Report by Grigory Yavlinsky

Forum 2000, Prague, September 16, 2013

It’s a great pleasure to be here and I’m very thankful for the invitation to see you and to speak to you. I would start with some quoting of Mikhail Gorbachev. He was asked once by Margaret Thatcher “What about transition in Russia?” And he responded that if “to say it in one word then it is good”, but if “to say it in many words – no good”. I think it is a detailed explanation of what has been going on, because there is a very big number of risks and it is absolutely not clear where the transition has been heading. It is the reality. But this reality is rooted as it was mentioned just now not only in historical roots in Russia, and historical cycles and different historical explanations, but from my point of view it is much more rooted in the way how the reforms were realized in Russia. And I want to present you my report specially prepared for this Forum covering some lessons of the Russian reform, because it was a large-scope reform, some lessons that must be very useful, from my point of view, for other reforms of a different kind almost in any country which we should examine in terms of risks of transition.

The first lesson is that the main goal of the reform should be not budget constrains or free prices and so on, but the main goal of the reform is changing the mentality of the society. This is the goal. Because you should influence this mentality in order to make so that the reforms are deep, irreversible and effective. But for that you need to use such instruments like incentives, values, motives and finally you should find the way to create institutions. But changing the mentality is the first goal. It is lesson number one.

Lesson number two. It is necessary to avoid by all means splitting of the society during the reforms. Reformers by nature must be integrators, rather than those who are setting division lines in the society, otherwise as you know the reforms will be reversible. No doubt about this, and it will be a revenge on behalf of the society. So, you must be an integrator.

The third lesson which we have suffered from our life is that there are no ready decisions how to implement the reforms – neither abroad, nor in our history, nowhere. It’s really necessary to create, develop and try to realize new

approaches because you can’t find ready models or recipes how to conduct the reforms. You can find some prepared recipes about the goals of the reform, but it is not possible to find the recipes how to conduct them.

The fourth lesson is, and it has been just asked in the questions, about the speed of implementation of the reform. Our lesson, our outcome shows that the speed is not important. What really matters is the deepness and irreversibility of the reform. The hysteria about the speed can’t be justified because as soon as you try to speed up the reforms, you will have a setback. So, it’s a different thing, as you must always keep in mind the criteria of a different type: how deep and how irreversible the reforms are.

The fifth lesson is very important and it tells us that reforms, real reforms, are not a military battle, they are more like peace negotiations with the society on the subject. If you are going to “attack” the society, you will never have the reforms that will be helpful for the country.

And the last but not least. A reform is kind of an art, and not everybody can do that. To be a reformer means to be an artist. That’s our conclusion. We have not had such kind of artists until today.

And here I come to the last question: what about the foreign aid and foreign support for the reform? Definitely there can be really a very important influence from abroad, but only in one way: as an example. Don’t interfere, simply show the example: that you know how to do this and that, that you are better, that you lie less, that you have less corruption, that you have more respect for the people, and that your people are more happy and that’s it. This is the main aid in the reform.

Thank you very much.

(Applause)