Page 67 - RusRPTNov23

received an offer from a buyer. Perhaps they were referring to an offer from Taimiraz Bolloyev, a longstanding acquaintance of President Vladimir Putin and the former head of the Baltika that was reported by The Financial Times. Bolloyev was handed control of Baltika after the nationalisation.
The story of Carlsberg and Baltika suggests that the Russian authorities do not see such takeovers — when external managers are appointed on an order from Putin — as true nationalisation. Perhaps they see it more as a mirror image of the Russian Central Bank reserves frozen in Europe — where the money has been seized but no-one yet dares to unfreeze the cash and hand it to Ukraine.
With 141 FDI projects in 2020, Russia ranked eleventh among Europe’s top 20 investment destinations. FDI projects in Russia dropped by 26% compared with the previous year (191), reflecting the wider trend across Europe: the average decline in European countries with negative FDI growth was 21%.
The number of FDI projects attracted by Russia in 2020 was close to that in 2014, with international investors undertaking fewer projects than they would have taken on in better market conditions. The COVID-19 pandemic, coupled with fears of imminent sanctions, had the highest impact on their decisions.
2020’s decline came off a previous historically high base. That high investment base would likely have been sustained, however the COVID pandemic, amplified by the economic downturn, dealt a significant blow to foreign investment into Russia, comparable only to the shock caused by sanctions in 2014.
The value of FDI inward stock in Russia fluctuated during this period from approximately US$471.5 billion in 2013 to US$449 billion in 2020, with the decline due to sanctions placed on the country in 2014 due to the annexation of Crimea.
Russia’s mining sector is by far the leading destination for foreign investors to Russia, with more than US$116 billion of accumulated FDI, according to Russian central bank figures.
Manufacturing remained the most attractive activity for foreign investors in Russia. The number of manufacturing projects was unchanged from 2019 at 107, undertaken predominantly by investors from Germany, China, Italy, and the US. All others combined represented only 32 total projects.
• The number of sales and marketing projects decreased as, in the face of the pandemic, many companies were less active on the media and promotion fronts.
67 RUSSIA Country Report November 2023 www.intellinews.com