Foreign companies continue to finance Russia’s aggression, paying $5 billion annually
24 March 12:58
Foreign companies continue to play a significant role in Russia’s economy, contributing about $5 billion to its budget annually. This is reported by the online edition Lenta.ru, citing Karen Shakhnazarov, a partner at O2 Consulting, Komersant ukrainskyi reports
According to him, as of March 2025, at least 10 thousand companies with foreign capital are actively operating in Russia. This figure shows that, despite sanctions and geopolitical tensions, Russia remains an attractive market for many foreign businesses.
Who is staying in Russia?
Karen Shakhnazarov notes that the countries whose companies continue to operate in Russia are dominated by so-called “friendly” states, as well as economic giants such as Germany and the United States.
“Other companies from the countries represented by these companies are likely to return to Russia. These countries primarily include the so-called “friendly” countries, as well as Germany and the United States, many of whose companies have not stopped their operations in Russia in recent years,” the expert emphasized.
This confirms that even companies from countries that have imposed sanctions against Russia are finding ways to maintain their presence in the Russian market.
Shakhnazarov estimates that taxes from foreign companies amount to at least $5 billion a year. This amount is a significant contribution to the Russian budget, especially in the context of economic pressure due to the war in Ukraine and international restrictions.
The Kremlin’s position: “Welcome” but no preferences
Russian President Vladimir Putin has repeatedly commented on the presence of foreign business in the country. on March 13, 2025, he said that Russia is ready to welcome Western companies that want to return.
“We will say welcome, but there will be no special preferences for the brands that have left,” the Kremlin dictator emphasized.
Later, on March 18, speaking at the congress of the Russian Union of Industrialists and Entrepreneurs, Putin added:
“We respect Western companies that have remained in Russia, even if they operate under other brands.”
Such rhetoric indicates the government’s intention to support those who did not leave the country despite pressure from their governments or public opinion.
It should be noted that sanctions against Russia are becoming a source of tension between Washington and Ukraine’s European allies, as US President Donald Trump seeks to end the Russia-Ukraine war. Putin is demanding the lifting of trade restrictions as a condition for a truce, and the Europeans have made it clear that they are not ready to agree to this.
Although Trump has said he is ready to increase sanctions if Moscow does not seriously engage in peace talks, European officials see no signs of preparations for such action. The US has already withdrawn in February from the KleptoCapture working group, which was created by the Biden administration with broad powers to implement measures against Russia.
The US has indicated that the sanctions will remain in place as long as the war continues, and it is not seeking any easing of any measures at this time, but some sanctions relief is likely to be part of any deal.
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How much money is the war in Ukraine costing Russia and does it have more resources?
One day of the war costs Russia at least $300 million – the aggressor country’s treasury is being depleted. In particular, because of Western sanctions. The problems of the Russian economy are becoming more and more noticeable. According to Bloomberg, to support the economy and finance the war against Ukraine, Russia spent almost 25% of the reserves of the National Welfare Fund last year.
For 2024, the fund remains at about 12 trillion rubles ($117 billion), but liquid funds and investments have decreased by 24% to 3.8 trillion rubles. Since the February invasion of Ukraine in 2022, the fund has decreased by 57%.
In addition, the Ministry of Finance was forced to spend 1.3 trillion rubles from the fund to cover the budget deficit, despite exceeding forecasts for oil and gas exports. According to the British Express, Putin is considering freezing bank accounts and introducing ration cards, as potato prices have risen by 95% and butter prices by 36.5%.
Economist Ihor Lipsits emphasized that Russia already has the funds to finance military operations in 2024, but the prospects for 2025 and 2026 look critical.
“2025 and 2026 are already a very problematic time horizon. So far, we do not see any enlightenment in the financial sector. We see the National Welfare Fund being eaten up. We see problems with the decline in Russian exports. And Putin has chosen a good mine for a bad game in this regard,” Ihor Lipsitz
Thus, the expert emphasizes that the financial forecast remains unchanged, and if the situation does not improve, Russia’s reserves for warfare may be completely exhausted by 2026.
