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. Last Updated: 07/27/2016

Business in Brief

Foreign Investment Up 42%

The country attracted 42 percent more foreign investment in the first six months of this year than in 2005, the State Statistics Service said in an e-mailed statement.

Investment reached $23.4 billion in the first six months, with $6.4 billion of that classified as foreign direct investment. Portfolio investments almost tripled to $499 million. Loans accounted for $16.5 billion of the total. (Bloomberg)

Forecasts Threaten Stability

Finance Minister Alexei Kudrin said the government's constant revision of economic forecasts was threatening the country's macroeconomic stability, Kommersant reported.

Regular changes to inflation and exchange-rate forecasts mean interest rates and prices need to be recalculated, Kudrin told Kommersant in an interview. As a result, the government is not providing "stable conditions" for business, he said. (Bloomberg)

Central Bank Buys $57Bln

The Central Bank bought $57.3 billion from exporters in the first half of the year amid high oil prices, increasing the country's money supply and making it harder to meet the bank's inflation targets, Vedomosti said.

The bank's buying of dollars swelled the money supply by almost 44 percent in the year to July 1, compared with the target of 28 percent growth set for the whole year. (Bloomberg)

Debt Payments on Track

The government expects to sign an agreement this week to pay off its $1.8 billion debt to France, Deputy Finance Minister Sergei Storchak said Tuesday.

Of the 17 Paris Club creditor nations Russia plans to repay this month, France is the largest with which no agreement has been signed.

Storchak also told a press conference he would sign agreements with Switzerland and Denmark this week. (Bloomberg)

Imports Slow Industry

Industrial output grew at a slower than expected rate in July, according to data published Tuesday, as manufacturers struggled to compete with growing imports.

Industrial production fell by 0.4 percent in month-on-month terms, while the year-on-year growth rate was 2.9 percent, unchanged from June and well below consensus expectations in a Reuters poll of 4.8 percent. (Reuters)

Putin, Niyazov Talk Energy

ASHGABAT, Turkmenistan -- President Vladimir Putin and Turkmen leader Saparmurat Niyazov discussed "energy cooperation" Tuesday, two weeks before a threatened cut in gas exports by the Central Asian state was set to come into effect as the result of a price dispute.

Analysts believe shipments may not be disrupted and that Russia and Turkmenistan will seek to find a last-minute deal. (Reuters)

U.S. Praises Turkmen Crude

ASHGABAT, Turkmenistan -- A top U.S. diplomat met with Turkmen President Saparmurat Niyazov on Monday, praising Turkmenistan's efforts to increase exports of its vast natural gas supplies to world markets, state-run Turkmen television reported.

Stephen Mann, the U.S. State Department envoy for Caspian energy development, and Niyazov discussed diversifying energy resources in the Central Asian nation, Turkmen television reported. (AP)

Gazprom Ruling Rejected

Gazprom won a court case Monday that overturned a reduction of the company's stake in a natural gas field in the Arctic, Vedomosti reported, citing the Moscow Arbitration Court.

Gazprom's 25 percent stake in South Tambey was cut to 12.6 percent when the license to the field was transferred to Yamal-LNG from Tambeyneftegaz. (Bloomberg)

Russia-Kazakh Oil Venture

Russia and Kazakhstan will sign an agreement Oct. 3 on a joint venture to refine crude oil and gas, Interfax reported, citing Kazakh President Nursultan Nazarbayev.

Nazarbayev was speaking at a meeting with President Vladimir Putin in Sochi, the news service reported. (Bloomberg)

TNK-BP Sells Unit

Baker Hughes, a U.S. oilfield-services provider, bought a unit of TNK-BP, Interfax reported, citing an unidentified person familiar with the matter.

TNK-BP subsidiary Orenburgneft earlier said it had completed a transaction to sell Orenburgneftegeofizika, the news service said. (Bloomberg)

Svyazinvest Sale in Doubt

Economic Development and Trade Minister German Gref said the sale of the government's stake in national fixed-line operator Svyazinvest may not happen at all, Interfax reported Tuesday.

"The situation with Svyazinvest is not yet finally decided," Gref said, the news agency reported. "All alternatives of its future are under discussion."

Gref said the decision on the company's future could be made this year and that his ministry was still interested in the sale, Interfax reported. (Bloomberg)

Atomstroi Gains Partners

Areva, the world's biggest maker of nuclear reactors, and Germany's Siemens will join state-owned Atomstroiexport in a bid to win the right to build a $3 billion nuclear power plant in Bulgaria.

Atomstroiexport, the country's nuclear technology exporter, is bidding against a group of Czech companies led by Skoda Praha to construct a 2,000-megawatt nuclear power plant. Areva and Siemens will supply safety and operational control systems, the companies said in Sofia on Tuesday. Bulgaria will choose the winner this month. (Bloomberg)

Nike Stores to Open

Stockmann, a Finnish department-store company, said it reached an agreement to open and run shops in Russia for Nike, the world's biggest maker of athletic shoes.

The first Stockmann-operated Nike store will open at the start of 2007, and several more are planned "over the years to come," the Helsinki-based company said Tuesday in a stock-exchange statement. (Bloomberg)

Uzbekistan Strips License

TASHKENT, Uzbekistan -- Uzbekistan has revoked a license held by Britain's Oxus Gold to develop the Khandiza deposit in the south of the country, a government source said Tuesday.

The source said a state-owned copper company would develop the Khandiza deposit, which contains gold, zinc, silver, copper and lead. (Reuters)

KrasAir Case Dropped

Prosecutors have dropped a criminal case into suspected large-scale fraud at KrasAir, the nation's No. 3 airline, a company official said Tuesday.

The KrasAir official said the criminal charges had been dropped "for lack of evidence." (Reuters)

Novolipetsk Buys Steel Firm

Steelmaker Novolipetsk said Tuesday that it had bought 100 percent of VIZ-Stal, the country's second-largest electrical steel firm, for $550 million.

Novolipetsk had said earlier that it would rank among the world's top three electrical steel producers after the acquisition. (Reuters)

Chelyabinsk Deliveries Up

Chelyabinsk Pipe Works and Pervouralsk Pipe Works increased deliveries by 12 percent in January through July, said Arkley Capital, which controls the plants.

Deliveries increased to 925,600 tons from 824,800 during the same period last year, Arkley said Tuesday in an e-mailed statement. (Bloomberg)

Novoship Debt Sinks Profit

Novorossiisk Sea Shipping, the country's second-largest shipper, said profit fell 40 percent in the first half of the year as it paid off debt.

Net income fell to $95.53 million from $161.75 million in the same period of 2005, the Novorossiisk-based company, known as Novoship, said on its web site. Revenue rose 25 percent, to $260.31 million, from $207.15 as the company increased spot deliveries. Payments to creditors surged 30 percent to $19.17 million. (Bloomberg)

Magnit Revenue Soars 56%

Magnit, a food retailer that raised $368 million by selling shares to the public in April, said revenue surged 56 percent in the first seven months of 2006 even as the company added fewer stores than in the year-earlier period.

Revenue rose to $1.29 billion from $824.5 million in the year-earlier period, the Krasnodar-based company said Tuesday in a statement. (Bloomberg)