OECD Investment Policy Reviews

1990-0910 (online)
1990-0929 (print)
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OECD Investment Policy Reviews present an overview of investment trends and examine a broad range of policies and practices affecting investment in the economies under review. This can include investment policy, investment promotion and facilitation, competition, trade, taxation, corporate governance, finance, infrastructure, developing human resources, policies to promote responsible business conduct, investment in support of green growth, and broader issues of public governance. The reviews take a comprehensive approach using the OECD Policy Framework for Investment to assess the climate for domestic and foreign investment at sub-national, national or regional levels. They then propose actions for improving the framework conditions for investment and discuss challenges and opportunities for further reforms.

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OECD Investment Policy Reviews: Russian Federation 2004

OECD Investment Policy Reviews: Russian Federation 2004

Progress and Reform Challenges You do not have access to this content

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03 Dec 2004
9789264018518 (PDF) ;9789264018495(print)

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The 2004 Investment Policy Review of the Russian Federation evaluates the progress made since the publication of OECD's 2001 study on this topic.  The report finds that Russia has made significant improvements in its business environment and has signed investment and double taxation treaties with a number of countries.   Nevertheless, the Russian Federation has attracted relatively little FDI and has experienced large-scale capital flight.   The report recommends further reforms that are needed.
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  • Progress and Prospects
    The Russian Federation, the world’s largest country, with a land area of 17 million square kilometres and a population of 144 million, has attracted relatively little foreign direct investment (FDI). This modest performance of Russia in attracting FDI is particularly evident in comparison with other transition economies in Europe, which have received far more FDI, adjusted for population, and have also exhibited a positive correlation between FDI inputs and GDP growth rates. By the end of 2003 Russia had recorded a cumulative inflow of USD 26.1 billion, less than half China’s annual inflow for 2003 alone, and far below comparable absolute figures for the Czech Republic and Poland. Divided by population, the resulting...
  • The Pattern of Russia's FDI Inflows
    Official FDI statistics indicate that Russia has continued to under perform in both the quantity and the composition of FDI in comparison with other industrialised economies, including transition economies in Central and Eastern Europe.
  • Progress Since the 2001 OECD Study
    One of the fundamental reforms that were being introduced as the 2001 study was drafted concerns the Russian tax system. Based on their experience of the system in force during the 1990s, investors complained vociferously about the tax burden created not so much by the incidence of tax rates but by the multiplicity of different taxes levied and the methods of determining the tax base. Many structural aspects of the system contained an inherent bias against business activity, and its negative impact on entrepreneurs, both...
  • Addressing Remaining Non-descriminatory Barriers to Investment
    The progress reviewed in Chapter 3 above presents an impressive number of concrete reform steps, supported by a large body of new or amended legislation. The resulting improvements in the overall investment environment should be evaluated against these criteria:

    Is there an adequate, rules-based legal and regulatory environment for investment?

    Does it apply consistently, for all, across the territory of the Russian Federation, or are there inconsistencies and regional variations?

    Are the rules being properly implemented and enforced, or are they being thwarted through corrupt behaviour and rent-seeking by economic agents?

  • Relaxing Discrimanatory Restrictions on Foreign Direct Investment
    A number of measures in several sectors of industry and services discriminate directly against foreign investors and are thus not consistent with the principle of non-discrimination embodied in international instruments such as the OECD Codes of Liberalisation or the National Treatment Instrument. Ownership quotas and other restrictions on foreign investment apply in agricultural land, banking and insurance as well as in the mass media, aviation and domestic transport sectors. In addition, reciprocity conditions apply to foreign participation in telecommunications, and the regulatory framework for the natural monopolies in the gas and electricity sectors sets limits on direct and indirect foreign ownership....
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