Posted on 09/17/2024 9:46:12 PM PDT by Cronos
Since the aggression against Ukraine, Russia has lost most of its Foreign Direct Investment (FDI). The Bank of Russia admits that today Russian business can only count on itself.
– The Russian economy needs money for structural transformation, but it can only count on its own resources – emphasized Elvira Nabiullina, Governor of the Bank of Russia, in the analysis “Main Directions of Development of the Russian Financial Market” for the Next Three Years, published on Monday
FDI has fled Russia, count on your own money The authors emphasize that investments can be financed through the financial market not only from internal funds, but also by attracting foreign capital from partner countries to the Russian economy, because despite sanctions, the Russian market "remains part of the international financial system."
However, "in the near future, the volume of such (foreign – ed.) investments will be small," admits the Bank of Russia. Confirmation of this is not far to seek, because a few days ago, the Chinese authorities recommended that their business not build any plants in Russia and not risk their money on this market. Therefore, as the Bank of Russia admits, "at least in the medium term, it is necessary to rely mainly on domestic sources of financing."
Where to get money for business in Russia? The question is where will Russian business, which is already running on fumes, get the money for investments? The central bank assures that it intends to develop various financial instruments, from individual investment accounts and a long-term savings program launched this year, to encouraging companies to develop corporate pension programs and joint insurance.
However, as the opposition newspaper The Moscow Times emphasizes, talks about these instruments have been going on in the Kremlin for many years, but their results so far have been modest: more than 2/3 of household financial assets are placed in banks and cash. Russians are ready to invest, as can be seen from the high demand of private investors for IPOs in 2023-2024, but they are "more skeptical" about long-term investments, says professor of economics Oleg Shibanov. In his opinion, this is a consequence of "a series of crises and poor results of Russian pension funds, which do not compensate for inflation every year."
Business operates on its own money Today, when the war started by Putin is already in its third year and sanctions have cut off business from Western financing, the main source of investment (50–60%) of Russian companies remains their own funds and profits.
The state is in second place; banks obtain about 10 percent of funds allocated for investments. Although companies are increasingly actively using the possibilities of obtaining financing on the capital market, its size is incomparable to the size of credit activity, the Bank of Russia states.
That is why investors on the Russian market have an extremely narrow choice. "Despite the wide selection of financial instruments, the industry diversity of issuers, the volume of securities in free circulation... is not large," the regulator continues, and proposes encouraging the use of the capital market to obtain funds, similarly to subsidizing interest on loans.
Friendly banks also refuse For its part, the central bank is trying to create a new infrastructure for foreign investment, which would replace the one “destroyed by sanctions”. In particular, it is trying to reach an agreement on the construction of “deposit bridges” that would provide foreign investors with direct access to the Russian market and allow them to issue securities in national currencies. However, there are no results. “The development of such relations depends on the willingness of the parties,” the Bank of Russia admits.
And the countries considered “friendly” by the Kremlin are increasingly closing their financial markets to Russian business. Banks in China, India, Turkey, the UAE and Asian republics are refusing to finance transactions and open accounts. Every contact with the Russian side is followed by months of scrutiny and makes it difficult to do business.
No wonder almost no one wants to invest in Russia anymore.
The Muscowite federation runs based on KGB-oligarchy scams
Nice try comment SPAMMER, Bobl.
Those aren’t the only articles I post here. Yet your comments history shows exclusive Russian content, don’t it?
when the USA was 160 million was in the 1950s.
At that point, the rest of the world was still devastated by World War II or under communism or recovering from colonialism.
The economy and items made were simpler - look under the hood of a car from when you were in diapers and compare it to looking under the hood of a car from today
I’m voting Kamala. She is not as sick as Putin.
Be happy. The world under WEF and the deep state is a whole lot betters than the guy who quacks like a Muscovy duck. Go for the Pro program Propaganda.
The impact considering that the Chinese aren’t ready to take the vacuum creating by wester5n companies leaving is as follows:
1. the car industry is down 90% to 95% — this corresponds to the fact that in Russia, 95% of auto parts are imported
2. There is no semiconductor fav in all of Russia that can make a modern microprocessor. This has had a notable impact on the defense industry which cannot replace the many precision guided munitions expended without semiconductors from the West. But of course the shortage (and with gray market and black market sourcing supplies will still lag demand) impacts many other industries such as appliances, cars, and of course consumer electronics — but Russia imports nearly all of their consumer electronics for precisely this reason. They do not have the capability to build this up in decades.
3. The same with aircaft - 75% of aircraft parts are imported so Russia will have to cannibalize to keep its fleets functioning. Airbus and Boeing parts are no longer available. Ural and Pobeda have already reduced their fleets and are cannibalizing parts.
4. As to the tractors still run - the older ones do, the newer ones face the same lack of parts issue as cars and aircraft.
5. And for trams - yes, they do run, but the trams outside Moscow have reverted to the Soviet era trams and lack parts, hence the recent “tram can’t stop” accidents.
“The economy and items made were simpler”
My father got to and from work in a 1964 Impala.
Ivan and Natasha can get to and from work in such simple cars if necessary.
I’m voting Trump. Kami is like Pootie in 1999
It is not a binary option - both the pinkmafia and the KGBmafia are bad. Equally bad.
By enabling Ukraine to defend itself we prevent a wider conflagration - just as if the UK and France had armed Czechoslovakia in 1938.
Now tell me that Russians have only shovels.
“There is no semiconductor fav in all of Russia that can make a modern microprocessor. This has had a notable impact on the defense industry which cannot replace the many precision guided munitions expended without semiconductors from the West.”
I suspect Russians have a lot of cell phones with some very capable processors. They might even have some old ones hanging around their tiny apartments.
“But of course the shortage (and with gray market and black market sourcing supplies will still lag demand) impacts many other industries such as appliances, cars”
In my youth, appliances and cars did not have microprocessors.
I have a bread machine and a microwave oven that use microprocessors. Natasha might have to knead dough by hand and boil her sausages and potatoes, after her machines break.
“and of course consumer electronics — but Russia imports nearly all of their consumer electronics for precisely this reason. They do not have the capability to build this up in decades.”
Much the same could be said of the USA. I suspect a trade in used consumer electronics has developed.
To: wildcard_redneck—” Russia has benefited from the ejection of parasitic multinationals.”
That is an interesting supposition.
Will they also throw out the parasitic oligarchs?
Why is it, that no one will take over the factories once owned by multinationals?
The Russian government picked up some but has yet to produce anything? And the workers are paid much less, such a deal.
The Russians are utilizing microprocessors from washing machines etc., however those aren’t the levels that they need for more sophisticated aircraft and cars.
As to the USA - yes, the USA can build it up as it retains the know-how and the pre-fabs or has partners such as in the Nederlands who can provide it. But that isn’t relevant - we’re talking about Putin’s Russia, not the USA
Russia to grow faster than all advanced economies says IMF
16 April 2024
Xxx
The International Monetary Fund (IMF) expects Russia to grow 3.2% this year, significantly more than the UK, France and Germany.
https://www.bbc.com/news/business-68823399
“China is still unhappy about Russia glomming on to Siberia.”
China is far older than russia. They have a long, long memory.
It’s that Soros may not be able to invest now due to sanctions. I wonder if he may have bet against Russia a few years ago.
The comment thread here is filled with all sorts of telepathy and measurements of parameters of no apparent significance.
It’s not all that useful to declare what China thinks or is unhappy about. This is mind reading.
Financial gobbledygook is a contorted laying out of numbers that describe how much of a substance created on a whim by a central bank (that’s what money is) exists or flows in what direction.
Youtube has become the revealer of truth, oddly. You can go see videos of Russia. Are they propaganda? Probably some are. In both directions. But you can look behind the guy on camera and ignore what he says and see what is in the background. There is stuff back there that is clearly not faked. There would be far too much to fake.
https://www.youtube.com/watch?v=8sE83SeMDQA
This guy’s youtube channel predates the war. He’s Australian. Odds of propaganda not high, but ignore what he’s saying. Look behind him. His intro is in a parking lot 2000 kilometers from Moscow at a grocery store. Lots of cars.
At this scroll point: 10:30 he’s showing shopping center stuff. Ignore it. What I see is military age men walking around or working. They did not leave the country. That was all bogus.
At 14:02 is a kid driving around on an electric scooter of the municipal kind. You can look off into the distance and see all sorts of traffic and day to day life going on per normal.
17:00 minutes, a pharmacy. This looks like a non US pharmacy like Mexico or Singapore. Very much devoted to meds, rather than the Walgreen formula of selling much more than meds.
20:00 mustard flavored chips. I want to try that.
About 29:30 is his leaving the stores. Can’t be sure, looks like a bike rack with e-bike stacked there. Barcode scanners etc. He always makes his vids mid day to minimize crowds, but there are plenty of people around.
Point being. This imagination of sanction derived life of destitute just isn’t happening. Oil and gas transcend everything . . . Everything, with a capital E.
I'm not just being insulting, I'm being literal when I denounce the western oligarchies as fascist.
“Yet your comments history shows exclusive Russian content, don’t it?”
Oh really - anyone here can check and quickly find out just who is full of FLAT-OUT LIES on this site.
https://freerepublic.com/tag/by:bobl/index?tab=comments;brevity=full;options=no-change
Maybe have a vote here - is my posting history “exclusive Russian content” as Cronus states? Just click the link.
Well I guess their people will rise up and overthrow the communist government, like they did in Cuba......
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.