Hi, need to submit a 1500 words paper on the topic Political Climate for Business in Russia. In 2004, even the Governors of the federal districts are nominated by the president for confirmation of the regional legislative body (Baker & McKenzie, 2007, p 2).Because the present political government of Russia is still young, demarcation lines for power and structure are still not well defined. Even if Russia is a federation, the still-evolving country has not yet set up its clear-cut divisions of power and authority. This also somehow results also to the frequent change in laws and statutes which could impact the business enterprises. Because of this, it is harder to fully determine who has jurisdictions and command over guidelines and policies.With regard to the economic capabilities of investing in Russia, the country offers a lot of opportunities. After the turbulent 1990’s decade characterized by the economic crisis in 1998, it bounced back and registers positive economic growth for the last ten years with the average increase of 6.8% annually of GDP between 1999-2004, by 6 % in 2005 and 6.6% in 2006 (Baker & McKenzie, 2007, p 4), 8.1% in 2007 and 6% in 2008 (CIA Factbook, 2009). The Russian economy at present has a GDP of $2.225 trillion (2008 est.) and a GDP per capita (PPP) increasing at a steady pace $14,000 (in 2006 est.) to $15,200 (2007 est.) and $15,800 (2008 est.) (CIA Factbook, 2009) . The steady increase of the economy is attributed to “devalued ruble, implementation of key economic reforms (tax, banking, and labour and land codes), tight fiscal policy, and favourable commodities prices” (Background note: Russia, 2008). Inflation is high at 13.9% (2008 est.) and unemployment is at 6.2 per cent but literacy is 100 per cent and public debt is 6.8% of GDP (2008 est.) (CIA Factbook, 2009)Russia’s economy is driven mainly by oil and natural gas exports which are due to the increase in the price of oil in the world market in recent years coupled by the increase of their oil production (EIA Russia, n.d.). . The IMF and WorldBank estimate that this sector contributes more than 60 per cent of export revenues (64% in 2007), and 30 per cent of all foreign direct investment (FDI) in the country (EIA, Russia, n.d.). . .
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