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Country Snapshot - Russian Federation  

HighlightsRankingsQuantitative DataLegislationAnalytical WorkProject Portfolio
  • Eastern Europe & Central Asia
  • Upper middle income
  • 141,750,000 (2011)
  • 9,910
Russian Federation Flag
Below are select highlights for the data included in the profile.

  1. Russia’s overall Doing Business 2011 ranking is 123, recording a 7-point decline compared to last year.
  2. According to the latest Enterprise Surveys (2009), Tax Rates, Access to Finance and Inadequately Educated Workforce represent the main constraints to the business environment in Russia. Among the firms surveyed, only 31.25% of them reported having a line of credit or loans from financial institutions, compared with 43.74% for the region.
  3. As reported by the Economist Intelligence Unit, May 2011’s robust retail figures suggest that falling unemployment is boosting consumer demand, after a relatively gentle recovery last year from a big fall in private consumption over 2009. Private-consumption growth is expected to accelerate to 3.5% this year, from 3% in 2010.
  4. Russia’s economic freedom score is 50.5, making its economy the 143rd freest in the 2011 Index. Its score is 0.2 point better than last year, reflecting minor improvements in four of the 10 economic freedoms. Russia is ranked 41st out of 43 countries in the Europe region, and its overall score is below the world and regional averages. Economic freedom is severely challenged in Russia. While strong returns from hydrocarbons have buoyed its economy, prospects for sustained long-term diversification and growth remain dim. An increasingly statist approach to economic management adds to the cost of investment and mutes private-sector dynamism. Pervasive corruption and limited respect for property rights hinder the development of economic activity that is free from government control or influence. Macroeconomic instability is a drag on economic growth. Fiscal freedom is the one area in which Russia is at the forefront. Russia’s competitive flat income tax rate and low corporate tax rates support innovation, although private enterprises also must cope with “informal taxes” such as bureaucratic hassling and corruption.

Subnational Doing Business Report

Doing Business in Russia 2009 compares business regulations across 10 Russian cities. The report focuses on local regulations that affect 4 stages in the life of a small or medium-size domestic enterprise: starting a business, dealing with construction permits, registering property, and trading across borders. These indicators capture federal and municipal legislation and practice and suggest that Russian cities could improve competitiveness by adopting local and international best practices.

Main Findings

  • Doing Business was easiest in Kazan, followed by Tver and then Petrozavodsk. It was most difficult to start and operate a business in Moscow and Voronezh.
  • The time to register a business varied from 22 days in Rostov-on-Don to 37 days in Petrozavodsk.
  • Cities in Russia do well on the number of procedures and cost to register property—on average, only 6 procedures were needed and the cost totaled only 0.6% of the underlying property value. The process was half as costly as in OECD countries.

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