Page 107 - RusRPTAug24

4.3.2 Corporate dynamics
The number of foreign companies in Russia reached a plateau this spring (about 77 thousand), that is, those that really wanted and could leave have already done so, writes Kommersant based on SPARK-Interfax calculations. This makes it possible to meaningfully record changes that have occurred in the sector since the beginning of the war, based on financial reporting materials.
Since 2018, there have been almost 50 thousand fewer foreign companies (not only Western ones) in Russia, and since 2021 - by 10 thousand.
European companies accounted for 80% of the total decline in revenue of foreign organizations over the past two years. But companies with Chinese participation have increased their revenue by 2.5 times since 2021, their share in the total revenue of “foreigners” reached 11%. Previously, the first places in this indicator were occupied by Germany, theNetherlands and Cyprus. Also, the revenue of Indian companies increased 2.5 times.
Sales of companies with owners from the CIS also grew, but more slowly: from Belarus - by 74%, from Kazakhstan - by 47%, from Uzbekistan - by 36%. In total, they accounted for 8% of the revenue of foreigners in Russia.
Despite the decline in revenue and loss of market share, companies with “unfriendly” owners still account for 60% of both the assets and revenue of foreign firms in Russia. Partly due to the fact that about a third of both are the results of disguised structures of Russian holdings. However, the rest are truly “unfriendly” companies that have chosen the “wait and remain silent” option. That is, those who have curtailed their activities, but retain their assets due to the impossibility or unwillingness to sell them on enslaving conditions.
4.4 Fixed investment
Investment activity of businesses increased in the first half of the year,
despite the shortage of qualified personnel, difficulties with logistics and payments, the Central Bank writes in the report "Regional Economy".
According to Rosstat, in the first quarter, investments in fixed capital grew by 14.5% year-on-year. Enterprises' own funds remained the main source of investment financing (61.9%), followed by budget funds (12.9%) and bank loans (11.2%).
The largest contribution to the annual dynamics of capital expenditures was made by the implementation of projects in the manufacturing industry, mining and construction. The Ministry of Economic Development forecasts a 2.3%
107 RUSSIA Country Report August 2024 www.intellinews.com