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Russia: Analysis from Washington -- Inefficient Transport Prevents Economic Growth

Washington, 4 February 1998(RFE/RL) -- The continuing search for a pipeline route to carry Caspian basin oil and gas to world markets calls attention to a broader problem that afflicts Russia and many of her neighbors: the absence of a transportation infrastructure sufficient to promote economic growth and political integration of each of the countries involved.

Since the collapse of Soviet power, the countries of the region and Western oil and gas interests have sought to find a route out for the Caspian basin's enormous petroleum resources. But as in the past, the distance of these resources from the sea, the political calculations of neighboring countries, and the cost of certain routes remain major obstacles on the road to that goal.

But if anything, the other portions of the transportation infrastructure in the post-Soviet states are in worse shape -- and threaten to become even greater bottlenecks to the development of this region.

Many have highway systems that resemble those of Europe and America more than half a century ago. Where they exist, modern superhighways extend only a few miles from the capital city. Secondary roads often are unpaved. And in some cases in the Russian Federation, there are no roads at all linking cities together. .

The status of the railway network is not much better. Few have rail systems that correspond to their economic requirements either for national development or export. And most face the task of replacing aging equipment and rebuilding decaying roadbeds.

And after an initial increase in the number of national and regional airlines following the breakup of the Soviet Union, many countries in this region now are closing their national carriers and reducing routes, leaving them in some cases more isolated from other countries in the region and the outside world than they were five years ago.

To a large extent, these problems are part of the legacy of the Soviet system in which political calculations routinely took precedence over economic ones.

First of all, Soviet planners gave precedence to the development of natural resources for the benefit of domestic industry.

On the one hand, that meant that most rail lines and highways in this region connect industrial sites rather than population centers, leaving Russia at least as a kind of archipelago of cities often with poor or even no ground transportation among them.

And on the other, that meant that Moscow gave precedence to rail rather than road transport lest the existence of highways contribute to a demand for more private vehicles, something the Soviet authorities opposed on both economic and political control grounds.

But in both cases, Moscow sought to develop the transportation network in a way that largely ignored the possibilities for export, except to Warsaw Pact countries.

Second, Soviet planners set up the transport network in ways intended to make it difficult if not impossible for individual republics to think about going their own ways. Stories about having to fly via Moscow in order to go from Dushanbe to Tashkent were part and parcel of the Soviet period; to a certain extent, however, such patterns are still true.

In even more cases, Moscow laid rail lines and roads in such a way that one could not go from one part of a republic to another part without passing through a second republic. That was famously the case in Kazakhstan where one had to pass through Uzbekistan on the way from one part of eastern Kazakhstan to its western districts.

But such arrangements existed elsewhere as well. Sometimes they meant that trains going from one section of a republic had to go to another regional hub outside that republic before returning to another part of the same republic.

While economically inefficient, such a pattern of course promoted integration among the Soviet republics. But neither then nor now does it promote integration within particular post-Soviet states. And that means that these states must either invest heavily in transport infrastructure to promote their own political goals or suffer the consequences of one designed for the Soviet era.

And third, Soviet planners did not invest heavily in the development of most parts of the transport network and allowed many to fall into a dilapidated state. That pattern became even worse at the end of the Soviet period, and now the post-Soviet states are confronted with the task of rebuilding much of the old even as they seek to create the new.

The post-Soviet states may ultimately be able to overcome this part of the legacy, but they cannot do much about its other causes: the enormous distances involved in the Russian Federation, borders drawn for political purposes rather than reflecting either ethnic or economic patterns, and isolation from key resources and markets.

While many in the West have given the most attention to oil and gas pipelines, the countries in this region are likely to have to give far more to railroads, highways and airlines if they are to make a successful transition to free market economies.