Vladimir Mau, Rawi Abdelal speak to RANEPA program participants
On July 26 at RANEPA there was a scheduled seminar for participants in the second module of the educational program “Management Mastery: the Development of Regional Teams.” Harvard University Professor Rawi Abdelal told representatives of the authorities about the role of the United States in the global economy and RANEPA Rector Vladimir Mau spoke about the challenges of economic policy in modern Russia.
At the RANEPA, the second module of the educational program “Management Mastery: the Development of Regional Teams” began, this program was developed together with the companies Ward Howell and the Agency for Strategic Initiatives. The program envisages the exchange of the best Russian and international practices in the improvement of the investment climate, and also increasing the level of team cooperation. The organizer of the program is RANEPA’s Center for the Development of Regions.
RANEPA Rector Vladimir Mau and Harvard Professor Rawi Abdelal conducted a seminar with program participants.
Rawi Abdelal spoke about the modern state of the American economy and its role in the global economy. The Harvard professor cited data on the state of the payment balance of the United States and China. “In the United States there is the most colossal deficit of the payment balance in humanity’s entire history, in China there is the largest surplus,” Rawi Abelal. He said that the Chinese economy grew mainly due to the fact that U.S. households began to buy Chinese goods. Gradually the resources of American households were depleted, and citizens were mired in debts and loans. Now the average size of debt for an American family is $9,000.
“Using credit borrowings, we “threw a party”, we created the situation with uncontrollable consumption and gave birth to the global financial crisis. This is the only story of success for American exports. We are exporting services and crises. And I would like to ask forgiveness on the behalf of the United States for this,” Rawi Abdelal said.
In his turn, RANEPA Rector Vladimir Mau named six serious intellectual and political challenges, which developed countries need to answer. These are prospects for economic growth, prospects for non-traditional monetary policy, prospects for the global market amid national regulation, prospects for globalization and de-globalization, the problem of re-industrialization in developed countries and also the problem of inequality and economic growth.
Vladimir Mau spoke about the challenges of economic policy in modern Russia. The rector of RANEPA said that the global crisis attests to the fact that developed countries will be the locomotive for getting out of the crisis. And in this sense, it is important to develop the Russian economy with the understanding that the crisis that was born in the United States is not the main problem for Russia. Vladimir Mau said that in Russia there is an interweaving of many crises, in particular the global one and the stabilization one. And on the global crisis, in its turn, there is the crisis of external shocks and the crisis connected with financial sanctions. “Today we are seeing not a crisis of declines and increases, but a crisis of unsustainability, from which will come new forex configurations, a new economic doctrine, new management models and many, many other things,” Vladimir Mau said.
Vladimir Mau said that today Russia is starting quite effectively overcome the aforementioned problems. In particular, Russia has a low state debt, a low refinancing rate, capital outflow has sharply fallen, and the credit bubble is deflating. In addition, he said, despite the fluctuations in the exchange rate, for the first time in 25 years, there has not been a dollarization of savings in Russia. This is partly the result of the political stabilization and partly the Central Bank’s correct policy of the floating exchange rate of the ruble. However the main problem is that with the growth of personal savings, there are no investments. “This problem is much more fundamental and is not resolvable through macroeconomic methods. And in this sense, resolving the issue of how to make private businesses start to invest, this is why we have gathered here,” Vladimir Mau said.