Emerging Market

Topics: Russia, Investment, Dmitry Medvedev Pages: 7 (2475 words) Published: June 11, 2013
Written Report of Assessment One
Module : MKT10901 Emerging Markets (Hong Kong)
Topic : Emerging Market in Russia

Local Tutor is Stephen Li (s.li@cityu.edu.hk)
Student Name : Huen Ho Ki
Edinburgh Napier University student no. : 40073098
Scope, City University of Hong Kong student no. : 52652990
Word Count : 1982

Executive Summary
Russia is a country which has rich natural resource with Europe’s largest population of more than 140 million, this shows Russia’s heavy weight as a player in global trade, also indicates the potential benefits that the country can bring to other WTO members upon accession. Being one of the emerging country, Russia does have unlimited potential to develop into a country flourish. His daily necessities exports rely mainly on the field the introduction, including Asia and Europe. Russia aspirations to localize consumer goods production would provide new opportunities for Hong Kong companies, especially parts and components suppliers of electronics, footwear and apparel. Meanwhile, weakness and threats of Russia has to be considered about. As the Russian terrain is rather special, the island is more dispersed, so that a large population of investment in power becomes relatively weak, because of the lack of experienced manpower, and most people prefer the money be converted into cash by their own savings, the relative impact of the future development of the investment environment. It is not an easy task to be succeeded in Russia, investors must weigh the risks and the work entailed to ensure the integrity of its compliance regime. Addressing these challenges starts with knowing where jurisdictional authorities draw lines with regard to compliance, lines that are sometimes arbitrary and inconsistently applied but nevertheless, enforceable.

Potential Market
Although Russia is still not a member of the WTO, its trade and business regime the liberalization of its trade and business regime is keep going to open to public throughout the years. (Hong Kong Trade Development Council website, 2011) Russia is open for investment, the country is rich in natural resources, has a skilled and well-educated workforce, and encourages foreign investment for continued growth. (Hong Kong Trade Development Council website, 2011) Given their location and historic ties, EU countries and Commonwealth of Independent States countries (e.g. Belarus) have always been major trading partners of Russia. Although it is unlikely that Asian suppliers can challenge the share of European and CIS countries in Russia’s external trade, the interest of Russian importers in sourcing from Asia is increasing. (Hong Kong Trade Development Council website, 2011) Rich natural resources such as minerals and metals in Russia is accounting for more than 80% of the country’s total exports in 2009. Due to a fragmented market structure, the Russian importers can only trade consumer goods in small order size and used to turn to European distributors for imports from Asia. (Hong Kong Trade Development Council website, 2011) However, the strong economic growth and increasing globalization have greatly enhanced Russia’s import absorption capabilities, prompting Russian buyers to look for more competitive sources of imports and consider more competitive sourcing models. (Hong Kong Trade Development Council website, 2011) Russia is the most populous country in Europe with the dazzling spending patterns among the new rich in the past decade, has transformed into a sizable and lucrative emerging market for Hong Kong companies. The Russian economy cannot be decoupled and is still suffering from the economic storm battering the whole world. (Hong Kong Trade Development Council website, 2011) Russia lacks a large domestic manufacturing base for general consumer goods although it is advanced in terms of technology and weaponry. Together with the high production costs, imports occupy in an extreme large proportion, offering steadfast export...
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