(Moscow Times – themoscowtimes.com – Diana Kulchitskaya – May 7, 2014) Visa and MasterCard will hold fast to Russia despite a new law that forces them to pay over $3.8 billion as a security deposit to the Central Bank. Both international firms consider the measures taken as too severe and think that they will not only make work in Russia […]
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(Business New Europe – bne.eu – Ben Aris in Moscow – May 7, 2014) Nathan Rothschild once famously said, “buy on the sound of canons, sell on the sound of trumpets.” However, the few investors that were still looking at Ukraine are fading away as the cycle of violence escalates and the body count rises. War is close and the […]
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(Business New Europe – bne.eu – Ben Aris in Moscow – May 6, 2014) [Charts here http://www.bne.eu/content/russia-heads-toward-stagnation] The Ukraine crisis has been an economic train wreck for Russia. The outlook for this year was never good, but on April 30 the International Monetary Fund (IMF) argued the Russian economy is already in recession and a growing number of analysts believe […]
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(Interfax – May 5, 2014) Russia filed a suit with the World Trade Organization on April 30 to begin judicial hearings on the application of the European Union’s Third Energy Package, a source close to the WTO told Interfax. The chief trade negotiator at the Economic Development Ministry, Maxim Medvedkov confirmed that the suit has been filed. He said that […]
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(Russia Beyond the Headlines – rbth.ru – Maria Karnaukh, special to RBTH – May 2, 2014) The 2014 Winter Olympics have already gone down in history as the most expensive Olympics ever, but now they promise to set another record in terms of profits generated by the organizers. The funds from sponsors alone will bring the Sochi Organizing Committee $1.3 […]
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(Russia Beyond the Headlines – rbth.ru – Alexei Lossan, RBTH – May 1, 2014) More than a month has now passed since the EU and the United States first imposed sanctions on Russia in response to what they saw as its annexation of Crimea. On Monday, April 28, the U.S. hit Russia with a further round of sanctions. But what […]
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(Bloomberg – bloomberg.com – Anna Andrianova and Andre Tartar – April 29, 2014) Russia faces a fifty-fifty chance of recession, the highest since Bloomberg started to track the measure, as the crisis in Ukraine raises the risk of further sanctions, according to a survey of economists. The probability of a recession over the next 12 months rose to 50 percent, […]
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(Russia Beyond the Headlines – rbth.ru – Vsevolod Pulya, RBTH – April 28, 2014) The Russian search engine was actually registered in the Netherlands and received its first investments from foreign investors. Nevertheless, it believes that this is “common practice for any internet startup.” Russian search engine Yandex has responded to comments by Russian President Vladimir Putin about foreign influences […]
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(opendemocracy.net – John Weeks – April 25, 2014) ‘Shock therapy’ was imposed on the post-Soviet world by the West, with catastrophic results. Now, we are planning on repeating that experiment in Ukraine. John Weeks is Professor Emeritus, School of Oriental & African Studies, University of London, and author of Economics of the 1%: How mainstream economics serves the rich, obscures […]
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(Moscow Times – themoscowtimes.com – Peter Hobson – ALABUGA, Tatarstan, April 28, 2014) As Western politicians huffed and puffed about slapping additional sanctions on Russia, captains of big global business in the country showed no jitters as they met with top Russian officials Friday. Moreover, the only person to mention Russia’s clash with the West over Ukraine at a meeting […]
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MOSCOW, April 25 (RIA Novosti) – Russian Minister of Economic Development Alexei Ulyukayev said Friday that a recent downgrade in Russia’s financial rating was expected and partially due to politically motivated decisions, but is not affecting investors’ behavior. International ratings agency Standard & Poor’s cut Russia’s rating to BBB- from BBB Friday and kept its outlook negative, amid the ongoing […]
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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 markets for their money. And […]
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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, but also a great opportunity […]
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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 said. “The prognosis we have […]
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(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. and European allies consider wider […]
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(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 world are aimed at reducing […]
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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, we think the situation of […]
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(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 to target specific sectors of […]
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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 interest, and has nothing to […]
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(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 of tensions between Russia and […]
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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 the events that happened in […]
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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 the base scenario to $40 […]
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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 the possibility in the base […]
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(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 domestic and foreign investment this […]
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(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 seen as desirable. Sociologists at […]
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(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 economic growth might be 2.3 […]
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(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, according to Yevgeny Gontmakher. In […]
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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. “Without the support that they […]
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(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 started. Last week, the government […]
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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 in the country. And by […]
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(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 perceived inability to deal with […]
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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 Western markets, and a review […]
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(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 corporate culture in Russia appeared […]
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(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 to regional airports, shipping companies […]
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(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 loan from Russia to the […]
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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 have found a paradoxical thing. […]
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(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 March 17. Putin then designated […]
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(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 deputy minister said that “it […]
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(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 capital flight since the 2008 […]
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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 because they envision the participation […]
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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 Tuesday on the news. “If […]
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(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 due in Russia for the […]
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(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 economy. But the actions taken […]
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(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 for Strategic Initiative, Delovaya Rossiya […]
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(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. and EU sanctions in response […]
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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 them to have a clear […]
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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. “Our corporate sector currently has […]
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(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 crisis but also reflecting the […]
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(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 than it was back in […]
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(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 calmer day on the stock […]
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