On June 4, Prime Minister Dmitry Medvedev affirmed the new makeup of the government commission for the socio-economic development of the North Caucasus. The commission is comprised of 26 top officials and headed by Medvedev himself. Moscow’s envoy to the North Caucasus, Aleksandr Khloponin, and all the heads of the regional governments in the North Caucasus Federal District are on the commission. Adygea is not included since administratively it belongs to the Southern Federal District. All the main ministers of the federal government with the exception of the interior and defense ministers and the heads of the security services are also on the commission, along with the CEOs of the large state-backed Russian banks, such as Sberbank and Vnesheconombank. Ahmed Bilalov is one of the few people on this list who stand out. He is identified as deputy head of the foreign affairs committee of the Federation Council, the upper house of the Russian parliament (http://government.ru/, June 5). The cursory description does not mention that Bilalov is also the outspoken head of the government corporation Northern Caucasus Resorts (http://www.vedomosti.ru/persons/55816/Ахмед%20Билалов).
Bilalov’s inclusion on the government commission along with top officials indicates that Moscow is still intent on pursuing the development of tourism in the North Caucasus, or at least exploit this topic for propaganda purposes. Khloponin first unveiled the grand vision of building world-class ski resorts in the North Caucasus in the summer of 2010. The idea was the first tangible indicator of Moscow’s changing strategy in the North Caucasus, which would start using carrots alongside the heavily overused sticks. The project envisioned building five large resorts in all the republics of the North Caucasus other than Ingushetia and Chechnya. The gigantic project currently includes installing 179 ski lifts and building lodgings with over 90,000 beds, yielding a daily capacity at the resorts of up to 150,000 people (http://ncrc.ru/e/resorts/).
Since its inception, however, little practical work has been done on this project, apart from numerous grandiloquent declarations. As Russia is gearing up for the 2014 Winter Olympics in Sochi, located on the Black Sea coast of the North Caucasus, the contrast between preparations for the Olympics, for which billions of dollars in government money have been spent, and the North Caucasus project, spending for which has largely stalled, is apparent. It is still unclear how serious Moscow is about investing in the North Caucasus. Whether the ski resorts are a genuine project or a ploy designed to appease the local elites and deflect complaints about the rapid development of Sochi should become clear within the next two years. Given numerous reports about the misuse of government funds in Sochi, it is also unclear whether Moscow will be able to pull off another grand project across several regions, even if it genuinely wants to.
On May 31, the Federation Council’s social policy committee held an extramural conference in Nalchik, Kabardino-Balkaria. The first deputy head of the committee, Vladimir Zhidkikh, stated that North Caucasus residents should themselves be interested in developing tourism in the region. Indeed, ideally it would probably make sense to have the local population actively participating in the development and implementation of the tourism sector.
However, Moscow from the very beginning was acting in a top-down manner, as it usually does. Even the regional governments of Ingushetia and Chechnya were startled that their respective republics were not included in the project. Eventually, Moscow had to offer them substitute tourism projects to ease the strained relations. However, Moscow has continued to take a top-down approach, and republican authorities in the North Caucasus have played almost no role in Moscow’s grandiose plans. Moscow’s decision to sideline republican authorities and the local public was not a mere coincidence: the grand vision behind the project probably was to build a unified economic structure that would employ North Caucasians and place them under tighter control from Moscow. In addition, it would provide an avenue for the return to the region of ethnic Russians, who have been abandoning the North Caucasus in greater numbers over the last several decades. According to Zhidkikh, 10 percent of the Russian population, or 14 million people, travel abroad for recreational purposes every year. The official suggested that the North Caucasus tourism project should tap into this stream of Russian tourists (http://www.kavkaz-uzel.ru/articles/207481/, June 1).
However, it is unclear why Russians would risk their lives to travel to the North Caucasus when they can visit other recreational areas abroad or inside Russia, which has no lack of resorts. The deputy head of the Russian federal agency for tourism, Dmitry Mikheyev, said that the yearly flow of tourists into the North Caucasus Federal District is currently two million people, which is 5.3 percent of the total number of Russian tourists per year. At the same time, tourism represents only 2 percent of the North Caucasus’ regional domestic product (http://www.kavkaz-uzel.ru/articles/207481/, June 1). It is unlikely that two million tourists from outside the region visit the North Caucasus Federal District each year. Most likely, officials in Moscow added up all visitors, whether they travelled to the region for recreational purposes or not.
Meanwhile, the North Caucasian elites are naturally inclined to cash in on Moscow’s willingness to spend money in the region and are putting forward increasingly bizarre projects. The head of Dagestan, Magomedsalam Magomedov, has recently proposed building a new city on the Caspian Sea coast “a little bit to the south of Kaspiisk,” which is south of Makhachkala. The population of the city will initially be capped at 150,000 people, but will eventually expand to 500,000 (http://www.kremlin.ru/transcripts/15478, May 29).
With unstable energy prices and consequently slimmer coffers at Moscow’s disposal, the government will probably be less inclined to spend lavishly on the North Caucasus. Rising Russian nationalism is another serious limitation to Moscow’s ambitions for developing the region. With many Russian provinces in dire need of infrastructure development, Russians are increasingly sensitive about the Kremlin’s plans for developing the North Caucasus.