Детерминанты прямых иностранных инвестиций за рубеж в российской экономике: анализ на микроданных / Determinants of foreign direct investment outflows in the Russian economy: micro-level analysis
Аннотация
FDI laterally appreciatively influences the host frugality through, among others, knowledge and technology prolixity. Russia came one of the major FDI recipients in the world in the first decade of the 21st century. Because of warrants and the posterior profitable retardation, the Russian economy has faced a sharp decrease in FDI outflows during the last two years. Russian economy has faced a sharp decrease in FDI outflows during the last two years. Between 2011 and 2019, FDI outflows in Russia changed from over 48.6 billion U.S. dollars in 2011 to roughly 22.02 billion U.S dollars in 2019. The smallest mark over the given timeframe was recorded in 2020, at 6.31 billion U.S. dollars. The types of finance in Russia’s commercial sector FDI outflows, in discrepancy, remained relatively different. Reinvestment of gains has stayed popular, while investment in share capital and lending by Russian parent companies to their foreign subsidiaries also retained their places. Foreign direct investment (FDI) is an integral part of the open and a well-functioning economic system and the main catalyst development. At the same time, however, the receipt by different countries, sectors of the economy and groups of the population, united on a territorial basis, an increasing number of benefits from FDI does not occur automatically and these benefits are distributed not evenly between them. Opportunity to attract more and more FDI developing countries and maximizing the benefits from them in order to achieve the objectives development is determined by the policies pursued by these countries and the so-called international investment architecture.
Object of research: Russian companies investing abroad.
Subject of research: FDI outflows in the economy.
Aim of the study: identify the determinants of FDI outflows in the Russian economy.
Motivation of research is to see which factors influence companies to have branches abroad. The dynamics of FDI correlates well with business sentiment. Expectations of positive results of the future activities of companies and confidence in the expediency of investments largely depend on confidence in the future. Sanctions,
of course, worsen these expectations and act as a source of enormous uncertainty for business. So, is capital outflow a good thing or a bad thing? Neither one nor the other. The outflow of capital means that our country is investing surplus funds received in the framework of current economic operations abroad. This happens because we sell more goods and services abroad than we buy, and we have external savings. That is, on the one hand, the outflow of capital is an indicator that our products are in demand abroad and the money from their sale is not only enough to buy imports, but also remains for investment abroad. And this is a positive sign.
On the other hand, the country's balance of payments also reflects the flow of foreign investment into the Russian economy. If foreign investment is reduced, this can also become one of the reasons for the outflow of capital. Sometimes this can be a bad sign - investment conditions in the country are not attractive enough. In this case, it is worth working to improve the situation.
But at the same time, one should not forget that foreign investments in Russian companies and banks can increase external debt. For example, if a company attracts money from foreign investors with the help of bonds, it turns out that it borrows them. And together these debts of companies add up to the external debt of the country. Under unfavorable external conditions, for example, when the dollar strengthens, servicing such debt becomes unsustainable for the company. Therefore, some countries adhere to a policy of moderation so that there is not too much external money in the economy. The negative attitude towards it is often associated with the fact that it is confused with "capital flight". “Capital flight” is the illegal withdrawal of funds abroad in order to hide shadow incomes and evade taxation. This really has a negative impact on the economy, and the Bank of Russia is actively fighting with this.
Relevance: FDI outflows cause effects in the economy.
The main objectives of my research:
- analysis of factors that influence companies to have branches abroad;
- to study the theoretical aspects of foreign direct investments outflows;
- to construct econometric model
- to identify the determinants
- to analyze the role of sustainable development goals in the spread of huge Russian companies
The methodological tool consists of statistical and econometric methods of analysis, as well as substantiation of the sequence of econometric research.
Statistical methods are used to analyze graphical and tabular materials, analyze the studied phenomena in dynamics. The use of econometric methods of analysis is necessary for the regression study of panel data and the construction of a model of the dependence of foreign direct investments outflows on Russian manufacturing sector companies, as well as finding relationships between variables.
The source of theoretical data for the study of this topic will be articles by Russian and foreign authors –who previously studied on the topic of the determinants of FDI outflows in the Russian economy, as well as official documents, directives and for empirical data I will use databases such as Ruslan database.
During a statistical and econometric study, it was revealed that more productive Russian companies tend to make FDI abroad. This gives a reason to further develop this direction. Therefore, achieving the Sustainable Development Goals (SDGs) by 2030 by Russian companies should be accepted as an effective global policy.
Due to my results, high-growth companies (with significant leverage) are not looking to expand abroad and need to expand within their local markets. Total factor productivity, Scale, HHI influence on a company having foreign brands. Where there is little competition in an industry, firms will need to establish a foreign affiliate because this will increase the diversification.
Object of research: Russian companies investing abroad.
Subject of research: FDI outflows in the economy.
Aim of the study: identify the determinants of FDI outflows in the Russian economy.
Motivation of research is to see which factors influence companies to have branches abroad. The dynamics of FDI correlates well with business sentiment. Expectations of positive results of the future activities of companies and confidence in the expediency of investments largely depend on confidence in the future. Sanctions,
of course, worsen these expectations and act as a source of enormous uncertainty for business. So, is capital outflow a good thing or a bad thing? Neither one nor the other. The outflow of capital means that our country is investing surplus funds received in the framework of current economic operations abroad. This happens because we sell more goods and services abroad than we buy, and we have external savings. That is, on the one hand, the outflow of capital is an indicator that our products are in demand abroad and the money from their sale is not only enough to buy imports, but also remains for investment abroad. And this is a positive sign.
On the other hand, the country's balance of payments also reflects the flow of foreign investment into the Russian economy. If foreign investment is reduced, this can also become one of the reasons for the outflow of capital. Sometimes this can be a bad sign - investment conditions in the country are not attractive enough. In this case, it is worth working to improve the situation.
But at the same time, one should not forget that foreign investments in Russian companies and banks can increase external debt. For example, if a company attracts money from foreign investors with the help of bonds, it turns out that it borrows them. And together these debts of companies add up to the external debt of the country. Under unfavorable external conditions, for example, when the dollar strengthens, servicing such debt becomes unsustainable for the company. Therefore, some countries adhere to a policy of moderation so that there is not too much external money in the economy. The negative attitude towards it is often associated with the fact that it is confused with "capital flight". “Capital flight” is the illegal withdrawal of funds abroad in order to hide shadow incomes and evade taxation. This really has a negative impact on the economy, and the Bank of Russia is actively fighting with this.
Relevance: FDI outflows cause effects in the economy.
The main objectives of my research:
- analysis of factors that influence companies to have branches abroad;
- to study the theoretical aspects of foreign direct investments outflows;
- to construct econometric model
- to identify the determinants
- to analyze the role of sustainable development goals in the spread of huge Russian companies
The methodological tool consists of statistical and econometric methods of analysis, as well as substantiation of the sequence of econometric research.
Statistical methods are used to analyze graphical and tabular materials, analyze the studied phenomena in dynamics. The use of econometric methods of analysis is necessary for the regression study of panel data and the construction of a model of the dependence of foreign direct investments outflows on Russian manufacturing sector companies, as well as finding relationships between variables.
The source of theoretical data for the study of this topic will be articles by Russian and foreign authors –who previously studied on the topic of the determinants of FDI outflows in the Russian economy, as well as official documents, directives and for empirical data I will use databases such as Ruslan database.
During a statistical and econometric study, it was revealed that more productive Russian companies tend to make FDI abroad. This gives a reason to further develop this direction. Therefore, achieving the Sustainable Development Goals (SDGs) by 2030 by Russian companies should be accepted as an effective global policy.
Due to my results, high-growth companies (with significant leverage) are not looking to expand abroad and need to expand within their local markets. Total factor productivity, Scale, HHI influence on a company having foreign brands. Where there is little competition in an industry, firms will need to establish a foreign affiliate because this will increase the diversification.