Investment climate in the Russian Federation

Russia has an attractive investment climate. In 2013, more than 170 billion US Dollars were invested in Russia. Total investments in construction of plants, enterprises, retail chains and stores amounted to more than 26 billion US Dollars.

In 2014 more than 1700 foreign companies were registered in Russia and 1300 being joint ventures with foreign participation. This demonstrates high appeal of the Russian Federation as a fast growing market evidences.

Russian sectors that are the most appealing to the foreign investors (the data of the Russian Statistics Service)

Sector

Investments in 2013
(
billion USD)

Processing

89,7

Trade

31

Finance

20,1

Mining

11,4

Real estate

9,7

Transportation and communication

4,7

Energy

1,6

Construction

0,7

Agriculture

0,6

Russia’s active membership with the Shanghai Cooperation Organization (SCO), BRICS, Asian Infrastructure Investment Bank (AIIB) and the BRICS Development Bank is the cornerstone for the national investment environment formation. Joint investment projects with the APAC countries are delivered within the framework of the pertinent intergovernmental agreements. There are numerous fledging Russian-Chinese joint investment projects.

 Industrial production development, manufacture of the state-of-the-art electronic equipment, modernization of agriculture, traffic system and construction are the national priorities of the Russian Federation. There are significant opportunities for foreign investment in the above sectors.

Resources

Russia is the world’s leader in industrial and fuel and energy resources (natural gas reserves – about 75% (ranked first globally), oil- 18% (ranked seventh globally), uranium – 10%, nickel - 40%, coal – 30% (ranked third globally), the largest in the world total nonferrous metal ore reserves).

Sustained GDP growth

The reported sustained GDP growth in the recent 15 years ranks Russia fifth in the world.

Tax burden

A moderate tax burden and a wide range of tax incentives result in the maximum foreign capital revenue.

Political stability

Stable political environment and state institutions are the cornerstones of secure investments.

International treaties

Russia may pride itself on the full-fledged membership in the majority of international organizations and unions, which secures adherence to international business ethics rules.

Government support 

Protection of investor rights and creation of supportive investment environment are the key priorities of the national, federal and regional policies.

Labor force

People with specialties and higher education make the main share of the labor force, if required, there is a possibility of advance training.

Russia was reported to be ranked first in the world in terms of the number of educated people (54% of people of 25-64) (The Organization for Economic Cooperation and Development, OECD; Education at a Glance 2012). As a comparison, only 42% of Americans and 31% of Europeans are of education.

Consumer market

According to the French analysis the Russian consumer market will be the fourth largest in the world.

An average monthly wage amounted to RUB 32 000 in 2014, which is relatively similar to that in China, Brazil, Mexico, Georgia and Rumania.

The shopping capacity in Russia is the largest in Europe leaving behind France and the UK. In 2014 it exceeded 17,7 million sq. m.

Publication of the state of the investment climate in Russia:

Organization

Article and link

Ministry of Economic Development of the Russian Federation

Мониторинг «О текущей ситуации в экономике Российской Федерации по итогам первого полугодия 2015 года»

Agency of Strategic Initiatives

Национальный рейтинг состояния инвестиционного климата в субъектах РФ. Результаты 2015

Ernst & Young

Investment climate in Russia 2015

PWC

Doing business and investing in the Russian Federation 2015

KPMG

Investing in Russia 2013

TMF Group

Creating a sound investment climate in Russia

International ratings

Rating

Ranking

Year

Link

 “Doing business” report of the World Bank

62

2015

http://www.doingbusiness.org/rankings

Transparency International Russia “Corruption Perceptions Index 2014”

136

2014

http://www.transparency.org.ru/indeks-vospriiatiia-korruptcii/indeks-vospriiatiia-korruptcii-2014-otcenka-rossii-upala-na-odin-ball

Global Innovation Index

49

2014

https://www.globalinnovationindex.org/content.aspx?page=data-analysis

OECD “Education at a Glance 2012”

1

2012

http://www.keepeek.com/Digital-Asset-Management/oecd/education/education-at-a-glance-2012_eag-2012-en#page1

Russia is regarded by overseas investors as a potential investment site to be properly handled. If you intend to invest in the Russian economy, the Russian Investment Agency may provide you with tailored solutions to match your specific project needs.