Russia and Ukraine exchange POWs, Russian news agencies report
MOSCOW, June 19 (Reuters) - Russia and Ukraine have carried out another exchange of prisoners of war, Russian news agencies reported on Thursday, citing a statement from Russia's Defence Ministry.
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Reuters
an hour ago
- Reuters
Russia's VTB still plans to open a branch in Iran but will wait for hostilities to end first, CEO says
Russia, June 19 (Reuters) - Russia's second largest lender VTB still plans to open a branch in Iran, but will wait for hostilities between Israel and Tehran to end and is analysing the situation, VTB CEO Andrei Kostin said on Thursday. VTB, which is under Western sanctions, opened a representative office in Iran in 2023 and has applied for a banking licence. Israel bombed nuclear targets in Iran on Thursday and Iranian missiles hit an Israeli hospital overnight, as the week-old air war escalated with no sign yet of an off-ramp. "We do not know, nobody knows how the situation will develop there. We are analysing the situation," Kostin told reporters on the sidelines of Russia's biggest economic forum in St. Petersburg. "We applied for a licence, now we will wait, we will not take any action," Kostin said. "We are not in a hurry, let the shooting stop first." Kostin said that Iran had become a significant trading partner for Russia in recent years, but that doing business there was difficult. "We saw that there is a substantial business there, but it is not an easy place for business. The currency regulation there is very complex," Kostin said. A Russian-led Eurasian Economic Union (EEU) free trade deal with Iran took effect in May. Iran's Oil Minister Mohsen Paknejad, who visited Moscow in April, said that the free trade deal would increase bilateral trade to $6 billion. Iran was the third-largest buyer of Russian wheat in 2024.
The Independent
4 hours ago
- The Independent
Russia's economy minister says the country is on the brink of recession
Russia's economy is 'on the brink of going into a recession,' the country's economy minister said Thursday, according to Russian media reports. Economy Minister Maxim Reshetnikov delivered the warning at the St. Petersburg International Economic Forum, the annual event in Russia's second largest city designed to highlight the country's economic prowess and court foreign investors. Russian business news outlet RBC quoted the official as saying 'the numbers indicate cooling, but all our numbers are (like) a rearview mirror. Judging by the way businesses currently feel and the indicators, we are already, it seems to me, on the brink of going into a recession.' Russia's economy, hit with a slew of sanctions after the Kremlin sent troops into Ukraine in February 2022, has so far outperformed predictions. High defense spending has propelled growth and kept unemployment low despite fueling inflation. At the same time, wages have gone up to keep pace with inflation, leaving many workers better off. Large recruiting bonuses for military enlistees and death benefits for those killed in Ukraine also have put more income into the country's poorer regions. But over the long term, inflation and a lack of foreign investments remain threats to the economy, leaving a question mark over how long the militarized economy can keep going. Economists have warned of mounting pressure on the economy and the likelihood it would stagnate due to lack of investment in sectors other than the military. Speaking at one of the sessions of the forum in St. Petersburg, Reshetnikov said Russia was 'on the brink,' and whether the country would slide into a recession or not depends on the government's actions. 'Going forward, it all depends on our decisions," Reshetnikov said, according to RBC. RBC reported Russia's Finance Minister Anton Siluanov and Central Bank Gov. Elvira Nabiullina gave more optimistic assessments. Siluanov spoke about the economy 'cooling' but noted that after any cooling 'the summer always comes," RBC reported. Nabiullina said Russia's economy was merely 'coming out of overheating," according to RBC.
Reuters
4 hours ago
- Reuters
Russia's flagship economic forum offers scant hope of foreign investment revival
ST PETERSBURG, Russia, June 19 (Reuters) - Foreign direct investment into Russia has fallen sharply, U.N. data published on Thursday showed, and Russia's premier economic forum in St Petersburg this week is offering scant hope of a revival, with Western investors largely absent. Russia is hosting the St Petersburg International Economic Forum for the fourth time since invading Ukraine in February 2022, an offensive that precipitated sweeping Western sanctions on Moscow and a widespread corporate exodus from the country. Soaring defence spending has propped up Russia's $2 trillion economy since then and Moscow, turning its back on the West, has sought partnerships with so-called "friendly" countries like China, India, Turkey and nations across the Middle East. But for all the talk of new strategic partnerships, foreign holdings in Russia have almost halved to $596 billion since the invasion, according to central bank data, and FDI inflows fell by 62.8% year on year in 2024 to $3.35 billion, UN Trade and Development data showed on Thursday. Sergei Aleksashenko, a former deputy governor of Russia's central bank now living abroad, said few serious businesses would consider Russia as an investment destination even if the war were to end tomorrow. "Everyone can clearly see the situation with property rights is getting worse every day," Aleksashenko told Reuters. The Kremlin has seized about a dozen foreign-owned businesses in the last three years and quickened the pace of domestic asset seizures, with prosecutors claiming Moscow's Domodedovo Airport and grain trade Rodnie Polya. "Stopping the war itself does not significantly reduce the level of political risks," Aleksashenko said, pointing to market risks as well. President Vladimir Putin has said the state should only seize assets where Russia's national security is jeopardised. "The real question is: where are the investors?" said one Russian participant of the forum who spoke on condition of anonymity. The West has shunned Russia since 2022, and though sanctions make investing in Russia all but impossible, U.S. President Donald Trump's softer stance towards Moscow has led some investors to keep an eye out for opportunities. The forum in St Petersburg, a city founded by the tsars as a window to Europe, for years had a Western-looking feel, but it is now returning to its original role as an event primarily for Russian businesses to network with politicians. "The reason the West came to the forum was because Russia was sizeable, growing and profitable," Denis Denisov, managing partner at financial communications firm EM, told Reuters. "You don't find these three components very often." Now, said Denisov, attending his 18th St Petersburg forum, for most participants the gathering is an opportunity to develop government relations and is less about PR. "The American Chamber of Commerce (AmCham) has been pushing hard for the Russia-USA panel, there are loads of European businesses still operating in Russia," Denisov said. "They're here, they're lobbying, just quietly." Speaking after that panel, AmCham head Robert Agee said there needed to be some sort of end to the conflict before U.S. companies would consider coming back to Russia. Major multinationals PepsiCo (PEP.O), opens new tab, Nestle (NESN.S), opens new tab and Mondelez (MDLZ.O), opens new tab are among those still operating in Russia, although they have scaled back their business there. Putin met Indonesian President Prabowo Subianto on Thursday, as Moscow looks to strengthen ties with Jakarta, while Russian officials are turning to Brazilian and Chinese companies to plug gaps left by departing Western firms. But UNCTAD's FDI data shows that actual investment in Russia is waning. But even with Russia's economy on the brink of recession, according to Economy Minister Maxim Reshetnikov, there is domestic money to spend after two years of elevated defence spending fuelled growth. Russian funds have great options, such as collaborating with wealthy individuals that want to invest, rather than keep funds on deposit, said one Russian investor at the forum who declined to be named. People are also jostling for position before the war ends, the investor added. The same is true of Western investors who feel that the wind is gradually changing, said Jean-Jacques Coppee, founding partner of CoppeeLaw & Associates, who is due to speak on the Russia-France panel on Friday. Sanctions have made cross-border payments a "nightmare", Coppee told Reuters, but should opportunities arise, investors will take them, even if others in the West object on moral grounds to engaging with Russia. "The rule is pragmatism," he said. "Pragmatism and opportunism."
