Irish investors have been too slow to invest in Russia and must seize the opportunity now while the economic outlook for the nation is positive, a gathering of Russian and Irish business people were told yesterday.
Addressing a conference entitled "The New Russia: Perspectives and Opportunities for Ireland", Peter Sutherland, chairman of BP and Goldman Sachs, said the positive growth forecasts for the Russian economy have scarcely any parallels in the world, making the country an excellent destination for future investment.
"In looking at the opportunities for the future. One has to look at the macro-economic picture and in Russia's case this is excellent," he said.
Government spending in Russia is forecast to increase by more than 20 per cent and imports are likely to grow at the same rate, according to Mr Sutherland. "This is remarkable buoyancy and is quite unique," he told conference attendees.
While Irish companies and investors had been slow on the uptake in Russia, many German, British and Italian companies had already been successful in setting up businesses in the area.
BP itself had made the largest investment - $10 billion (€8.3 billion) since 2003 - by any external company in Russia and was now reaping the benefits, according to the former EU commissioner and first director-general of the World Trade Organisation (WTO). About 25 per cent of the company's daily crude oil production comes from Russia and the country accounts for 10 per cent of the group's total profits.
"We are encouraged by the rapid progress and are quite happy with the future we see before us," said Mr Sutherland, adding that changes taking place in the Russian economy were not dissimilar to those seen in the Irish economy in the past decade.
"Business conditions are not perfect, but for the most part they are workable," he said.
Mr Sutherland admitted there were issues concerning the rule of law and corruption in Russia, but was adamant that president Vladimir Putin was on the right track to tackling these issues.
He said he hoped the close relationships Russia had with individual EU members would develop into an even stronger one with the EU as a whole and said he was very keen that Russia joined the WTO as soon as possible.
"Of course there are risks but you also need to look at the opportunities," said Mr Sutherland.
