2259V. Zagashvili (zagashvili@imemo.ru),
Primakov National Research Institute of World Economy and International Relations, Russian Academy of Sciences (IMEMO), 23, Profsoyuznaya Str., Moscow, 117997, Russian Federation
Acknowledgements. The article has been supported by a grant of the Russian Science Foundation (project ¹ 14-28-00097 “The optimization of Russian foreign investment ties in the context of deteriorating relations with the EU”).
Abstract. The article analyzes political risks faced by the Russian companies in their foreign investment activities. The concept of political risks and their main types are considered. Since the bulk of the capital outflow from Russia goes to European countries, the main attention is paid to political risks, accompanying investments in the countries of this region. The peculiarity of the current situation is that the worsening of political relations with Western countries has led not only to an increase in external political risks that affect the foreign investment activity of Russian companies, but also weakened the investment attractiveness of the Russian economy itself. The Russian business is squeezed between the grips of high internal and external risks. The increase of political risks worsens access to the sources of raw materials and markets, restricts the receipt of new technologies, impedes the participation of Russian companies in the transnational production networks and slows down the economic growth. Analysis of investment risks leads to the conclusion that there is a need for institutional reforms within the country and normalization of political relations with developed countries. Among the political risks faced by Russian investors in Europe the most important are the risks associated with the course of European integration, sanctions and EC energy policy. The threat of the disintegration of the European economic space represents a significant investment risk. But an excessively rapid movement along the path of integration is also dangerous since it is accompanied by radical transformation of the regulatory framework and is fraught with the unbalancing of the integration process. Sanctions limited the sources of investment finance and spheres of capital application, increased the risks of discriminatory treatment of Russian companies abroad. Political investment risks for Russian companies are rising in the context of Brussels’ energy policy of diversifying gas sources. The construction of gas pipelines is especially highly sensitive to political risks. It is important for the investor not just to secure the guarantees of the buyer, but to attract financing from his side in order to share investment risks with him.
Keywords: political risks, foreign investment, Russia, EU, European integration, sanctions, energy policy
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