“After the fall of Communism, Russia ushered in capitalism by selling off billions of dollars in state assets,” the New York Times reports.
“Now, 30 years later, the Russian government is stepping up a wartime campaign to do the opposite: seizing private businesses, this time in the name of national security.”
“In the last month, courts have ordered Russia’s largest warehouse owner to be taken over by the state and also directed the nationalization of a major grain exporter. And in the most stunning case, prosecutors filed a lawsuit in January to seize Moscow’s second-largest airport.”
Researchers from the London School of Economics have documented over 200 rulings by Russian courts to nationalize private firms since the onset of the Ukraine invasion in 2022. These seizures collectively represent the largest confiscation of property in Russia since the privatization initiatives of the 1990s.
Although Russia has arguably gained the upper hand in its war with Ukraine, the large nation appears to be struggling and pulling out all the stops, and its seizure of private businesses is indicative of its struggles.
While Russia has expressed openness to welcoming back Western companies that exited after the 2022 invasion of Ukraine, the ongoing seizures and diminished property rights raise significant concerns for potential investors. The Russian government claims that US businesses have incurred losses totaling $324 billion due to their exit from Russia.