Kaliningrad Oblast is a unique part of Russia. Sandwiched between Poland, Lithuania, and the Baltic Sea, the exclave is isolated from the rest of the Russian mainland, both physically and culturally. As such, Moscow has launched several disparate policies over the years to address its unique geographic and economic concerns.
There was the plan to turn Kaliningrad into the "Russian Macao": one of a small number of special legal gambling zones in the Russian Federation. But the scheme has been scuttled and Kaliningrad’s casinos have moved to Minsk in Belarus.
Then there was the ambitious effort to promote investment in the oblast with special tax incentives for businesses that chose to make Kaliningrad home. However, this mandate ends in 2016 and will not be renewed, as the business community has shown little interest.
Now, one of the latest plans looks like it has indeed benefited Kaliningrad’s residents – but to the detriment of the oblast’s business community, especially the retail sector.
A new agreement between the Russian Federation and European partners Poland and Lithuania, which took effect in 2012, allows residents of Kaliningrad to travel visa-free into the neighboring countries up to 50 kilometers (31 miles), for durations of a few days. Likewise Poles and Lithuanians can visit Kaliningrad with similar restrictions.
Travel to Poland has proven especially popular and the zone for visa-free visits has been expanded beyond its original limits by mutual agreement. Kaliningraders are enjoying brief holidays in Polish Baltic Sea resorts, weekends in the beautiful medieval city of Gdansk, and shopping sprees in Polish supermarkets and shops.
All of this great news for residents of Kaliningrad, who have been bottled up in their exclave 350 kilometers (about 220 miles) from contiguous Russia since the ascension of Poland and Lithuania to the European Union in 2004.
“I prefer to go to Gdansk or Sopot just to have fun, to eat, to walk, just to change the environment,” says Margarita Bochkova, a Kaliningrad native in her 20s. “And if I go there I might also stop by at the supermarket to buy some food we don't have in Kaliningrad yet."
"But I know lots of people who go there to shop every weekend," she says. "They are mostly families, so it is much cheaper for them to stock up on food, clothes, and items for the home there.”
Illya Dementev, a professor at Immanuel Kant Baltic Federal University in Kaliningrad sees a similar pattern but notes that Poles are barely making reciprocal journeys – instead just popping over the border for the cheaper gasoline. “Usually, Polish people come to the petrol stations, and that is all. As for us, we prefer Polish shops and cultural centers such as Gdansk, so we go there often,” he says.
Professor Dementev notes that consumer rubles flowing out of the oblast is a concern to local businesses. “As for the outflow of cash from the oblast, it is a problem. Retail businesses in Kaliningrad are very frightened by this regime because they are losing money," he says.
A Kaliningrad official put the situation succinctly. “Frankly speaking, I'm very glad to spend my money in [large department stores] IKEA and Auchan in Gdansk, for instance," he said, before asking to remain anonymous. "That’s just between us.”
Michael Amundsen is co-editor at TallinnArts.com.