Russia To Restrict Foreign Investments

The Russian government is introducing new legislation which is aimed at reducing the power and influence that foreign corporations could impact Russian society. Prime Minister Putin is pushing for these new laws despite the more liberal economically minded Finance Minister Alexi Kudrin. Kudrin is raising issues as to whether such restrictions will damper the desire of foreign investors to place their money into the Russian economy. As he put it, “some investors are not going to come for a minority stake or less.” Under provisions of the new law, a foreign corporation would be barred from entry into any one of 42 sectors of the economy such as aviation, telecom, media, utilities, etc.. Foreign companies seeking to invest in any of these areas of the economy would have to obtain special permission from the Russian government.

The new laws are aimed at preventing foreign influence into such areas as the media which is currently controlled by the government and thus it enables Putin and Medvedev to maintain tight control over what the Russian public is allowed to read or see pertaining to contemporary events.

Of course, the Putin assumption is that Russia’s energy resources will last into the forseable future and thus avoid the need for foreign investment. It is an assumption.