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Possibilities of Entrepreneur Potential Development
of Yamal-Nenets District
Elena Chizhevskaya:
Department of Management in the fuel and energy sector
Tyumen Industrial University
Tyumen, Russia
chizel76@yandex.ru
Marina B. Balikaeva:
Department of Cross-cultural Communication
Tyumen Industrial University
Tyumen, Russia
marinabalikaeva@list.ru
Abstract— The entrepreneurship development in modern
Russia is associated with a number of features and conditions,
including the territorial location factors and the region social
and economic development level. On the other hand, the small
and medium business is the main source of revenues to
budgets. It provides employment for the population and affects
the population life quality. The article presents an overview of
the developing entrepreneurial structures possibilities of a
mono-raw territory. The authors identified the strengths and
weaknesses of the Yamal-Nenets district economy, the
opportunities and threats to its development. The article pays
special attention to the influence of the fuel and energy
complex on the development possibilities of the territory under
consideration.
Keywords— entrepreneurship; small business; development
strategy; social and economic development of the region.
I. INTRODUCTION
Entrepreneurship is a driving factor in the development
of the Russian economy. According to the message of the
President of the Russian Federation, it is necessary to create
conditions for the most favorable conditions for the
development of entrepreneurial structures. They include
financial support measures, organizational mechanisms, an
assistance in the business development and an access to
international markets. At the same time, the opportunities
for the small and medium-sized businesses development are
different in regions of Russia due to a number of
circumstances. This article is devoted to the study of the
example of the Yamal-Nenets Autonomous District.
II. PROBLEM STATEMENT
The territorial development strategy aims to raise the
level and quality of the population life and well-being. This
aim can be achieved through the most promising sectors
management development and employment of the
population. The economy of the Yamal-Nenets Autonomous
District has a mono-raw specialization and limited
opportunities for the entrepreneurial structures development
[1]. This is due to complex natural and climatic conditions,
territorial remoteness, disunity, and low population density.
In addition, the traditional economic sectors of the district
(oil, gas and gas condensate extraction) require large capital
investments and represent large vertically integrated
companies. Their activities have a connection with the use
of the largest resources located in the territory of Yamal-
Nenets Autonomous District. For the development of small
and medium-sized businesses, it is advisable in the field of
infrastructure facilities that support the fuel and energy
sector [2]. These areas are the most important resources for
realizing the entrepreneurial potential of the district.
Thus, the state of the oil and gas sector has the strongest
impact on the results of the district's social and economic
development [3]. This dependence is an indicator of weak
economic diversification, which carries high risks.
The evaluation of activities indicates a narrow
specialization and concentration on hydrocarbon production
in the fuel and energy sector of the district. This means that
the economic situation will become worse with the fall in
production volumes. In this connection, it is advisable to
consider the possibilities of producing the final product from
the extracted raw materials. It is necessary to create oil and
gas refineries. Prerequisites and all resources are available
for it in the territory.
The significant negative impact on the image and
income in budgets of different levels had a situation in
reindeer husbandry. This is a striking fact of the negative
influence of one-sided industrialization on the living
conditions of the north indigenous peoples. In this regard, an
area of business structures development is a creation of
enterprises whose activities are aimed at implementing
environmental projects (land reclamation, waste recycling,
construction and commissioning of treatment facilities, etc.)
The high rate of district population aging is another
distinguishing feature of this district. The high rates of the
population aging will lead to a significant increase of the
population proportion of the over working age. It will lead
to the impossibility of financing from the district budget of
the district pensioners [4].
The energy deficit of the Yamal-Nenets Autonomous
District also increases substantially the risks of the social
and economic development in the future. Low transport
development of the territory hinders the resources
development. The weak energy base and the energy
development determined the region energy deficit.
International Conference Economy in the Modern World (ICEMW 2018)
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Advances in Economics, Business and Management Research, volume 61
40
There is the large difference in social and economic
development between the oil and gas and rural districts [5].
Agricultural production in rural has the low economic
efficiency, primarily because the territory belongs to the Far
North regions and their agriculture is costly. The presence of
disproportions in the social and economic development of
municipalities has a deterrent effect on the autonomous
region development because it leads to a redistribution of
budget funds in the direction of increasing current
expenditure[6].
The most important competitive advantage of the
Yamal-Nenets Autonomous District is one of the world's
largest pipeline systems for the transportation of natural gas.
The existing gas transportation infrastructure allows
planning the commissioning of new gas fields [7]. Their
products will replace the fields gas located at the stage of
falling production. The system of the main pipeline transport
of the Yamal-Nenets Autonomous District allows pumping
almost 600 billion cubic meters of natural gas outside the
Yamal-Nenets Autonomous District.
External factors for the Yamal-Nenets Autonomous
District also affect the state of its economy. There is a direct
correlation between the prices of hydrocarbons on the world
market and the economy state of the Yamal-Nenets
Autonomous District. The oil and gas sector of the Yamal-
Nenets Autonomous District and other sectors, especially
budgetary ones, demonstrate the fluctuations in world
energy prices. Therefore, the investments and employment
are increasing; wages are rising in the budget sector with the
growth of oil and gas prices. There are opportunities to
upgrade the material and technical base of educational,
health, cultural and sports institutions. With a decline in
prices in the oil and gas sector conversely, the number of
employed and real wages is decreasing, the budgetary sector
is shifting to the mode of budgetary economy. Thus, the
sustainability of the social and economic development of the
Yamal-Nenets Autonomous District as a mono-raw territory
is determined by the conjuncture of the world hydrocarbon
market. In addition, with a long and sustained rise of gas and
oil prices, there are risks of a significant reduction in the
level of gas and oil consumption due to the expansion of the
alternative energy sources use and increased consumption of
energy coals. In this regard, it is strategically important to
diversify the sales markets.
The Yamal-Nenets Autonomous District has the centers
remoteness for the adoption of state and corporate decisions.
In this connection, regional control over the issues of
effective development of oil and gas fields is lost. The head
offices of the largest subsoil users are located outside the
Yamal-Nenets Autonomous District. It leads to the
macroeconomic approach to solving production issues
instead of the microeconomic one. To consolidate the
population in the Yamal-Nenets Autonomous District, it is
necessary to improve the population life quality radically
[8].
III. DISCUSSION
Table I shows the impact of external and internal factors that
determine the current state of the district economy.
TABLE I. IMPACT OF EXTERNAL AND INTERNAL FACTORS THAT DETERMINE
THE CURRENT STATE OF THE DISTRICT ECONOMY
I
The SWOT - analysis of the Yamal-Nenets Autonomous Region
state
External environment
Opportunities
Threats
1. Demand for the main products
of the Yamal-Nenets Autonomous
District (hydrocarbon raw
materials);
2. Presence of unique objects of
world importance;
3. Steady demand for products of
national crafts of indigenous
peoples of the North.
1.World prices for energy
carriers;
2. Remoteness of the centers for
the adoption of state and
corporate decisions;
3. Significant increase in the level
of welfare and quality of life of
the population in the Russian
Federation;
4. Dominance of transport with
alternative fuels by 2015
Internal environment
Strengths
Weaknesses
1.Valuable and large-scale natural
resources;
2. Highly qualified personnel;
3. Immediate proximity to
strategically important facilities
(the Northern Sea Route);
3. Availability of infrastructure
for transport of recoverable
hydrocarbon feedstocks;
4. Special biological resources
associated with geographical and
climatic conditions.
1.Difficulties with the
reproduction of mineral resources;
- mono-raw specialization of the
economy of the Autonomous
district;
2. Weak development of
infrastructure and supporting
industries;
3. Negative influence on the
nature and ecology of the district
of industrial objects;
4. High rates of aging of the
population of the Autonomous
district;
5. Weak competitiveness of
production due to high costs for
its production (zones of the Far
North, increased labor costs for
employed workers, delivery of
goods, a large length of
infrastructure facilities)
The small business development level is an important
characteristic of the entrepreneurship development and
market relations assessment in a certain territory. Small
business is typically market based and forms the basis of
modern market infrastructure. Small business has a
significant impact on the rate of economic growth, the
structure and quality of the gross regional product and
determines the development scale of the service sector in the
economy [9, 10].
The starting point for the small business formation in the
Yamal-Nenets Autonomous District was the economic
transformation in the country in the early nineties of the last
century. The dynamics and small business development
direction, as in other regions of Russia, were influenced by
the industrial infrastructure formed by that time and the life
specific way in the Far North.
Considering the "northern" specifics and the mono-
sectoral nature of the region economy, the small and
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41
medium-sized business sector has been sufficiently
developed today. This situation is typical for the regions of
the Far North of Russia.
The main directions of the regional economy
predetermine the main parameters for the small and medium
business development of the Yamal-Nenets Autonomous
District for the long term. For the simplicity and
convenience of identifying opportunities of the small and
medium-sized businesses development, the impact of
political, economic, social and technological aspects on the
entrepreneurial potential of the Yamal-Nenets Autonomous
District is presented in the table II [11].
TABLE II. THE IMPACT OF POLITICAL, ECONOMIC, SOCIAL AND
TECHNOLOGICAL ASPECTS ON THE ENTREPRENEURIAL POTENTIAL OF THE
YAMAL-NENETS AUTONOMOUS DISTRICT
II
PEST-matrix of entrepreneurial potential of the Yamal-
Nenets Autonomous District
Politics P
Economics E
I. Stable political
situation;
II. Implementation of
measures taken by the authorities
of the Russian Federation and the
Yamal-Nenets Autonomous
District to develop and expand
services in the areas of medical
services to the population, in the
sphere of tourism, physical
development and sport,
processing spheres of activity
III.
IV. Mono-sectoral nature
of the region's economy;
V. Severance of economic
ties with the central regions of
Russia;
VI. Outflow of passionate
people and finances from the
region in favor of large economic
centers and resettlement sites
when reaching the retirement age.
VII.
Socium S
Technology T
1. one of the lowest
unemployment rates in Russia;
2. The lowest proportion
of the population with incomes
below the subsistence minimum;
3. The highest level of
employment;
4. High need of
organizations and enterprises in
labor resources;
5. Active migration
processes;
6. Active involvement in
the sphere of economic relations
of representatives of indigenous
small-numbered peoples of the
north.
7.
8. 1. An active policy of
attracting SMEs into the sphere of
energy-efficient technologies in
the housing and communal sector;
9. 2. Development of
innovative and innovative
activities.
10.
Besides the above factors affected the functioning of
small and medium-sized businesses, there are some factors
affecting the development of this economy sector. They are
the size of the regional market and the level of demand from
business entities and individuals, geographical location,
resources, a complex transport scheme for the commodity
resources delivery in remote hard-to-reach settlements, etc.
In this connection, the Yamal-Nenets Autonomous
District, like other regions located in the Far North, is
characterized by geographical distance, a break in economic
ties with the central regions of Russia, a population and
finances outflow from the region in favor of large economic
centers and resettlement areas when reaching a pension age
[12].
It should be noted that there is one of the lowest
unemployment rates in Russia, the lowest share of the
population with incomes below the subsistence minimum,
the highest level of employment of the population, the high
need of organizations and enterprises for labor resources,
which is compensated by the recruitment of shift workers
from other regions [13].
In addition, active migration processes characterize the
district [14]. It is a known fact that a large proportion of the
population does not associate their entire life with the Far
North. The nature of the "temporality" of residence in the
region also influences the small and medium-sized
businesses development, despite the fact that the
autonomous district retains a considerable potential for its
development [15].
IV. RESULTS
Today the small businesses such as trade (34% of small
enterprises), construction (26%), real estate operations
(14%) and transport (7%) have been developed actively.
Stable political environment, high effective demand of
the population and measures implementation taken by the
authorities of the Russian Federation and the Yamal-Nenets
Autonomous District will stimulate the development of
medical services, tourism, physical development and sport
for the population. An active policy of attracting small
business to the energy-efficient technologies in the housing
and communal sector is being carried out.
A special role plays the restructuring of large
organizations of the fuel and energy complex in favor of
"service" companies. Their main part represents high-tech
small and medium-sized enterprises. This will contribute to
the development of innovative activities, improve the level
of production cooperation and prepare training partners.
These partners will be able to assume part of the servicing
functions, the main production and non-core productions.
These processes will provide substantial financial support to
small business entities and maintain the employment level
of the economically active population of the Yamal-Nenets
Autonomous District.
The great potential contains the active involvement of
indigenous minorities’ representatives of the North in the
sphere of economic relations, in the development of reindeer
husbandry, processing of venison meat and fish products,
handicraft production and their sale for their own needs.
VIII. CONCLUSION
We consider that the implementation of the proposed
directions for the entrepreneurial structures development
takes into account the factors influencing the activation of
entrepreneurship and will allow increasing the degree of
economy diversification. It will affect positively the
opportunities for achieving the main aim of the social and
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42
economic development of Yamal-Nenets Autonomous
District and improve the life quality of region population.
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