R-ECOMONY, 2018, 4(3), 121–129 doi: 10.15826/recon.2018.4.3.017 121 www.r-economy.ru Online ISSN 2412-0731 Original Paper doi: 10.15826/recon.2018.4.3.017 Evaluation of economic security in the Ural region in the context of development of small and medium-sized enterprises Natalya Yu. Vlasova , Olesya O. Kalganova Ural State Economic University, Ekaterunburg, Russia; email: nat-vlasova@yandex.ru ABSTRACT Enhancing economic security of regions is crucial for the development of the whole country, which is what makes research in this sphere particularly important. Th is study aims to analyze and compare the economic securi- ty data on the regions constituting the Ural Federal District (Russia). In contrast with current studies in the fi eld, we are conducting detailed anal- ysis of the factors that aff ect the development of small and medium-sized enterprises (SMEs) and business climate in the regions. Th e conceptual framework of this research relies on entrepreneurship theories and theo- retical approaches to analysis and evaluation of regional economic secu- rity. We develop methodology based on sets of quantitative and qualita- tive indicators and apply analytical, comparative and statistical methods as well as the method of expert evaluation. Th e data are provided by the regional statistic services and business support foundations. We also an- alyze regional support programs for small and medium-sized businesses. We found that all regions of the Ural Federal District are characterized by the medium (acceptable) level of economic security and moderate risk. In the economic security ranking, Tyumen region is at the top while the second place is occupied by Sverdlovsk region; Chelyabinsk and Kurgan regions are at the bottom. KEYWORDS region, regional economic security, small and middle-sized enterprises, entrepreneurship, business support programs, Ural Federal District FOR CITATION Vlasova, N. Yu., Kalganova, O. O. (2018) Evaluation of economic security in the Ural region in the context of development of small and medium-sized enterprises. R-economy, 4(3), 121–129. doi: 10.15826/recon.2018.4.3.017 Оценка экономической безопасности в уральском регионе в контексте развития малых и средних предприятий Н. Ю. Власова , О. О. Калганова Уральский государственный экономический университет, Екатеринбург, Россия; email: nat-vlasova@yandex.ru РЕЗЮМЕ Укрепление экономической безопасности регионов имеет важное зна- чение для развития всей страны, что делает исследования в этой сфере крайне важными. Данное исследование направлено на анализ и сравне- ние данных экономической безопасности в регионах, входящих в Ураль- ский федеральный округ (Россия). В отличие от текущих исследований в данной области, мы провели детальный анализ факторов, влияющих на развитие малых и средних предприятий (МСП) и делового клима- та в регионах. Концептуальные рамки этого исследования основаны на теориях предпринимательства и теоретических подходах к анализу и оценке региональной экономической безопасности. Мы разработали методологию на основе наборов количественных и качественных пока- зателей и применили аналитические, сравнительные и статистические методы, а также метод экспертной оценки. Данные предоставлены ре- гиональными службами статистики и поддержки бизнеса. Мы также анализируем региональные программы поддержки малого и среднего бизнеса. Мы обнаружили, что все регионы Уральского федерального округа характеризуются средним (приемлемым) уровнем экономиче- ской безопасности и умеренным риском. В рейтинге экономической безопасности Тюменская область находится на вершине, а второе место занимает Свердловская область; Челябинская и Курганская области на- ходятся внизу. КЛЮЧЕВЫЕ СЛОВА регион, региональная экономическая безопасность, малые и средние предприятия, предпринимательство, программы поддержки бизнеса, Уральский федеральный округ ДЛЯ ЦИТИРОВАНИЯ Vlasova, N. Yu., Kalganova, O. O. (2018) Evaluation of economic security in the Ural region in the context of development of small and medium-sized enterprises. R-economy, 4(3), 121–129. doi: 10.15826/recon.2018.4.3.017 122 www.r-economy.ru R-ECOMONY, 2018, 4(3), 121–129 doi: 10.15826/recon.2018.4.3.017 Online ISSN 2412-0731 Introduction Global economic instability has made the question of regional economic security crucial for the prosperity of countries. In its turn, econom- ic security of regions depends on multiple factors and conditions, which include the quality of the human capital, the general level of economic de- velopment and associated processes, the quality of the infrastructure, the availability and diversity of resources, political stability and so on. Th e re- gion’s attractiveness for investment and the level of entrepreneurial activity are also important fac- tors for its economic security. Th e vast majority of studies confi rm that small and medium-sized businesses (SMEs) are among the key drivers of economic growth. Th ere is also evidence that not only does SME development positively aff ect the general eco- nomic performance of the region, but also has a signifi cant social impact, which is crucial for regional and local economy. SMEs contribute to the development of entrepreneurship and improve business climate, moreover, they help the government tackle the problem of welfare mentality by encouraging people to look aft er themselves. Small and medium-sized business- es are essential for innovation-driven sectors of economy as it is primarily in such enterprises that new products and technologies are created and tested. Th erefore, the development of SMEs and self-employment is an important factor that determines the region’s economic security. Th ere is, however, a lack of adequate methodology to evaluate the impact of SME development on the level of economic security and our study is going to address this issue. Theoretical framework Th is research is based on two groups of theo- retical approaches. Th e fi rst group comprises the- ories on economic security in regions. Th ese the- ories mostly focus on threshold values of various economic and social indicators that are crucial for stable regional development. Th e second group includes theories of entrepreneurship, especially the ones that deal with small- and medium-sized businesses. Th ere is a vast body of research literature dis- cussing the problems of economic security in re- gions. A thorough retrospective analysis of these problems was conducted by the Ural research school [1]. In general terms, economic security on the regional level is seen as “a complex of con- ditions and factors that characterize the current state of regional economy, its stability and pro- gressive growth as well the degree of its indepen- dence in the processes of integration with federal economy” [1, p. 29]. Th e following methods are applied in Russian studies to evaluate the level of economic security: a) monitoring of the key macroeconomic in- dicators, especially when their values approach the threshold values [2]; b) expert evaluation and ranking of regions according to the level of security threat [3]; c) evaluation of the consequences of security threats by measuring the damage [1]. Mingaleva and Gershanok show the connec- tion between the region’s stability, its compet- itiveness and the level of economic security [4]. In some studies, economic security of small-sized businesses is seen as an important factor and as a criterion for evaluating economic security of the region and the whole country [5; 6]. Undoubtedly, the more active local business life is, the stronger is the positive eff ect that SMEs have on regional economy [7]. Th erefore, we should have a good understanding of the factors and conditions that infl uence the entrepreneurial climate in the region, for example, by analysing policies aimed at supporting entrepreneurship and evaluating their effi ciency [8–12]. Some studies fo- cus on specifi c forms of such support that target small businesses. For instance, Korchagina analyzes the state policy of stimulating the development of clusters of small and medium-sized enterprises [13]. Other studies question the long-term effi cien- cy of such policies and emphasize the fact that the quality of human capital, population mobility and density are much more important [14; 15]. A big group of studies analyze SME support programs in transitive economies [16–18]. Data and Methodology Our methodology for economic security eva- luation relies primarily on the indicators of SME development. Th e methodology comprises both quantita- tive and qualitative parameters. For the former we used the offi cial statistical data while the latter re- quire additional research and expert evaluations. Economic security implies stability that en- sures sustainable growth of the region’s economy, which means that, in order to evaluate its current state, we should be focusing on the ongoing trends and patterns of regional development. R-ECOMONY, 2018, 4(3), 121–129 doi: 10.15826/recon.2018.4.3.017 123 www.r-economy.ru Online ISSN 2412-0731 We estimate the parameters by applying a ten- point scale with the higher values corresponding to better performance: if the current values are lower than the target value, the region scores 0. If the current values are closer to the average value, the region scores 5. If the current values meet the target values, then the region scores 10. Th e indicators used to evaluate regional se- curity with the focus on SME development are shown in Table 1. Table 1 Indicators of regional economic security (with the focus on SME development) Quantitative indicators Qualitative indicators Th e number of SMEs Th e number of employees in SMEs Th e share of SME turnover in the GRP Th e amount of taxes paid by SMEs to the budget Funds for SME support from the federal and region- al budgets Th e number of fi nancial support recipients Th e number of non-fi nan- cial support recipients Th e number of jobs created by support recipients Capital investment Th e quality of SME support infrastructure Effi ciency of SME support programs Red tape (registration and re-registration procedures for businesses) Th e level of entrepreneurial activity Attitude of local inhabitants towards entrepreneurship Access to information about the market, its potential and resources, production facilities and equipment Opportunities for further development of SMEs Let us now consider these indicators and their impact on regional economic security in more detail. 1. Quantitative indicators (better perform- ing regions score 10; if no signifi cant changes are registered, 5; and if the trend is negative, 0): a) the number of SMEs, that is, the number of legal entities operating in the region as of the end of the fi nancial year. Th e growth in the number of SMEs signifi es that the region’s economic securi- ty is improving as enterprises are participating in social and economic development of the region by contributing to its stability and prosperity; b) the number of employees in SMEs. Th e ris- ing number of employees working for small, me- dium-sized and micro-enterprises has a positive impact on economic security as it means more jobs. SMEs perform a vital social function as they reduce the level of unemployment and relieve so- cial anxiety; c) the share of people employed by SMEs. In the way similar to the previous indicator, its growth is benefi cial for regional economic security. We ap- ply the following formula to calculate it: 100%. The share The number of people of SME employees employed The Workforce by SMEs Number in the Region =∫ (1) d) the turnover of SMEs. An increase in the turnover of SMEs shows that the needs of the re- gional population for products and services are fully (or to the fullest extent possible) satisfi ed and that the contribution of SMEs to the GRP is increasing; e) the share of SME turnover in the GRP. An increase in the share of SME turnover indicates an increase in the GRP per capita. According to some experts, in order to make businesses and the region competitive and to achieve the necessary level of economic security, the share of SME turn- over must be 60%. We apply the following formu- la to calculate it: 100%. The share of SME SME turnover turnover in the GRP GRP =∫ (2) f ) the total amount of tax paid by SMEs. An increase in the total amount of taxes paid by SMEs also refl ects improved economic security in the region; g) funds spent on SME support from the feder- al and regional budgets. A decrease in the amount of funds spent on SME support is detrimental to SME development as some of the businesses would then fi nd themselves struggling to survive; h) the number of recipients of fi nancial sup- port, which include both non-repayable subsidies and grants) and repayable assistance (guarantees, microloans, subsidized loans). An increase in this indicator should enhance entrepreneurial activity (the number of SMEs, the number of employees in SMEs, SME turnover, and so on); i) the number of recipients of non-fi nancial support, which includes consulting, training, and so on. Th is kind of support helps entrepreneurs deal with the lack of the relevant skills and knowl- edge. A competent entrepreneur is crucial for the success of his or her business and for ensuring economic security of the region; k) the number of jobs created by support recipi- ents. An increase in the number of jobs shows the effi ciency of support programs, which in the long run aff ects the region’s economic performance and economic security; l) capital investment. A business can grow if it receives enough investment, which allows it to 124 www.r-economy.ru R-ECOMONY, 2018, 4(3), 121–129 doi: 10.15826/recon.2018.4.3.017 Online ISSN 2412-0731 modernize its equipment and production facili- ties and launch new product lines. Th rough capi- tal investment SMEs enhance the quality of their production and services, which positively aff ects the consumer demand. 2. Qualitative indicators: if the value of an indicator is high, the region scores 10; if low (un- satisfactory), 0: a) Th e region’s SME support infrastructure is evaluated by looking at the number of busi- ness support organizations. Development and improvement of the SME support infrastructure shows the level of regional economic security; b) Effi ciency of SME support programs is evaluated by comparing indicator values with the total amount of spending on SME support in the region (state programs realized on diff erent levels). To analyze the region’s performance in this indicator we need the data provided by the program implementation reports. If 80–100% of the program’s objectives and targets are met, then the region scores 10; if 50–79%, 5; and if less than 50%, 0. c) Red tape and administrative barriers. Com- plexity of the procedure of registration or re-reg- istration can prove to be a serious impediment to the development of SMEs discouraging people from starting up a new business. Th e more com- plex these procedures are, the harder it is to start a business, which causes a decline in the number of SME turnover in the GRP and is detrimental for economic security and vice versa, the simpler the procedure is, the higher the region scores in this indicator; d) the level of entrepreneurial activity. Th e growing number of people willing to start their own business means that more new companies will be created in the region and that their contri- butions to the region’s economic security will be more substantial; e) social attitudes towards entrepreneurship. If local inhabitants demonstrate a positive attitude towards private business, it is benefi cial for the so- cio-economic and political situation in the region. f ) Access to information about the market and its resources, the available production facilities and equipment is vital for the success of a business. If entrepreneurs are well-informed about the avail- able resources, they have more opportunities to contribute to economic development and eco- nomic security of the region. g) opportunities for SME development. Th is in- dicator corresponds to the region’s attractiveness for investment and the overall level of economic activity. Th us, our methodology comprises eighteen indicators: 11 quantitative and 7 qualitative. In each indicator, the region can score from 0 to 10. Th e maximum total score is 180; the minimum, 0. Ranking scores: a) the score of 121–180 corresponds to A ranking or a high level of economic security. Th e main indicators of SME development show pos- itive dynamics; there is a growth in the number of local businesses. Th e contribution of SMEs to the GRP is increasing as new jobs are created and businesses pay more taxes to the budget. Th e re- gion is in a riskfree zone. b) the score of 61–120 corresponds to B ran- king, which is a medium (acceptable) level of eco- nomic security. Th e main indicators of SME deve- lopment remain stable and may show insignifi cant (positive or negative) changes. SMEs are enjoying sustainable growth; the state support is effi cient al- though not to the fullest extent. Th e region is thus in the zone of acceptable risk, which should be monitored in case the situation deteriorates. c) the score of 0–60 corresponds to C ranking, which is a low (disastrous) level of economic se- curity. Th e main indicators of SME development show negative dynamics: enterprises shut down, their turnover falls and so is the number of their employees. Th e production of SMEs is no longer in demand. Th e SME sector is in recession and support measures are ineff ective. Th e region is subject to severe risk, which requires the authori- ties to take urgent measures to lower the risk level. Results Let us now look at the level of economic secu- rity in Sverdlovsk region in 2016 by focusing on SME development indicators. Th e scores for each indicator are shown in Table 2. Th e exponential growth in the turnover of SMEs in 2016 in comparison with 2015 was de- termined by the actual turnover growth but also by the changes in the criteria of classifying busi- nesses according to their size and annual revenues (see the Decree of the Government of the Russian Federation No 702 of 13.07. 2015). Th e workforce number in Sverdlovsk region in 2015 was 2,293.1 thousand people and in 2016, 2,230.1 thousand. Th us, by applying formula (1), we have calculated that the share of people em- ployed in SMEs in the region was 18.8% in 2015 and 19.6% in 2016 of the total workforce. R-ECOMONY, 2018, 4(3), 121–129 doi: 10.15826/recon.2018.4.3.017 125 www.r-economy.ru Online ISSN 2412-0731 Th e GRP in Sverdlovsk region in 2015 was 1,822.8 billion roubles and in 2016, 1,978.1 billion. By applying formula (1), we can calculate that the SME turnover accounted for 60.2% in 2015 and 73.4% in 2016. For a region to be competitive, this value should exceed 60%. Th e state SME support program is a part of the subprogram Impetus for Business of the state program Enhancement of Sverdlovsk Region’s At- tractiveness for Investment Until 2024 approved by the decree No 1002-ПП of 17.11.2014 of the Gov- ernment of Sverdlovsk Region. Federal spending cuts caused cuts in fi nancial support for SME de- velopment. Sverdlovsk region enjoys a well-developed multi-level infrastructure for SME support. Th e core of this infrastructure is Sverdlovsk Regional Foundation for Business Support, created in 2002. Th erefore, the region scores high in this indica- tor – 10. Th e effi ciency of SME support programs in Ekaterinburg was 87%, which means that the region is quite successful in this indicator and scores 10. Analytical centre Expert-Ural has studied the current state and problems of SME development in Sverdlovsk region and found that only 11.8% of entrepreneurs surveyed complained about regula- tory and administrative barriers, in particular the complicated procedure of registration and re-reg- istration. Since the registration procedure is nei- ther simple nor fast, in this indicator the region scored only 5. As for the level of entrepreneurial activity, the introduction of a tax holiday in the region has proven to be effi cient (see the law On Setting Tax Rates and the Introduction of Simplifi ed Tax Com- pliance Procedures for Specifi c Categories of Tax Payers in Sverdlovsk Region). Not only did this measure stimulate entrepreneurial activity but it also led to the creation of new jobs, according to the data provided by the press service of the re- gion’s legislative assembly. Recent studies have shown that the populari- ty of entrepreneurship has been increasing among local inhabitants. Potential businessmen are able to receive timely and quality access to informa- tion about the SME support system in the region. Th ere is also a complex of measures being realized to stimulate youth entrepreneurship, for exam- ple, career guidance services and entrepreneurial training. As for the access to information about the market, its resources, production facilities and equipment, it does not seem to be a serious prob- lem for regional entrepreneurs. According to the study of Expert-Ural, the majority of business managers (58.3%) are well informed about the market resources. Th e information is provided through on-line sources, governmental agencies and municipal services. Th e key factors contributing to the develop- ment of SMEs in Sverdlovsk region are the inter- nal market, large enterprises, and comparatively high purchasing power. In Expert RA ranking, Sverdlovsk region has been classifi ed as having a high investment potential combined with the moderate level of risk. Entrepreneurs themselves evaluate the economic situation in their target markets until 2020 the following way: 48.6%, as Table 2 Quantitative indicators of economic security in Sverdlovsk region Indicator 2015 2016 Absolute change Score Number of SMEs 8,589 4,601 –3,988 0 Number of employees in SMEs (ths people) 233.01 134.26 –98.75 0 Share of employees in SMEs (%) 10.16 6.02 –4.14 5 Turnover of SMEs (bln rbs) 546.55 530.32 –16.23 5 Share of SME turnover in the GRP (%) 29.98 26.81 –3.14 5 Total amount of tax paid by SMEs, ths rbs 23,952,263 26,536,719 +2,584,456 10 Funds spent on SME support (from federal and regional budgets) (mln rbs) 815.3 640.7 –174.6 0 Number of fi nancial support recipients 744 922 +178 10 Number of non-fi nancial support recipients 10,352 8,665 –1,687 0 Number of jobs created by support recipients 2,532 2,438 –94 5 Capital investment (mln rbs) 9,335.5 7,172.4 –2,163.1 0 Total score 40 Source: Based on the data of Sverdlovsk Regional Business Support Foundation. Retrieved from https://sofp.ru/ 126 www.r-economy.ru R-ECOMONY, 2018, 4(3), 121–129 doi: 10.15826/recon.2018.4.3.017 Online ISSN 2412-0731 quite favourable; 36.3%, as favourable (the data of Expert-Ural). Th us, in this indicator the region scores 10. Th e total region score, both in qualitative and quantitative indicators, is 100. In 2016, Sverd- lovsk region ranked in the category B, that is, the medium (acceptable) level of economic security. Th e values of the main SME-related indicators re- mained virtually unchanged, that is, the negative/ positive changes were insignifi cant. Even though the support programs are not fully eff ective, they manage to provide stable SME development and the region is in the zone of acceptable risk. Even with an insignifi cant improvement in the SME-re- lated indicator values the region is likely to go up in the ranking by reaching A category or a high level of economic security. Table 3 shows qualitative indicators used for evaluation of economic security in Sverdlovsk, Chelyabinsk, Kurgan and Tyumen regions. Th e Strategy of Socio-Economic Development of the Ural Federal District Until 2020 considers SMEs as one of the key instruments for using hu- man, innovation and investment potential to raise the living standards and ensure sustainable devel- opment of this area. Table 4 shows quantitative indicators of eco- nomic security in Chelyabinsk, Kurgan and Tyu- men regions. We analyzed the offi cial statistical data for the federal and regional levels and im- plementation reports for state SME support pro- grams. According to Rosstat’s data on the work- force in Chelyabinsk region, in 2015 there were 1,856.9 thousand people and in 2016, 1,850.2 thousand. In Kurgan region, in 2015, 424.6 thou- sand and in 2016, 411 thousand. In Tyumen re- gion, in 2015, 1,934.1 thousand people and in 2016, 1,956.6. By applying formula (1), we can calculate the share of employees in regional SMEs from the total number of workforce. According to Rosstat’s data, in 2015, the GRP in Chelyabinsk region was 1,209.2 billion rou- bles; in 2016, 1,260.7 billion. In Kurgan region, the GRP in 2015 was 179.4 billion roubles and in 2016, 193.9 billion. In Tyumen region, in 2015, the GRP was 5,851.6 billion roubles and in 2016, 5,922.1 billion. By applying formula (2), we can calculate the share of the SME turnover in the GRP of these regions. Since 2009, a SME support foundation has been operating in Chelyabinsk region. Th e SME support infrastructure in this region also includes the Regional Integrated Centre; the state-funded Innovation Business Incubator of Chelyabinsk Re- gion, the Foundation for Industrial Development of Chelyabinsk Region, and the Engineering Cen- tre of Chelyabinsk Region. In 2017, an organi- zation called Business Territory was created that united all the existing SME support structures. Th us, we can conclude that Chelyabinsk region has a well-developed SME support infrastructure and it scores 10 in this indicator. Kurgan region has a guarantee fund and a microfi nance fund as well as organizations for non-fi nancial support of SMEs – four business in- cubators, a techno-park, Kurgan Regional Export Support Centre, Centre for Youth Innovation, Cen- tre for Cluster Development of Kurgan Region, and municipal business consulting centres. Th erefore, Kurgan region also scores 10 in this indicator. Tyumen region has the following SME in- frastructure support organizations: foundation Investment Agency of Tyumen Region; a microfi - nance fund; a guarantee fund; Centre for Entre- Table 3 Qualitative indicators of economic security in Ural regions in 2016 Indicator Score Sverdlovsk region Chelyabinsk region Kurgan region Tyumen region SME support infrastructure 10 10 10 10 Effi ciency of SME support programs 10 10 5 10 Red tape (registration and re-registration of businesses) 5 5 5 10 Level of entrepreneurial activity 10 5 5 10 Social attitudes towards entrepreneurship in the region 10 5 5 5 Accessibility of information about the market, its potential and resources for development; about the available production facilities and equipment 5 5 5 5 Potential for further SME development 10 10 10 5 Total score 60 50 45 55 Note: Based on expert evaluations. R-ECOMONY, 2018, 4(3), 121–129 doi: 10.15826/recon.2018.4.3.017 127 www.r-economy.ru Online ISSN 2412-0731 preneurship Support; Centre for Coordination of Export-Oriented SME Support; state-funded Regional Business Incubator, which has offi ces in Tyumen, Tobolsk and Ishim; techno-park West- ern Siberian Innovation Centre of Oil and Gas. Th us, Tyumen region also scores 10. Our calculations have shown that in 2016, the effi ciency of the subprogram SME Support and Development in Chelyabinsk Region in 2016–2019, which is a part of the larger state program Econom- ic Development and Innovative Economy of Chely- abinsk Region in 2016–2019, was 84% (0.844). As for the implementation of the SME sup- port model, Tyumen region is the top perfromed by reaching the level of 98%. According to the SME organization Opora Russia, in Chelyabinsk region starting a new busi- ness is diffi cult rather than easy while the situa- tion in Tyumen region is the opposite: it is easy rather than diffi cult. Both Tyumen and Chely- binsk regions have created favourable conditions for business development, which means that they both score 10 in this indicator. As for Kurgan re- gion, it scores lower in all the rankings. Table 4 Quantitative indicators of economic security in Chelyabinsk, Kurgan, and Tyumen regions Indicator Chelyabinsk region Kurgan region Tyumen region 2015 2016 Absolute change Score 2015 2016 Absolute change Score 2015 2016 Absolute change Score Number of SMEs 4,185 3,142 –1,043 0 1,111 913 –198 0 4,185 5,804 +1,619 10 Number of employ- ees in SMEs (ths people) 135.61 124.44 –11.17 0 38.46 34.94 –3.52 5 135.61 164.04 +28.43 10 Share of the popu- lation employed in regional SMEs (%) 7.3 6.7 –0.6 5 9.1 8.5 –0.6 5 7.0 8.4 +1.4 5 Turnover of small enterprises (bln rbs) 312.80 308.83 –3.97 0 44.76 43.02 –1.74 0 312.80 547.82 +235.02 10 Share of SME turn- over in the GRP (%) 25.9 24.5 –1.4 5 24.9 22.2 –2.7 5 5.3 9.3 +4 10 Total amount of tax paid by SMEs, mln rbs 15,863.5 15,612.8 –250.7 0 2,489.5 2,612.5 +123 5 112,769.1 124,455.7 +11,686.6 10 Funds spent on SME support (from federal and regional budgets) (mln rbs) 411.1 302.5 –108.6 0 301.9 114.8 –187.1 0 319.8 172.0 –147.8 0 Number of fi nancial support recipients 96 120 +24 10 3,968 1,245 –2,723 0 – – – – Number of non-fi - nancial support recipients 18,230 18,250 +20 5 – – – – 5,191 – – – Jobs created by recipients of SME support 120 363 +243 10 2,100 2,800 +700 10 1,204 733 –471 0 Capital investment (bln rbs) 8306.4 5604.3 –2702.1 0 1860.6 1495.2 –365.4 0 1641.5 1753.0 +111.5 5 Total score 35 30 60 Source: Based on the data of the Report on the Implementation of State Program Comprehensive Support for SME Develop- ment in Chelyabinsk Region in 2015–2017 as of 2015; Report on the Implementation of State Program Economic Development and Innovation Economy of Chelyabinsk Region in 2016–2019 as of 2016; Report on the Implementation of State Program in Tyumen Region Development of SMEs and the Knowledge-Intensive Sphere Until 2020; the Decree of 16 June 2015 No 3817 on the infor- mation of Tyumen government about the implementation of the law On SME Development in Tyumen Region; Annual Report on the Implementation and Effi ciency Evaluation of State Program in Kurgan Region On SME Development and Support in Kurgan Region in 2014–2020 as of 2016; Report on the Performance Results and Key Activity Areas of the Economic Development De- partment of Kurgan Region in 2018–2020 as of 2017; No 1-НМ Form Report on Taxies and Levies Paid to the Budget System of the Russian Federation (Federal Tax Service). 128 www.r-economy.ru R-ECOMONY, 2018, 4(3), 121–129 doi: 10.15826/recon.2018.4.3.017 Online ISSN 2412-0731 Th e business information agency Rankings and News ranks Tyumen higher than Chelyabinsk and Kurgan, which ranked almost identically, in terms of entrepreneurial activity. Th us, Tyumen region scores 10 in this indicator while Chely- abinsk and Kurgan, only 5. Conclusion Th e economic security ranking of the Ural Federal District looks the following way: Chely- abinsk region, 85; Kurgan region, 75; and Tyumen region, 115. All the regions in our analysis were classifi ed as ‘B’ regions, which means that they have a medium (acceptable) level of econom- ic security. Th e risk level is also acceptable but it should be under constant monitoring. Th e devel- opment of SMEs in these regions is stable and the state support in this sphere is effi cient. Th e ranking of the regions according to their economic security levels looks the following way: 1. Tyumen region (115). 2. Sverdlovsk region (100). 3. Chelyabinsk region (85). 4. Kurgan region (75). On average, the Ural Federal District scores 92.5 and is characterized by a medium (accep- table) level of economic security. Tyumen re- gion, which also includes the Khanty-Mansiysk Autonomous District and the Yamal-Nenets Au- tonomous District, is the top performer in this respect. In this region, purchasing power is quite high and the same can be said about the factor endowments. Risks are comparatively low and are compensated for by the region’s signifi cant economic potential. Sverdlovsk region enjoys such advantages as a well-developed internal market, large enterprises and comparatively high purchasing power of the population. Th ese are the key factors contributing to the development of SMEs in this region. Im- proved indicators in SME development will sig- nify that the region has achieved a higher level of economic security and will allow Sverdlovsk re- gion to rise in the ranking. As for Chelyabinsk region, there is a whole set of problems that need to be addressed in or- der to enable the region to make any short-term improvements in its economic security. 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Local Governance and Business Performance in Vietnam: the Transaction Costs’ Perspective. Regional Studies, 52(4), 542–557. Information about the authors Natalya Yu. Vlasova – Professor, Department of State and Municipal Management, Ural State Economic University (62/45, 8 Marta/Narodnoi voli St., 620144 Ekaterinburg, Russia); e-mail: nat-vlasova@yandex.ru. Olesya O. Kalganova – Master Student, Department of State and Municipal Management, Ural State Economic University (62/45, 8 Marta/Narodnoi voli St., 620144 Ekaterinburg, Russia).