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Despite strained relations, Britain invests $23bn in Russia – Putin

CUMULATIVE British investment in the Russian economy today amounts to $23.8 billion while the relevant figure for Russian investment in Britain exceeds $11 billion, says Russian President Vladimir Putin.

And BP Group chief executive officer Robert Dudley says restoring and nurturing relations between Russian and the UK could only bring great benefits to both countries.

Speaking with representatives of the UK business community during a meeting at the Kremlin last Wednesday, President Putin said although relations between Britain and Russia have not been at their best in the past few years, trade grew by 23 per cent in one go in 2017.

“After energy prices stabilised, it increased by another eight per cent last year to $13.7 billion… More than 600 enterprises partly owned by British businesses operate in our country. That is quite a large number. They operate in the industry in the broadest sense, such as mechanical engineering, and the pharmaceutical and other innovation-driven industries. The energy corporations of Russia and the UK are involved in producing and processing crude oil and gas, raw materials, and generating and delivering electric power. They are jointly implementing major projects such as Nord Stream 2 and Sakhalin 3. And I am not even talking about BP being the largest shareholder in our leading oil and gas company, Rosneft.”

He said experts from London’s City were involved in efforts to create an international financial centre in Moscow, and the London Stock Exchange facilitates capital flows to Russia.

“The securities of almost all public Russian companies are listed on the LSE. I would like to emphasise that we in Russia are doing our best to make sure foreign investors, our partners and friends, feel comfortable working on the Russian market and do not come under excessive administrative stress. For your information, Russia is now 31st in the World Bank’s Business Freedom Index having risen dozens of places over the past five years,” he said.

President Putin said hundreds of billions of dollars would be invested in critical sectors of the economy and the social sphere as part of national projects.

“I am sure that your companies could be part of this work; the market is large enough for everyone. We hope that once implemented, these projects will have a comprehensive synergetic effect on the dynamic growth of the entire country, and will open up significant business opportunities, including for the British business community,” said President Putin.

And Dudley said despite times of great allegiance and high tension, the “deeply historic” relationship between Russia and the United Kingdom had always endured, not least because of trade.

“Because trade keeps open the channels of dialogues between the two countries. Trade supports the growth and the prosperity and it is also an important bridge when other channels of communication close down. In those times, you have always been able to talk to find common ground and that is essential for restoring and building trust,” Dudley said.

He said BP deeply appreciated the support and trust Russia had given the company over the last 30 years.

“With your support, Mr President, we have gone from a single retail station in Moscow to the strategic partnership we have today with Rosneft. … The world has changed profoundly since the 1990s, as have BP’s interest here. We now account for more than half of the capital flows from the UK to Russia. … the UK is Russia’s single biggest foreign direct investor but that the majority of that investment comes from our own company. And that means that there is huge potential for the company and other companies across the UK, industries and sectors to grow, diversify trading connections between the two countries,” Dudley said.

He added that there remained scope for thousands of individual trading relations between Russia and the UK.

“And the more there can be done to foster and grow that mutually beneficial trading relationships, the more the lines of communication can be opened – and the greater the opportunity to build trust, reduce tensions, create bonds, create jobs, economic growth,” said Dudley.

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