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Motor vehicle transport and motor vehicle repair enterprises

2.2

4.1

4.2

4.4

4.9

4.9

4.9

4.9

Retail trade

24.9

19.4

15.9

16.0

12.3

12.2

11.4

10.9

Wholesale trade

0.9

1.2

1.3

1.3

1.4

1.4

1.4

1.6

Public eating facilities

9.8

7.4

6.6

6.7

5.6

5.6

5.4

5.4

Consumer services

13.2

11.8

9.3

9.4

6.5

6.6

6.3

6.2

Incomplete construction sites

4.8

4.6

4.8

4.9

5.3

5.3

5.4

5.4

Others

24.8

32.2

40.1

39.4

48.1

48.6

50.3

50.7

Total

100.0

100.0

100.0

100.0

100.0

100.0

100.0

Source: State Committee on Property of the Russian Federation, calculations by the authors.

From Table 4 it follows that the basic tendency of changes in the industrial branch structure of state and municipal enterprises in 1993-1997 was a sharp increase, a doubling in the proportion of enterprises of the so-called other branches (from 24.8 percent to 50.7 percent).

It has to be explained that the official statistical accounting of the State Committee on Property of the Russian Federation singled out first of all those branches of the economy, the enterprises of which, proceeding from the norms of state programs for privatization, were subject to obligatory privatization (with not very large limitations): light industry and the food industry, construction and the construction materials industry, motor vehicle transport and motor vehicle repair enterprises (further: the motor vehicle business), retail and wholesale trade, public eating facilities and consumer services, incomplete construction sites, and also agriculture.3

Whereas base branches of the economy (the fuel and energy complex, metallurgy, chemicals and petrochemicals, machine-building and metalworking, the timber, woodworking, and cellulose-paper industry, transport by kinds of transport, with the exception of motor vehicle transport), and also housing and utilities, branches of the social sphere, science and scientific services, and a considerable number of others, were not singled out in this>

Aside from state enterprises of other branches, over the period 1993-1997 there was growth in the share of the motor vehicle business (from 2.2 percent to 4.9 percent), wholesale trade (from 0.9 percent to 1.6 percent), incomplete construction sites (from 4.8 percent to 5.4 percent). The share of agricultural enterprises and equipment maintenance servicing for agriculture remained stable (7.2 percent). Aside from the block of other branches, by the beginning of 1998 the proportion of practically all other branches, both those that had increased and those that decreased the share of their representation in the overall structure, did not exceed ten percent, the only exception being retail trade (about eleven percent). At the beginning of 1993 this was characteristic of consumer services (13.2 percent) along with retail trade (almost one fourth).

In connection with this there arises the legitimate question, at what level of the state sector did the processes which brought about such a growth in the proportion of branches not having strategic significance in the economy occur

Table 5

Structure of state enterprises in Russia in 1993-1998 on independent balance sheets of federal property ownership by branches of industry

Branches	As of 1 Feb 1993		As of 1 Jan 1994		As of 1 Jan 1995		As of 1 Jan 1998
	units	%	units	%	Units	%	units	%
Light industry	1273	1.2	682	1.1	286	0.6	165	0.6
Food industry	2541	2.4	1476	2.3	899	2.0	445	1.5
Construction enterprises	8866	8.2	6027	9.5	3650	8.0	1539	5.2
Construction materials industry	1349	1.3	753	1.2	455	1.0	210	0.7
Agricultural enterprises and equipment maintenance servicing for agriculture	8596	8.0	3635	5.7	2904	6.4	2397	8.1
Motor vehicle transport and motor vehicle repair enterprises	2936	2.7	2188	3.5	1312	2.9	742	2.5
Retail trade	20342	18.9	7745	12.2	2775	6.1	1934	6.5
Wholesale trade	1075	1.0	406	0.6	292	0.6	172	0.6
Public eating facilities	9414	8.7	3500	5.5	1735	3.8	625	2.1
Consumer services	9989	9.3	3689	5.8	1876	4.1	905	3.1
Incomplete construction sites	7859	7.3	5028	7.9	4447	9.8	3690	12.4
Others	33557	31.1	28155	44.5	24753	54.5	16842	56.8
Total	107887	100.0	63284	100.0	45384	100.0	29666	100.0

Source: data base of the State Committee on Property of the Russian Federation, calculations by the authors.

Table 5 shows that in the structure of state enterprises on independent balance sheets of federal property ownership by branches of industry by the beginning of 1998 the share of other branches had grown significantly (to 56.8 percent as against 31.1 percent at the beginning of 1993).

The share of incomplete construction sites grew to about the same degree (from 7.3 percent to 12.4 percent). Aside from the block of other branches, this category of enterprises proved the only one, the proportion of which exceeded ten percent (at the beginning of 1993 such a one was retail trade – about nineteen percent).

The share of agricultural enterprises, which had decreased from eight percent to 5.7 percent by the beginning of 1994, began to grow in the following years and by the beginning of 1998 had returned to its initial magnitude (8.1 percent). The share of the motor vehicle business was practically unchanged over that period (2.7 and 2.5 percent). It has to be emphasized thereby that the absolute number of federal enterprises in these branches decreased: by 3.6 times in agriculture and by almost four times in the motor vehicle business. The proportion of all other branches decreased noticeably.

Changes in the structure of state enterprises of republican property ownership by branches of industry were different (Table 6).

Table 6

Structure of state enterprises in Russia in 1993-1998 on independent balance sheets of republican property ownership by branches of industry

Branches

As of 1 Feb 1993

As of 1 Jan 1994

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