Servitization of Industry: New Evidence

A significant increase in the use of services is observed for some industries in GVCs (Global Value Chains). The paper has shed light on important dimension of the servitization which is the sale and export of services by manufacturing firms, often bundled together with goods. Firm-level data confirm that many firms are involved both in the production of goods and services and that there are complementarities between these activities. Not only manufacturing firms are involved in the distribution, transport and logistics services needed for their international operations in GVCs but also, they provide installation, maintenance, repair services as well as a variety of other business support and complementary services that increase value for their customers. The servitization has important policy implications, particularly when taking into account the fact that trade in services is generally more restricted than trade in goods. As the lines between goods and services are blurred, economic policy today might be more challenging than in the past, particularly for companies moving to new business models that imply more interactions with customers and a more intensive use of digital technologies. Services themselves are split into different modes of supply for which there are different levels of economic policy. A closer look at the mechanisms of value creation in the case of services suggests that there are still the needs of new economic policy addressed at business models described as value networks or value shops. As technologies become more disruptive and more companies move to ‘servicified’ GVCs, the need for a more consistent international economic policy regime, particularly at the multilateral level, will become more urgent.

Russian-Turkish Relations after 2015: New Trends, Old Dilemmas

As the events of the past few years indicate, relations between Russia and Turkey are increasingly determined by security-related issues. Such a shift in priorities in bilateral relations should be perceived not only as a response to the emerging threats to the internal and external security of the two countries but also as a consequence of the changes in the strategic orientation of Russia and Turkey after the end of the Cold War. The most important events in the formation of a new model of relations between Russia and Turkey were such as the “Arab Spring”, the wars in Syria and Libya, US support for the Syrian Kurds from the “People’s Self-Defense Forces”, the revolution in Ukraine and the subsequent Russia’s annexation of Crimea, the Russian military operation in Syria, the 2015 crisis in Russian-Turkish relations, and the attempted military coup in Turkey in 2016. Regional crises near the borders of Russia and Turkey and the growing securitization of the policies of both states not only pushed Moscow and Ankara to interact in the security sphere but also created new challenges for their relations. In this article, the authors examine the dynamics of Russian-Turkish relations, paying particular attention to the security dimension, as well as the opportunities and limitations for cooperation between the two countries, given that security is becoming an increasingly important element in bilateral relations. The main focus is on the analysis of competitive cooperation between Russia and Turkey in Eurasia, for the understanding of which it is necessary to refer not only to the current context but also to the historical experience of interaction between the two countries in this wide geographical space. Acknowledgements. Published with the financial support of the project “The influence of the policy of Iran and Turkey on transformation of the Middle East and Post-Soviet space” of the Faculty of World Economy and International Affairs of HSE-University.

Prospects for Cooperation Between Russia and the Republic of Korea in the Fields of Big Data, Network and Artificial Intelligence for the Development of the Digital Economy

Today, each country has interest in digital economy and has established and implemented policies aimed at digital technology development and digital transformation for the transition to the digital economy. In particular, interest in digital technologies such as big data, 5G, and artificial intelligence, which are recognized as important factors in the digital economy, has been increasing recently, and it is a time when the role of the government for technological development and international cooperation becomes important. In addition to the overall digital economic policy, the Russian and Korean governments are also trying to improve their international competitiveness and take a leading position in the new economic order by establishing related technical and industrial policies. Moreover, Republic of Korea often refers to data, network and artificial intelligence as D∙N∙A, and has established policies in each of these areas in 2019. Russia is also establishing and implementing policies in the same field in 2019. Therefore, it is timely to find ways to expand cooperation between Russia and Republic of Korea. In particular, the years of 2020and 2021marks the 30th anniversary of diplomatic relations between the two countries, and not only large-scale events and exchange programs have prepared, but the relationship is deepening as part of the continued foreign policy of both countries – Russia’s Eastern Policy and New Northern Policy of Republic of Korea. Therefore, this paper compares and analyzes the policies of the two countries in big data, 5G, and artificial intelligence to seek long-term sustainable cooperation in the digital economy.

Energy Transition and Post-COVID World

Received 13.01.2021. The coronavirus pandemic has accelerated global economic, technological and social transformation, including the energy sector, and has given the impetus to energy transition from organic fuels to clean energy sources. Though oil will remain an important energy resource in the global energy balance, in the long run renewables will become the leading energy. The European Union and China are the leaders in implementation of energy transition strategies from fossil to clean energy. The transformation in the energy market has affected dramatically the relations between producers and consumers, who now actively determine the consumption trends (for example, green energy, electric vehicles, etc.). Distributed generation and blockchain in power industry enable the consumers to play an active part in the electricity production and distribution chains. Digital transformation and climate agenda are changing the structure of energy business from vertically integrated companies to knowledge-intensive networks. Investors almost unanimously vote for renewable energy. The largest oil and gas companies change their long-term strategies and transform into energy holdings with the prevailing share of renewables in the business structure. Hydrogen attracts particular attention as a promising energy source. The EU plans to develop hydrogen transport infrastructure. For its part, Russia has the ability to supply hydrogen to the European market through the existing gas pipelines. Coronacrisis accelerated the development of online services, artificial intelligence, and distant work. Education and telemedicine received a powerful impetus for further development. Еducation becomes continuous process in the digital world. New educational ecosystems in which skills and competencies are worked out on an interdisciplinary basis are formed. Digital transformation meets the expectations of the generation Z, which in the coming decades will become economically active and will dominate in social and economic agenda. Digitalization, adaptive nature-like technologies, environmentally friendly energy resources, flexible horizontal network between market participants are already a post-COVID reality.

Social Challenges of the Digital Economy: Russia in a Global Context

The subject of the research is the challenges of the digital economy for the employment sector in Russia. The need to reduce costs in the face of a deteriorating situation in the global economy is a factor in accelerating the digital transformation of employment in the country. The transformation is carried out through the automation of the main business processes, as well as through the development of platform employment formats. Specific features of the process of digital transformation of employment form the shape of the development of the Russian labor market in the post- Soviet period. Its main factor was the country’s entry into the global system of division of labor, which led to the formation of the modern structure of employment. The economy of Russia, recognized as raw material, turned out to be “commercial” in terms of employment, since it was this industry that created the bulk of jobs during that period. The commerce sector, which had high growth potential in the early 1990s in Russia, provided jobs for all those labor resources that were released from the industry. However, at the moment this source has been exhausted. Digitalization threatens the most labor-intensive sectors of the Russian economy. Commerce turns out to be the first industry to undergo automation and digitalization of jobs. At the same time, the most massive professions (accountants, bank employees, HR specialists, salesmen, cashiers, couriers, security guards, secretaries, packers, call center workers, drivers) are under the threat of “disappearance”, while new ones in demand by the market are more likely “unique” and they are mostly associated with robotization, digitalization and biotechnology. The unmet demand for these professions is a reflection of the complexities of training highly qualified interdisciplinary specialists and not a physical shortage of labor resources, and this is a serious challenge for the vocational education system. The study aims to gain a deeper understanding of the processes taking place in the social and labor sphere in Russia, to create a conceptual basis for the development of a socio-economic policy of the state that adequately responds to the challenges of the digitalization of the economy. Acknowledgements. The article was prepared within the project “Post-crisis world order: challenges and technologies, competition and cooperation” supported by the grant from Ministry of Science and Higher Education of the Russian Federation program for research projects in priority areas of scientific and technological development (Agreement № 075-15-2020-783).

Belt and Road Initiative: Interim Results and Challenges During Pandemic

The article analyses the current status of the Belt and Road Initiative (BRI), its key achievements and challenges, including those related to the COVID 19 pandemic. In the 2010s China has become one of world’s largest investors and BRI is one of the most important tools of Chinese investment policy. Due to its flexible structure, BRI has been able to adjust and develop in the context of the U.S. – China trade war and the growing anti-Chinese sentiment in the world that included the concerns over so called China’s debt diplomacy. But this lack of rigidity is also a challenge to those who study BRI because there is no official list of projects (estimations vary between 118 and 374) and countries participating in BRI (up to 138). China’s key BRI partner is Pakistan. The total value of projects implemented by China in Pakistan as part of the China-Pakistan Economic Corridor was initially estimated at $46 billion but now exceeds $70 billion (new projects were signed even during the pandemic). BRI is increasing the number of its participants. In March 2019 Italy became the first G7 country to sign a BRI MoU with China. While implementing BRI China has faced such challenges as rising concerns of “China’s debt trap”, as well as ecological and political issues. In 2020 BRI is facing a new challenge with the COVID-19 pandemic. Some BRI projects were postponed because of the pandemic, but in some cases they were unaffected. There are 64 out of 138 countries participating in BRI that come from low and lower-middle income groups according to the World Bank classification. Their average ratio of foreign debt to GDP was 54% in 2018–2019. It is most likely that these countries will be hit hard by the coronacrisis. Thus the pandemic will encourage China to tighten the selection process for BRI projects with a focus on the most strategically important and cost effective ones. From the point of view of China’s BRI partners, the effect can be two-fold: the most unstable economies will increase their dependence on China, while with the economically strong countries China will be more willing to make concessions and offer more favorable conditions for cooperation.

Tribal Factor in Libya: Metamorphoses after Qaddafi Epoch (2011-2020)

The overthrow of M. Gaddafi with the assistance of NATO in October 2011 led to the collapse of the vertical of power and institutions of the state and sentenced Libya to a deep systemic crisis. The article examines the peculiarities and role of the tribal factor in the current events in Libya, a country with deeply divided, multi-composite societies (DDS). It is characterized by tribal, regional, racial and ethnoreligious diversity. With 90% of its population having tribal roots, the number of tribes passes 140. This diversity has left its mark on the course of events, affected the struggle for power. The author sums up the shifts that have taken place in the tribal segment of society in recent decades. The rush of members of different tribes to the city led to their fragmentation, diminution of their former structure. The bonds of kinship, the spirit of solidarity, the traditional behaviour of the tribesmen have been to different extents eroded. However, the influence of a tribe or genus that play the role of a bonding society remains essential. This was especially evident after the advent of dual power in 2014, the author assumes. The two poles of domination – Tripoli and Tobruk are trying to play this card to their advantage. On the other hand, the security vacuum caused by the fall of the regime spontaneously filled forces, including regional tribal groups. The scholar tracks how various tribal councils and other entities here and there take on the functions of maintaining resilience and order, ending infighting, returning hostages, etc. In doing so, they often turn to the traditional usual right – Urf. The author agrees with a number of Libyan scholars and other foreign researchers that there are now some signs of a breeding tribal identity in Libya. At the same time, this process is multi–directional, as in Libya, a country with a deeply divided society, tribes can both engage in conflicts and contribute to their peaceful denouement. The researcher draws attention to the fact that the relationship between tribalism and Islamists is rather contradictory. The latter use to argue that “Islam is the solution to all problems.” But their entry into the arena of politics in Libya after October 2011 did not prevent the de facto collapse of the country and the growth of sectarian standoff. And that according to the author divides society and plays into the hands of certain political forces. In this atmosphere, tribal polarization and the general alienation of society are at risk of growth. The author analyzes the relations between tribal and national identities in a country where the process of consolidation of the population into a single nation has not yet been completed.

The Countries of Southeast Asia and the Chinese Initiative Belt and Road: a Model of Interaction

The choice of the countries of Southeast Asia as an example for analyzing the nature of interaction between developing countries and China within the framework of the Belt and Road Initiative is not accidental. The very logic of China’s stated goals of gaining dominant positions in the world economy and politics makes it inevitable that the countries of Southeast Asia located in geographic proximity to it are included in its long-term economic and political plans. The question, however, is to what extent do they meet the interests of the Southeast Asian countries themselves? The solution to this question is the main subject of research in the article. There are objective prerequisites for mutually beneficial cooperation. The Belt and Road projects are viewed by China as a tool for economic expansion into the region with the prospect of taking a leading position there, using the interest of Southeast Asian countries in the inflow of foreign investment to create modern infrastructure, the lack of which narrows their opportunities for further economic growth, maintaining competitiveness and developing integration ties within ASEAN Community. Expert assessments made by international organizations confirm the positive impact of OBOR projects on the economic development of Southeast Asian countries and although today it is too early to draw any conclusions, since the initiative is only at the initial stage of its implementation in the region, nevertheless the case studies presented in the article indicate a mismatch in the positions of the parties on a number of issues related to the financing of projects, their lack of transparency. non-compliance with environmental and social requirements. The support of the initiative on the part of the Southeast Asian countries does not automatically mean their acceptance of the terms of the agreements proposed by China, which are far from always consistent with their national interests and give rise to fears in society about its expansionist intentions. Therefore, in many Southeast Asian countries, participation in OBOR projects is turning into a subject of political discourse, which reflects the presence of disagreements in society and confrontation of interests regarding the advisability of rapprochement with China, given the associated economic and political risks. The countries of Southeast Asia can be conditionally divided into two groups according to their relation to the Belt and Road initiative. The first group includes Indonesia, Malaysia, Singapore, the Philippines, Thailand, Vietnam and Myanmar, whose position can be described as national pragmatism. While supporting the Chinese initiative in general, they nevertheless assess the possible risks of their participation in projects and seek to reduce them. The second group is represented by Laos and Cambodia, whose leadership unconditionally supports the Chinese initiative, guided by the interests of their own survival, which largely depends on Chinese assistance. Therefore, the prospect of falling into a debt trap and increasing economic dependence on the PRC and even the threat of losing sovereignty does not deter them from participating in highly controversial projects from a commercial point of view. Based on the analysis made, the author comes to the conclusion that, given the existing alignment of political forces in Southeast Asia, China can count on promoting its initiative in the region, which, however, does not automatically lead to an increase in its political influence and to the creation of a China-centric model of regional order. Acknowledgements. The article was prepared within the project “Post-crisis world order: challenges and technologies, competition and cooperation” supported by the grant from Ministry of Science and Higher Education of the Russian Federation program for research projects in priority areas of scientific and technological development (agreement № 075-15-2020-783).

Belgium on the Road to Confederation: Problems and Prospects

The article is about the Belgian federal system transformation, as well as the factors that aggravate or, on the contrary, restrain the centrifugal trends in the country. The specific nature of Belgian federalism determines its evolution from federation to confederation, but the answer to the question about the prospects of this transformation remains open. On the one hand, the Belgian Kingdom history, its geographical location, as well as economic and cultural-linguistic features predetermined the existence and deepening of dividing lines between the two main ethnic communities in the country – the Walloons and the Flemings. Decentralization, as a response to the aggravation of interethnic contradictions, allows political elites to partially control the process and minimize, as far as possible, the costs of this conflict of interest for the economy and the population, but at the same time, it feeds centrifugal tendencies. Reforms do not remove the problem of separatism from the agenda, but, vice versa, give the regions and communities all the necessary resources, reducing the central authorities’ competences. Each reform creates the basis for the next redistribution of power. The logic of the decentralization process predefines the dual, asymmetric, dissociative and improvisational nature of the federal system of Belgium, and contributes to its extreme complication. The main drivers of centrifugal tendencies remain Flemish nationalists when the institutions and mechanisms designed to unite the country do not function effectively enough. On the other hand, the scenario of a complete collapse of the Belgian federation is not something predetermined and inevitable. There are still internal and external factors unifying Belgians (the Senate, the King, the absence of a provision for a national referendum in the constitution, a special place in the federation of the Brussels-Capital region, the country’s membership in the EU), but their influence on the entire system is gradually decreasing. Belgium’s active participation in the European integration contributing to creation of a highly developed modern economic system and high living standards, as well as stable GDP growth (with exception of crisis periods), play an important role in stabilizing the Belgian federation. So, the European Union prevents a rapid development of separation process, but does not change its main trends. The EU accompanies the Belgian federal system transformation, in order to reduce its costs for society and the European integration, but does not set the task of inversing its evolution. At the same time, the unstable political situation in the country has a certain negative impact on the European integration, exacerbating the complexity of the decision-making process within the EU. The coronavirus pandemic became a catalyst for controversial political processes in Belgium, brought renewal of the social and environmental contract and a new view of European solidarity. However, the pandemic highlighted the main shortcomings of the existing federal system. The dissociation of the federation and its drift to a confederation is a peaceful and slow process, but the country’s unifying factors are gradually eroding. It is not yet clear whether and when a full-fledged confederate system will be created and the separation will be stopped, or whether the confederation will become the next stage on the Belgium’s way to the final division. It is impossible to completely exclude a rollback scenario of the strong federation restoration while reducing competencies of regions and communities, but it is obvious that its probability is extremely small.

The Trajectory of Development of Social Partnership

Profound changes in the social and labor sphere are followed by both emergence of the new opportunities associated with the development of flexible forms of employment, expansion of opportunities for employment, humanization and digitization of work, and the emergence of new threats: the occurrence of such phenomena as employment preсarization, growth of the informal components in the labor relations, distribution of practice of bringing the labor relations to the civil legal area, and so on. As a result, controversies between the main participants of the social and labor relations grow. An effective and worldwide recognized mechanism of resolving them is the social partnership which has the deep historical roots going back to outstanding thinkers of antiquity. During later historical periods the ideas of social partnership gained development in the works of domestic and foreign scientists, public and statesmen. In the Russian Federation social partnership has the specific trajectory of development which has developed under the influence of both historical and modern factors. The carried-out analysis allowed to reveal the following problems of formation and development of the social partnership system in the Russian Federation: sociocultural features, weakness of the trade-union movement, development of non-standard forms of employment, differentiation of the income of the population, low interest of the government. The designated problems which are slowing down the process of transition of the social and labor relations to partner type are manifested both on federal, and on regional levels. To research the extent of development of collective contract regulation and identification of the problems which take place in the system of social partnership at the local level sociological survey of workers of a number of the Russian organizations was performed. As a result, it was found that collective contract regulation of the social and labor relations in the Russian Federation at the local level demands improvement. The main problems of system of social partnership at the local level are: weak knowledge of trade-union members concerning the activity of those organizations, especially at the sectoral, regional, and territorial levels; unwillingness to resolve the issues of social and labor regulation at the organizational level without governmental support and lack of the developed practice of conducting collective negotiations; passivity and weak motivation of trade-union members in protection of their labor rights; weak feasibility of practical implementation of the collective agreement provisions. The results of the theoretical and empirical researches allow to predict the trajectory of further development of social partnership consisting in strengthening of the social component due to the extension of the database concerning the problems of the social partners.