Business argues for long-term US-Russia ties

World
Europe

02:09

Tension between Russia and the US have eased for the moment as Russian lawmakers postponed passing a bill making it a crime to comply with Western sanctions on Russia. Yet American investors have felt a change since the sanctions.

“One thing we certainly feel (about the effects of the sanctions) is keeping the cost of capital relatively high for our business in Russia and that obviously constrains what we could do to grow our business, ” Chris Van Riet, CEO of Radius Group, told CGTN.

Chris has been living in Russia for more than 20 years, and he's worried that the uncertainty would hang over the investment mood in the country.

Business leaders at the St. Petersburg International Economic Forum (SPIEF) are pushing for a long-term relationship.

Even though faced with different challenges, the most important thing is the commitment that “we can do great things together”, Bertrand-Marc Allen, President of Boeing International, said at a panel at SPIEF.

The Russian government has issued a series of initiatives to attract foreign investment. In the Far East region, for instance, policy favors include free use of land, infrastructure and utilities, as well as tax rebates.

Officials are confident that the variety of business opportunities would secure more investment despite outside pressure.

With these polices, Russia has welcomed some pioneers from all over the world.

An investor from Australia has brought his family to the Far East to develop farming business and local government gave him land basically for free, Leonid Petukhov, CEO of Far East Investment & Export Agency, told CGTN.

Russia needs to diversify its foreign investment portfolio, said Petukhov.

Yet investors say American sanctions may stand in the way of that effort because the costs of financing have risen, making it more expensive to do capital-intensive industries.

Businessmen on the panel said that the American delegation was the largest at the forum, even though official trade figures between the two countries don’t reflect the situation.

The panelists argued for a long-time serious relationship between Washington and Moscow. But it's still uncertain how any good gestures would produce deliverable results.