Foreign investment in Russia

In September 2008, UNCTAD published a report according to which Russia is in fourth place on the list of countries that transnational corporations consider the most attractive places to place future foreign investments ^[4] . As noted in the report, the investment attractiveness of Russia in comparison with the data of the 2007 UNCTAD report has increased markedly ^[4] .

According to the results of 2008, the inflow of direct foreign investments into Russia amounted to 70 billion US dollars - 5th place among the countries of the world. ^[five]

According to a press release from Boeing for the summer of 2009, plans for developing a Boeing business in Russia for the next 30 years are about $ 27 billion. They will be invested in a program of cooperation with Russian partners in the field of titanium production, design and development of civil aircraft, as well as the acquisition of various services and materials ^[6] .

Russian Railways OJSC (Russian Railways) placed its debut issue of Eurobonds for $ 1.5 billion. ^[7]

As of March 2010, the total accumulated foreign investment in the Russian economy was $ 265.8 billion, of which: ^[8]

• other investments made on a repayable basis - 53.8%
• direct investment - 38.7%
• portfolio investment - 7.5%

In June 2010, a report by the British auditing company Ernst & Young noted that in 2009 Russia was among the top 5 countries in terms of the number of new investment projects attracted. According to the report, there is a growing interest of large and medium-sized European companies in the Russian market. ^[9]

According to data from March 2010, of the total accumulated foreign investment in the Russian economy, the following countries accounted for: ^[8]

• Cyprus - $ 52.2 billion
• Netherlands - 43.3 billion dollars
• Luxembourg - $ 36.4 billion
• UK - $ 20.5 billion
• Germany - $ 20.3 billion
• British Virgin Islands - $ 15.4 billion
• China - $ 10.2 billion
• Ireland - $ 9.1 billion
• Japan - $ 8.5 billion
• France - $ 8.0 billion

Cyprus

About half of all foreign investment comes to Russia from Cyprus ^[11] . According to Rosstat for 2011, the volume of “Cypriot” investments in Russia amounted to the equivalent of $ 78.2 billion US dollars , which is almost four times higher than the GDP of Cyprus ^[11] . Some EU countries, especially Germany, are of the opinion that a significant portion of these funds is simply laundered in Cyprus ^[11]

UK

According to the Federal State Statistics Service , in 2006 Great Britain took the second place among the investing countries in the volume of current foreign investments in Russia ( 2005 - the third place), having invested 7.0 billion dollars in the Russian economy. (12.7% of the total volume of current foreign investments in the Russian economy). In terms of industry, the UK was the first in terms of current investments in the production and distribution of electricity, gas and water (27.4% of foreign investment in the industry, wholesale and retail trade, repair of motor vehicles, household goods (27.9%), other utilities, social and personal services (47.6%), the second to manufacturing (10.3%), including the production of coke and petroleum products (16.2%), the third to chemical production (12.7%) ), transport and communications (15.2%).

As of December 31, 2006, Great Britain ranks fifth in terms of accumulated foreign investments in the Russian economy, their volume amounted to 11.8 billion dollars, including direct accumulated investments of 2.9 billion dollars. ^[12]

France

In March 2010, in Paris, Russian President Dmitry A. Medvedev, at a meeting with representatives of French and Russian business circles, announced that the volume of accumulated French investments in Russia exceeds $ 10 billion: “From 2003 to 2008, that is, in the pre-crisis year, Our turnover has grown 5 times. Indeed, we already have a very decent amount of accumulated French investment. And about half of them are investments not in raw materials industries, but in processing ” ^[13] .

USA

In the mid-2000s, the United States took 6th place ($ 8.3 billion) in the volume of accumulated foreign investment in Russia (6.5% of the total), with approximately half of US direct investment in the fuel and energy complex. Major projects include Sakhalin-1 and the Caspian Pipeline Consortium . The Russian car factories have assembly shops for American cars of the Ford brand, General Motors .

The non-manufacturing sector accounts for about 25% of US direct investment, primarily allocated to banking and insurance, as well as to information services.

From the beginning of 2017, specialized organizations began to form in Russia, which are engaged in attracting foreign investment in investment projects throughout Russia and the CIS. One such company is Investburg

In July 2017, the Russian newspaper Kommersant published an article on the reasons for the outflow of capital from Russia ^[14] :

Experts believe that the growth potential of investments in the Russian economy is undermining lawsuits against large private businesses. An example is the claim of the state corporation Rosneft against the private AFK Sistema . The first during the privatization of 2016 acquired the shares of Bashneft , and then, in May 2017, it filed a lawsuit against the former owner - AFK Sistema, accusing it of causing losses during a series of reorganizations of Bashneft since its ownership since 2010 to 2014 The initial amount of the claim was 106 billion rubles, subsequently it was increased to 170 billion rubles ^{[15] [16]} . Sistema JSFC believes that the process was engaged, citing as evidence, in particular, the fact that not one of its requests was satisfied, the interim measures taken by the court were unnecessary, and the plaintiff's evidentiary position did not contain a single justified fact. Experts believe that it is extremely difficult to establish and prove the guilt of AFK Sistema. Thus, Vladimir Pleshakov, Managing Partner of the Pleshakov, Ushkalov & Partners Law Firm, said that he considers the arguments of Rosneft and Bashneft questionable, as well as the legality of their claims. One of the former shareholders of Bashneft noted that the reorganization carried out by AFK Sistema at that time did not affect the value of Bashneft, and all shareholders perceived it as a need to optimize the ownership structure ^[17] .

In Russia, the federal law On Foreign Investment in the Russian Federation, adopted in 1999, is in force. ^[18] The law defines the basic guarantees of the rights of foreign investors to investments and the income and profits received from them, as well as the conditions for the business activities of foreign investors in Russia. ^[18]

Regional executive bodies create their own structures for working with investors, as well as adjust regional legislation. So, the regional development corporations become the main regional structures for working with investors. For example, such corporations were created in the Tula, Kaluga and Ulyanovsk regions. The main tasks are: attracting investments, supporting investment projects, providing industrial sites with engineering infrastructure.

• Investments in Russia