German investments in Russia fell by more than a third last year due to persistent EU and U.S. sanctions, Russian trade barriers, bureaucratic hurdles and other factors, the German-Russian Chamber of Commerce said on Thursday.
German net direct investments in Russia last year amounted to about 2.13 billion euros (2.4 billion U.S. dollars), 36 percent less than the previous year, the chamber said.
A major factor was Russian industry protectionism, hindering foreign businesses from competing with Russian companies on the domestic market, it said.
German businesses have invested the equivalent of 28 billion euros in the Russian economy since the end of the Soviet Union in 1991, according to the chamber of commerce.
"From no other country have so many firms invested in factories in Russia than from Germany," said the chamber's head, Matthias Schepp.
The majority of German companies are still positive on Russia despite investment barriers, Schepp said.
The European Union, the United States and other Western powers have imposed crippling sanctions against the Russian economy following Russia's 2014 annexation of neighbouring Ukraine's Crimea region.
Russia has followed suit with counter-sanctions against those powers.
Russia's economy is largely dependent on commodity exports, particularly oil and natural gas, a reliance upon which the country's rouble currency is vulnerable.
The Russian rouble has lost more than a 10th of its value versus the euro and U.S. dollar over the past week due to an oil price drop connected with falling global trade amid the coronavirus outbreak.
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