Category Archives: Economy, Business, Investment, Trade

Expats in Russia: No longer a boom – but not all doom and gloom

Diverse Paper Currency, Coins, Line Graph

(Russia Beyond the Headlines – rbth.ru – Bryan MacDonald, special to RBTH – March 30, 2015) The ruble’s calamitous fall against the euro and dollar this winter and a well-publicised recession makes Russia less attractive for expats than anytime in recent memory. But are they really leaving the country? Bryan MacDonald discovers that how the economy is faring back home […]

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IMF ties itself into knots over status of Russia’s loan to Ukraine

International Monetary Fund Logo Over Ukraine Flag

(Business New Europe – bne.eu – Ben Aris in Moscow – March 27, 2015) A confusing argument has broken out over the crucial question of whether Ukraine’s $3bn worth of bonds held by Russia and due in December are “official” debt or not. The answer is important because if the bonds are “official” and Ukraine doesn’t pay them, the International […]

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Russian Souvenirs Make Up to 500% Profit Online Despite Political Faceoff

Russia Nesting Dolls file photo, adapted from image wiesbaden.army.mil with photo credit Anemone Rueger

(Moscow Times – themoscowtimes.com – Peter Spinella – March 30, 2015) Russia’s relations with the West may have reached lows unparalleled since the Cold War, but the trend for kitschy Russian and Soviet souvenirs abroad appears to be as popular as ever, bringing vendors a pretty penny. Selling souvenirs on online marketplaces such as eBay and Etsy can yield a […]

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NEWSWATCH BBC: Brand Putin: Russia’s president still in fashion 15 years on

Vladimir Putin file photo with VOA logo; screen shot from video still

[“Brand Putin: Russia’s president still in fashion 15 years on” – BBC News – Sarah Rainsford – Moscow, March 27, 2015] The BBC examines Russia President Vladimir Putin’s personal notoriety and power as political symbol. Fifteen years ago, Vladimir Putin was elected promising to make Russia strong again: a country its citizens could be proud of and that the world would respect. * […]

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NEWSWATCH Reuters: Russia’s rich forego some luxuries but still back Putin

Diverse Paper Currency, Coins, Line Graph

[“Russia’s rich forego some luxuries but still back Putin” – Reuters – Elizabeth Piper –  March 29, 2015] Reuters covers the reactions among Russia’s elite to economic changes such as Western sanctions, a falling ruble, oil price losses and other disruptions. … the enforced modesty has not yet driven the super wealthy out of Russia or against President Vladimir Putin, who […]

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NEWSLINK Forbes: 10 Charts That Explain Russia

Map of Russia and Russian Flag adapted from images at state.gov

For reasons that are far beyond my ability to explain, Russia is a place that attracts clichés in much the same way that a bright flame attracts moths. Having always found the place confusing, contradictory, and vaguely mysterious, Westerners have settled upon a few choice quotes that supposedly summarize Russia in its entirety. Even today, with the welcome rise of […]

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Sanctions and Regime Survival

Tower and Building Inside Kremlin

(PONARS Eurasia – ponarseurasia.org – Mark Kramer, Director, Cold War Studies Program, and Senior Fellow, Davis Center for Russian and Eurasian Studies, Harvard University – March 11, 2015 – article also appeared at ponarseurasia.org/article/sanctions-and-regime-survival) Some debates never die; they just get replayed. After the Soviet Army invaded Afghanistan in late December 1979, the United States imposed economic sanctions against the USSR. The Russian Federation since […]

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NEWSLINK Christian Science Monitor: Russia heads to ‘America’s backyard’ to find salve for sanctions

Latin America Map

Foreign Minister Sergey Lavrov visited several Latin American nations this week to seek trade opportunities that could offset US efforts to puncture Russia’s economy. Russia took its global charm offensive to Latin America this week, as the Kremlin seeks to counter Western sanctions over its policies in eastern Ukraine and Crimea. … http://www.csmonitor.com/World/Europe/2015/0326/Russia-heads-to-America-s-backyard-to-find-salve-for-sanctions  

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Russians Increasingly Believe State Planning Better Than Market Economy

File Photo of Kremlin Tower, St. Basil's, Red Square at Night

(Moscow Times – themoscowtimes.com – March 27, 2015) Russians increasingly believe in an economic system founded on government planning rather than the free market, a poll by the independent Levada Center showed. Fifty-five percent of respondents said that a country’s economic system should be based on “government planning and allocation,” the pollster said in a report this week. On the other […]

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NEWSLINK TASS: Russia’s 200,000 employed senior citizens worry they may lose old age pension

Diverse Paper Currency, Coins, Line Graph

MOSCOW, March 26. /TASS/. Russian Labor and Social Protection Ministry’s idea of stripping employed senior citizens whose annual remuneration is one million roubles (about $16,500) or more of their old age security pension has sparked a debate in Russian society. In the context of Russia’s modern realities one million roubles is a sum enough to buy an average class car, […]

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Russian Government Struggles to Check Surging Cost of Medicine

Medical Symbol with Pole, Serpents, Wings, adapted from image at lanl.gov

(Moscow Times – themoscowtimes.com – Delphine d’Amora – March 27, 2015) The cost of medicine is rising fast in Russia, hitting consumers and challenging a government that has made its reputation as a bulwark of social stability. The ruble’s fall of nearly 40 percent to the U.S. dollar and 22 percent to the euro since the beginning of 2014 has sent […]

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The Central Banker Who Saved the Russian Economy From the Abyss

File Photo of Elvira Nabiullina at OECD Event, at Podium and On Large Video Screen

(Bloomberg – bloomberg.com – Evgenia Pismennaya and Ilya Arkhipov – March 25, 2015) It was Dec. 16 — the day Russian traders would later christen Black Tuesday — and the ruble was in a freefall. “Intervene! Intervene!” a central bank official shouted. Governor Elvira Nabiullina watched the currency on her tablet screen react to her emergency rate increase. No, she said, […]

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Russia’s economy in 2015 – more resilient than expected

Diverse Paper Currency, Coins, Line Graph

(Business New Europe – bne.eu – Mark Adomanis in Philadelphia- March 26, 2015) How is Russia’s economy doing right now? Pretty clearly, the answer is “not very well.” 2014 was the first year since Putin came to power in which, due to a combination of spiking inflation, plummeting oil prices and flat-lining growth, the average real disposable income actually shrank. […]

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Ruble Panic Recedes as Russians Start Selling Dollars

Diverse Paper Currency, Coins, Line Graph

(Moscow Times – themoscowtimes.com – March 26, 2015) Russians sold more foreign currency than they bought in January for the first time in two years, the Central Bank said Wednesday, in a sign that last year’s panic over the ruble has subsided. The Russian currency went into meltdown in December as a months-long devaluation prompted by Western sanctions and oil […]

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Uproar in Murmansk as Teachers’ Salaries Withheld Amid Economic Crisis

Cash, Calculator, Pen

(Moscow Times – themoscowtimes.com – Gabrielle Tétrault-Farber – March 26, 2015) Teachers’ salaries have been withheld en masse in Murmansk as Russia’s economic crisis bears down on the regional budget, news site FlashNord reported Wednesday. The Murmansk branch of Russia’s national teachers’ union filed a complaint with regional governor Marina Kovtun, claiming that a large number of employees of Murmansk’s […]

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Effect of ruble strengthening nearly neutral for Russian budget – Nesterenko

Diverse Paper Currency, Coins, Line Graph

MOSCOW. March 25 (Interfax) – Ruble strengthening in excess of that assumed in the 2015 budget would lead to both lower revenue and lower spending, meaning that the net impact on the budget will be neutral, First Deputy Finance Minister Tatyana Nesterenko said. “The ruble exchange rate and the price of oil [assumed in the budget] are forecasts calculated as […]

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Health Care Workers to Hunger-Strike in Protest of Labor Conditions

Map of Russia and Russian Flag adapted from images at state.gov

(Moscow Times – themoscowtimes.com – Anna Dolgov – March 24, 2015) Health care workers in central Russia threatened to stage a hunger strike starting Monday to protest what they described as “repercussions” against co-workers who demanded better working conditions and higher salaries at previous protests, media reports said. The hunger strike, planned in Ufa, the capital of Russia’s republic of Bashkortostan, […]

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Russia Sets Terms for Capital Amnesty to ‘Correct Past Mistakes’

Diverse Paper Currency, Coins, Line Graph

(Bloomberg – bloomberg.com – Andrey Biryukov, Anna Andrianova – March 26, 2015) Russia laid out the terms of a draft law to offer amnesty on repatriating capital, promising new incentives and legal protections to aid an economy starved of investment by sanctions over Ukraine. The bill won’t require the return of assets to Russian territory, demanding only their registration in […]

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NEWSLINK Moscow Times: Is the Worst Over for the Russian Economy?

Diverse Paper Currency, Coins, Line Graph

For investors, business owners and everybody else with an interest or involvement in the Russian economy, this is now a period of waiting; waiting to see whether the relatively good start to 2015 for the ruble, investment returns and some segments of the economy mean that we can all breathe a huge sigh of relief that the predictions of doom and gloom in late 2014 have not materialized, or whether this is just the eye of the storm and another battering […]

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Ukraine’s Catch 22 over its oligarch class

Map of Ukraine, Including Crimea, and Neighbors, Including Russia

(Business New Europe – bne.eu – Mark Adomanis in Philadelphia – March 25, 2015) As the Soviet Union collapsed in both Russia and Ukraine, small groups of extremely clever and even more ruthless men “privatized” (or if you prefer less exalted language “stole”) all of the prize industrial assets. Virtually overnight, these formerly mid-ranking bureaucrats and functionaries became billionaires, some […]

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BOOK REVIEW: “Mr Putin: Operative in the Kremlin” – an updated version

Vladimir Putin file photo with VOA logo; screen shot from video still

(Business New Europe – bne.eu – Timothy Ash, Head of EM Research, ICBC-Standard Bank, London – March 23, 2015) “Mr Putin: Operative in the Kremlin”, new and expanded, by Fiona Hill and Clifford G. Gaddy, Brookings Institute Press, Washington, 2015. This book is sold as a biography, but if you want a standard chronological recap of the life of Vladimir Putin […]

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Russia needs Ukraine fix as its power hits post-Soviet peak

File Photo of Kremlin Tower, St. Basil's, Red Square at Night

(Business New Europe – bne.eu – Ben Aris in Moscow – March 23, 2015) Russia needs a resolution to the conflict with the West over Ukraine now because its power has probably hit its post-Soviet peak. The US can afford to do nothing, and that is probably its best strategy – but it comes at the possible cost of the destruction of […]

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Russia Rebounds, Despite Sanctions

Diverse Paper Currency, Coins, Line Graph

(Bloomberg – bloomberg.com – Matthew A. Winkler – March 20, 2015) Matthew Winkler, editor-in-chief emeritus of Bloomberg News, writes about markets. [Charts here bloombergview.com/articles/2015-03-20/russia-rebounds-despite-sanctions] Sanctions meant to punish Russia for snatching Crimea from Ukraine one year ago were supposed to hurt Russian business. And they did. Russian stocks, bonds and commodities had the worst performance in 2014 of those in […]

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Moscow Times: Poll: Record Number of Russians Reject Emigration

Map of Russia and Russian Flag adapted from images at state.gov

(Moscow Times – themoscowtimes.com – Peter Spinella – March 23, 2015) Eighty-three percent of Russians say they’re not interested in moving anywhere outside of the former Soviet Union, the independent Levada Center pollster revealed, noting that this represented the highest such figure since the end of the Soviet era. Another 81 percent of respondents said they never even think about the […]

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NEWSWATCH Reuters: U.S. faces meager options for further Russia energy sanctions

Oil Wells File Photo

[“U.S. faces meager options for further Russia energy sanctions” – Reuters – Timothy Gardner – March 23, 2015] Reuters examines Western sanctions on Russia, including some of the remaining options for energy-related sanctions. Energy is the economic lifeblood of Russia, which vies with the United States and Saudi Arabia to be the world’s top oil producer …the sector is the main target of […]

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How to end the Ukraine conflict

Map of Ukraine, Including Crimea, and Neighbors, Including Russia

(Business New Europe – bne.eu – Ben Aris in Moscow – March 19, 2015) March will be a tense month as Russia has decided to poke its finger in Nato’s eye again. Russia’s Armed Forces are holding for the first time Arctic military exercises, which kicked off on March 16 and will last through March 21. The exercises are massive. The […]

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Ukraine Bondholders’ Tough Talk Signals Debt Deal Won’t Be Easy

International Monetary Fund Logo Over Ukraine Flag

(Bloomberg – bloomberg.com – Lyubov Pronina, Krystof Chamonikolas – March 17, 2015) The jockeying has begun in Ukraine’s debt restructuring talks. The government’s notes slid below 42 cents on the dollar on Tuesday as Russia said it wouldn’t budge on being paid back a $3 billion loan in full on time and the Financial Times reported Franklin Templeton won’t accept a […]

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NEWSLINK Reuters: Putin says no reason for confidence in economy, officials say worst over

Diverse Paper Currency, Coins, Line Graph

Russian President Vladimir Putin said on Thursday it was still too soon to feel confident about the country’s economy, although his ministers said the worst is over. Speaking to a conference of Russian businessmen, Putin said the central bank’s main interest rate, now at 14 percent, remains high but that the level was warranted by the situation. …     […]

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NEWSLINK Moscow Times: Q&A: Drawing Foreign Firms to Russia [interview with Kaluga governor Anatoly Artamonov]

Diverse Paper Currency, Coins, Line Graph

The Kaluga region, an hour’s drive southwest of Moscow, has become a haven for investors. International giants in industries ranging from automotive to pharmaceutical have built plants, trained and employed thousands of locals, and turned a once-depressed region heavily dependent on federal subsidies into a donor to the national budget. …   http://www.themoscowtimes.com/business/article/qa-drawing-foreign-firms-to-russia/517581.html

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Labour conflicts in Russia on the rise, cuts top of agenda – union official

Map of Russia and Russian Flag adapted from images at state.gov

(Interfax – Volgograd, March 17, 2015) The number of social labour conflicts in the Russian Federation has increased in the past eight months, deputy chairman of the Federation of Independent Trade Unions of Russia Yevgeniy Makarov said on Tuesday [17 March]. “The previous week was one of the most difficult ones. Conflicts were recorded in every federal district. There were […]

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82% of Russians See Steep Prices Rises as Nation’s Biggest Problem – Poll

File Photo of Older Russian Woman Shopping in Grocery Store

(Moscow Times – themoscowtimes.com – March 17, 2015) Inflation is the biggest concern for Russians with 82 percent of the population picking it as the most pressing issue facing the country, according to a poll published by the independent Levada Center on Monday. The figure is up from 71 percent in August, and from 69 percent this time last year. […]

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The Russian banking system? Yeah, that’s going to be a problem

Cash, Calculator, Pen

(Business New Europe – bne.eu – Mark Adomanis in Philadelphia – March 16, 2015) The most basic part of any bank’s business model is the extension of loans to consumers and corporations. Clients need money, to expand their business, buy a home, or, in a less sunny scenario, to re-finance existing borrowing, and the bank gives it to them while […]

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Moscow Times: Ukraine Must Make Compromises and Radically Reform for IMF Funding to Continue

International Monetary Fund Logo Over Ukraine Flag

(Moscow Times – themoscowtimes.com – March 14, 2015) With the first billions of dollars foreign aid in its pocket, Ukraine’s government can now stay afloat long enough to embark on its radical reform drive, but the hard part is only just beginning. Ukraine received the first $5 billion on Friday of $17.5 billion in aid promised by the International Monetary […]

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Six steps to return Russia to economic growth. The Russian economy is under pressure: it’s time for an alternative.

Diverse Paper Currency, Coins, Line Graph

(opendemocracy.net – Kirill Rodionov – March 9, 2015) Kirill Rodionov is an independent journalist. From 2008 to 2013, he was a Research Fellow at the Gaidar Institute for Economic Policy, Moscow. Follow him on Twitter: @k_rodionov In late January 2015, the Russian government adopted an anti-crisis programme. The plan includes a number of measures intended to provide sustainable development of […]

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IMF cash to do little to change grim reality for ordinary Ukrainians

International Monetary Fund Logo Over Ukraine Flag

(Business New Europe – bne.eu – Kateryna Killyashenko in Kyiv and Nick Allen in Berlin – March 13, 2015) After the International Monetary Fund’s (IMF) approval on March 11 of its $17.5bn loan package to Ukraine, with $5bn due to flow immediately to bolster Kyiv’s dwindling coffers, the population could be forgiven for thinking the material hardships of recent months […]

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NEWSLINK Moscow Times: Oil Crash Is Crushing Russia

Oil Wells File Photo

The impact of oil prices on the Russian economy is well known. After crude fell 50 percent last fall, the Ministry of Economic Development forecast a 3 percent GDP contraction this year, along with 12 percent inflation. The crash in oil prices will not only test President Vladimir Putin’s domestic support. It will upend Russian foreign policy, challenging the modernization of the country’s armed forces while diminishing its influence in Asia […]

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NEWSLINK Carnegie Moscow: Left Behind? Russia in the New Industrial Revolution.

Artist's Conception of Nanotechnology Components

… Russia will not be able to keep pace with the outside world. If Russia does not possess sufficient economic strength (I do not mean simply hard currency—I mean the capacity to create wealth by real production), surrounding countries will not willingly ally with it. …     http://carnegie.ru/eurasiaoutlook/?fa=59335

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Ukraine is Russia – or at least the Russia that Western critics imagine

Diverse Paper Currency, Coins, Line Graph

(Business New Europe – bne.eu – Mark Adomanis in Philadelphia) Writing and thinking about Russia can often have a rather surreal quality to it. Something about the place seems to short-circuit peoples’ critical thinking skills. Serious pundits write things (“Russia life expectancy is collapsing!”) that are flatly contradicted by recent academic research and that don’t withstand even the most cursory […]

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NEWSLINK: Federal Judge Orders Browder to Comply with Subpoena in Money-Laundering Case

U.S. Courthouse for Southern District of New York in Manhattan

Wall Street Journal: A Manhattan federal judge has ordered London-based hedge fund manager William Browder to comply with a subpoena that could force him to reveal the sources of information he gave to federal prosecutors in a high-profile money-laundering case. …

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Botched Law Could Close Hundreds of Foreign Firms’ Rep Offices in Russia

Tower and Building Inside Kremlin

(Moscow Times – themoscowtimes.com – Peter Hobson – March 11, 2015) Representative and branch offices of foreign companies working in Russia are in a race against time to re-register with the authorities or lose their license to operate in the country. The re-registration was intended to streamline bureaucracy for foreign firms, but organizational failures and lack of proper warning have […]

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Has the Russian equity market turned the corner?

File Photo of Outdoor Electronic Sign with Russian Exchange Data

(Business New Europe – bne.eu – Ben Aris in Moscow – March 6, 2015) So far in 2015 Russia has been one of the best performing equity markets, up 15% year-to-date, following three straight weeks of inflows following the Minsk II ceasefire agreement signed in February. So far in 2015 Russia has been one of the best performing equity markets, […]

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Russian ruble seen appreciating by third this year

Diverse Paper Currency, Coins, Line Graph

(Business New Europe – bne.eu – Ben Aris in Moscow – March 9, 2015) [Charts here http://www.bne.eu/content/story/russian-ruble-seen-appreciating-third-year] After crashing in December, Russia’s ruble has made a remarkable comeback since February by rising about 15% against the dollar, making it the best performing currency amongst the 14 in Emerging Europe so far this year, according to Bloomberg. And the appreciation of the ruble […]

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Russian Corporate Default Fears So Far Overblown – Report

Diverse Paper Currency, Coins, Line Graph

(Moscow Times – themoscowtimes.com – March 6, 2015) Russian companies have defaulted on 6 billion rubles ($98 million) worth of debt payments over the last seven months, according to a report Thursday by the RBC news website. Despite fears of a spate of corporate defaults as Russia’s economy falters under a falling oil price, Western sanctions on Moscow over Ukraine and […]

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Russians Less Likely to Protest as Their Situation Deteriorates, Urnov Says

Map of Russia and Russian Flag adapted from images at state.gov

(Paul Goble – Window on Eurasia – Staunton, March 4, 2015) It is an axiom in most countries that people will protest when their living conditions decline and that assumption underlies current Western policy toward Moscow, but Mark Urnov, one of Russia’s leading political analysts, argues that the situation in Russia is different and that Russians are less rather than […]

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Screenwriter Alyona Barsukevich: ‘If I’m fired I’ll be in serious trouble’

Diverse Paper Currency, Coins, Line Graph

(Russia Beyond the Headlines – rbth.ru – Yekaterina Sinelschikova, RBTH – March 4, 2015) RBTH continues its Coping with the Crisis series, a collection of stories about how people of different social groups are surviving the economic crisis and how their lives have changed. This time we speak to a young specialist, screenwriter Alyona Barsukevich, who admits that it is […]

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Foreign Russia Investors Warn Over Nemtsov Killing

Boris Nemtsov file photo

(Moscow Times – themoscowtimes.com – Howard Amos – March 3, 2015) Businessmen and investors said Monday that the killing of opposition leader Boris Nemtsov by the walls of the Kremlin last week will further worsen Russia’s battered investment climate and create more uncertainty in a market suffering from Western sanctions and an economic recession. “We are already in a period […]

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BNE: Chart – Russians’ latest reactions to Ukraine, sanctions and Putin

Map of Commonwealth of Independent States, European Portion

(Business New Europe – bne.eu – Henry Kirby in London – March 3, 2015) [Charts here http://www.bne.eu/content/story/bnechart-russians-latest-reactions-ukraine-sanctions-and-putin] A series of recent polls by Russia’s Levada Center has cast an interesting light on major issues surrounding Russia, such as Russians’ views on the conflict in eastern Ukraine, the effects of continued Western-led sanctions, and the general popularity of the government. Ukraine […]

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War in Ukraine obstructing Russian economic recovery, say analysts

Map of Commonwealth of Independent States, European Portion

(Russia Beyond the Headlines – rbth.ru – Alexei Lossan, RBTH – March 2, 2015) The war in Ukraine is impeding attempts to improve the business climate in Russia, according to the head of the Moscow State University Department of Economics, Alexander Auzan. The Russian authorities therefore have to invest in infrastructure projects in order to overcome the crisis, say analysts. […]

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Interfax: Over 73 percent of Russians admit crisis in Russia

Tower and Building Inside Kremlin

(Interfax – February 27, 2015) A public opinion poll conducted by the Institute of Priority Regional Projects in February 2015 4 showed that three-fourths of Russians see the situation in the country as a crisis, Nikolai Mironov, general director of the Institute, said. The poll surveyed 1,600 Russian citizens aged older than 18. It was conducted in 120 populated areas […]

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Ukraine Left Behind as Russian Stock Gains Are Unmatched

Diverse Paper Currency, Coins, Line Graph

(Bloomberg – bloomberg.com – Elena Popina – February 26, 2015) Russia is emerging as the world’s best stock market after putting in the worst performance last year. For neighboring Ukraine, the second-biggest loser in 2014, there’s no sign of such a turnaround yet. Russia’s dollar-denominated RTS Index has soared 15 percent in 2015, while the Ukrainian Equities Index is last […]

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