"Russia is dangling the promise of new investment opportunities for U.S. companies as the Trump administration seeks an end to the war in Ukraine, from energy and critical minerals to space cooperation with Elon Musk.
But the opportunities for Western businesses likely will be limited, even if there is a full restoration of economic ties with Moscow. President Vladimir Putin has put caveats on potential cooperation, and many Western firms would hesitate to make new investments as they weigh the political uncertainties and reputational risks.
The potential for a thaw in Moscow's ties with Washington gained fresh momentum on Tuesday as Putin agreed to pause strikes on Ukrainian energy infrastructure. A call between President Trump and Putin largely focused on the conflict but also addressed potential economic cooperation, according to White House and Kremlin readouts.
But just before speaking to Trump, Putin told a Russian business convention that government policy would still favor Russian firms if Western sanctions were eased. He also chastised foreign companies that "demonstratively slammed the door" when they quit Russia after its 2022 Ukraine invasion.
"There will be no privileges or preferential terms for returning companies," he said, adding that firms that sold Russian assets on the cheap when they left wouldn't be allowed to repurchase them for the same low price.
The Western firms that would be best positioned to profit immediately after any thaw likely would be those that never left Russia or the ones that could easily begin exporting to the country again without having to make long-term investments, economists say.
Russia's 2022 invasion set off one of the biggest corporate exoduses in history as Western allies hit Moscow with a wave of sanctions, prohibiting many types of trade and investment. Many companies have painful memories of how difficult it was to get out. The Kremlin seized the assets of some companies, including those of French food producer Danone, Danish brewer Carlsberg and energy giant Exxon.
The Russian economy has held up through more than three years of war largely because of its ability to continue exporting oil, particularly to China and India. But it is now slowing under the weight of the sanctions, inflation and rising interest rates, making it a less attractive place to invest. Even if the U.S. were to ease sanctions, Europe is unlikely to follow suit quickly, leaving Russia a compliance nightmare for international companies.
Putin recently suggested U.S. companies could join projects exploring Russia's rare-earth mineral deposits, while other officials have pointed to potential joint energy development in the Arctic. Kremlin envoy Kirill Dmitriev on Tuesday said Russia plans to speak with Musk about a possible mission to Mars.
As of January, nearly 500 international companies had left Russia completely since the 2022 invasion, according to the Kyiv School of Economics. Another 1,300 announced departures but haven't finished them.
A rapprochement could benefit some of the 2,200 foreign firms that stayed in Russia. Those include big food companies such as PepsiCo, Nestle and Mars. The companies, which are selling scaled-back product lines, maintained some local production that they potentially could expand if relations improved.
Pepsi declined to comment on its plans. Nestle and Mars didn't respond to requests for comment.
Companies exporting goods or services to Russia, such as aircraft manufacturers, automakers and software developers, might consider re-engaging before those that would need to re-establish bricks-and-mortar assets requiring long-term stability, such as McDonald's, Starbucks and Exxon, analysts said.
A return could be politically fraught. Russia's deputy prime minister said Moscow would require returning retail chains to open outlets in regions of Ukraine re-united with Russia." [1]
1. World News: West Wary of Russian Climate for Business. Whalen, Jeanne. Wall Street Journal, Eastern edition; New York, N.Y.. 21 Mar 2025: A8.
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