Russia's north wins World Bank aid

Life is tough in Russia's freezing winter

By Eurasia analyst Steven Eke

The President of the World Bank and the Russian Deputy Prime Minister have agreed an $80m loan agreement to finance a pilot project aimed at relocating people from Russia's far north region.

Poor economic conditions and collapsing infrastructure mean that many of the region's inhabitants want to move to other parts of the country.

Russia wants to use the money to set up a system of housing vouchers, which will be used to help mainly elderly and disabled people to buy accommodation elsewhere.

The loan was approved by World Bank President James Wolfensohn

There are some 12 million inhabitants in the 28 territories making up the far north region, which holds an astounding 60% of Russia's exportable raw materials.

But the region's natural riches contrast with its wretched living conditions.

Gone are the lavish subsidies of the Soviet period, when Russians were enticed to the far north with higher salaries and the grand communist plan for industrialisation.

Harsh conditions

The region's inhabitants depend on the central authorities for deliveries of food, fuel and clothing, and all three are in short supply.

Conditions are so bad that life expectancy in some parts of the far north has fallen to 35.

But while young people have deserted the region, the high costs of relocation and Russia's chronic housing shortage have meant that the elderly and the disabled have been stranded.

Moscow has accepted technical assistance for the far north before, but has always rejected the idea of paying people to leave.

The World Bank has taken account of this, and while it wants to help the poor and deprived find easier lives, it is also working with Moscow on projects to revitalise the region's vast coal and timber industries.