Reasons to invest in Russia
Growing foreign investment
“Russia has recorded peak foreign direct investment (FDI) inflows of USD 27.8 billion in 2007 from only USD 6.8 billion in 2003. Per capita FDI’s have risen almost sevenfold compared with 2003, reaching USD 369; this is far higher than in other BRIC countries and more than the average for emerging market economies.”
World Bank (Russian Economic Report) June 2008
“Higher investments are helping Russia to realize its catch-up potential. Returns on investment are high—reflecting the scarcity of capital—and surging oil prices, large capital inflows following the liberalization of capital controls, and a steady deepening of financial markets are providing investors with the financing and retained earnings needed to take advantage of this. The resulting rise in investment, and the associated reallocation of labour to more productive sectors, are unlocking catch-up gains in productivity. This is providing a further boost to growth in real incomes and consumption, which have already been buoyant for some time, owing to large terms-of-trade gains.”
Russia — Mission Concluding Statement of the 2008 Article IV Consultation Moscow, June 1, 2008
Strategic Location
At 17,075,400 square kilometres Russia, is the largest country in the world, covering more than an eight of the Earth’s land area and shares land borders with the 14 countries: Norway, Finland, Estonia, Latvia, Lithuania, Poland, Belarus, Ukraine, Georgia, Azerbaijan, Kazakhstan, China, Mongolia and North Korea. It is also close to the U.S. state of Alaska, Sweden, Denmark, Turkey and Japan.
Dynamic Economy
“Russia’s short-term economic growth has accelerated above its long term trend, defying weak global conditions. In 2007, the economy grew by 8.1 percent on the heels of high oil prices, robust domestic demand and strong macroeconomic fundamentals. Preliminary data indicate an even faster real growth in GDP and industrial production of 8.7 and 6.2 percent in the first quarter of 2008.”
World Bank (Russian Economic Report) June 2008
“…large capital inflows, and high credit growth are providing the impetus for a virtuous circle of robust growth in investment, productivity, real incomes and consumption. As to the financial sector, the regulatory framework has improved..”
Russia — Mission Concluding Statement of the 2008 Article IV Consultation.
Moscow, June 1, 2008 IMF
Special Economic Zones in Russia
Below is the list of regions, where the particular Special Economic Zones are found
Technical / Innovational Zones:
Dubna Region, St. Petersbrug, Zelenogradsky Administrative District (Moscow), Tomsk Region
Industrial Production Zones:
Lipetsk, Tatarstan
Tourism and Recreational Zones:
Kaliningrad, Krasdnodar, Stavropol, Altai (the territory of Altai and the Republic of Altai), Republic of Buryatia, Irkutsk Region
Special economic zones are part of the territory of the Russian Federation determined by the Government of the Russian Federation, to support special regime business activities. Three types of SEZ may be created: Industrial-production, Technology-innovative And Tourist-and-recreational.
- The main purposes of SEZ are:
- Development of processing and hi-tech economy branches;
- New type of products manufacture, import substituting manufactures development;
- Development of tourism and sanatoria- and health-resort sphere.
SEZ benefit from a number of government concessions including a period of low taxation and business support (most SEZ regions have no customs duty on imports and various taxation benefits). More information can be found on the official website of the Russian Special Economics Zones (http://eng.www.rosoez.ru).