Russia's economic reform: insights and analyses into Gazprom

This study continues the issue of Russian economic reform in the study by Quast and Locatelli (1997) and extends the same reform in many aspects. In this paper, an in‐depth study is also made in the reform strategies and the business performance of Gazprom, Russia's natural gas company, as Russia tried to curtail its domestic political and economic problems by means of the organisational reform (privatisation) of Gazprom starting in 1993. This study discovered that Gazprom had truly been a private corporation before 2005; however, it became practically a state‐run business after 2005. We further disclose that Gazprom's business performance after the reform did not come from the corporate organisational reform but rather resulted from the increase of natural gas prices and was irrelevant to the production capacity. Data in many aspects, such as the adoption of privatisation, liquefied natural gas, sole proprietorship, merger and the strategy of market diversification, are used in this study to sustain Gazprom's business performance after the reform. However, it is believed that the key factor of these changes was whether Russia's ruling party could really transform a state‐run business into a private enterprise, as otherwise, any economic reform would be a transient happening for the Russian economy.