Canada: The Consistent Attractiveness Of Russia: Notes From The American Chamber Of Commerce Annual Investment Conference 2013 In Moscow

Last Updated: June 17 2013
Article by David Aylen

Forever burdened with the journalists' penchant to pick on Russia but embrace the other BRICS, Russians do what they always have done: persevere.  It's business as usual. In fact, the highly dramatized reports on the political tensions in Russia have little or nothing to do with the thriving business opportunities which continue to grow in a country of 140 million consumers. This was the underlying theme at AMCHAM's 13th Annual Investment Conference held in Moscow in April 2013.

When it comes to the United States, its relationship with Russia is an "undervalued stock" and is "working much better than people think" said keynote speaker Michael McFaul, U.S. Ambassador to the Russian Federation.

While acknowledging that their politics differ on many issues, McFaul pointed out that USA-Russia policies are very much aligned as regards counter-terrorism, the situations in Iran, in North Korea and Afghanistan and most importantly, as regards their mutual interests in developing stronger ties in bilateral trade and investment. With the 2012 election year behind them, trade and investment are a top priority for both Presidents Obama and Putin.

McFaul pointed out that, while the governments in each country can do what is needed to facilitate trade, it is up to American (and Russian) businesses to seize the moment and take advantage of investment opportunities. He emphasized that his Government is also promoting Russian investment in America – something that they had discouraged 20 years ago.

Ernst & Young, one of the event sponsors, used the event as a platform to promote its 2012 Attractiveness Survey which points out that, while Western European and North American economies remain consistently flat or decreasing, Russia, China and Brazil are still on the upswing.1

Russia has huge reserves of natural resources. It has an educated and low cost labor force with the highest literacy rate anywhere in the world. It has a fast growing middle class of avid consumers. With the recent creation of a free trade zone with Kazakhstan and Belarus the consumer market is now well beyond 140 million people. And in 2012, Russia finally joined the WTO. In manufacturing, Ford, John Deere, Airbus and many others are here. In consumer services, McDonald's, Subway, Starbucks, Dunkin' Donuts, Cirque du Soleil are well established in Russia. In retail, the leading shopping malls host the likes of GAP, Banana Republic, Media Markt, Auchan, Ikea, Metro, Marks & Spencer and countless others. In the hospitality industry you will see Hyatt, Hilton, Ritz, Marriott, Holiday Inn, Inter Continental etc. In food and oral care Mars, P&G, Nestlé, Colgate, Unilever and Henkel, Pepsi and Coca-Cola make and sell their leading brands in Russia. In TV and film, Disney, Fox and others locally produce content intended for Russian audiences and American films are now released simultaneously in Russia.

A few of these success stories were told at the 2013 AMCHAM Conference. The impressive list of distinguished corporate executives, who took the time to share their perspectives on the modern Russia, included:

ExxonMobil Russia's President, Glenn Waller, who reaffirmed to the audience the fact that, on the global stage, Russia is now the most important country in the energy sector. Technology development in this sector will be the lifeblood of future business, he said. This includes importation of foreign technology and developing new technologies at home. Developed nations with a strong presence in the energy sector, such as the United States and Canada, are well positioned to benefit from projects in Russia.

DuPont Russia's Managing Director, Jiri Lang, said that his company is firmly established in Russia and expects to see growth and new business in bio-based industries, in the auto sector, in road construction and in the railroad infrastructure development sectors where DuPont is a supplier. In the automotive sector alone the expectation is that Russia will some day soon overtake Europe in terms of new cars and trucks for consumers.

Mondolez RUS (previously Kraft) Director General, Romeo Lacerda explained that, even though the growth of available consumer income has begun to decrease, the demand and growth in the fast moving consumer goods sector is still increasing and Nielsen forecasts even more growth. In part, this can be attributed to a growing middle class, which, in 2005 was 18% of the population, in 2011 was 25% (i.e.  35M people, the total current population of Canada) and in 2020 is expected to be 35% of Russia's 140M people.

PepsiCo Russia's Senior VP, Silviu Popovitch disclosed that Pepsi has already invested $9B in Russia. Their strategy has been to leverage their international brands and at the same time, build strong local Russian brands. According to their surveys, 42% of Russians, as contrasted with 23% of Americans, believe in the proposition: "the more I buy the happier I am". Russia is inherently a consumer culture. He concluded by saying that Russia is one of the most attractive markets for potential income growth in the FMCG sector.

Yet the World Bank's Doing Business survey still ranks Russia at no better than 120th place behind China and Brazil. There are obvious areas for improvement: reforming the unattractive political regime, seriously committing to eliminate corruption, enhancing the still weak physical infrastructure and facilitating, not discouraging, entrepreneurship.

One area where Russia is committed to continuous improvement is in respect to intellectual property enforcement. A specialized IP Court has just been constituted. This court, much like the US Court of Appeals for the Federal Circuit, will review lower court and tribunal decisions relating to infringement and validity. In its 2012 IPR Action Plan, the Russian Government committed to the United States to improve enforcement in areas such as internet piracy, anti-counterfeiting and improved efficiency in border controls.2 This is a great leap forward for foreign investment.


1  "Positioned for Growth, Ernst & Young's Attractiveness Survey RUSSIA".

2   Office of the United States Trade Representative announcement at:

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Events from this Firm
8 Nov 2016, Seminar, Ottawa, Canada

The prospect of an internal investigation raises many thorny issues. This presentation will canvass some of the potential triggering events, and discuss how to structure an investigation, retain forensic assistance and manage the inevitable ethical issues that will arise.

22 Nov 2016, Seminar, Ottawa, Canada

From the boardroom to the shop floor, effective organizations recognize the value of having a diverse workplace. This presentation will explore effective strategies to promote diversity, defeat bias and encourage a broader community outlook.

7 Dec 2016, Seminar, Ottawa, Canada

Staying local but going global presents its challenges. Gowling WLG lawyers offer an international roundtable on doing business in the U.K., France, Germany, China and Russia. This three-hour session will videoconference in lawyers from around the world to discuss business and intellectual property hurdles.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.