TWICE AS MANY BUSINESSES SHUT IN RUSSIA THAN THOSE REGISTERED

HomeNewsTWICE AS MANY BUSINESSES SHUT IN RUSSIA THAN THOSE REGISTERED

Last year, twice as many businesses were shut in Russia as opposed to those opened, according to the results of a market survey. This is a result of some technical issues in the economy, although mainly it is a result of the problems with the business climate in general as well as losses incurred by businesses in recent years. Last year more than 290.000 new enterprises were launched in Russia, whereas over 600.000 companies ceased their activity.

The largest number of businesses was started in Crimea: over 1700, the number of businesses shut, however, is also high: over 1600. Favourable statistics might be a result of the “Federal programme for the development of the peninsula until 2022”. Among other things it provides for the creation of industrial parks and ensure the smooth operation of the Free Economic Zone.

The total federal budget allocated is almost 900 billion roubles until 2022. The largest growth in the number of new companies was registered in the Republic of Ingushetia: 615 companies opened here while 384 shut down. Chechnya ranks second among the regions in terms of growth, with 657 new businesses opened and 594 discontinued. The trend of the number of closed companies in Russia surpassing those that open was observed as of 2016 and continued in 2017-2018.

The western region of Kaliningrad became the leader of this negative rating with the number of entities liquidated here during 2018 at almost 7,000, and only 1,500 new businesses opened, in spite of the Special Economic Zone status of the region, exempting residents from the taxes on assets and on profits during the first 6 years, zero import duties and no VAT on goods consumed directly in the region.