¶ … Business in Russia The Russian Federation occupies most of Eastern Europe and north Asia. It stretches from the Baltic Sea in the west to the Pacific Ocean in the East and from Arctic Ocean in the North to Black Sea in the south (Pearson Education, 2012). It is the largest of the 21 republics that make up the Commonwealth of Independent States. There are also 6 federal territories, 2 federal cities, 49 regions, 1 autonomous region, and 10 autonomous areas (Pearson Education, 2012). Norway and Finland borders the Federation in the northwest while Estonia, Latvia, Belarus, and Ukraine border it in the west. In the south it is bordered by Kazakhstan, Mongolia, China, and North Korea. Russia occupies a land area of approximately 17,075,500 sq km (Pearson Education, 2012).

Russia is spread over all climatic zones except tropical. West of the Ural mountains from the Black Sea to the Arctic Ocean is a broad plain with low hills (Pearson Education, 2012). East of the Ural lies the Siberia that is covered with Coniferous forest, swamps, tundra, and mountainous terrain (Russian Embassy, 2012). The country has an array of natural resources including deposit of oil, coal, natural gas, strategic minerals, diamonds, and timber (Pearson Education, 2012). Coastlines along Arctic and Pacific Ocean, and Baltic, Caspian, and Black Seas have significant reserves of fish, oil, and natural gas. Russia has harsh continental climate with big difference between winter and summer temperatures. Russia has only 8% of arable land (Pearson Education, 2012).

The first Russian dynasty was founded in Novgorod in 862 by Viking Rurik. The myriad tribes in the federation were united by the spread of Christianity in the 10th and 11th centuries (Pearson Education, 2012). The spread of Christianity culminated into the conversion of the first Vladimir or Saint in 988. Power was centralized at Kiev where grand dukes lived. When Kiev was destroyed in 1240 by the Mongols, Russian territory was split into smaller dukedoms (Pearson Education, 2012). Moscow's role as an administrative and trade centre coupled with the fact it was the seat of the office of tribute collector for Mongols made early dukes of Moscow extend their influence over other Russian cities. When Duke Ivan III acquired Novgorod and Tver in the late 15th century he threw off the Mongol yoke. Ivan IV is credited with creating the Russian state especially after he had crushed the powers of rival princes and boyars (Pearson Education, 2012). However, Russia remained largely medieval until the reign of Peter the Great (1689-1725). Peter the Great was the grandson of the first Romanov czar, Michael who reigned in 1613-1645. Peter's rule was characterized with extensive reforms. When he defeated Charles XII of Sweden in the battle of Poltava in 1709, the Russian boundaries were extended to the west. Catherine the Great (1762-1796) carried off from where Peter left and ended up acquiring Crimea, Ukraine, and part of Poland (Pearson Education, 2012). When Napoleon attempted to subdue Russia during the reign of Alexander I, he was defeated and a new territory acquired. These included Finland and Bessarabia. Holy Alliance, Alexander's brainchild, helped in crushing Europe's rising liberal movement. Alexander II (1855-1881) pushed Russia's borders to the Pacific and into central Asia. During his reign, serfdoms were abolished (Pearson Education, 2012). However, restrictions were imposed on the emancipated class. After Russia's defeat in war with Japan, revolutionary strikes ensured which forced Nicholas II (1894-1917) to grant a representative national body known as duma (Pearson Education, 2012). Members of duma were elected by narrowly limited suffrage. The duma held its first sitting in 1906. It had very little influence on Nicholas (Pearson Education, 2012). The U.S.S.R. was established on Dec. 30, 1922.

Culture and per capita income

Russia Gross Domestic Product (GDP) as at 2011 was $2,380 trillion. Its per capita income was $16,700. The Real growth rate was 4.3% and inflation at 8.9%. The rate of unemployment was 6.6% (Pearson Education, 2012).

For you to do business in Russia you have to know much about them in terms of greetings, negotiations, and conducting business. Greeting is characterized with a very firm handshake. Your greeting has to be appropriate for the time of the day- dobraye utra, dobryy den, dobryy vecher, for good morning, good afternoon, and good evening respectively. It is commonplace for people doing business in Russia to introduce them using their surnames (Kwintessential, 2004). For a foreign national doing business in Russia it is appropriate that you find out if your Russian counterpart uses any other titles because this is extremely important. One should refer to his counterpart by either gaspodin or gaspazhah which are similar to Mr. And Mrs. Respectively plus his or her surname (Kwintessential, 2004). Russians have three names the first being the given name and the last the father's family name. The middle name is a...

For men the name ends with the suffixes "vich" or "ovich." This means son of. For women the name ends with suffixes "a" or "ova" which means daughter of. You have to make a business card when doing business in Russia. This helps in maintaining contacts in Russia (Kwintessential, 2004). One side has to be translated into Russian. Add titles and degrees you have on this business card. You have to be punctual for meetings. Take no offense if your Russian counterpart is not punctual. Russian business people always appear hours later after the agreed time. Their punctuality is an indicator of how serious they are with the business meeting. Russian businessmen will assess ones credibility during their initial meeting. One must therefore be firm and dignified while maintaining an air of warmth and approachability (Kwintessential, 2004). Russians are not impressed by foreigners doing business in Russia who use special visuals and flashy PowerPoint presentations as these hardly sway their decisions. Yours is to demonstrate your knowledge, professionalism, and expertise. Significant numbers of Russian businessmen speak good English so the issue of language barrier should not be an issue. However, if need be, you can hire an interpreter. One must try to present in Russian. Negotiations have to be tough and full of theatrics (Kwintessential, 2004). There should be no concessions in the formative stages of negotiations since Russians view compromise as a sign of weakness. Loss of tempers, walkouts, and threats to end the deal is part of negotiations. Business meetings and negotiations are normally done at dinner time. Russians business people will always invite you out for dinner (Kwintessential, 2004). Turning down such invites would be rude. Always comply. Center seats at the table are used by the most senior attendees. Guest sits in the middle of the table opposite their immediate counterpart. Russians drink alcohol and refusing to drink is unacceptable unless you give a plausible reason for refusal like health or religious reasons. There has to be limit to amount of alcohol you taking (Kwintessential, 2004).
Literacy level, educational structure, and funding

Literacy levels in Russia are nearly 100% except in some few areas which are dominated by ethnic minorities. Three-fifth of Russians aged fifteen and older have completed secondary school and 8% have completed higher education (U.S. Library of Congress, n.d.). The urban folks go to school than the rural folks. In Russia there are pre-schools, elementary schools, secondary schools, and tertiary learning institutions. Children stay in pre-school until they are seven years old. State education is free but private education is footed by individuals.

Natural resources and sources of foreign exchange earnings

Russia has major deposits of oil, natural gas, coal, strategic minerals, diamond, and timber. However because of formidable obstacles of climate, terrain, and distance it is difficult to exploit these natural resources.

Russian exports in 2011 added up to $498.6 billion. Its major foreign exchange earners are petroleum and petroleum products, natural gas, wood and wood products, metals, and chemicals.

Areas of the economy that attract international business

The population of Russian consumers, its growing middle class, and unlimited infrastructure is a boon for any businessman who would like to invest in Russia. It has a population of over 140 million consumers. Any person with an intention of investing in Russia should consider investing in these promising sectors of the economy: apparel, aviation, construction, refinery equipment, travel and tourism, and consumer electronics (USA.gov, 2013).

Registering a business in Russia

Registration of foreign business entities is done by tax authorities. A company can also be registered with State Committee for Statistics and three non-budgetary funds like the Pension fund, Obligatory Medical Security fund, and Social Security fund. Representation Office and Branches are accredited by State Registration Chambers, Chamber of Trade and Commerce and a number of Russian Government ministries (Way to Russia, 2009).