China's Foreign Investments in Russia

November 05, 2021 | BY

Susan Mok

Maxim Alekseyev, Senior Partner, Head of Asia-Pacific Desk and Timur Akhundov, Senior Associate of ALRUD Law Firm highlight the various investment regimes used to attract foreign investment in Russia and discuss the two levels of investment zones and opportunities to sign investment contracts, as well as the continued economic cooperation between China and Russia

Summary

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  • The measures promoting attraction and protection of foreign investment in Russia can be divided into two levels: international and national.
  • Russian investment zones cover Special Economic Zones (SEZs), Advanced Development Territories (ADTs) and the Free Port of Vladivostok (FPV).
  • The distinctive feature of investment contracts is the party who initiates the negotiations and execution of the contract i.e. the investor.

In an era of increasing competition and expansion of economic ties between states, the role of foreign investment in a country's economy plays a significant role. Although the Russian economy has been impacted by the economic crisis associated with the COVID-19 pandemic, the already launched projects of the previous years are still at the implementation stage and continue in their own development. At the end of 2020, foreign investors invested in 141 projects in the Russian Federation.

China traditionally occupies one of the leading positions (in second place) in terms of the volume of investments in the Russian economy. Statistics show that the most popular sectors of the economy chosen for investments in the recent years are the automotive, TMT, agricultural, oil and gas industries.

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