Investinrussia.ru: a new portal for doing business in Russia
InvestInRussia.ru is a new information portal developed to attract investment in Russia’s regions.
ThinkRUSSIA spoke with Kirill Dmitriev, CEO of the Russian Direct Investment Fund, on the organization’s new initiative to share information about Russia’s investment potential.
The Russian Direct Investment Fund (RDIF) recently launched InvestInRussia.ru, an information portal developed to attract investment in Russia’s regions. What was the thought process behind this site and what do you hope to accomplish?
We are hoping to make people more informed about Russia and its regions, promote investment opportunities and improve the investment climate. This portal is very topical at the moment and it is a continuation of our program, ‘Invest in Russia,’ which was launched in Davos in 2013. Last year FDI reached a record $94 billion - 83 percent higher than in 2012 – as Russia leapt to 3rd place in UNCTAD’s FDI inflow rankings. This growth was helped by our efforts to inform investors about lucrative opportunities in the country - RDIF has been actively deploying capital in Russia in collaboration with foreign partners. This portal is oriented towards the international global investment community to help navigate within the vast territory of the country and find strategically important regions which will reveal potential opportunities for investment. Russia is not just Moscow and St Petersburg. We have 85 constituent entities in the Russian Federation. Historically it has been a very time-consuming process to gather all the information together when considering investing within a particular region in Russia. This is the first time that the relevant materials have been put together according to international criteria for information disclosure. It is well structured and includes 65 success stories of companies such as Nestle, Renault and General Electric, which have been doing business in Russia for years. Russia has proven to be one of their most successful business developments.
Our aim is to attract investment to Russian regions from our existing partners along with new strategic investors, private equity funds and sovereign wealth funds. Our objective was to create a comprehensive first stop for potential international investors, where they can find all the necessary data in an inclusive manner to make an investment decision.
We have analyzed 500 different projects, chosen the most attractive, and created specific blocks of information that are required for each investment sector. The portal makes it easy to contact a regional partner, find the ideal area to locate a development site and even has information regarding things such as distance to ports.
In summary, the INVEST IN RUSSIA website provides visitors with a depth of granular detail not previously available, allowing potential investors to compare individual regions in terms of their key macroeconomic, geographical, infrastructural and demographic indicators. It provides comprehensive information from numerous sources and includes case studies, up-to-date news and insight from other investors. It also provides the relevant contact information of RDIF partners in each region for those wishing to inquire further about any particular location.
Why are Russia’s regions so important to driving economic growth in the country?
Investment into regions is crucial to realizing Russia’s full investment potential. The country is vast and yet such a small percentage of it has been utilized for development. It has always been a complex and lengthy process for each region to share relevant data with investors, and used to take several years. Our platform will streamline this process and will help each region to position itself within the investment market. The new website will facilitate the process of understanding which investment projects are not working and also identify potential areas for development within regions that are lagging behind the others. There is a tool on the site which allows you to compare different regions simultaneously across multiple metrics and key data points relevant to investors.
How do you see the InvestInRussia.ru initiative developing in the next few years?
We are hoping to launch versions in most major foreign languages by autumn 2014. In fact, we are actively working on the Chinese version at the moment.
We will continue to develop the platform and keep information up to date and promote investment opportunities within the biggest country in the world. The portal will be constantly updated in terms of new projects, development sites, case studies and data for the comparison of regions.
What would you most like potential investors to know about doing business in Russia?
We would like them to clearly understand “why Russia?”. We want potential investors to be able to review successful examples from of multinational companies already operating within the country. We want to show that foreign companies have, contrary to arguments often made in the media, made great strides in combating corruption, reducing bureaucracy. We want to show that ultimately the profits levels of foreign companies investing in Russia’s regions have justified their expansion into Russia – far more than in other developing economies. We would like investors to understand more about particular sectors; our knowledge hub and news section will be the most comprehensive source of information about the Russian investment climate available.
Everyone should know that unemployment and inflation remain low. Government debt is among the lowest of all developed western countries. Russia also has the largest skilled workforce in Europe, a 99.4 percent literacy rate, a stable domestic investment equal to any developed country and foreign reserves worth about $500 billion.
Russia’s middle class has tripled in size over the past five years, and now represents 55 percent of the population, making it the ninth biggest consumer market in the world. This is a far greater proportion than seen in the other BRIC countries - just 21 percent of China’s population and 11 percent of India’s are deemed to be middle class – while Russia also has the highest GDP per capita among the four.
Russia is also a country that is incredibly willing to do business, as evidenced by its accession to the World Trade Organization and the formation of a Common Economic Space with Belarus and Kazakhstan. The government has also made moves to combat corruption and perceptions that it is not ready for inward foreign business. It is also a signatory to the OECD’s Anti-Bribery Convention.