Asia Replaces West in Russia’s FDI

A number of investments from western countries in Russia are on hold, but the situation is more than made up for by new investors from Asia.  Foreign investors put up capital for 238 projects in 2017–a record number for Russia, according to an annual survey by EY, Intellinews reported. Asian countries showed strong interest in the Russian economy: China last year became the leader by the number of foreign direct investment projects for the first time, with Japan and South Korea also among Russia’s top 10 investors. However, in monetary terms the growth of FDI was a lot more modest. According to central bank data, FDI in the second quarter (excluding banks) was just $1.7 billion, down from $12.6 billion over the same period of 2017. The latest figures suggest the moderate recovery in FDI following the 2014-16 recession may be going into reverse. As in 2016, foreign investors focused on the construction of new manufacturing facilities in Russia (202 projects), rather than business expansion (36 projects).