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Archive for Economy, Business, Investment, Trade

RIA Novosti: Proportion of ‘Grey Capital’ Outflow from Russia Reached 20%-40% in 2012-2013 – Medvedev

Dmitry Medvedev file photo

MOSCOW, April 22 (RIA Novosti) – The proportion of “grey capital” outflow from Russia in 2012-2013 reached 20 percent to 40 percent, Russian Prime Minister Dmitry Medvedev said Tuesday during his annual report in the country’s lower house of parliament. “One of the forms of outflow comes from those who are looking for more attractive

RIA Novosti: Russia Can Create New Foundation for Self-Sufficient Economy – Medvedev

Dmitry Medvedev file photo

MOSCOW, April 22 (RIA Novosti) – The current situation with unstable world markets, Western sanctions against Moscow over Crimea, and the country’s own economic problems is a great opportunity to create a new foundation for an industrial-based economy, Prime Minister Dmitry Medvedev said Tuesday. “The current situation for our government is not only a challenge,

Capital Flight From Russia Expected to Reach $70-80B

File Photo of Cash, Coins, Line Graph

MOSCOW, April 21 (RIA Novosti) – The Russian Finance Ministry has forecast this year’s capital outflow from Russia as reaching $70-80 billion, the director of long-term planning at the ministry said Monday. “We are certain that it won’t jump to $100 billion this year. A more reasonable estimate would be around $70-80 billion,” Maxim Oreshkin

Some Multi-National Companies Ignoring Western Sanctions Against Russia

Truck at Russian Border Crossing

(Voice of America – Mil Arcega – April 21, 2014) Western sanctions are hurting Russia’s economy. That’s according to the country’s economic minister, who says Russia’s economic output is shrinking as investors take their money elsewhere. But some western companies are bucking that trend – expanding business interests in Russia – even as the U.S.

U.S. sanctions may spur economy reforms in Russia – business ombudsman

Boris Titov file photo

(Interfax – April 15, 2014) New U.S. sanctions against Russia may impact the global economy but may in the end stimulate economic reforms in Russia, businessmen’s rights commissioner Boris Titov said. “Of course, we would like to avoid sanctions. Money loves tranquility that is why the economy can develop only when international relations in the

RIA Novosti: Medvedev Says Russian Financial System Reliable

Dmitry Medvedev file photo

MOSCOW, April 15 (RIA Novosti) – Russia’s financial sector is reliable and under control, Russian Prime Minister Dmitry Medvedev said during a meeting with finance officials Tuesday. “We are in a very uneasy situation indeed, that’s why we need to make some allowances … but they are not supposed to be fundamental. On the whole,

Fragile Europe Weakens U.S. Push for Russia Sanctions

EU Map

(Bloomberg – bloomberg.com – Sangwon Yoon – April 14, 2014) The U.S. readiness to impose new economic sanctions on Russia over Ukraine is offset by the European Union’s reluctance to introduce stronger measures that could threaten its already fragile economic recovery. While the Obama administration said yesterday that it’s prepared to ramp up sanctions, possibly

RIA Novosti: Opinion: G7 in Decline, Confrontation With Russia Will Lead to Economic Problems

File Photo of G7 Leaders and other Officials Around Round Table at the Hague, with Flags

MOSCOW, April 11 (RIA Novosti), Luidmila Chernova – Russia’s exclusion from the G8 is a knee-jerk reaction provoked by short-sighted interests, which will ultimately lead to economic problems, according to Andrew McKillop, a former chief policy analyst at the European Commission Directorate General for Energy. “It’s a purely political stance, provoked by only political short-term

Burger King Expands Into Crimea After McDonald’s Exit

File Photo of Russian McDbnald's Crew with U.S. Diplomat

(Moscow Times – themoscowtimes.com – Peter Hobson – April 10, 2014) U.S. fast food giant Burger King plans to expand its chain into Crimea, filling the vacuum left when McDonald’s pulled out of the peninsula last Friday, citing unspecified supply issues. Burger King currently has no outlets in Crimea, which has been at the center

RIA Novosti: Capital Outflow from Russia Due to Ruble Rate, Not Crimea

File Photo of Cash, Coins, Line Graph

BERLIN, April 10 (RIA Novosti) – The outflow of capital from Russia is not tied to events in Ukraine, but to fluctuations in the exchange rate of the ruble, Russian First Deputy Prime Minister Igor Shuvalov said Thursday. “The outflow of capital is not mainly tied to Crimea, the outflow, of course, is connected with

Russian Economic Ministry revises capital outflow forecast up to $100 bln for 2014

File Photo of Cash, Coins, Line Graph

MOSCOW. April 9 (Interfax) – Russia’s Economic Development Ministry has increased its capital outflow forecast for this year to $100 billion from the previous $25 billion, Deputy Economic Development Minister Andrei Klepach said at a Tuesday evening briefing in Moscow. The outflow forecast for next year in the conservative scenario is increased to $50, in

Russian Economic Ministry revises 2014 GDP growth forecast down to 1.1%

File Photo of Cash, Coins, Line Graph

MOSCOW. April 9 (Interfax) – Russia’s Economic Development Ministry has lowered its 2014 GDP growth forecast in the base scenario from 2.5% to 1.1% and in the conservative scenario to 0.5%, Deputy Economic Development Minister Andrei Klepach said during a Tuesday evening briefing in Moscow. The main difference between the two scenarios, Klepach said, is

Political instability affecting Russia’s investment climate

File Photo of Outdoor Electronic Sign with Russian Exchange Data

(Russia Beyond the Headlines – rbth.ru – Ben Aris, special to RBTH – April 8, 2014) Ben Aris is the editor-in-chief of Business New Europe. The incursion into the Crimea was as much a shock to Russia’s business leaders as it was to the politicians in Brussels and Washington and is bound to hurt both

The future’s in their hands

File Photo of U.S. Diplomat Teaching Class to Russian Students

(Russia Beyond the Headlines – rbth.ru – Anastasia Maltseva, special to RBTH – April 7, 2014) Sociologists have conducted research on what professions Russian parents would like their children to do in the future. The results follow the changing dynamics of the job market in recent years and show that humanities-based occupations are no longer

IMF lowers Russian GDP growth forecasts to 1.3 percent in 2014, 2.3 percent in 2015

File Photo of Cash, Coins, Line Graph

(Interfax – April 8, 2014) The International Monetary Fund (IMF) has lowered its 2014 Russian GDP growth forecast from 2 percent to 1.3 percent. The IMF said in its latest World Economic Outlook (WEO) Update that the 2015 forecast was now 2.3 percent, down from the 2.5 percent the Fund was predicting in January. CIS

Crimea-Induced Brain Drain Will Hurt Russia More than Sanctions, Gontmakher Says

Ukraine Map and Flag

(Window on Eurasia – Paul Goble – Staunton, April 7, 2014) The domestic consequences of Moscow’s Crimean policy combined with Russia’s weakening economic prospects will drive ever more young Russians to seek work and possibly permanent residence abroad, an “exodus” that will hurt the country far more than any of the sanctions announced so far,

RIA Novosti: Ukraine’s Economy Would Have Collapsed Without Russian Aid – IMF Chief

File Photo of Cash, Coins, Line Graph

MOSCOW, April 3 (RIA Novosti) – Ukraine’s ailing economy would have collapsed without Russia’s financial help, the head of the International Monetary Fund said Wednesday. IMF Managing Director Christine Lagarde said that the Eastern European country’s economy had hit a wall last year and was heading for disaster when Russian bailout money averted a catastrophe.

No, Russia Isn’t Going Broke Any Time Soon

File Photo of Cash, Coins, Line Graph

(Bloomberg – bloomberg.com – Mark Gimein – April 3, 2014) Mark Gimein is Companies and Markets editor at Bloomberg.com, and lead writer for the Market Now blog and newsletter. Russia finally succeeded in selling government bonds this week, at a fat yield of 8.93 percent. This comes after four failed auctions since the Crimea occupation

Housing and High Wages Will Stop Russian ‘Brain Drain’ – Russian Official

Artist's Conception of Nanotechnology Components

MOSCOW, April 2 (RIA Novosti) – New housing incentives and high wages will help prevent young Russian scientists from leaving the country, a Russian official said Wednesday during a meeting of young scientists in Siberia. “I think that we should create better conditions so that our young scientists are motivated to build their career here

25% of Russians Think Government Is Corrupt, Poll Says

Cropped File Photo of Two Men in Business Suits Shaking Hands and Passing Cash

(Moscow Times – themoscowtimes.com – April 2, 2014) One in four Russians think that the current government is corrupt and self-serving, while about one in eight have nothing bad to say whatsoever about the administration, a recent poll indicates. The most common complaint of the government, selected by 41 percent of those questioned, is its

RIA Novosti: Geopolitics Poses Risks to Russian Financial Stability – Bank of Russia

Elvira Nabiullina file photo

MOSCOW, April 2 (RIA Novosti) – A review of ratings of Russian borrowers and the threat of their exclusion from international capital markets may affect Russia’s financial stability, the head of the Central Bank of Russia said Wednesday. “The geopolitical risks are large, especially if our banks and companies run into limitations on refinancing in

Sex, lies, intrigue and everything you wanted to know about Russian corporate culture

Empty Boardroom

(Russia Beyond the Headlines – rbth.ru – Dan Pototsky, RBTH – March 31, 2014) RBTH has collected data from the largest Russian recruiting companies, spoken with employees of a range of corporations with different outlooks and made a list of the main distinctions of Russian corporate culture. Note on Russian office culture: The idea that

Russia to Privatize Additional 431 Companies Through 2016

Empty Boardroom

(Moscow Times – themoscowtimes.com – April 1, 2014) The Cabinet approved a plan to privatize an additional 431 companies through 2016, according to a document published on the government’s website Monday. About 20 percent of Novorossiysk Commercial Sea Port, the Russian Lottery, and multiple scientific-research, construction, and agricultural facilities are up for sale, in addition

Soft war – when finance becomes continuation of politics by other means

File Photo of Cash, Coins, Line Graph

(Business New Europe – bne.eu – PERSPECTIVE – Roland Nash of Verno Investment Research – March 27, 2014) As the conflict between Russia and the West for influence in Ukraine unfolded, finance has found itself in the unfortunate position of sitting squarely in the front line. From the acceptance by Viktor Yanukovych of a $15bn

Interfax: Russian rouble “the most sanction-proof currency” – Central Bank official

Russian Central Bank file photo

Moscow, 26 March: The rouble is a sanction-proof currency, the first deputy head of the Central Bank of the Russian Federation, Kseniya Yudayeva, has said at a conference in the State Duma. “The rouble is the most sanction-proof currency,” she said without specifying the currencies compared to which the rouble is the most sanction-proof. “We

Putin Tasks Trusted Lieutenant With Economic Development Of Crimea

Russian Naval Vessel in Ukrainian Port

(RFE/RL – rferl.org – March 24, 2014) Russian President Vladimir Putin named Deputy Prime Minister Dmitry Kozak, his long-time trusted lieutenant and trouble-shooter, on March 21 to oversee the economic development of the Re public of Crimea. Crimea and the city of Sevastopol were formally incorporated into the Russian Federation as individual federation subjects on

Russian official admits Crimean economy depends on links with Ukraine

Maidan Square file photo

(Interfax – Moscow, March 24, 2014) The potential of the Crimean economy will depend to a large extent on the development of its economic ties with Ukraine, Russian Deputy Minister of Economic Development Andrey Klepach told a briefing in Moscow on Monday. Asked what contribution the Crimean economy would make to the Russian economy, the

Capital Flight Expected to Hit Staggering $70Bln in First Quarter

File Photo of Cash, Coins, Line Graph

(Moscow Times – themoscowtimes.com – Anna Dolgov – March 25, 2014) Capital flight will reach up to $70 billion in the first quarter of this year amid the deterioration of the country’s relations with the West over Moscow’s annexation of Crimea, a deputy economy minister said. The forecast marks what would amount to the largest

Contacts between G8 countries continue at expert level – Peskov

Kremlin and Saint Basil's

MOSCOW. March 25 (Interfax) – G8 contacts between countries that were held as part of preparations for the G8 summit in Sochi continue today at the expert level but in other formats, the Russian president’s press secretary Dmitry Peskov told Interfax. “Some meetings have been cancelled. Other meetings have been held in a broader format

Ruble Strengthens on Finance Minister’s Comments

File Photo of Cash, Coins, Line Graph

MOSCOW, March 25 (RIA Novosti) – Russian Finance Minister Anton Siluanov gave a boost to the ruble Tuesday by raising expectations the Russian currency would strengthen once the current foreign and domestic economic situations stabilize. The ruble strengthened by 46 kopecks (1.3 percent) against the dollar and by 76 kopecks (1.5 percent) against the euro

BNE: No one can kick Russia out of G8

File Photo of G7 Leaders and other Officials Around Round Table at the Hague, with Flags

(Business New Europe – bne.eu – March 25, 2014) “I would never want to be member of a club that wanted me as a member,” Marco Grouch famously said. Russia’s foreign minister Sergei Lavrov came out with pretty much the same defence after Russia was suspended from participating in the G8 meetings and international leaders

Russia-Ukraine: Return of the Prometheans

Russian Naval Vessel in Ukrainian Port

(Business New Europe – bne.eu – Chris Weafer, Macro Advisors – March 24, 2014) “Taking a new step, uttering a new word, is what people fear the most” Fyodor Dostoyevsky, Crime and Punishment The threat is more important than existing sanctions. The sanctions announced so far do not directly cause any material disruption to the

TRANSCRIPT: Putin at Congress of the Russian Union of Industrialists and Entrepreneurs

File Photo of Vladimir Putin at Valdai Club 2013 Meeting, Adapted from Screenshot of Valdai Club Video at youtube.com

(Kremlin.ru – March 20, 2014) Vladimir Putin took part in the annual congress of the Russian Union of Industrialists and Entrepreneurs. The topics on the congress’ agenda include de-offshorisation of the economy, making business more transparent, enhancing labour productivity, improving labour legislation, and creating a better investment climate. During the congress, representatives from the Agency

Navalny Proposes Sanctions List to the West

Alexei Navalny file photo

(Moscow Times – themoscowtimes.com – Christopher Brennan – March 20, 2014) Opposition leader Alexei Navalny, currently under house arrest in connection with a criminal case against him, has written an op-ed for the New York Times in which he calls for sanctions on officials and businessmen connected to President Vladimir Putin. Saying that previous U.S.

RIA Novosti: US Advises Funds to Warn Investors About Russian Risk – Report

File Photo of Outdoor Electronic Sign with Russian Exchange Data

MOSCOW, March 20 (RIA Novosti) – US financial officials have contacted investment funds with Russian assets and advised them to inform clients about potential risk associated with the crisis in Ukraine, the Reuters news agency reported Thursday. The commission began counseling investment companies weeks ago, advising them to clearly communicate risks with investors and warning

Kudrin on sanctions: Western banks already closing credit lines to Russian corporate sector

Alexei Kudrin file photo

ST. PETERSBURG. March 13 (Interfax) – Former Russian finance minister Alexei Kudrin is apprehensive about possible Western sanctions against Russia and said limitations in the banking sector have already begun. “I can say quite definitely: credit line limits for Russia are being closed,” said Kudrin, who is currently a member of the Presidential Economic Council.

Politics trumps & thumps economics

File Photo of Cash, Coins, Line Graph

(Business New Europe – bne.eu – Chris Weafer, Macro-Advisory – March 11, 2014) “Sanctions and boycotts would be tied to serious political dialogue” Daw Aung San Suu Kyi We have cut our growth forecast to 1% for 2014, and revised some other macro forecasts partly because of the uncertainty and disruption caused by the Ukraine

Punishing Putin Will Hurt the U.S. and Europe, Too

File Photo of Cash, Coins, Line Graph

(Bloomberg – bloomberg.com – editorial – March 6, 2014) As the U.S. and Europe consider financial sanctions to punish Russia for trampling on Ukraine’s sovereignty, they are coming up against an uncomfortable reality: Those sanctions tend to cut both ways. But how deep do they cut? Russia is far more financially intertwined with the West

Ukraine Uncertainty Depressing Growth and Investment

File Photo of Cash, Coins, Line Graph

(Moscow Times – themoscowtimes.com – Alexander Panin – March 6, 2014) As world leaders increase or trash their political clout depending on their audience and the statements they make about the situation in the Ukraine, some analysts were revising Russian GDP growth estimates to as low as 1.1 percent for the year. Wednesday was a

Russia and Ukraine Have Bigger Problems Than Each Other

File Photo of Cash, Coins, Line Graph

(Bloomberg – bloomberg.com – Matthew C. Klein – March 3, 2014) Matthew C. Klein is a writer for Bloomberg View You may have missed it amid the ongoing drama in Ukraine, but Russia’s central bank raised its main interest rate today to 7 percent from 5.5 percent — the single biggest increase in Russian benchmark

Markets plunge over Ukrainian crisis

File Photo of Outdoor Electronic Sign with Russian Exchange Data

(Russia Beyond the Headlines – rbth.ru – Tatyana Lisina, special to RBTH – March 4, 2014) The tensions in Crimea have already had serious economic consequences for Russia. The country’s stock market fell dramatically on Monday and the ruble continued its slide. Many experts compare the current developments to the events of August 2008, when

Ukraine Crisis Nets Billions of Dollars for Kremlin

Kremlin and Saint Basil's

(Moscow Times – themoscowtimes.com – Anatoly Medetsky – March 5, 2014) A cheaper ruble and more expensive oil could actually go a long way in improving Russia’s economy, possibly offsetting other potential aftershocks of the Ukraine crisis. U.S. Secretary of State John Kerry in interviews on Sunday identified the ruble’s slide as among Russia’s economic

Dvorkovich Sees 4% Economic Growth Next Year

Arkady Dvorkovich file photo

(Moscow Times – themoscowtimes.com – February 28, 2014) Deputy Prime Minister Arkady Dvorkovich on Friday said the country’s economy could accelerate to a growth rate of 4 percent next year, in stark contrast to the dour expectations of the Economic Development Ministry. The ministry sees the Russian economy struggling to rise above 3 percent growth

Russia waiting for U.S. investors

File Photo of Outdoor Electronic Sign with Russian Exchange Data

(Russia Beyond the Headlines – rbth.ru – Igor Dunayevsky, special to RBTH – February 27, 2014) Russian Minister of Economic Development Alexey Ulyukayev on Russia’s plans to attract U.S. investors and boost mutual trade. Russian Minister of Economic Development Alexei Ulyukayev paid a visit to the Washington, DC on Feb. 24-26 to discuss possibilities for

Investigative Committee to Crack Down on Corruption During Coming Privatization

Empty Boardroom

(RIA Novosti – February 27, 2014) The head of the powerful Investigative Committee said Thursday that preventing corruption during a planned privatization of state assets will be a top priority for his agency this year. The government recently announced plans for an ambitious three-year program running up to 2016 to privatize a wide array of

Emerging middle class delays major purchases; lots of catchup left

Cash, Calculator, Pen

(Business New Europe – bne.eu – Ben Aris in Moscow – February 27, 2014) [Charts here

Official sees sliding ruble adding $10 billion to Russian treasury

File Photo of Cash, Coins, Line Graph

(RIA Novosti – February 27, 2014) Steady weakening of the ruble will contribute to inflation, but may also boost revenues to the Russian treasury by $10 billion, a senior finance official has predicted, according to a report in a daily newspaper Thursday. Since the federal budget for 2014 assumed an exchange rate of 33 rubles

Weak ruble could push Russian budget into surplus – report

File Photo of Cash, Coins, Line Graph

(RIA Novosti – February 25, 2014) A weakening ruble could boost Russia’s federal income by $28 billion this year, pushing the treasury into surplus, according to a report published Tuesday by Moscow’s Higher School of Economics. The ruble has fallen by more than 7.5 percent since the beginning of the year against the dollar-euro basket

Economic Crime Afflicts Over Half of Russian Companies

Cropped File Photo of Two Men in Business Suits Shaking Hands and Passing Cash

(Moscow Times – themoscowtimes.com – February 24, 2014) More than 60 percent of Russian companies say that they have been victims of economic crimes like bribery, a report said. Worldwide, the incidence of fraud is much lower, with 37 percent of companies having come into contact with it, according to research by PricewaterhouseCoopers released late

Economists and Officials Disagree On Recovery Forecasts

File Photo of Cash, Coins, Line Graph

(Moscow Times – themoscowtimes.com – Alexander Panin – February 24, 2014) According to government predictions, state companies’ spending plans are likely to pull the economy out of stagnation toward the end of the year. Other economists, however, remain skeptical of these forecasts. Figures for January released last week did not give grounds for optimism, and

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