Home – Home – Jornals – Region: Economics and Sociology 2023 number 2

This article explores the dynamics and structure of foreign direct investment (FDI) to the East of Russia, specifically considering the impact of the economic shocks caused by COVID-19 in 2020-2021. We aim to understand the FDI dynamics since 2014-2015, including their spatial and sectoral distribution, to identify any shifts that occurred during the pandemic, and to find the amount of FDI the eastern territories acquired at the beginning of 2022. Overall, FDI in the form of capital participation increased across Russia during the period under review, with the Far East experiencing a higher growth rate than the rest of the country. Conversely, in Siberia, FDI share has declined, largely due to capital withdrawal from raw materials projects. The sectoral composition of FDI in Russia has undergone changes since 2014. Specifically, the share of FDI in commodity sectors has increased by over 150%, while in the manufacturing industry, it has decreased almost threefold. During and immediately after the pandemic, the decline in FDI in manufacturing sectors in the East of Russia was significantly lower, and by 2022, their volume had increased by 70% compared to 2015. Overall, the impact of the pandemic on FDI in Russia was not severe, and the eastern regions were even less affected. By 2022, FDI volumes in almost all sectors had recovered and, in some cases, drastically exceeded the 2015 levels. After comparing the dynamics of trade turnover with the Asia-Pacific countries, we can conclude that the high demand for goods and resources, which generates import-export flows between Russia and these countries, is not being effectively translated into productive cooperation in the form of FDI. This finding should be considered when developing policies for international economic cooperation following the 2022 sanctions.