German businesses have frozen part of their investments in Russia due to coronavirus - head of Russian-German Chamber of Commerce Abroad
MOSCOW. Aug 31 (Interfax) - Chairman of the Russian-German Chamber of Commerce Abroad Matthias Schepp has spoken of a sharp reduction of investments from Germany in the Russian economy.
"After active growth in 2018 and 2019, the volume of net direct investments of German businesses in Russia has demonstrated sharp reduction. In the period from March to June, German companies withdrew a total of 1.1 billion euros from Russia. This is evidenced by the latest data of the Bundesbank, which the Russian-German Chamber of Commerce Abroad is in possession of," Schepp told Interfax on Monday.
"Nevertheless, the total volume of investments in H1 2020 grew by nearly 700 million euros. Many investments were postponed and frozen. The global measures for the fight against coronavirus are intensifying uncertainty among investors who contribute funds to Russia," he said.
Schepp said that in 2018 and 2019, the volume of net direct investments had been 3.8 billion euros and 2.6 billion euros, respectively, reaching record levels. "Many companies had set themselves up for a good year for business in Russia, but then came coronavirus," he said.
"In Q2 of this year, the level of German investments was the lowest in the past 20 years. The period from March to June was the peak of the Russian nationwide restrictive measure to combat coronavirus, which led to interruptions to supplies and production, at German enterprises too," Schepp said.
He said that the trade turnover of Germany and Russia had fallen 24% to 22 billion euros in H1. "Thus, Russia occupied just fourth place in terms of trade with Germany among countries of Eastern Europe after Poland, the Czech Republic, and Hungary," Schepp said.
The Russian-German Chamber of Commerce Abroad represents the interests of German companies in Russia and Russian companies in Germany. It unites some 900 member companies and is the biggest foreign business association in Russia. At present, there are 4,274 companies with German capital on the Russian market.
