Land Reform in the Russian Far East

One of the developments that caught my eye recently was a proposal by Yuri Trutnev to Vladimir Putin on the 19th of January, in which he suggested that the government offer a free hectare of land to anyone willing to move to the Russian Far East. Putin was open to the idea and suggested putting forward a concrete proposal, as at this stage it was a very basic outline. Below I’ll set out the basics of it, and discuss the prospect further. If you want to read a follow-up interview with Trutnev on the issue first, check out this link. (Russian language)

What is the proposal?

In short, Trutnev has proposed that any Russian citizen should be entitled to receive one hectare of land free of charge for up to five years, possibly for three, after which time they can buy that piece of land at a concessionary price if the government/relevant authority deems they have used it properly. He proposes barring foreign citizens from taking part in this venture, or from sub-letting the land out once it has been allocated to a native. As an added bonus, he suggests that applicants can choose which exact hectare they receive using an online system. In a follow-up story, the governor of Magadan jumped on the idea and suggested his region offer five hectares, but since the proposal is at the drafting stage, these proposals await more concrete details. More importantly, people can use this land to engage not only in agriculture, but also in forestry, tourism, industry, hunting…any operation within the law basically. As noted at the start of this article, Putin supports the idea in principle, noting that previous initiatives have been employed in Siberia in the past.

Where will the land be available?

Everywhere in the Far Eastern Federal District, on government-owned land which is not currently in use. This includes the border areas with China along the Amur river, and presumably also the areas close to North Korea. However he does precludes areas situated directly around cities as he feels that ownership of land so close to large companies, transport and infrastructure networks, and prime land is too open to corruption. In saying that, only 1.18% of the available land falls into this category, leaving a lot of land available for the scheme. To put this in perspective, the government land holdings of various categories in the Far East amounts to about 614 million hectares.

What if the land is rented or sold on to foreigners?

In the interview, I’ve translated his response to this question as partially accepting that corruption is a high possibility, but that it would be of limited value since no substantial development could ever take place on the land as it would never be approved by the regional authorities.

What are his reasons for suggesting this initiative?

Trutnev believes that a lot of land is simply lying unproductive in the region, and is essentially wasted economic potential. The state is doing nothing with it, so he feels that others should get a chance to make a go of it. It sounds like he also thinks it may attract more able-bodied citizens to the region, noting that the population in the region rose slightly at the last count around the end of 2014 and as such it is becoming more attractive. Finally, he sees it as an experiment that could be useful in preparing for something similar to be rolled out across the whole of Russia, noting that even Western Russia has far too much unused land.

Background

One thing that stood out in some of the basic news stories was that Putin mentioned that major reforms had been carried out before in Siberia.  I don’t think he would have been trying to invoke any particular movement, and I translated his response as very cautious, but there is a general memory in Russia that major land reforms and developments have occured before. For those of you who aren’t familiar with the history, I’ve laid out a brief summary below.

Russia pressed forward into Siberia by the 16th century, but periods of internal strife in the country delayed any mass civilian movements east until the end of the century. Peasants started making their way into Siberia in the hope of settling on new lands and enjoying greater freedoms, particularly as the best lands were already monopolised in Western Russia. Tales of fertile soil had spread and families took the chance to claim it and make a bit more money for themselves. Perhaps just as enticing, the Tsar had set a far more generous tax system in Siberia, having permission to work five acres of land for every one acre they worked to pay the Tsar, and getting a 10-year tax-break to boot.

This situation petered out for a while as the best lands in Siberia started to become full, but when the Trans-Siberian Railway and other branch lines were completed near the end of the 19th century, migration to Siberia once again increased, with up to 10 million peasants making the journey east. This was encouraged by Tsar Nicholas II and his commissions, occuring during the period of the Stolypin reforms, and are perhaps the most remembered of Russian agricultural reforms by the modern world. Essentially those who were willing to go east were offered various benefits, receiving about 16 hectares of land per person. As with previous migrations they received small sums of money, tax-breaks, and help with their initial resettlement.

The next major reforms were during the Stalin era, carrying out dekulakisation and collectivisation. Not only did this take land mostly out of private hands, and turn the countryside into mass state-controlled farms, it also resulted in the death or exile of many skilled farmers. Agricultural potential and efficiency suffered due to this, but after the death of Stalin, another of the most famous reforms was carried out by Khrushchev; the ‘Virgin Lands’ campaign to settle and farm areas in Southern Russia, Southern Siberia and Northern Kazakhstan. This wasn’t really a reform in the traditional sense, as peasants weren’t given benefits and incentives to move east, it relied on the enthusiasm of Soviet youth to head out and settle these areas as part of the great drive to build the future in the present day. A few hundred thousand volunteers headed south and east resulting in early gains in output, but with time the campaign petered out, soil was overused, and eventually it was considered a failure.

Although later Soviet years didn’t see any substantial agricultural reforms, the economic focus on the city helped the nearby rural areas in unintended ways. Those farming areas close enough to growing and prospering cities were able to develop transport and trading links to the cities, resulting in benefits to both sides and an expansion in agricultural output in those areas. Unfortunately for these areas, the economic decline in Russia throughout the 1980s saw the agricultural areas also suffer as cities began to see a downturn in fortune. By the 1990s agricultural areas continued to collapse in productivity due to the structural problems and car-crash economics that followed the end of the Soviet Union and the beginning of Russia under Yeltsin. It highlighted just how dependent the rural areas had become on thriving urban centres, and perhaps in that lies a seed of a lesson for the contemporary attempts to develop the Russian Far East.

Will the current proposals work?

Until final proposals are put forward, it’s difficult to say for certain, but based on the ideas Trutnev discussed in the interview I linked to at the start of this article, I’m very sceptical on the plans and I think they’re highly unlikely to succeed. For one, the overwhelming majority of people in central and western russia have no intention of moving to the Russian Far East, and they certainly don’t harbour dreams of moving east to become a farmer or a hunter. Most of the able-bodied generation in contemporary Russia enjoy the comforts of modern life, living inside or in close proximity to cities and amenities, and in general they may well be ill-prepared and inexperienced for such a venture. The fact that the proposals restrict the offer to one hectare, and preclude offering land in the areas closest to the city which would be beneficial for production and supplying finished goods to the cities, is likely to be a major drawback. Even for those who don’t need to be close to a city, there would be major logistical and transport issues around the coldest parts of the year when roads are not always safe or available.

Compounding the issue of getting people to move east is plain and simple economics. It’s one thing to get the land for free, but you also need capital to invest in it and get it started. You might need to build a home on the land, and at the very least you’ll need to buy storage facilities and security measures if you don’t live there. You’ll likely need some mechanised equipment to make efficient use of the land, and even if you want to get into a non-agriculture industry you’ll still have numerous start-up costs. Without an accompanying grant, tax-break and financial support this will be a prohibitive venture. Those who are making money aren’t generally going to take a punt on one hectare of land, and those with no money can’t afford to take the chance. Given the current financial restrictions in Russia, low-income citizens aren’t likely to get large loans from a bank either.

On the issue of corruption, although foreigners are prohibited from taking advantage of this offer, it’s not difficult to see that areas close to China could be rented illegally from natives by individual Chinese farmers or collectives, farmed, and the products then sold in Russia or China. The China Daily has already speculated on this, and whilst any meaningful development on each hectare is still unlikely through corruption, most of the fertile areas are close enough to the border that it could still undermine the initiative. Whatever Trutnev puts forward in a concrete proposal is really going to have to have some plans to minimise this possibility. (Note, this is in no way suggestive of a Chinese invasion and annexation of the Russian Far East. That myth has been debunked enough times that I’ve no intention of addressing it here)

The only positive way I could see this idea playing out is if the 1.18% of available land close enough to cities is included in the initiative, as the vast majority of the suitable land is located in the south of the region, around the Amur, Khabarovsk, Primorsky and Jewish Autonomous Oblast regions. This is important for the reasons I alluded to a bit further up, where Russian agricultural areas received a boost when the cities they were close to also developed. It is vital that the cities develop in the Russian Far East if the agricultural side is to prosper as well. Good ideas shouldn’t be discouraged, but until the major cities of Vladivostok and Khabarovsk develop and start to thrive, the areas around it will continue to struggle. Develop the cities, and the agriculture will develop with it, even if it’s through foreign investors rather than native Russians. Where there is demand, supply will surely follow.

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