Putin: Russia does not rule out limits on foreign investment

Int’l Relations

Russia does not rule out putting limits on foreign investment in the country’s economy, President Vladimir Putin said Monday.

Putin, currently on a visit to the United Arab Emirates designed to encourage mutual trade and investment, said the United States had passed a law limiting foreign investment, and that other countries were considering similar measures. “Certainly if the trend persists, we will have to take similar steps as well, to protect our interests,” he said.

Washington adopted a law in late July toughening control over foreign investment in key businesses in a move to address national security concerns and to prevent foreign governments from gaining control of US firms. The legislation requires that senior officials, including the national intelligence chief and the defense secretary, review deals and participate in decisions on direct foreign investment in and mergers and acquisitions of US companies.

The Russian leader said this was a worrying trend for Russia, as it could affect investment activities and the free market economy. Putin recalled the early 1990s, when Western powers pressurized Russia to open its markets for investment. “And now those countries are moving in the opposite direction, effectively closing their markets to investment or impeding access to them. Of course, this worries us,” he said.

Moscow is considering legislation to restrict foreign investment in strategic sectors. The Kremlin has tightened its grip over the oil and gas sector in recent years and has used regulating bodies to put increasing pressure on foreign operators in the country.

Putin raised the investment issue at Asia Pacific Economic Cooperation consultations in Sydney, which ran throughout last week and culminated in a weekend summit. Moscow and Washington’s differences on the issue add to a growing rift in bilateral relations already strained over a host of issues including US plans to deploy missile defense elements in Central Europe. But on the missile shield dispute, Putin said in Abu Dhabi he believed that Moscow and Washington could still reach a compromise: “Not all chances have been lost, and there is still healthy optimism."

Russia vehemently opposes Washington’s plans to put radar and missile silos in the Czech Republic and Poland, which it considers a threat to its national security, and has offered several compromise solutions. In Abu Dhabi, during the first visit to the Emirates by a top Russian official in 35 years, Putin highlighted Russia’s interest in stepping up ties with the Arab world and Russian companies’ interest in oil production in the UAE and military and infrastructure contracts.

“We intend to broaden the geography of our relations... Our companies seek investment cooperation, and projects to develop mineral resources and infrastructure. Our military and technological cooperation also has bright prospects,” Putin said. (rian.ru)

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