Market Entry Strategies for German Companies in Russia

Inhaltsangabe:Abstract:Germany is Russia?s biggest trade partner. According to Russian official statistics, Russia imported 8.1% from and exported 13.4% to Germany in 2006. For Germany, Russia ranks eighth in overall trade volume, with exports about 23 Billion Euro and imports about 30 Billion Euro. Due to high prices for oil and gas, which amount for roughly 60% of Russian exports, the statistics indicates a negative trade balance for Germany since 2003.Germany is Russia?s oldest trade partner, as well. No other West-European country has the same history of cultural, social and economical exchange with Russia as Germany does. The very term `German´ in Russian language was century long the word for all `foreigners´. Having left behind a century of forced antagonism, both countries are nowadays converging steadily. Today, the Russo-German trade relationships become more and more important for both countries. This paper focuses on the strategies German companies pursue on the Russian market. The fundamental question is empirical in nature: ?What have German companies done in Russia??. The ultimate aim, however, is to gain empirical evidence for theoretical reasoning: ?What should German companies do in Russia??. The paper consists of three parts. The first part gives a brief overview over Russo-German trade relations and Direct Foreign Investment. The Second part describes the legal, social and cultural environment in Russia and how German companies cope with it. The third part focuses on their strategy in response to their aims and to the environment.Inhaltsverzeichnis:Table of Contents:List of Tables7Executive Summary81.INTRODUCTION82.METHODOLOGY93.TRADE RELATIONS AND INVESTMENT ENVIRONMENT113.1BILATERAL TRADE VOLUME113.2GERMAN DIRECT INVESTMENT IN RUSSIA133.3BUSINESS ENVIRONMENT164.LEGAL FRAMEWORK FOR INVESTMENT INTO RUSSIA174.1LEGAL FORMS OF INVESTMENT174.1.1THE REPRESENTATIVE OFFICE174.1.2THE BRANCH OFFICE194.1.3CORPORATE ENTERPRISES234.1.3.1The Limited Liability Company (OOO)264.1.3.2The Closed Joint Stock Company (SAO)274.1.3.3The Open Joint Stock Company (OAO)284.1.4OTHER FORMS OF COMMERCIAL ACTIVITY284.1.4.1Joint Partnership294.1.4.2Limited Partnership294.1.4.3Additional Liability Companies304.1.4.4The Production Cooperative304.2TAXATION315.SOCIAL ENVIRONMENT FOR MARKET ENTRY335.1HUMAN RESOURCES335.1.1Educational System335.1.2Labor Market355.1.2.1Current situation in […]