Wednesday, July 15, 2009

Russia's lost opportunity for road maintenance

Russia is losing 3% of its GDP because of the poor quality of its roadways according to the LA Times The country failed to invest in paving, maintaining and building roads during the oil rich boom years and now faces transportation problems.

Amazingly, transport costs within the country are now about 20 percent of the value of cargo. So much for declining transportation costs. In addition, the country only has about 40 percent of the estimated one million miles of roadways needed. Since Russia is a country with a shrinking population maybe by the time they can afford to build a lot of new roads they won't need so many miles. I'm curious how the quality of the transportation infrastructure affects the relative economic strength of metropolitan regions. How long can some of the small towns with sporadic transportation access to larger cities survive?
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