Evaluation of the competitiveness and the business environment of Russian Federation: challenges and perspectives.

Abstract

In this dissertation we examine the competitiveness and the business environment in Russian Federation by analysing the country’s performance according two important indexes: the Global Competitiveness Report published by the World Economic Forum and the Ease of Doing Business published by World Bank. Both indexes' reports published annually are international benchmarking indicators related to a country's analysis and regional analysis. We compare the Russia's performance to that of the ten Black Sea countries, the average of the European Union member states, the U.S.A. and the remaining three BRIC countries (Brazil, India and China), over several periods mainly the last decade. From the analyses, it was found that Russian Federation has improved both its performance in the competitiveness and in the attractiveness of the business environment compared with the previous year, and at the same time has a good overall position compared with the average of the Black Sea countries and the remaining BRIC countries. In addition, we find evidence that the effect of the attractiveness of the business environment and the country’s competitiveness on per capita GDP is positive. In fact, the beneficial effect of the attractiveness of the business environment it is three times more pronounced in the case of low-income countries compared with the high-income countries. Also, the positive effect of competitiveness on per capita GDP is almost five times than the effect of the business environment. For all groups of countries no statistically significant effect of the business environment on FDI inflows was found, but a positive effect was found only in the case of high-income countries. This conclusion may well be combined with several policy recommendations as underlined by the reports for further improvement of such indicators of the Russian Federation.