Country Analysis of Russia - The business aspect
In order to make a decision, concerning the market expansion into the foreign country, it is necessary to outline the ethnic aspects of managing business in the chosen country. In our research, we would consider Russian Federation – as an additional available opportunity of making business. We would pay attention on the cultural aspects, economical situation and the rate of social development. The globalisation impact on the economical development would also be outlined in order to determine the rate of foreign goods and services influence on the domestic markets. The currency background and its stability are the next important aspects of running business in the Russian Federation – that allows the foreigner to investigate the investment climate of the country. Finally, knowledge of political and legal factors of Russian Business running are the key success factors in the business strategies formation and its main goals achievement.
Key words: economic overview; economic indicators; currency history; trade relations; trade bloc participation; investment climate; industrial climate; impact of globalization; political and legal factors; cultural brief; future prospects.
The topicality of our research is caused by the company’s top management willing to expend the field of activity and to occupy new foreign market. The Russian Federation was chosen for that purpose, because of not filled cells for successful economical activity development some segments of the market, which are completed in the Western countries, are still not occupied. Our research will include the investigation of the current market, determination its all strong and weak points and outlining all specific aspects of running business in the Russian Federation. Our research would answer the following questions:
- What kind of economic, legal and political systems are found in Russia? What impact do these systems have on business?
- Profile Russia’s business culture. How does this culture impact a foreign firm seeking to do business in Russia?
- What kind of impact have preparations for the 2014 Olympics had on Russia’s economy and business community so far? What are some of the opportunities and challenges presented by this event?
- What kind of trade and investment policy does Russia have? What should a foreign firm know before they consider trade and investment with Russia?
- What impact has the global economic downturn had on Russia’s economy? What is the outlook here for the next 5 years?
What kind of economic, legal and political systems are found in Russia? What impact do these systems have on business?
Currently the economical system of Russian Federation (RFES) refers to the combined type of economical system. It tends to the market economy status, but still there is some heritage of the Soviet Union plan-based economy.
The RFES looks the following way – it is the integration of all economical processes, happening in the current Russian society. It is based on the relationship of property and economical mechanisms. As all economical systems, the main attributes of RFES are the manufacturing of goods, its distribution, exchange and consumption. For manufacturing process of some goods the raw materials are required. Russian Federation has got the following raw materials: petroleum, natural gas, timber, furs, precious and nonferrous metals. In the agricultural sector, the following goods are exported- dairy products, grain, sunflower seeds, meat, sugar beets etc. As industrial achievements of RF it is possible to outline automobiles, tracks, agricultural equipment, construction equipment, advanced aircraft, aerospace, machine and equipment products; medical and scientific instruments.
In order to outline the above said in the numbers, we would provide the reader with the flowing statistical data (RosStat) - in the 2009 the GDP of RF was $1.231 trillion ; the export volume was 301.6 billion and the import volume 167.4 billion 
The main business partners of the RF are Japan, China, EU, and CIS.
The main features of the RFES are the following:
- The priority of the market organisation of economical activity;
- The economy of RF contains several sectors;
- The government entrepreneurship is deeply interrelated with the private entrepreneurship; the wide governmental support is provided to the private entrepreneurship.
- The state financial, credit and tax policies are oriented on the social stability and economical development of the country;
- Social protection of population.
The current political system of the Russian Federation has got its special features: there are two essential characteristics of the system. First of all, this is the system of the one-person power of ‘non-alternative’ presidents, which excludes the opportunity of transfer of power from ruling president to its oppositionist opponent; there is a possibility of transferring the power to the successor, who was chosen by the president personally. Secondly, that is the one-person power is not executed openly- there are still many cells for passing over in silence.
The legal system of RF is represented by the bicameral federal assembly, which includes the State Duma and the Council of the Federation and in regions it is represented by the general courts (parliaments).
All three systems (economical, political and legal) make the direct influence on the business development- current legal system develops the judicial background foe the business; the political system guarantees the stability of all processes, happening in the society and economical system supports the business development and its existence in competitive environment.
Profile Russia’s business culture. How does this culture impact a foreign firm seeking to do business in Russia?
In order to be accepted by the Russian business world, all the participants and new-comers should follow the general rules and requirements of the Russian Business. In our research we would like to offer following basic issues of doing business in Russia:
- Total control over all actions, carried out by the employees- it is obvious that all agreements, signed by the representatives of the company, should be oriented on getting profit or some advantage for the company. But there are still some cases when the representative of the company acts according to his own interest- getting career growth or some additional profit for himself (not for the company);
- It is better to be the only owner if the company. It is very popular in Russia to start common business with friends, wife, brother etc. And very often such business finishes with disorder in the company. In some cases that leads to the bankruptcy. The main reason for that issue is lack of knowledge of laws and weak judicial background. Also Russians are very trustful to their friends or relatives.
- High level of corrupt practices in doing business. According to the non-official sources, the cost of unchecked business activities is approximately 20% from the total sum of concluded treaty.
- Weak judicial system. The law in Russian Federation is not perfect and there are many opportunities for misrepresentation of legislative acts for doing not fair business. 
What kind of impact have preparations for the 2014 Olympics had on Russia’s economy and business community so far? What are some of the opportunities and challenges presented by this event?
The process of preparation to the 2014 Olympics has speeded for the majority of fields of human life. There’re many responsibilities, caused by this issue, and at the same time, there are many new opportunities for business activities.
First of all, the decision of holding the Olympics games in Sochi – is the new opportunity for development of the South Region of RF. The actuality of founding and developing business in that region allows the new-comers and existing foreign companies to participate in preparation of the Olympic Games 2014. That is well-financed segment of economical, social and political life of the country, and cover of expenditure in the project is also high.
For those new-comers to the business system of RF, who have not got an experience of foundation and running business in Russia, there are many consulting companies, operating in the market of business services, who may professionally organize profitable business in every area of human activity or to provide a support for introducing existing foreign business into Russian economical system 
What kind of trade and investment policy does Russia have? What should a foreign firm know before they consider trade and investment with Russia?
While considering the investment policy of RF it is possible to say that Russia is interested in:
- restoration and updating of the industrial potential;
- consumers' market saturation with high quality and inexpensive goods and services;
- development and reorganisation of its export potential;
- carrying out the policy, directed for reducing importing goods;
- introduction of western management culture into Russian society.
What impact has the global economic downturn had on Russia’s economy? What is the outlook here for the next 5 years?
Because Russian Federation is a part of the global economical system, all the changes, events and tendencies of Global economical system make their impact on the economical situation in Russia. But still, Russia is a wealthy country- it has got rich mineral wealth, and that allows skilful Russian government to protect, support and develop Russian economy, while making it attractive for foreign investors.
To our opinion, it is possible to say that the general tendency of economical growth and development of Russian society – is the main tendency for next five years.
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