European Investment in Kaluga Region: Features under Sanctions

457
DOI: 10.20542/0131-2227-2018-62-9-81-87

A. Gutnik (anngutnik@mail.ru), 
Primakov National Research Institute of World Economy and International Relations, Russian Academy of Sciences (IMEMO), 23, Profsoyuznaya Str., Moscow, 117997, Russian Federation;
O. Trofimova (olgatrofimova53@mail.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 was prepared at the Primakov National Research Institute of World Economy and International Relations, Russian Academy of Sciences and supported by a grant from the Russian Science Foundation (project no. 14-28-00097 “The optimization of Russian external investment ties in the conditions of deteriorating relations with the EU”).


Abstract. The article examines the inflow of uropean investment to Kaluga region, one of the most successful in Central Federal District of Russia. The authors identify the specifics of the regional location of European direct investment (FDI) in Russia before and after imposition of Western sanctions in mid-2014 using the existing theories of consistent pattern and different factors influencing this distribution. One of the most important factor consist in that the European Union represents an integration association where each country has its national interests and priorities and particular business model. This explains the differences between EU members in regional and branches preferences in investing in Russia. The article analyses investment attractiveness and advantages of Kaluga region which worked out an effective Investment Strategy 2013- 2020 based on “soft” drivers and cluster model of economy. Special investment product of the region are productive sites (‘brownfield” and “greenfield”) set up in industrial parks and special economic zones. The main cornerstones of the strategy are successful activities of local government and favorable conditions for European investors. The economic crisis and sanctions against Russia has not affected seriously the participation of major European investors due to successful and clever policy of region authorities. No one abandoned their project plans. Authors pay special attention to the advantages of Kaluga region cluster model for European investors and their concentration in manufacturing industries, including high-tech and innovative production. The branches’ structure of European investment reflects cluster orientation of region`s economy. Western Europe remains the top investor in the region. The largest number of FDI projects is implemented by German companies. 

Keywords: Russia, Kaluga region, European investment, economic development, cluster model, investment advantages, investment distribution, regional policies, industrial parks, innovative development 


REFERENCES

1. Kuznetsova O.V. Rol’ inostrannogo kapitala v ekonomike regionov: vozmozhnosti otsenki i mezhregional’nye razlichiya [Role of foreign capital in the economies of regions of Russia: possibilities of assessment and inter-regional differences]. Problemy prognozirovaniya, 2016, no. 3, pp. 59-70.

2. Russia ranked seventh among European countries by number of projects of foreign direct investment. Ernst&Young, 01.06.2017. (In Russ.) Available at: http://www.ey.com/ru/ru/newsroom/news-releases/ey-russia-ranked-seventh-among-european-countries-by-fdi-projects (accessed 09.01.2018).

3. Central Bank informed about inflow of portfolio investment in Russia. Economy and life, 04.07.2017 (In Russ.) Available at: http://www.eg-online.ru/news/349268/ (accessed 12.1.2018).

4. Kuznetsov A.V., ed. ES i Rossiya. Ot pryamykh kapitalovlozhenii k investitsionnomu sotrudnichestvu [EU and Russia. From direct investment to investment cooperation]. Moscow, Nauka, 2008. 335 p.

5. Attraction of foreign investment: slow progress. Moscow, Tsentr makroekonomicheskikh issledovanii Sberbanka RF, 2013. 7 p. (In Russ.) Available at: http://data.sberbank.ru/common/img/uploaded/analytics/2013/macro_25102013.pdf (accessed 15.04.2018).

6. Russian fund of direct investment. Foreign investment in Russia in 2016. Figures and facts Moscow, RFDI, December 2016. 17 p. (In Russ.) Available at: http://investinrussia.com/data/files/fdi/RUS%20FDI%20announcements%20report%202013-2016.pdf (accessed 15.04.2018).

7. Region of high investment density. RIA rating, 29.07.2013 (In Russ.) Available at: http://riarating.ru/regions_study/20130729/610577884.html (accessed 20.01.2018).

8. Kuznetsova O.V. Nakoplennye inostrannye investitsii v rossiyskikh regionakh: territorial’naya struktura i rol’ ofshornogo kapitala [Accumulated foreign investment in Russia`s regions: territorial structure and role of offshore capital]. Analysis of problems and state management projecting, 2015, no. 6, pp. 47-62.

9. Possibilities for business. Ministry of economic development of Kaluga region. Vestnik, no. 4, May 2016 (In Russ.) Available at: http://arrko.ru/deyatelnost/iakaluga/heralds/vestnik-4-2016-vozmozhnosti-dlya-biznesa/ (accessed 10.01.2018).

10. Industrial parks. Not brownfield but greenfield. 30.05.2013 (In Russ.) Available at: http://www.tehsovet.ru/article/chief/1856.html (accessed 10.01.2018).

11. Industry. Technologies. Projects. Ministry of economic development of Kaluga region. Vestnik, no. 6, November 2017 (In Russ.) Available at: http://arrko.ru/deyatelnost/iakaluga/heralds/vestnik-6-2017/ (accessed 10.01.2018).

12. National rating for investment climate in entities of RF. Agency for strategic initiatives (In Russ.) Available at: https://asi.ru/investclimate/rating/ (accessed 15.01.2018).

13. RF Central Bank. Statistics of foreign sector. Available at: https://www.cbr.ru/statistics/?Prtld=svs (accessed 20.01.2018).

14. Regions of Russia. Social and economic indicators. Moscow, Rosstat, 2017, pp. 638-639 (In Russ.)

15. Foreign investors in Kaluga region. Available at: http://ru.investinrussia.com/investment-in-regions/24 (accessed 09.01.2018).

16. Investment Gateway of Kaluga region (In Russ.) Available at: http://investkaluga.com (accessed 20.01.2018).

17. Survey of European countries’ investment attractiveness. Russia (In Russ.) Available at: http://www.ey.com/Publication/vwLUAssets/EY-attractiveness-survey-russia-2017-rus/$File/EY-attractiveness-survey-russia-2017-rus.pdf (accessed 20.01.2018).

18. L`Oreal invests 2.5 billion rubles in expansion of group’s plant in Russia. Finversia, 11.09.2017. (In Russ.) Available at: https://www.finversia.ru/news/markets/l-oreal-investirovala-2-5-mlrd-rublei-v-rasshirenie-zavoda-gruppy-v-rossii-27294 (accessed 12.01.2018).

19. Current state and perspectives of social of socio-economic development of Kaluga region. Analytic Herald. 2016. no. 22 (621). Moscow, Analytic department of Federation Council of Russian Federation. 66 p. (In Russ.)

20. Investment strategy of Kaluga region (Investment strategy up to 2020 (with changes as of July 4, 2014) (In Russ.) Available at: http://investkaluga.com/investitsionnaya--strategiya/ (accessed 09.01.2018).

21. Kaluga region: sale of industrial parks gives enormous investment. Nation’s capital, 04.05.2010 (In Russ.) Available at: http://kapital-rus.ru/articles/article/kaluzhskaya_oblast_prodazha_industrialnyh_parkov_daet_kolossalnyj_obem_inve/ (accessed 12.01.2018). 


Registered in System SCIENCE INDEX

For citation:
Gutnick A., Trofimova O. European Investment in Kaluga Region: Features under Sanctions. World Eonomy and International Relations, 2018, vol. 62, No 9, pp. 81-87. https://doi.org/10.20542/0131-2227-2018-62-9-81-87



Comments (0)

No comments

Add comment







Indexed

 

 

 

 

Current Issue
2023, vol. 67, No. 3
Topical Themes of the Issue:
  • Tax Instruments to Stimulate Innovations in EU Countries 
  • Russia and Western Balkans: Realized and Missed Opportunities in Trade
  • Spanish Society: Stable Instability 
  • ASEAN and the Myanmar Dilemma 
  • Greater Middle East
Submit an Article
INVITATION FOR PUBLICATION
The Editorial Board invites authors to write analytical articles on the following topics:
  • changes in the processes of globalization in modern conditions
  • formation of the new world order
  • shifts in civilization at the stage of transition to a digital society

The editors are also interested in publishing synthesis articles / scientific reviews revealing the main trends in the development of certain regions of the world - Latin America, Africa, South Asia, etc.