Economists on Russia’s Import Substitution Prospects
In an interview with Sputnik, the president of the Russian Academy of Economics said that it is impossible to predict which sectors of the Russian economy can quickly find substitutes for imported components in their own production and which sectors cannot, and it will be clear in a few months.
He explained, “Until recently, despite all the talk of import substitution, the Russian economy has developed in an absolutely natural way due to the complexity of the production process. There are many links in the production chain and many companies from different countries have been involved. .”
According to him, there may be 50 components involved in the production, one of which is imported, but that is, it may be the key one. “It’s like microchips in cars or bleach in paper. It turns out this is the case in many industries, and no one can tell which industries are and how many of them. China’s lockdown and supply,” he noted. The chain change has exacerbated this.”
He added, “It’s such a complex, intertwined system that it’s impossible to predict in advance which production will increase and which won’t. Over the next few months, we will have to figure out imports through trial and error and trial and error. Where the components are is key, and how to replace them.”