Oxfam's work in Russia in depth

In spite of recent economic growth, one-in-six people in Russia still live below the poverty line. This long period of economic crisis is the continuing after-effect of the collapse of the Soviet Union in 1991. Ever since, the gap between rich and poor people has widened drastically. Oxfam is helping to redress the balance – and is working with a coalition of Russian organisations to campaign against poverty, both nationally and internationally.

Oxfam in Russia

Oxfam started working in Russia in 2003. By 2008, 4,000 people had developed small businesses, after we funded training and loans. Their family incomes have increased by an average of 30 per cent, and they now have better medical care, nutrition, and homes. We are also working with local and regional government to make the business environment one in which small businesses can thrive.

Entrepreneurial spirit

Russia’s small- and medium-sized towns have been particularly hard-hit by the economic crisis. When the towns’ main industries collapsed – virtually overnight, after the demise of the Soviet Union, a mass of people migrated to cities in search of work. Those who stayed – or who were left behind – have had to make a living as best they can. But to set up in business, they needed equipment… materials… workshops… outlets... as well as the necessary skills to run a business successfully, and overcome regional authorities’ tendency to resort to time-consuming and obstructive bureaucracy.

Alexei Gorbatenko faced such barriers when he decided to set up a cobbling business. With so many poor people in his town of Selizharovo, he soon found himself providing a vital service: “People don’t have enough money to buy new shoes,” he says. “They need to keep their old shoes in good condition for as long as possible.”

Through the Russian Women’s Micro-finance Network – an Oxfam partner that operates in five towns in central Russia – Alexei received the loan he needed to buy a lathe, sewing machine, and materials. And, like others who’ve been assisted by this programme, Alexei can attend training sessions on marketing and business development.

Municipal development

In order to have the greatest impact, Oxfam is working in towns where the municipal governments have already prioritised small business development and where people such as Alexei are entitled to have their say.

We promote dialogue between the municipalities and entrepreneurs, and provide consultation to the authorities – for instance by promoting tried-and-tested measures and that they can adopt to help small businesses to thrive. We also encourage the improvement of local infrastructure, and reduction of administrative bureaucracy that might hinder success.

The business models that people are adopting, with our initial support, can be copied and developed in other parts of Russia. In fact, we’ve already started: two additional micro-finance partners are extending this work in more small towns and rural areas across Russia, so that thousands more people can benefit in similar ways.

And, even further afield, Oxfam is sharing this success story with federal and other district governments, to influence their policies on reducing poverty.

Last updated: July 08