“Polylog” CG has successfully completed the project on testing the techniques of the competitive environment analysis in the Primorsky Krai developed at the initiative of the Department for Competition Development of the Ministry for Economic Development of the Russian Federation under the guidance of A. A. Pirozhenko.
The development of multi-functional centers was proposed to reduce administrative barriers (there is only one center in Ussuriysk now). Lack of credit resources for small and medium-sized businesses might be solved by proactive development of microfinance funds which can draw a small sum of money for current activities. Recommendations devoted to small and medium-sized businesses were included into a separate block. Some changes in the official portal of the Administration were proposed to raise the efficiency of cooperation of the Administration with entrepreneurs. The development of methodological support to small businesses and organization of educational events for entrepreneurs were among other recommended actions.
As a result, the total competition index was calculated amounting to 0.657 in the Primorsky Krai (the index ranges from zero to one characterizing the highest competition level), indicating that there was a high competitive environment in the region. In that case the best results were obtained for the indexes characterizing the entrepreneurial activity of the population. A survey conducted as part of this research revealed that the proportion of established entrepreneurs as well as just those who wanted to set up their own business in the Primorsky Krai was much higher than on average across Russia. It meant that the region had significant potential for competition. Other socio-economic factors, such as availability and quality of human resources, solvency of the population, presence of the government in the economy and profitability of key industries also demonstrated good results.
23 indicative markets were studied to assess the competitive environment in the industry-specific sector on the basis of expert interviews and statistical analysis. The concentration level was calculated (Herfindahl-Hirschmann and Tideman-Hall indexes) and the main entry barriers were identified for the selected markets. Most of the analyzed markets were low and moderately concentrated.
According to the research, the main problems hindering the development of competition in the Primorsky Krai are rooted in administrative and infrastructure sectors. A poor quality of roads, limited cooperation of the Administration with businesses, preferential treatment to some companies, high rental rates, lack of credit resources have the greatest negative impact on the competitive environment.
Following the results of the research, recommendations for the Primorsky Territory Administration were implemented to improve the performance of the competitive environment with an emphasis on priority guidelines. The implementation of the National Anti-Corruption Plan was recommended in order to prevent preferential treatment to some companies.
The analysis of this methodology proved to be effective as a working tool for analyzing and monitoring the competitive environment of the Russian regions. The unified techniques, involving the calculation of integral index will let the Ministry for Economic Development of the Russian Federation create ratings and track changes in particular regions. It will undoubtedly increase the efficiency of the state competitive policy.