The Trump administration sends a surprising message to American companies: after three years as an international pariah, Russia could again be opened to business.
President Trump pressure Ukraine Accept an agreement to end the war. And Marco RubioIts Secretary of State, told a Moscow delegation in Riyadh last week that the United States and Russia could continue “potentially historical economic partnerships” and “Incredible opportunities“If Moscow ended his war.
The question, however, is whether American companies are interested.
And the response, agreed analysts and investors is unlikely.
“I do not think that the big companies in America will rush quickly in Russia, if not at all, and certainly not soon,” said Carl Weinberg, chief economist of the high frequency economy.
The invasion of Ukraine launched by President Vladimir V. Putin of Russia in February 2022 caused a sudden and rapid flight of foreign companies while the United States, Europe and other countries have imposed sanctions punishing and cut most of the exchanges. Since then, more than 1,000 companies have left or restricted operations, according to a database compiled by the Yale management school.
Russia they left, however, is not Russia in which they would come back.
The country’s war-centered economy is struggling with 21% interest rates, labor shortages and a number of middle-class consumers.
Then there is the unpredictable commercial environment in a country where the rule of law can easily transform the law of the manager. US companies must face the risk of Kremlin decrees which impose new costs, taxes and prices control; restrict the ability to send profits and dividends to the house, sell or make management decisions; And enter private companies.
In the last month, the government has questioned Efforts to also expropriate Russian companies. And Friday, Putin said that he wanted Russian companies to have “certain advantages” compared to foreigners “who return to the market”.
There is also the possibility of new changes in politics on Russia in Washington, if not now, then perhaps in four years, after the next elections.
“No one will spend a lot of money in Russia if they think politics will change overnight,” said Mark Walker, a senior advisor in the sovereign advisory office at Lazard, an investment bank. And Moscow cannot be reliable to remain open to foreign investments. “It is a diet difficult to do with business,” he said.
Even if the United States had to raise all its sanctionsThousands of others Imposed by the European Union, Great Britain, Japan and other countries could remain in place, hampering supply chains and threatening the benefits of the company. Monday, the European Union approved a 16th package sanctions against Russia.
“The Russian trade environment is extremely difficult, the risk of expropriation is high and the Russian economy is not exactly booming, “said Agathe Demain, a member of the main policy of the European Council for Foreign Relations.
American companies that have remained in Russia do not fully control their income and assets, Mrs. said. Companies deemed “hostile” by the Kremlin had to sell their companies for money on the dollar and pay a surcharge of 35% – labeled a “voluntary” contribution – to the government. Those who remained were prohibited from making a large part of their profits in their country of origin.
Other Western companies such as Danone,, Carlsberg And the German energy company Uniper has seized its assets.
The Trump administration continues what most analysts think they are fanciful economic opportunities in Russia because it has targeted Mexico and Canada, which are America The largest business partners. American manufacturers have complained that the president’s threat to impose 25% prices On these two longtime allies, would cause serious damage by increasing the costs and disturbing the supply chains.
Russia, of course, controls large expanses of land, an oil and gas warehouse and a nuclear arsenal. But it was a little actor in the world economy. Before its troops invade Ukraine, the country was responsible for only 1.7% of total outing.
Trade with the United States was tiny. In 2021, exports to Russia represented 0.4% of the total American exports – almost the same amount as Honduras. And most multinationals in Russia do not reach more than 1% of their world income, according to researchers in Yale.
“Before 2022, the environment was already difficult, but there was money to be made,” said Elina Ribakova, principal researcher at the Peterson Institute for International Economics in Washington. “Now the risks have increased considerably, but there is no money to be made.”
In the 2000s, the priced oil price fueled a growing Russian middle class with an appetite for foreign goods and cars. “This dynamic no longer exists,” said Ribakova, who is also vice-president of foreign policy at the kyiv School of Economics.
And export No. 1 of Russia – oil and gas – rivals the energy sector of the United States directly. Even American oil companies which once had operations in Russia, such as Exxon Mobil, Do not seem to want to make big investments there.
The United States, the European Union and dozens of other countries have also broken a wide range of financial links with Russia. They have jointly prohibited many Russian banks from using Swift, the system used worldwide to carry out financial transactions. And they frozen billions of dollars belonging to the Russian government but held in Western banks.
The United States, which dominates the World Bank, could abandon this united front. Mr. Trump could decide to allow American banks to treat again Dollars transactions involving Russia. This would remove a huge barrier that has paralyzed the ability of many companies to carry out business with Russia.
According to Yale’s countapproximately two dozen American companies, including the outings of franchise restaurants Metro And TGI Fridays,, Always do business in Russia. Dozens of companies work but have postponed new investments and have reduced operations.
The companies that have stayed in Russia would probably welcome the end of American sanctions. And Russian officials are trying to prick the American interest. On Friday, the first Denis Manturov Denis Prime Minister said that the government would plan to allow Boeing to resume the purchase of titanium if the company was ready to return, according to the Russian news agency Interfax.
But deterrents to enter Russia remains.
Rub the tangle of sanctions – as well as the countermeasures promulgated by the Russian government – would be a long and complicated process. The same goes to settle the legal and financial meli-Mélo left by the exit of foreign companies.
Mike Mayo, bank analyst at Wells Fargo, said it is unlikely that all American banks return to Russia. “Never say,” he said, but “Wall Street has become much more surgical about where they are investing in the past times.”
Citigroup had the greatest presence in Russia in any American bank in Russia but above all came out. There is almost no chance that he will come back, especially since he withdrew to the consumer bank on most world markets. A spokesperson for Citigroup refused to comment.
Many companies are always seated at losses. Pimco, One of the largest asset managers in the world has seen the value of its Russian bond assets decreased by more than a billion dollars in 2022.
“I think there will be more interest in recovering former investments rather than taking into account new risks,” said Brad Setser, economist at the foreign relations council.
Even some debt investors who have built their career betting on desired results said it was too early to think about returning to Russia.
As Ms. Ribakova at the Peterson Institute said it about Russia: “The biggest problem here is simply that there is no money to win.”
Maureen Farrell,, JOE RENNISON,, Danielle Kaye And Niraj Chokshi Contributed reports.