Foreign Investors in Russia

STRATEGIC BUSINESS PLANNING FOR FOREIGN INVESTORS IN RUSSIA

This research explores the advantages and disadvantages of investment in Russia in the early-1990s through a review of the various aspects involved in the application of the principles of strategic business planning to the Russian economic environment. In the conduct of this exploration, market anomalies between Russia and developed western economies, investment opportunities in Russia, joint venture potentials, and the operation of free economic zones are considered.

Market Anomalies Between Russia and Developed Western Economies

The failure of the attempted coup de etat against the Gorbachev government in the Soviet Union in 1991 led directly to both the official disestablishment and the official disenfranchising of the Communist Party of the Soviet Union (Goldman, 1991, pp. 30-33). Writing the Communist Party out of government in the Soviet Union, in turn, made it possible for the introduction of economic changes that, in effect, marked an end to Soviet socialism, unless it is reborn at some later date (Toffler and Toffler, 1991, pp. 34-39).

The general assumption in the western international press appears to be that the failure attempted coup de etat caused the collapse of Soviet socialism. In fact, the attempted coup de etat was just a manifestation of the collapse of Soviet socialism. The collapse of Soviet socialism began with the ascendancy to power of Mikhail Gorbachev in 1985. By the time of the attemp

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imary data, a wealth of problems may confront the market researcher with respect to official governmental data. In addition to these problems, however, the market researcher in contemporary Russia may find that: 1. Individuals are unwilling to respond to the questions posed by the market researcher. 2. It may be all but impossible to conduct some types of marketing research activities. Telephone surveys, as an example, are difficult (if not impossible) to conduct. 3. Sufficient characteristics about the Russian population are often not available in the level of detail required to permit the development of a valid sample. Having laid the ground work to make the point that the development of plans for the exploitation of opportunities in contemporary Russia will be a difficult process at best, it is equally important to state that many opportunities do indeed exist. Industrial production in Russia declined by 12 percent in 1991 (NATO Economic Committee, 1992, p. 7). On its face, such a statistic might well cause an investor to recoil. On the brighter side, however, economic performance in contemporary Russia has caused the Russian government to actively seek foreign investment (Foreign Trade, 1992, pp. 46-48). Foreign inve

Category: Economics - F