Fueling the Post-Soviet Economies: Oil and Gas
Ever since the nineteenth century, the Eurasian idea has been a popular way of explaining the unique dualism of the Russian national character. But with the collapse of the Soviet Empire, an important phemonenon is emerging a phenomenon that is not receiving sufficient consideration by Western analysts and businessmen. As the ensuing economic disintegration of the former Union accelerates, three distinct zones of influence are forming: western, southern, and eastern. In terms of economic affairs, the western part of the former union is drifting further and further in the direction of the European Community, while the east Asian periphery is leaning towards Japan. The southern Asian regions are gravitating toward Turkey, Iran, and neighboring Muslim countries. Meanwhile, the industrial potential of the states on the territory of the former Soviet Union is rapidly deteriorating. Their capacity to maintain let alone expand output, has been seriously weakened. In 1990, in order to reduce the budget deficit, a dramatic decrease in industrial investment was effected, one that was unprecedented in the economic history of the Soviet Union. This severe cutback in investments was not carried out in a rational manner: it did not facilitate the resolution of