Russia’s unpredictable lawmaking scaring off investors, claims FIAC

Alexander Ivlev, E&Y Managing Partner for Russia

FIAC: Russia’s unpredictable lawmaking procedures are undermining Russia’s ability to attract foreign investors, according to Ernst & Young. In a  report published before a meeting of the overseas investor’s representative  body the Foreign Investment Advisory Council (FIAC) with Prime Minister Dmitry Medvedev yesterday, E&Y claimed that  77% of firms survey were unhappy with the unpredictability of legislative changes.
At the meeting, FIAC  members complained to Medvedev  that his  government was making unexpected decisions — such as new waste disposal rules and measures to incentivise local production — without calculating the consequences and which had  cost consumer goods producers $1.7bn  in 2015 alone. 
In a written submission to the meeting, E&Y Managing Partner Alexander Ivlev claimed that the government had become increasingly preoccupied with “economic sovereignty” following the crisis in Ukraine last year and the resulting economic sanctions. The replacement of foreign goods and services with local production had become a key priority, and was an issue of increasing concern to foreign investors, he said.
The report listed a number of detrimental regulatory changes that had been introduced over the past year, including the  law requiring companies to store data in Russia, legislation restricting media ownership by foreign companies to 20%, and the embargo on a range of  EU food imports.