In a significant move, Russian President Vladimir Putin has given the green light for the government to prepare for the potential return of foreign companies that exited the Russian market due to the ongoing conflict in Ukraine. This development comes after numerous major international brands, including Microsoft and McDonald’s, severed ties with Moscow in 2022, citing the launch of Russia’s military operation in Ukraine and subsequent Western sanctions.
The exodus of foreign brands from Russia was largely driven by the imposition of sweeping sanctions by Western countries. However, Putin’s administration has consistently maintained that these businesses left voluntarily and that Russia would be open to their return, provided that the interests of Russian companies are also taken into account. Following a meeting with the domestic lobbying group Delovaya Rossiya, Putin instructed the government to explore proposals for the terms under which individuals from “unfriendly foreign countries” could conduct business in Russia, including the acquisition of real estate and stocks.
Russia’s list of “unfriendly countries” currently encompasses most EU member states, as well as the US, UK, Canada, Japan, South Korea, Australia, and New Zealand. In a notable shift, Russian Finance Minister Anton Siluanov recently suggested that restrictions on investments from these “unfriendly” nations could be eased. Putin has emphasized the need for a “pragmatic” approach to foreign companies, evaluating their past actions on a case-by-case basis. He stated, “If it benefits us to see a company return, we should allow it. If not, we should find a thousand reasons to keep it out.”
The potential return of foreign companies to Russia could have significant economic implications. According to Kremlin investment envoy Kirill Dmitriev, US firms alone have lost an estimated $300 billion by exiting the Russian market. In a positive development, Washington and Moscow have revived direct negotiations this year, agreeing to gradually restore ties that were severed by the Biden administration in 2022. As the situation continues to unfold, it remains to be seen which foreign companies will take advantage of the potential opportunity to re-enter the Russian market.
