. 5.5 ............75 HIV prevalence, % adult pop.* ............................... 1.1 ..........110 Business impact of HIV/AIDS ................................. 5.8 ............60 Infant mortality, deaths/1,000 live births* ................ 8.9 ............53 Life expectancy, years*......................................... 70.5 ............95 Quality of primary education ................................... 4.2 ............57 Primary education enrollment, net %* .................. 96.2 ............54

10th pillar: Market size
10.01 10.02 10.03 10.04 Domestic market size index, 1–7 (best)*................. 5.7 ..............7 Foreign market size index, 1–7 (best)* .................... 6.1 ..............9 GDP (PPP$ billions)* ....................................... 2,556.2 ..............6 Exports as a percentage of GDP* ........................ 27.8 ..........104

11th pillar: Business sophistication
11.01 11.02 11.03 11.04 11.05 11.06 11.07 11.08 11.09 Local supplier quantity ........................................... 4.4 ............91 Local supplier quality.............................................. 4.1 ............88 State of cluster development.................................. 3.1 ..........118 Nature of competitive advantage ............................ 3.4 ............75 Value chain breadth................................................ 3.5 ............96 Control of international distribution ......................... 4.0 ............73 Production process sophistication.......................... 3.5 ............92 Extent of marketing ................................................ 4.3 ............64 Willingness to delegate authority ............................ 3.6 ............81

5th pillar: Higher education and training
5.01 5.02 5.03 5.04 5.05 5.06 5.07 5.08 Secondary education enrollment, gross %* .......... 95.3 ............56 Tertiary education enrollment, gross %*................ 76.1 ............19 Quality of the education system ............................. 3.5 ............84 Quality of math and science education .................. 4.3 ............59 Quality of management schools ............................. 3.7 ..........104 Internet access in schools ...................................... 5.1 ............41 Availability of research and training services ........... 4.3 ............59 Extent of staff training ............................................ 3.8 ............89

12th pillar: Innovation
12.01 12.02 12.03 12.04 12.05 12.06 12.07 Capacity for innovation........................................... 3.8 ............66 Quality of scientific research institutions ................. 4.0 ............56 Company spending on R&D................................... 3.2 ............62 University-industry collaboration in R&D ................. 3.6 ............67 Gov’t procurement of advanced tech products ...... 3.3 ............81 Availability of scientists and engineers .................... 4.1 ............70 PCT patents, applications/million pop.* .................. 7.1 ............41

6th pillar: Goods market efficiency
6.01 6.02 6.03 6.04 6.05 Intensity of local competition .................................. 5.0 ............74 Extent of market dominance .................................. 3.7 ............75 Effectiveness of anti-monopoly policy ..................... 3.7 ..........102 Effect of taxation on incentives to invest................. 3.1 ..........122 Total tax rate, % profits* ....................................... 50.7 ..........116

Notes: Values are on a 1-to-7 scale unless otherwise annotated with an asterisk (*). For further details and explanation, please refer to the section “How to Read the Country/Economy Profiles” on page 101. The Global Competitiveness Report 2014–2015 | 321

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