AN ANALYSIS OF ECONOMIC CHALLENGES AND DEVELOPMENT POTENTIAL IN THE NORTH CAUCASUS REPUBLICS
AN ANALYSIS OF ECONOMIC CHALLENGES AND DEVELOPMENT POTENTIAL IN THE NORTH CAUCASUS REPUBLICS

Summary/Abstract: This study evaluates the current economic issues, potential, and proposed solutions for the seven North Caucasian Republics (Adygea, Chechnya, Dagestan, Ingushetia, Kabardino-Balkaria, Karachay-Cherkessia, and North Ossetia). In this context, their political, geographical, and demographic structures are first examined, followed by a discussion on the root causes of the region's current economic problems. Grounded in fiscal federalism theory, the analysis of macroeconomic and foreign trade data reveals that the region has failed to achieve the desired level of economic performance due to low per capita income, high unemployment, low average wages, and low export levels. Structural bottlenecks and weak manufacturing further entrench federal transfer dependency. The study concludes that ensuring economic stability requires local administrators in the republics to be more active in economic decision-making processes compared to Moscow, and that Russia must end its oppressive policies toward the region. Unlocking longterm potential depends on transitioning authority to democratically elected local leaders to enhance accountability.

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