Modern cities now vie for human capital, rather than factories or plants, Moscow Mayor Sergei Sobyanin told participants at the Moscow Urban Forum 2017 plenary meeting. This can be explained by the fact that talented experts are increasingly able to find jobs in any part of the world, he added.
“I believe that Moscow does not compete with Russian cities. Today, it is home to about 10,000 migrants from other Russian regions. However, about 200,000 people are leaving for other countries. Therefore Russian cities and Moscow in particular must create favourable conditions for preventing the drain of the best human resources and the best human capital,” he noted.
He said this situation was typical of all countries, and that not all megacities could stand the competition during large-scale migration. Even well-established city agglomerations can lose part of their population, including Paris, which is surrounded by powerful rivals, he added.
Over the last 25 years, Russia posted impressive urbanisation rates, with city agglomerations developing actively during this time. Many cities were very successful over that period. “Key Russian cities have become larger, with the population of agglomerations increasing by ten million, due to migration over the past few years and the population’s natural rates of growth. And most big Russian cities have managed to establish full-fledged agglomerations. Today, there are over 20 of them with a population of over one million each,” Mr. Sobyanin said.
Russian cities have expanded and have also become people-friendlier, the Mayor noted. Their infrastructure continues to develop, new housing is being built, and a people-friendly environment is being established. “Russia’s urbanisation potential is far from being depleted. Experts believe that, in the next few years, big cities will receive an additional 8-10 million people, many of whom now live in small communities, single-employer towns and the countryside. And I support their opinion,” Mr. Sobyanin said. In the next 10-15 years, megacities will account for about 40 percent of the entire Russian population. At the same time, it is important not to lose key development points and to create economic growth centres there.
Speaking of the Moscow agglomeration, Mr. Sobyanin recalled that it remained one of the largest worldwide and also Europe’s largest. “Today, the Moscow agglomeration has a population of about 20 million, or 13 percent of Russia’s population. At the same time, it accounts for 26 percent of the national GDP. This shows that Moscow is a net contributor to the federal budget, rather than the other way round, as many believe,” he said.
There are many myths about the Russian capital, Mr. Sobyanin said. One of them claims that the city has no production facilities at all. “This is not true, the Moscow agglomeration’s nucleus boasts a modern diversified economy typical of the best global agglomerations. Such innovative and promising fields as industry, the IT sector, insurance, education and healthcare account for the local economy’s impressive share. But the production sector and high-tech production facilities also play a major role,” Mr. Sobyanin noted.
Contrary to stereotypes, the city economy and budget have eliminated their dependence on the oil and gas sector several years ago, he added. The capital is gradually turning into a centre of high-tech exports, and it also accommodates the manufacturing-sector and research and development facilities. In 2016, such companies exported goods worth 520 billion roubles, or about 20 percent of high-tech exports nationwide.
“Despite the crisis, Moscow continues to actively attract investment. The city’s economy has been receiving additional investment for over five years now, the volume of which has reached 1,700 billion roubles, with private investment accounting for 70 percent of this sum,” Mr. Sobyanin added.
The city has also created about 3.5 million jobs nationwide and absorbs 70 percent of goods and services being manufactured in other Russian regions, he pointed out. At the same time, Moscow redistributes resources in favour of other regions via the federal budget. “Federal budget deductions alone have soared by 60 percent over the past few years and have reached one trillion roubles. It should be mentioned, for the sake of comparison, that federal budget transfers to other regions total 1.5 trillion roubles. In effect, two-thirds of this sum is compensated for by deductions from Moscow-based companies,” he said.
He also mentioned the capital’s impressive deductions to various federal funds allowing ten percent of Russian citizens to receive pensions and free medical treatment.
To move forward, Moscow has to ensure the priority development of its transportation, engineering, utility and other infrastructure,” the Mayor commented. “A big city’s main advantage, the concentration of people and resources, would turn into overpopulation, the main problem, unless we accomplish this task. The megacity would cease to be a source of growth and would start generating serious problems,” he said.
This is why it is needed to develop a public transportation system in megacities, first and foremost. Moscow is building new metro stations, improving commuter train services, the Moscow Central Circle (MCC) belt railway has recently opened, and there are plans to open the metro’s Third Interchange Circuit soon, too.
“We have reached such a pace that we are building about 100 kilometres of roads and about ten metro stations every single year. These sophisticated road structures are not located in the middle of nowhere, but they are becoming part of the living city fabric, with due consideration for numerous utility lines, intersections, available housing and commercial developments,” Mr. Sobyanin noted.
The urban development sector’s main tasks include the relocation and renovation of industrial zones, the creation of new centres of public activity and a people-friendly urban environment. “To become a people-friendly city, Moscow should provide its residents with a modern urban environment, including well-tended courtyards, parks, clean air, as well as stage holiday events, festivals, engage in the restoration of various landmarks, make investments in theatres and museums. This is not a luxury but rather a development strategy, priority tasks for upgrading the urban environment. Therefore we have improved 450 parks and green areas over a period of the past few years,” Mr. Sobyanin explained. There are plans to improve and upgrade over 300 more streets before the year is out, he added.
Ageing housing is a major problem facing all cities, including Moscow, he said. The city has decided to launch a relocation programme that would prevent thousands of old residential buildings from becoming the largest collection of rundown housing. “Apart from relocating people from these run-down five-storey residential buildings, we are, of course, setting the task of establishing modern city residential areas with new comfortable block of flats, districts with all the required infrastructure and high-quality homes. We are involving the best national architects in urban-design projects, and we hold international competitions too,” Mr. Sobyanin said.
Although Russia has no special programme for the development of megacities, there is an understanding that cityscape issues should be addressed in a detailed manner. “Successful cities and active city residents are Russia’s main advantage today. Moscow has everything it needs to move rapidly forward. It has historical experience, traditions of innovation, talented and hard-working city residents, people who come here from all over Russia and also from all corners of the world, and it has the required economic potential. Indeed, I am confident that Moscow will become a reliable partner and a serious rival for many megacities of the world,” Mr. Sobyanin stressed.
The Moscow Urban Forum is taking place at Pavilion No. 75 of the National Exhibition of Economic Achievements (VDNKh). Over 6,000 people have attended the forum on the first day of its business programme. This year’s forum brings together over 400 world-class experts and has become the biggest yet. Delegates include representatives from 40 countries, and about 30,000 people are expected to attend its events.