Problems of foreign investments attraction in Russia

Attraction of investments into real sector of economy is one of the economic policy main problems in Russia.

Foreign investors which operate in the Russian market can be divided into 3 groups:

investors which operate in enclave part of the general legal field of national managing treatment;

small and average commodity producers who possess the original production and services "know-how"

investors who are guided by reception of profit of speculative character

In Russia, it is necessary to attract the second type of investors. They will promote competition among manufacturers.

Measures focused on creation of attractive conditions for inflow of investments include 3 basic groups: base measures on creation of favorable investment climate; legal and administrative bases of foreign investors activity; specific stimulus for inflow of investments.

Strategic target of policy in sphere of foreign investments attraction is to provide favorable conditions for foreign investors to invest in Russian economy. The serious preparatory work on tax change, investment and corporate legislation which could promote intensification of investment process is needed for this purpose. The national treatment of economic activities that exists in Russia is extremely unattractive for the foreign companies. The national treatment principle in Russia should be complemented by system of privileges and guarantees for foreign investors.

Along with application of national treatment, realization of other foreign investments legal regulation principles is also necessary. First of all, it is the treatment of the most favored nation which is applied on purpose of discrimination in relation to investors from any countries.

Russian politics according to foreign investments should be characterized with high transparency.

Priorities of policy of attraction of foreign investments in Russia should be focused on several aspects:

- Financial incentives for kinds of activity which are important for economy of the Russian Federation, including export of competitive production and import of new technologies;

- Branch priorities: attraction of foreign investments (1) in hi-tech branches (information technology, the space and nuclear industry; (2) branches that have "bottlenecks" character in economy; and (3) branches that develop export – machine-tool construction for the wood, oil, gas industry, power, metallurgy.

- Priorities for some companies: it is inexpedient to stop stimulation of the large companies, but at the same time it is necessary to pay attention to the small and average foreign companies investments attraction

- country priorities: activisation of investment attraction process in Russia economy, demands country investments inflow sources diversification at the expense of economically developed countries, and the countries with dynamical emerging markets.

The investments policy should be focused on liquidation of formal restrictions and administrative barriers on the way of the foreign capital, on use of system of the guarantees focused on specificity of foreign investments and called to compensate negative consequences of the developed investment climate.

Conclusion

Every country tries to attract foreign capital and obtain direct and indirect advantages of foreign investment. Today foreign investment plays one of the main roles in the direction of global development. Foreign investment plays an extraordinary and growing role in global business.

Russia has an enormous and underdeveloped endowment of natural resources, particularly in mineral resources and petroleum. There are high expectations for foreign investments to flow into resource development and related sectors. However, foreign inflows to Russia have tended to flow into not only the primary sector but also into the services sector. In general, foreign investments are more concentrated in the central regions of the Moscow, St. Petersburg and the Republic of Tatarstan than elsewhere.

There are some problems of investing in Russia. In Russia, government support of investment is very low. Bureaucracy in the Russian Federation is a very strong obstacle for investing. The legal environment for foreign investments in Russia has historically been characterized by the weak enforcement of laws and contracts. Also our country has many restrictions on investing (for example investing in strategic branches).

Russia has recently considerably enhanced its position as a foreign investments destination. It is very important for our country. Foreign investments are one of the major foundations for economic growth of Russia.

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