Country Business briefing

Define Russia in a nutshell? 

Imagine how big is the territory of a state in which one of the presidential residencies is located in the most northerly capital city in the world, St. Petersburg, where you can actually see the aurora borealis in the polar night, and in which his other living quarters is in Sochi, a subtropical climate zone. Surprised? Incredibly, the extension of the Russian Federation from north to south is insignificant compared with its extension from east to west. To travel from Kaliningrad, the Russian enclave in Europe, to the main city in the Russian area near the Pacific Ocean, Vladivostok, it takes half a day by plane. In this vast territory we find magnificent natural resources: forests of taiga rich woods, fertile black soil, marine and fluvial fishing zones, oil, gas, diamonds and precious minerals too.

However, this vast territory generates serious problems for the country. The 140 million inhabitants it possesses are clearly insufficient to dominate all the wealth it houses. Even in the two most important cities in Russia, the population density is the lowest among all European capitals. For this reason, Russia has always been hospitable to foreigners who are willing to invest in the development of the country. Many years of Russian history confirm this fact.

In the sixteenth century, there was already an influential community of expatriates and foreign investors who lived permanently in Moscow. During the time of Peter the 1^st and his reforms, the members of this community became a central pillar for the society of the time. In St. Petersburg, the capital of the Russian Empire, founded by the aforementioned monarch, foreigners came to constitute 25-30% of the total population at various historical moments. Foreign investors were well received and encouraged to contribute to the Russian economy not only with their capital, but also with their skills; among them, people of the significance of the Nobel brothers, the founding Swedish entrepreneurs of the most prestigious international award and heavy investors in the Russian industry. Among the curious facts regarding the presence of foreigners in the country, we can mention that the ancestors of the current president of the European Commission, Ursula von der Leyen, obtained the noble dignity and the title of barons from the Russian emperor, as a reward for the contribution to the local economy. 

This foreign-investment-friendly period got suddenly interrupted by the 1917 revolution, which is called in Russia “the great revolution”. However, after the fall of the communist regime, Russia returned to its historical tradition and opened itself again to those foreigners who wished to invest or live in the country. If you are attracted to large-scale investments, it is relevant to study the entrepreneurship opportunities offered by Russia, and it´s important to get to know the heart of the Russian people.

Modern Russia can qualify as an old, but very modern country at the same time. The right to private property, the ownership of a business unconnected to the state and a free market appeared in Russia less than thirty years ago. A part of the generation that has not been able to accept the fall of the communist regime is still alive today, but young people who do not remember or know the Soviet way of life have an ever growing influence in today´s Russia. It can be said that Russia is currently in the process of developing the economic and state institutions necessary for its stability. However, it looks like Russia will rise successfully from this current era of global changes that has been catastrophic for many countries. This is due to the fact that the Russian authorities, during these last few transition years, have been able to take advantage not only of Russia´s natural wealth, but also of the rich history and ancient traditions, and of the great scientific achievements of the USSR. All these facts are more than enough to consolidate a society that integrates different social groups and diverse political opinions.

When doing business in Russia, it is necessary to take into account this state of "transition" and understand that the resulting uneven development can create certain difficulties, nonetheless, this also opens opportunities that are unthinkable in other countries.

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