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Western Investors in Russia: New Realities

16 June 2022
Западные инвесторы в России: новые реалии

Key conclusions

Some Foreign Companies Have Stayed in Russia, Including Because of Social Responsibility 

“Only 11% of our members have left, far fewer than people think when they read articles and listen to the media. 4% are still deciding whether or not to go. That means 85% remain in RussiaOf these, 12% are cutting back on operations while 6% are expanding their business in Russia. So I would say that [the situation] with American business in Russia is not as bad as they might say”, Robert Agee, President, Chief Executive Officer, American Chamber of Commerce in Russia. 

“In general, Italian companies have not left Russia. This means that, in the main, companies are doing sustainable business here. They are expressing a desire to continue cooperating with Russian companies, to remain on the Russian market. They face a multitude of problems at the day-to-day level. In particular, in the given situation, in fact they are small ones. This allows them flexibility and autonomy in decision-making – that is why they are here, why they are not all that dependent on foreign factors”, Alfredo Gozzi, General Director, Association ‘Confindustria Russia’. 

“There is one specific – our attention to social responsibility. First of all, we all think about social responsibility toward our staff. For the Italian legislation, labour relations are extremely important, and relations with employees are the most important a company can establish. No matter what passport the employee holds in their pocket – Russian or Italian”, Vincenzo Trani, President, Italian-Russian Chamber of Commerce. 

“We currently have 550 people working with us – I must say that we are keeping you on because that was a political decision. <…> The Chamber has 60 staff members and I would feel very uncomfortable saying: "I’m sorry but we are closing our doors because of what is happening in Russia right now", Emmanuel Quidet, President, French-Russian Chamber of Commerce and Industry. 

Russian Businesses Cannot be Kicked out Permanently from the World Business Community 

“I believe it is impossible in practice in modern business to cut out partners from the global geographical map. The current situation is understandably such, including with the sanctions, but this is part of life and world development history. I believe a time will come, though the question is when, but we will consider the important role Russia plays in interrelations with Europe”, Vincenzo Trani, President, Italian-Russian Chamber of Commerce. 


Russia Needs to Resolve the Issue of External Administration and Support of Foreign Companies 

“The biggest problem for us is financing. A problem not only in western countries for them but also of the measures taken by the Russian government. I don’t want to say whether these are wrong or right. But this is an objective factor that affects companies’ operations and how they can withdraw their revenues, transfer their money, including to their own country”, Alfredo Gozzi, General Director, Association ‘Confindustria Russia’.

“The aspect that concerns everyone with respect to external administration: we all understand perfectly how something can be managed from abroad. We just need to find a common formAnd we don’t know the overall answer to this crucial question. Nor can we let colleagues just up stocks and leave our market, slamming the door behind them and leaving thousands of our workers outside the fence”, Vladimir Padalko, Vice President, Chamber of Commerce and Industry of the Russian Federation.

The Sanctions Have Seriously Affected the Situation in Agriculture in Russia and Other Countries

“60% of exports that have become household names throughout the world are based on the work of small and medium-sized enterprises in Russia – farmers and agricultural producers. They will experience negative [emotions] toward technology suppliers that have stopped fulfilling their warranty obligations. This is not acceptable”, Nikolai Dunayev, Vice President, All-Russian Non-Governmental Organization of Small and Medium Business OPORA RUSSIA.

“The result is catastrophic since this is a doubling of prices, a price spike – the greatest evil, and the inflation raging across the planet, – this is all a chain that has been unleashed, 35-40% of fertilisers throughout the world come from Russia and Belarus. Here it is not the sanctions themselves that are hitting hard but the chain of events triggered by the sanctions”, Robert Agee, President, Chief Executive Officer, American Chamber of Commerce in Russia.

Sanctions Response Measures Might Have a Negative Effect on Business so Reasonable Solutions are Needed 

“The draft laws currently being considered require balance and a constructive dialogue”, Nonna Kargamanyan, Vice President, Head of Executive Committee, All-Russia Public Organization Delovaya Rossiya (Business Russia). 

“There is a position with respect to sensitive draft laws that, we believe… cannot be adopted as they stand. This applies first of all to the bill envisaging criminal liability for observing the sanctions and there are many other such sensitive draft laws. Some measures have already been taken that require amendment in relation to parallel imports. We express our position precisely, that the conditions for existing investors must not be worsened. On the contrary, these conditions should be improved”, Sergey Krasilnikov, Vice President, Managing Director of the International Relations and Integration Directorate, Russian Union of Industrialists and Entrepreneurs.


Russia’s New Economic Model Should Provide for Strong Support for SME

“Russia must think about a new economy and economic model including small and medium-sized businesses. WhyRussia is forecast to return to its 2021 GDP only in ten years’ time, – this is not very realistic. Measures will most likely be taken and Russia will find a way out, a way to overcome the difficulties. I think the new model should include an understanding of the work or small and medium-sized businesses”, Alfredo Gozzi, General Director, Association ‘Confindustria Russia’.

Russia’s openness toward foreign companies will help in restoring business links

“Small and medium-sized businesses have sustained their position… that no counter-sanctions be introduced to the bank on Russian truckers driving round Europe. People in Europe can still ship their goodsMy last word at the late night meeting was precisely that Polish, Italian and Slovakian drivers will, on returning home, explain that nothing bad happened to them. That will trigger restoration of the dialogue we all need”, Nikolai Dunayev, Vice President, All-Russian Non-Governmental Organization of Small and Medium Business OPORA RUSSIA.

For more details, see the ROSCONGRESS.ORG Information and Analytical System.