Latest news with #US-Russia
Time of India
15 hours ago
- Business
- Time of India
Donald Trump sees 'unlimited' potential for 'large-scale trade' with Russia when 'bloodbath is over'
US President Donald Trump has put forward the possibility of resuming large-scale trade with Russia once the war in Ukraine ends, but experts say major obstacles stand in the way of such a move anytime soon. Tired of too many ads? go ad free now "Russia wants to do large-scale TRADE with the United States when this catastrophic bloodbath is over, and I agree," Trump said in a statement following a phone call with Russian President Vladimir Putin. "There is a tremendous opportunity for Russia to create massive amounts of jobs and wealth. Its potential is UNLIMITED," he added. But the ground reality paints a grim picture for the US–Russia business revival. Reasons behind: US firms remain wary According to the Associated Press, since Russia's 2022 invasion of Ukraine, hundreds of foreign companies, including major US brands like Coca-Cola, Nike, Starbucks, ExxonMobil, and Ford — have exited the country. Now, more than three years into the war Trump is suggesting that the US-Russia trade could resume if a peace deal is reached. Putin has also said that foreign companies may return "under certain conditions," but analysts warn that the business environment has changed dramatically, and not in favor of foreign investors. Russia now classifies nations allied with Ukraine as "unfriendly states," imposing tight restrictions on withdrawing funds and allowing the government to seize key businesses. Companies that left were often forced to sell assets at half their value or simply write them off. Some, like Danone and Carlsberg, had their assets taken over by the Russian state. Elina Ribakova, a non-resident senior fellow at Brussels-based Bruegel research institute, asserts that Russia's policy decisions and legislative modifications have inflicted "long-lasting damage" to its commercial landscape. According to her assessment, the possibility of American companies resuming operations in Russia remains "not very likely. Tired of too many ads? go ad free now Political risk, legal uncertainty While some companies like Renault and Ford left Russia with repurchase agreements, the Russian legal system is now considered too unstable to count on such deals. The Kremlin has signaled it intends to strengthen local companies at the expense of foreign rivals. "We need to strangle them," Putin said recently about Western tech firms like Zoom and Microsoft that limited services in Russia. "After all, they are trying to strangle us: we need to reciprocate. We didn't kick anyone out; we didn't interfere with anyone. We provided the most favorable conditions possible for their work here, in our market, and they are trying to strangle us," he added. Putin assured a representative from Vkusno-i Tochka — the Russian company that replaced McDonald's in the country — that the government would support them if McDonald's ever tried to buy back its old outlets. When asked for comment, McDonald's pointed to its 2022 statement saying that continuing to operate in Russia was no longer viable, AP reported. Economic outlook dim Beyond legal uncertainty, Russia's economy is increasingly centered on military production, with little growth expected in civilian sectors. According to the Bank of Finland, Russia faces one of the lowest projected growth rates globally. Even the lucrative oil and gas sector may not draw American firms back. ExxonMobil wrote off $3.4 billion after its stake in the Sakhalin project was terminated. And while some smaller oil service firms might be interested in returning, they'd need to meet new Russian requirements for local investment and presence. Despite sanctions, over 2,300 foreign companies still operate in Russia, mostly from China and other non-Western nations. Sanctions still a major hurdle Even if the US were to lift sanctions, EU restrictions would continue, creating compliance issues for global firms. American sanctions, which carry the risk of being shut out of the US financial system, remain the most severe deterrent. For now, Trump's vision of a post-war trade boom with Russia appears more political narrative than business reality, at least until there's a dramatic shift in both geopolitics and the legal environment inside Russia.
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Business Standard
15 hours ago
- Business
- Business Standard
Trump, Putin hint at trade revival, but biz environment remains hostile
Hundreds of foreign companies left Russia after the 2022 invasion of Ukraine, including major US firms like Coca-Cola, Nike, Starbucks, ExxonMobil and Ford Motor Co. But after more than three years of war, President Donald Trump has held out the prospect of restoring US-Russia trade if there's ever a peace settlement. And Russian President Vladimir Putin has said foreign companies could come back under some circumstances. Russia wants to do large scale TRADE with the United States when this catastrophic bloodbath' is over, and I agree, Trump said in a statement after a phone call with Putin. There is a tremendous opportunity for Russia to create massive amounts of jobs and wealth. Its potential is UNLIMITED. The president then shifted his tone toward Putin after heavy drone and missile attacks on Kyiv, saying Putin has gone absolutely crazy and threatening new sanctions. Recent comments from Putin warning Western companies against reclaiming their former stakes seemed to reflect reality more accurately that it's not going to be a smooth process for businesses going back into Russia. That's because Russia's business environment has massively changed since 2022. And not in ways that favor foreign companies. And with Putin escalating attacks and holding on to territory demands Ukraine likely isn't going to accept, a peace deal seems distant indeed. Here are factors that could deter U.S. companies from ever going back: Risk of losing it all Russian law classifies Ukraine's allies as unfriendly states and imposes severe restrictions on businesses from more than 50 countries. Those include limits on withdrawing money and equipment as well as allowing the Russian government to take control of companies deemed important. Foreign owners' votes on boards of directors can be legally disregarded. Companies that left were required to sell their businesses for 50% or less of their assessed worth, or simply wrote them off while Kremlin-friendly business groups snapped up their assets on the cheap. Under a 2023 presidential decree the Russian government took control of Finnish energy company Fortum, German power company Unipro, France's dairy company Danone and Danish brewer Carlsberg. Even if a peace deal removed the US from the list of unfriendlies, and if the massive Western sanctions restricting business in Russia were dropped, the track record of losses would remain vivid. And there's little sign any of that is going to happen. While the Russian government has talked in general about companies coming back, there's no specific evidence of any one company saying that they are ready to come back, said Chris Weafer, CEO of Macro-Advisory Ltd. consultancy. It's all at the political narrative level. Russia's actions and legal changes have left long-lasting damage to its business environment, says Elina Ribakova, non-resident senior fellow at the Bruegel research institute in Brussels. She said a return of US businesses is not very likely. We need to strangle them In a meeting at the Kremlin on May 26 to mark Russian Entrepreneurs Day, Putin said that Russia needed to throttle large tech firms such as Zoom and Microsoft, which had restricted their services in Russia after Moscow's invasion of Ukraine, so that domestic tech companies could thrive instead. We need to strangle them, Putin said. After all, they are trying to strangle us: we need to reciprocate. We didn't kick anyone out; we didn't interfere with anyone. We provided the most favorable conditions possible for their work here, in our market, and they are trying to strangle us. He reassured a representative from Vkusno-i Tochka (Tasty-period) the Russian-owned company that took over McDonald's restaurants in the country that Moscow would aid them if the US fast food giant tried to buy back its former stores. Asked for comment, McDonald's referred to their 2022 statement that ownership of the business in Russia is no longer tenable. Not much upside On top of Russia's difficult business environment, the economy is likely to stagnate due to lack of investment in sectors other than the military, economists say. Russia has one of the lowest projected long-term growth rates and one of the highest levels of country risk in the world, says Heli Simola, senior economist at the Bank of Finland in a blog post. Only Belarus offers an equally lousy combination of growth and risk. Most of the opportunity to make money is related to military production, and it's unlikely US companies would work with the Russian military-industrial complex, said Ribakova. It's not clear where exactly one could plug in and expect outsize returns that would compensate for this negative investment environment. Repurchase agreements Some companies, including Renault and Ford Motor Co, left with repurchase agreements letting them buy back their stakes years later if conditions change. But given Russia's unsteady legal environment, that's tough to count on. The Russian purchasers may try to change the terms, look for more money, or ignore the agreements, said Weafer. There's a lot of uncertainty as to how those buyback auctions will be enforced. But what about the oil and gas? Multinational oil companies were among those who suffered losses leaving Russia, so it's an open question whether they would want to try again even given Russia's vast oil and gas reserves. US.. major ExxonMobil saw its stake in the Sakhalin oil project unilaterally terminated and wrote off $3.4 billion. Russia's major oil companies have less need of foreign partners than they did in the immediate post-Soviet era, though smaller oil field services might want to return given the size of Russia's oil industry. But they would have to face new requirements on establishing local presence and investment, Weafer said. Some never left According to the Kyiv School of Economics, 2,329 foreign companies are still doing business in Russia, many from China or other countries that aren't allied with Ukraine, while 1,344 are in the process of leaving and 494 have exited completely. The Yale School of Management's Chief Executive Leadership Institute lists some two dozen US companies still doing business in Russia, while some 100 more have cut back by halting new investments. EU sanctions could remain even if US open US sanctions are considered the toughest, because they carry the threat of being cut off from the U.S. banking and financial system. But the EU is still slapping new rounds of sanctions on Russia. Even if U.S. sanctions are dropped, EU sanctions would continue to present compliance headaches for any company that also wants to do business in Europe.
Mint
18 hours ago
- Business
- Mint
Trump, Putin hint at US-Russia trade revival, but business environment remains hostile
Moscow, Hundreds of foreign companies left Russia after the 2022 invasion of Ukraine, including major US firms like Coca-Cola, Nike, Starbucks, ExxonMobil and Ford Motor Co. But after more than three years of war, President Donald Trump has held out the prospect of restoring US-Russia trade if there's ever a peace settlement. And Russian President Vladimir Putin has said foreign companies could come back under some circumstances. 'Russia wants to do large scale TRADE with the United States when this catastrophic bloodbath' is over, and I agree,' Trump said in a statement after a phone call with Putin. 'There is a tremendous opportunity for Russia to create massive amounts of jobs and wealth. Its potential is UNLIMITED.' The president then shifted his tone toward Putin after heavy drone and missile attacks on Kyiv, saying Putin 'has gone absolutely crazy' and threatening new sanctions. Recent comments from Putin warning Western companies against reclaiming their former stakes seemed to reflect reality more accurately — that it's not going to be a smooth process for businesses going back into Russia. That's because Russia's business environment has massively changed since 2022. And not in ways that favor foreign companies. And with Putin escalating attacks and holding on to territory demands Ukraine likely isn't going to accept, a peace deal seems distant indeed. Here are factors that could deter U.S. companies from ever going back: Russian law classifies Ukraine's allies as 'unfriendly states' and imposes severe restrictions on businesses from more than 50 countries. Those include limits on withdrawing money and equipment as well as allowing the Russian government to take control of companies deemed important. Foreign owners' votes on boards of directors can be legally disregarded. Companies that left were required to sell their businesses for 50% or less of their assessed worth, or simply wrote them off while Kremlin-friendly business groups snapped up their assets on the cheap. Under a 2023 presidential decree the Russian government took control of Finnish energy company Fortum, German power company Unipro, France's dairy company Danone and Danish brewer Carlsberg. Even if a peace deal removed the US from the list of unfriendlies, and if the massive Western sanctions restricting business in Russia were dropped, the track record of losses would remain vivid. And there's little sign any of that is going to happen. While the Russian government has talked in general about companies coming back, 'there's no specific evidence of any one company saying that they are ready to come back,' said Chris Weafer, CEO of Macro-Advisory Ltd. consultancy. 'It's all at the political narrative level.' Russia's actions and legal changes have left 'long-lasting damage' to its business environment, says Elina Ribakova, non-resident senior fellow at the Bruegel research institute in Brussels. She said a return of US businesses is 'not very likely.' In a meeting at the Kremlin on May 26 to mark Russian Entrepreneurs Day, Putin said that Russia needed to throttle large tech firms such as Zoom and Microsoft, which had restricted their services in Russia after Moscow's invasion of Ukraine, so that domestic tech companies could thrive instead. 'We need to strangle them,' Putin said. 'After all, they are trying to strangle us: we need to reciprocate. We didn't kick anyone out; we didn't interfere with anyone. We provided the most favorable conditions possible for their work here, in our market, and they are trying to strangle us.' He reassured a representative from Vkusno-i Tochka — the Russian-owned company that took over McDonald's restaurants in the country — that Moscow would aid them if the US fast food giant tried to buy back its former stores. Asked for comment, McDonald's referred to their 2022 statement that 'ownership of the business in Russia is no longer tenable.' On top of Russia's difficult business environment, the economy is likely to stagnate due to lack of investment in sectors other than the military, economists say. 'Russia has one of the lowest projected long-term growth rates and one of the highest levels of country risk in the world,' says Heli Simola, senior economist at the Bank of Finland in a blog post. 'Only Belarus offers an equally lousy combination of growth and risk.' Most of the opportunity to make money is related to military production, and it's unlikely US companies would work with the Russian military-industrial complex, said Ribakova. 'It's not clear where exactly one could plug in and expect outsize returns that would compensate for this negative investment environment.' Some companies, including Renault and Ford Motor Co, left with repurchase agreements letting them buy back their stakes years later if conditions change. But given Russia's unsteady legal environment, that's tough to count on. The Russian purchasers may try to change the terms, look for more money, or ignore the agreements, said Weafer. 'There's a lot of uncertainty as to how those buyback auctions will be enforced.' But what about the oil and gas? Multinational oil companies were among those who suffered losses leaving Russia, so it's an open question whether they would want to try again even given Russia's vast oil and gas reserves. US.. major ExxonMobil saw its stake in the Sakhalin oil project unilaterally terminated and wrote off $3.4 billion. Russia's major oil companies have less need of foreign partners than they did in the immediate post-Soviet era, though smaller oil field services might want to return given the size of Russia's oil industry. But they would have to face new requirements on establishing local presence and investment, Weafer said. According to the Kyiv School of Economics, 2,329 foreign companies are still doing business in Russia, many from China or other countries that aren't allied with Ukraine, while 1,344 are in the process of leaving and 494 have exited completely. The Yale School of Management's Chief Executive Leadership Institute lists some two dozen US companies still doing business in Russia, while some 100 more have cut back by halting new investments. EU sanctions could remain even if US open US sanctions are considered the toughest, because they carry the threat of being cut off from the U.S. banking and financial system. But the EU is still slapping new rounds of sanctions on Russia. Even if U.S. sanctions are dropped, EU sanctions would continue to present compliance headaches for any company that also wants to do business in Europe. This article was generated from an automated news agency feed without modifications to text.
Irish Examiner
3 days ago
- Politics
- Irish Examiner
After another call with Putin, it looks like Trump has abandoned efforts to mediate peace in Ukraine
After a two-hour phone call with Russian leader Vladimir Putin on May 19, US president Donald Trump took to social media to declare that Russia and Ukraine will 'immediately start negotiations' towards a ceasefire and an end to the war. He did, however, add that the conditions for peace 'will be negotiated between the two parties, as it can only be'. With the Vatican, according to Trump, 'very interested in hosting the negotiations' and European leaders duly informed, it seems clear that the US has effectively abandoned its stalled mediation efforts to end the war in Ukraine. It was always a possibility that Trump could walk away from the war, despite previous claims he could end it in 24 hours. This only became more likely on May 16, when the first face-to-face negotiations between Ukraine and Russia for more than three years predictably ended without a ceasefire agreement. When Trump announced shortly afterwards that he would be speaking to his Russian and Ukrainian counterparts by phone a few days later, he effectively mounted the beginning of a rearguard action. This was further underlined when, shortly before the Trump-Putin call, Vice-President J.D. Vance, explicitly told reporters that the US could end its shuttle diplomacy. Trump and Ukraine's president, Volodymyr Zelensky, had a short call before the former spoke with Putin. Zelensky said he told Trump not to make decisions about Ukraine 'without us'. Photo: Leon Neal/PA The meagre outcomes of the talks between Russia and Ukraine – as well as between Trump and Putin – are not surprising. Russia is clearly not ready for any concessions yet. It keeps insisting that Ukraine accept its maximalist demands of territorial concessions and future neutrality. Putin also continues to slow-walk any negotiations. After his call with Trump, he reportedly said that 'Russia will offer and is ready to work with Ukraine on a memorandum on a possible future peace agreement', including 'a possible ceasefire for a certain period of time, should relevant agreements be reached'. The lack of urgency on Russia's part to end the fighting and, in fact, the Kremlin's ability and willingness to continue the war was emphasised the day before the Trump-Putin call. Russia carried out its largest drone attack against Ukraine so far in the war, targeting several regions including Kyiv. There has been no let-up in the fighting since. And the fact that Putin spoke to Trump while visiting a music school in the southern Russian city of Sochi does not suggest that a ceasefire in Ukraine is high on the Russian leader's priority list. US-Russia reset A large part of the Kremlin's calculation seems to be its desire to strike a grand bargain with the White House on a broader reset of relations between the US and Russia. It is signalling clearly that this is more important than the war in Ukraine and might even happen without the fighting there ending. This also appears to be driving thinking in Washington. Trump foreshadowed an improvement in bilateral relations by describing the 'tone and spirit' of his conversation with Putin as 'excellent'. He also seemed pleased about the prospects of 'large-scale trade' with Russia. Abandoning European allies, Trump is on record as saying that there would be no progress towards peace in Ukraine until he and Putin get together. But it is worth bearing in mind that very little movement towards a ceasefire in Ukraine – let alone a peace agreement – occurred after the last phone call between the two presidents in February. Part of this lack of progress has been Trump's reluctance to put any real pressure on Putin. And despite agreement in Brussels and preparations in Washington for an escalation in sanctions against Russia, it is unlikely that Trump will change his approach. In this context, the sequence in which the calls occurred is telling. Trump and Ukraine's president, Volodymyr Zelensky, had a short call before the former spoke with Putin. Zelensky said he told Trump not to make decisions about Ukraine 'without us'. But rather than presenting Putin with a clear ultimatum to accept a ceasefire, Trump apparently discussed future relations with Putin at great length before informing Zelensky and key European allies that the war in Ukraine is now solely their problem to solve. This has certainly raised justifiable fears in Kyiv and European capitals that, for the sake of a reset with Russia, the US might yet completely abandon its allies across the Atlantic. China However, if a reset with Russia at any cost really is Trump's strategy, it is bound to fail. As much as Putin seems willing to continue with his aggression against Ukraine, Zelensky is as unwilling to surrender. Putin can rely on China's continued backing while Zelensky can count on support from Europe. Supporting Russia's war in Ukraine is essential for China to keep Moscow on side in its rivalry with the US. And for Europe, supporting Ukraine has become an existential question of deterring and containing a revisionist Russia hell-bent on restoring a Soviet-style sphere of influence in central and eastern Europe. In a world that has been in flux since Trump's return to the White House, these are some of the emerging constants. And they make a US-Russia reset highly improbable. Even if it were to happen, it would not strengthen Washington's position with Beijing. Walking away from Ukraine and Europe now will deprive the US of the very allies it will need in the long term to prevail in its rivalry with China. By abandoning his mediation between Moscow and Kyiv, Trump may have broken the deadlock in his efforts to achieve a reset with Russia. But getting this deal over the line will be a pyrrhic victory. Stefan Wolff is Professor of International Security, University of Birmingham
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First Post
4 days ago
- Politics
- First Post
3 reasons why Trump has not yet imposed new sanctions on Russia
Even though US President Donald Trump is now reportedly considering sanctions for Russia, he has not yet indicated sanctions are imminent. Here are three reasons why he has not yet imposed any sanctions on Russia. read more Even though he is now reported to be considering new sanctions for Russia, US President Donald Trump has not yet indicated he has taken such a decision. Trump came to office with the promise of ending the war in Ukraine within a day. More than four months later, however, the war is nowhere its end. Russian leader Vladimir Putin has rejected all ceasefire proposals floated by Trump and has again and again rebuffed Trump's pleas to not attack civilians in Europe. Amid such dismissal of his positions, it has been reported that that Trump is finally considering punitive measures for Russia. STORY CONTINUES BELOW THIS AD The Wall Street Journal has reported that Trump has not yet imposed sanctions on Russia for three reasons. Firstly, Trump has not yet imposed sanctions because of his personal dislike for Ukrainian President Zelenskyy. Trump's close ties to Putin and dislike for Zelenskyy is well-known. By parroting Russian propaganda, Trump has trashed Zelenskyy throughout the war by falsely accusing him of starting the war with Russia, falsely calling him an unelected leader, calling him a dictator, berating him for seeking to buy air defence systems, shouting at him after inviting him to White House on live television, and slamming him for calling Putin names. On the other hand, Trump has not yet done anything regarding Putin despite the Russian leader rejecting all ceasefire proposals and personal pleas. Trump dislikes Zelenskyy so much that even though he has started rebuking Putin lately, he still continues to trash Zelenskyy. He said on Sunday that that Zelenskyy 'is doing his Country no favors by talking the way he does'. Secondly, Trump has believed that more sanctions would not curb Russia's ability to wage war. Instead, he has believed that more sanctions would hamper ongoing efforts to revive US-Russia economic relations. Thirdly, Trump has believed that his personal relationship with Putin would lead to the Russian leader ending the war as a personal favour. However, Putin has shown no indication that he wants to end the war — even Trump has acknowledged it. STORY CONTINUES BELOW THIS AD After the call with Putin last Monday, Trump told European leaders on a call that Putin does not want to end the war in Ukraine because he thinks he is winning, according to The Journal.
