Economic News in Review
Crisis, Sectors, and Domestic Policy in Russia
April, 2010

 

Business

 

John Deere opens Russian plant, sees potential

Deere & Co (DE.N), the world's largest farm equipment maker, opened a manufacturing and parts distribution plant near Moscow, saying it was prepared to increase investment in the country.

 

Steel baron Vladimir Lisin tops Russia rich list

Steel baron Vladimir Lisin was ranked Russia's richest man by Forbes magazine after a year in which the number of Russian billionaires doubled to 62 as resource tycoons restored their riches following the crisis.

 

Domestic

 

Foreigners, job cuts key to Russia success - Kudrin

Russia must make more effort to attract foreign investors, while its companies need to slash inefficient staff if the economy is to succeed in diversifying away from oil, Finance Minister Alexei Kudrin said.

 

Factbox: Key political risks to watch in Russia

Oil price movements, internal Kremlin politics and the risk of insurgent attacks will provide the key political risks for investors in Russia in the aftermath of lethal subway bombings (March 29th).

 

Law and order

 

Medvedev submits amendments to fight corporate raiding in Russia

Russian President Dmitry Medvedev proposed amendments to the country's criminal legislation to fight the illegal seizure of companies.

 

The Noose Tightens on Raiders

After much procrastination, there are serious efforts afoot to combat the biggest scourge of business life in Russia: raiders’ attacks.

 

Fighting corruption in people's minds: new strategy approved

In a move to eradicate Russia’s worst evil – corruption – President Medvedev has signed a national strategy on tackling the problem. Among the ambitious goals it sets is changing people’s attitudes.

 

Russia Slow to Pick Up the Lead in Bribery Cases

On April 1, the U.S. Justice Department unsealed documents showing in remarkable detail how the German carmaker Daimler had paid millions of euros in bribes to Russian government officials to clinch sales of patrol cars for the police and sedans for the presidential motorcade.

 

Hewlett-Packard's Moscow offices raided over bribery claims

Russian and German authorities are pursuing IT firm Hewlett-Packard over claims that executives paid a huge bribe to land a lucrative contract with the Russian Prosecutor General's Office.

 

Multinationals pledge no corruption in Russia

More than 50 international companies are pledging zero-tolerance of bribery in Russia under a fresh Kremlin-backed effort to improve the business climate in one of the world's most corrupt countries.

 

Top Russian officials reveal their incomes

How much do the Russian President and Prime Minister make a year? Information on the top officials’ incomes was revealed Monday.

 

Russia to let all new businesses start without state approval – Putin

Russia will completely eliminate the requirement for new business startups to get prior state approval, Prime Minister Vladimir Putin said, noting that Russian entrepreneurs still faced too many restrictions.

 

Finance

 

Special taskforce to oversee creation of Moscow financial center

A project group under the presidential council for financial markets will oversee Russia's efforts to establish an international financial center in Moscow, a Kremlin aide said.

 

Indicators

 

Russian Inflation Slows to 12-Year-Low 6.5% as Ruble Gains

Russia’s inflation rate fell to the lowest level in 12 years as a stronger ruble made imports cheaper and a sluggish recovery damps consumer demand, allowing the central bank to continue cutting rates.

 

Russian Economy May Get 'Biggest Bounce' in World

Russia’s economy is poised for the “biggest bounce” in the world this year as companies rebuild stocks and resurgent consumer demand boosts output after a record slump in 2009, Bank of America Merrill Lynch said.

 

Russia Vulnerable to Budget Crisis, Renaissance Says

Russia’s current fiscal policy leaves it vulnerable to an “inevitable” new global downturn and may lead to a budget crisis if demand for oil sours, Renaissance Capital said.

 

Economy Expanding Despite Fragile Recovery.

The economy grew in the first three months of 2010 and expansion is likely to continue, although recovery in consumer and investment demand is still fragile, Economic Development Minister Elvira Nabiullina said.

 

Russia, CIS Economies Will Recover at 'Moderate Pace,' IMF Says

Russia and the economies of the former Soviet republics will recover at a “moderate pace” this year as financial-industry weakness offsets a rebound in trade and higher energy income, the International Monetary Fund said.

 

Infrastructure

 

Russia Still isn't Connected by Road from Kaliningrad to Vladivostok

Moscow has a transportation ministry and a highway administration but it “does not have a road which reliably connects the East and West of the country,” a lack that Russian officials from Vladimir Putin on down have tried to conceal but one that has profound consequences for how that country is ruled and its ability to function as a single state.

 

Labor

 

Russian women fight for top jobs

Is the feminist dream viable in Russia? After Deborah Spar, president of New York's Barnard College, came to Moscow to deliver a lecture on the role women can play in social and political leadership, the situation for ordinary women here remains somewhat removed from much of what she hopes for.

 

Russian trade unions fail their members

Far from being a dynamic part of the modern working environment, it appears that Russia's trade unions are becoming a Soviet-era relic.

 

Russia fails to provide 'service with a smile' – survey

Russian shop assistants are not known for their smiles, and with good reason according to a survey of 14 countries' service industries that ranked the country 12th, popular Russian daily Gazeta reported on Friday.

 

Retail

 

Lessons Learned

IKEA’s representative Lennart Dahlgren worked in Russia for eight years, arriving in 1998. The account of his experience, seasoned with jokes, can at times be a bit cloying, but it’s a thrilling ride.

 

Technology

 

Kremlin Control of Russian Internet Rising, OSC Says

The Russian-language internet is increasingly subject to control by the Russian government and its allies in the private sector, according to a new report from the DNI Open Source Center (OSC).

 

Counting Connections

Social networking in Russia is growing rapidly, but which sites will eventually dominate the market is still unclear.

 

First Russian nanotech company opens up

Rosnano head Anatoly Chubais and Russian deputy premier Sergey Ivanov have announced the creation of the country’s first company applying nanotechnology commercially.

 

Gas

 

Ukraine, Russia reach gas deal

A meeting between Russian President Dmitry Medvedev and Ukrainian counterpart Viktor Yanukovich have reached agreement on gas prices and volumes for coming years.