Politics
Will Foreign Businesses Return to Russia?
May 22, 2025
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Ben Noble
Associate Fellow, Russia and Eurasia Programme, Chatham House -
Nikolai Petrov
Consulting Fellow, Russia and Eurasia Programme, Сhatham House
With apparent closer ties between Russia and the US under President Trump, political and business elites in both countries have been exploring the possibility of an easing of sanctions. Political scientists Ben Noble and Nikolai Petrov discuss the likelihood of foreign business returning to Russia.
This text has originally been distributed as a bulletin from the Chatham House Russia and Eurasia Programme and is republished here with their permission.
On the Russian side, is there a determination to decouple these processes from the ongoing war on Ukraine? If so, how feasible is this, particularly given a firmer stance among European states for this not to happen?
There is a desire by Russia and the US to rebuild bilateral relations.
Even with the signing of the minerals deal, the Trump administration has no real interest in Ukraine or Russia’s ongoing war on the country, which it views as a burdensome distraction.
At the same time, Russia is important to Trump both in terms of its geostrategic position and in terms of the confrontation between the US and China.
On the Russian side, is there a determination to decouple these processes from the ongoing war on Ukraine? If so, how feasible is this, particularly given a firmer stance among European states for this not to happen?
There is a desire by Russia and the US to rebuild bilateral relations.
Even with the signing of the minerals deal, the Trump administration has no real interest in Ukraine or Russia’s ongoing war on the country, which it views as a burdensome distraction.
At the same time, Russia is important to Trump both in terms of its geostrategic position and in terms of the confrontation between the US and China.
“Trump has much more in common with Putin in his vision of the desired world order than with European leaders.”
With the US giving up its leadership in European security, European governments are turning into a motley fleet without a flagship, which does not – yet, at least – represent a formidable and effective force.
This is also true for anti-Russian sanctions. The US has been the leading force in organizing them. With that leadership gone, European sanctions may quickly begin to crumble.
Trump’s revisionist position suits the Kremlin perfectly. But it is unclear whether that position will endure after Trump’s presidential term comes to an end. He may even be pressured to change course during his presidency, if his position weakens.
This is also true for anti-Russian sanctions. The US has been the leading force in organizing them. With that leadership gone, European sanctions may quickly begin to crumble.
Trump’s revisionist position suits the Kremlin perfectly. But it is unclear whether that position will endure after Trump’s presidential term comes to an end. He may even be pressured to change course during his presidency, if his position weakens.
In early April after two days of consultations in Washington Russian Direct Investment Fund CEO and special presidential envoy Kirill Dmitriev said that Russia and the United States have made "three steps forward". Source: X (Twitter)
Russia and the US, therefore, share a mutual interest in short-term investments and quick results. These may include the restoration of air traffic by removing Aeroflot from sanctions and restoring cooperation with Boeing, both in terms of purchasing and servicing aircraft, and in terms of titanium supplies.
Other steps may include cooperation in the Arctic, where it is easier to divide the world in two – for example, one country gets the Northwest Passage and the other the Northern Sea Route.
Kirill Dmitriev – Presidential Envoy on Foreign Investment and Economic Cooperation – has recently been the public face of the Russian side in these discussions. What do we need to know about him? Is he simply a messenger for Vladimir Putin or does he have his own agendas and areas of influence?
Kirill Dmitriev is a leading figure of the next generation of Putin's elite. And he embodies a business-like approach to foreign policy.
Other steps may include cooperation in the Arctic, where it is easier to divide the world in two – for example, one country gets the Northwest Passage and the other the Northern Sea Route.
Kirill Dmitriev – Presidential Envoy on Foreign Investment and Economic Cooperation – has recently been the public face of the Russian side in these discussions. What do we need to know about him? Is he simply a messenger for Vladimir Putin or does he have his own agendas and areas of influence?
Kirill Dmitriev is a leading figure of the next generation of Putin's elite. And he embodies a business-like approach to foreign policy.
“Dmitriev understands the Americans and is understandable to them. He also has good connections both in the US and in the Middle East.”
Dmitriev’s wife, Natalya Popova, is a former classmate and friend of Putin's daughter, Katerina Tikhonova. Dmitriev is, therefore, somewhat similar to Trump's son-in-law Jared Kushner, given their proximity to their respective presidents and families.
Dmitriev knows how to negotiate, and is rumoured to be a possible replacement for Sergei Lavrov as Minister of Foreign Affairs. Dmitriev is driven not by ideological but by business interests, which makes him not just a mediator, but the architect of a pragmatic – even cynical – approach to foreign policy.
How likely is it that US and other foreign businesses will start to return to the Russian economy in the near future? What are the factors that will encourage or hinder these possible moves?
Some foreign businesses have not left Russia – or, when leaving, left the door half open.
High expectations from the Russian public for a return of some foreign companies are well founded. In fact, the process is already underway.
Dmitriev knows how to negotiate, and is rumoured to be a possible replacement for Sergei Lavrov as Minister of Foreign Affairs. Dmitriev is driven not by ideological but by business interests, which makes him not just a mediator, but the architect of a pragmatic – even cynical – approach to foreign policy.
How likely is it that US and other foreign businesses will start to return to the Russian economy in the near future? What are the factors that will encourage or hinder these possible moves?
Some foreign businesses have not left Russia – or, when leaving, left the door half open.
High expectations from the Russian public for a return of some foreign companies are well founded. In fact, the process is already underway.
“Ultimately, this is a question of businesses assessing the risks in Russia and in their own countries, both regarding the reputational damage of re-entering the Russian market and in defying recommendations from their respective governments.”
Businesses with long-term investments will probably not return for a long time. But those that do not require large investments and have a short payback period will be ready to return – if the pressure on businesses from their governments reduces and if public opinion against returning to Russia weakens.
There will also likely be a clear sequence: first American, then European companies. If, for example, Russia and the US reach an agreement regarding Boeing, it is difficult to imagine that Airbus will not follow suit.
What does all of this tell us about how much Russia’s full-scale invasion of Ukraine has changed relations with the US, and Russia’s position in the world more broadly?
The world is changing rapidly. And so are ideas about Russia's place in it, after three years of war.
Putin and Trump will agree, if they haven't already, on spheres of influence in the spirit of Yalta 1945. It is not entirely clear what will remain of this after Trump leaves the presidency, but the isolationist phase of US foreign policy may well last for a long time.
If we talk about military power, which has again become important, then the US, Russia, and China have it. Europe, by contrast, does not – yet.
At the same time, Europe is much more powerful financially and economically than Russia. That is why it makes no sense for Putin to abandon military confrontation and move to economic competition.
With the arrival of Trump, Putin has almost got what he wanted. And this is not the annexation of new territories by Russia, which is not important for Russia – the largest territory in the world.
What is important to Putin is the creation of a world with three or four great powers, with their own zones of influence. In Putin’s mind, this would represent the righting of a historical injustice – and would make Russia great again.
Europe faces a precarious future. It lacks a coordinated strategy in a rapidly changing situation, in contrast to the clearer (albeit more callous) strategies of Putin and Trump. This is particularly dangerous with the US’s reduction of its security role on the continent.
The very existence of Europe is at stake.
There will also likely be a clear sequence: first American, then European companies. If, for example, Russia and the US reach an agreement regarding Boeing, it is difficult to imagine that Airbus will not follow suit.
What does all of this tell us about how much Russia’s full-scale invasion of Ukraine has changed relations with the US, and Russia’s position in the world more broadly?
The world is changing rapidly. And so are ideas about Russia's place in it, after three years of war.
Putin and Trump will agree, if they haven't already, on spheres of influence in the spirit of Yalta 1945. It is not entirely clear what will remain of this after Trump leaves the presidency, but the isolationist phase of US foreign policy may well last for a long time.
If we talk about military power, which has again become important, then the US, Russia, and China have it. Europe, by contrast, does not – yet.
At the same time, Europe is much more powerful financially and economically than Russia. That is why it makes no sense for Putin to abandon military confrontation and move to economic competition.
With the arrival of Trump, Putin has almost got what he wanted. And this is not the annexation of new territories by Russia, which is not important for Russia – the largest territory in the world.
What is important to Putin is the creation of a world with three or four great powers, with their own zones of influence. In Putin’s mind, this would represent the righting of a historical injustice – and would make Russia great again.
Europe faces a precarious future. It lacks a coordinated strategy in a rapidly changing situation, in contrast to the clearer (albeit more callous) strategies of Putin and Trump. This is particularly dangerous with the US’s reduction of its security role on the continent.
The very existence of Europe is at stake.
“In the event of the war ending in any form, sanctions policy will be revised – and a differentiated approach is likely.”
Some Western businesses could be used for the Russian military machine; these should not be allowed into Russia. But there are other business areas that are safer from this point of view, even if they would be paying taxes, thus contributing to state revenues. Companies in this latter group may return – or come for the first time – to Russia if they decide there are mutually beneficial terms.
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