Getting by in Khabarovsk

Months since the economic crisis hit, open any paper and you will see stories about unemployment on the rise, construction projects being halted and factories struggling to stay alive while being choked by debt incurred during better times.
Several thousand kilometers away from Moscow, only 20 kilometres from the Chinese border, the Khabarovsk region is also feeling the effects, but local officials insist the area is weathering the storm better than most.
Ahead of Friday's EU-Russia summit here, construction workers were busily repairing the road from the airport to central Khabarovsk. But cosmetic repairs aside, there does seem to be a lot of building going on. Khabarovsk's skyline is dotted with cranes, building affluent high-rise residential towers in the center, and enormous apartment blocks in the outskirts of town. The atmosphere is far from bleak, and traces of the construction boom from better times are still evident. Although people in Moscow have gotten used to people from the regions endlessly flocking to the capital, the regional government denies there is any mass exodus from the city; in point of fact, the number of residents is growing.
In a meeting with foreign journalists last week, Viktor Ishayev, President Dmitry Medvedev's envoy to the Far East Federal District and a former Khabarovsk governor, said that the place has its attractions - average pay is over 20,000 roubles per month, 20 per cent higher than the national average.
Affordable housing is a matter the regional government is taking seriously: "We are helping young people - young families," Ishayev said. "Forty percent of newly constructed housing has been allocated for affordable housing for young families - but mind you, we are helping families here, not the construction companies."
Officials acknowledge, however, that the region's remote location and its underdeveloped infrastructure present huge logistical challenges.
Unemployment is as familiar here as it is anywhere else. Official unemployment in the region stands at 4 per cent, or 33,000 of its inhabitants. In Komsomolsk-on-Amur, an industrial city 400 kilometres upriver, Amurmetal, a steel processing plant, was mulling laying off one-quarter of its workforce until September, even despite promises of state support during a visit last week by Prime Minister Vladimir Putin.
Viktor Koryakin, an official with the Khabarovsk region coalition of labour unions, says the government is coping with the problem: "Of course, there are hard-hit areas - such as metal processing plants - since demand has dropped. But we keep construction companies busy with infrastructure projects such as road building, and are also looking towards our neighboring regions, Primoriye and Amur, as a potential market, and are cooperating with them to see if we can send them our surplus products."
Natalia Zubarevich, director of regional programmes at the Independent Institute of Social Policy, said by telephone that Khabarovsk was relatively well off compared to some other cities. "Ishayev, who ruled the region for almost two decades, is a governor of the old Soviet order - he kept the region tightly controlled, and accomplished much, keeping order and a decent appearance as he saw fit."
That city appears relatively spick and span, and has become a sort of educational hub in the Far East. Evidently, much effort is being put into healthcare as well, with a new maternity hospital built, and a state-of-the-art cardiology centre under construction. Much of the funding came from the federal budget.
Ishayev said that the region's prospects were limited, since too much of its economy relies on the export of raw materials. "We should be exporting value-added materials," he said. "For example - we have good trade relations with China, but we sell them raw materials, and they sell the completed products back to us. This is not correct. But it's a difficult cycle to get out of."
"The region has one good taxpayer - Sukhoi in Komsomolsk-on-Amur - but they don't always have steady orders to keep them busy and affluent," said Zubarevich.
Indeed, despite the much-touted Superjet-100 orders on the books, 50 of the plant's 640 workers may be laid off this year. "There's a big ‘shadow economy' in the region," said Zubarevich. "Forests are being sold to China, and the fishing industry, too, although it is not large, it is also a ‘shadow economy'. Such businesses don't bring in any taxes for the region."
EU talks to focus on security
RIA Novosti
KHABAROVSK - President Dmitry Medvedev will focus on energy and security issues at the Russian-EU summit in Khabarovsk, starting Friday, in the light of Russia's recent gas dispute with Ukraine and last year's war between Russia and Georgia. On Thursday at an informal dinner Medvedev met the EU delegation, led by EU Commission chief Jose Manuel Barroso, Czech President Vaclav Klaus, whose country holds the rotating EU presidency and the EU foreign policy chief, Javier Solana.
Medvedev "will be interested in the EU's position, and plans for collective and individual action from our European partners, on the continuing threat to Europe resulting from our difficult relations with Ukraine in the gas sphere," presidential aide Sergei Prikhodko told reporters on Wednesday
"We want to convey our concerns over the continuing danger of the agreements reached with the Ukrainian prime minister being broken off," he said.
Earlier this week, Ukraine's president called the natural gas contracts signed with Russia earlier this year "unprofessional", and said they are likely to be reviewed in the near future, as Ukraine is unable to meet its obligations under the current terms.
On the Georgia issue, Prikhodko said Russia would object to some EU members' support for President Mikhail Saakashvili. Moscow has refused to negotiate with Saakashvili since last year's war.
"There are things we need to ask them: what will happen with this long-term, blind support for Saakashvili? What do they think about this? All the more considering that the opposition movement in Georgia has clearly demonstrated the level of mistrust of his policies, both domestic and foreign," he said.
"Is the EU ready take responsibility for its foreign policy, or will it only ask us about Iran, and other problems? And on this issue, is Europe ready to apply the same standards to such inadmissible acts?"
He said that Russia wants serious discussion rather than confrontation with the EU