Doing Business In Russia

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Chief Executive of British Expertise - Welcome

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Tracey Smith
Tracey Smith
Chief Executive, British Expertise

 

Russia remains a long term market of great potential for British exporters and investors. It is our fastest-growing major export market, and our twelfth-largest export market overall. Yet the UK earnings of over £4 billion each year account for only about 2% of Russian imports, so there is clearly scope for expansion. The Russian Government's economic modernisation and infrastructure development agenda, and the appetite of Russian companies and the country's 140 million citizens for quality goods and services, mean that demand is likely to increase steadily as the economy recovers from the effects of the global recession.

In 2011, Russia became the world's leading oil producer, surpassing Saudi Arabia; Russia is the second-largest producer of natural gas in the world and has the world's largest natural gas reserves, the second-largest coal reserves, and the eighth-largest crude oil reserves. Russia is the world's third-largest exporter of both steel and   primary aluminium. Yet Russia's reliance on commodity exports makes it vulnerable to the highly volatile swings that take place in global commodity prices. In 2007, the Government embarked on an ambitious program to reduce this dependency and build up the country's high technology sectors, but with limited results so far. It is also the case that the Russian economy was one of the hardest hit by the 2008-09 global economic crisis, as oil prices plummeted and the foreign credits that Russian banks and firms relied on dried up. The economic decline bottomed out in mid-2009 and the economy began to grow in the third quarter of 2009. High oil prices buoyed Russian growth in 2011 and helped Russia reduce the budget deficit inherited from the lean years of 2008-9. Unemployment has been falling since 2009 and inflation has been falling since 2010. Russia's long-term challenges include a shrinking workforce, a high level of corruption, difficulty in accessing capital for smaller, non-energy companies, and poor infrastructure in need of large investments.

At British Expertise, we have a great deal of experience of taking trade missions to Russia on behalf of UK Trade & Investment, and we see that British business continues to be very interested in this market, despite the problems it poses. We are confident that British professional services companies will continue to do good business in Russia and we are here to help. If you are not a member and would like to know more, please don't hesitate to call or email us.

Tracey Smith
Chief Executive, British Expertise
www.britishexpertise.org

 

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