While the world’s media has been focusing on the US presidential election, it has rather overlooked this weekend’s Presidential election in Russia where, barring any last minute catastrophes, Dmitry Medvedev, is expected to be elected.
One reason for this apparent lack of interest could be the fact that the election is a foregone conclusion because it is no secret that Mr Medvedev will be President to ensure a continuation of Vladimir Putin’s policies and plans. The move by Mr Putin to the office of Prime Minister is, no doubt, one way he hopes to keep an eye on his former protege. The danger for Mr Putin is if Mr Medvedev decides to stop behaving like some version of a political Stepford Wife and starts to think for himself.
This unusual political background and Putin’s bellicose rhetoric has not stopped international investors from pouring money into Russia. Even at the height of last year’s credit crunch, it was the most successful country in Europe in attracting funds. Indeed last year IPO (initial public offerings) in Russia totalled some $29bn and investors did not confine themselves to minerals or energy but spread themselves across all sectors, including ports, banks, pharmaceuticals and, of course, vodka. Returns across the portfolio were in the region of 13%. In addition its currency the rouble was picked last year by Goldman Sachs as a good buy.
From a personal point of view I have always found Russia a fascinating country whose character I feel has been defined by the sacrifices and suffering of its people. Having recently listened to a dramatized version of Tolstoy’s War and Peace it is striking how the events of 1812 can still resonate almost 200 years later.
Russia is, or course, part of BRICs – Brazil, Russia, India and China – countries now on the cusp of becoming economic superpowers. However, whether this change of President will lead to further growth or herald the start of an internal power struggle remains to be seen.
