Foreign direct investment between Russia and CIS countries amidst uncertainty

About the authors:

Yuliya A. Yukhtanova, Cand. Sci. (Econ.), Associate Professor, Junior Researcher, Department of Economic Security, System Analysis and Control, University of Tyumen, Tyumen, Russia; y.a.yukhtanova@utmn.ru, https://orcid.org/0000-0002-9365-9714

Sofya E. Belyaeva, 4^th year student of “Economic Security”, University of Tyumen, Tyumen, Russia; stud0000240318@utmn.ru
Anna A. Bogdanenko, Laboratory Assistant-Researcher, Department of Economic Security, System Analysis and Control, University of Tyumen, Tyumen, Russia; a.a.bogdanenko@utmn.ru

Abstract:

Foreign investment is an effective instrument of interaction between countries, as it promotes the development of foreign economic relations between them and the strengthening of mutual trust. Amidst instability, global and local crises, the ties between different countries strengthen or weaken, the directions of inflow and outflow of foreign capital change. It is assumed that the partial reorientation of Russian capital from the West to the South-East opens up new opportunities for strengthening integration cooperation within the CIS, including in the form of mutual foreign direct investment (FDI). The main objective of the study is to analyze the nature of interaction between the Russian Federation and the CIS countries in the form of mutual FDI in 2012–2022, including the times of uncertainty: the local crisis of 2014 (sanctions against the Russian Federation), the global crisis of 2020–2021 (COVID 2019) in the context of integration opportunities. The authors analyze statistical data of the World Bank, statistics of the external sector of the Bank of Russia on mutual FDI of the Russian Federation, using structural-dynamic statistical analysis, the method of cartography. Russia demonstrates different nature of investment interaction and integration with individual CIS countries. The local crisis of 2014 was a turning point in the positive change in the volume of FDI from the CIS countries into the Russian economy, yet during the following years there is no mutually agreed expansion of the scale of cooperation, except for Russia–Kazakhstan. The authors’ assumption of the global world crisis impact on mutual inflows and outflows of capital between Russia and CIS countries as mutual direct investment was not confirmed. The results help in identifying opportunities for further integration of Russia with the CIS countries and elimination of barriers and restrictions to strengthen and develop investment cooperation in the future.

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