Central regions | Finance, business

EY: foreigners see moderate improvement in Russia’s business climate

23 Oct '19
Sixty-one percent of foreign companies have seen an improvement in Russia’s business climate in the past year, the U.S.-Russia Business Council reported, citing a new Russian-language report by EY.

The number of positive reviews is the largest among Asian companies (78%), followed by U.S. and EU companies (64% and 49%, respectively).

Eighty-five percent of the foreign firms surveyed expect “slow expansion” of their business in Russia in the next three years. Growth expectations are the highest among healthcare and pharmaceutical companies (44%), followed by construction (40%) and energy (36%) firms. Most companies link growth expectations to new product launches and 40% to higher production volumes.

Half of the companies plan to expand their operations to Russia’s central and northwestern regions. In choosing new investment destinations, Asian firms prioritize local tax benefits while U.S. companies value opportunities for direct dialog with local authorities and the availability of skilled workers.

Forty-one percent of Asian companies plan to increase investment in Russia this year, as do 29% of U.S. or EU firms. In 2019, the total volume of new investment by the companies surveyed is estimated at $6.5bn, of which 44% would go to the energy and extractive sectors.

Although most companies included in the report (62%) noted adverse effects of sanctions on their businesses, 58% suffered only “modest” revenue losses due to sanctions. Among the negative effects of sanctions, 44% pointed to an overall contraction of the Russian market, 27% cited limited access to financing, 25% complained about supply chain disruptions, and 24% were concerned about reputational risks. Only 8% of foreign firms had to shut down existing projects and 7% had to cancel prospective projects in Russia due to sanctions.
Publish in Twitter
Write to Facebook
Google Buzz
Write to LiveJournal
Show in MM
Share MK
Find Related Content


Tags: report (18) / business climate (1) / foreign companies (0) / Ernst & Young (0) /

Latest News: Central regions
18 Nov '19 | Finance, business | Real estate
15 Nov '19 | Technology & innovation
15 Nov '19 | Technology & innovation
14 Nov '19 | Technology & innovation

Feature stories

8 Nov '19
For the first time in the history of Russian-African...
29 Oct '19
25 Jul '19
Russian scientists have come up with a new method of...
Search (News archive - 21576)
Marchmont News

Latest News

18 Nov '19
The Moscow Seed Fund invested $43,750 in Tango...
15 Nov '19
ID Finance, a Spain-registered fintech group of...
14 Nov '19
Earlier this week Kazan, the capital city of the...

Most read stories from last week

18 Nov '19
The Moscow Seed Fund invested $43,750 in Tango...