Themes Of SPIEF’25 Were Show Me The Money And Be Realistic

Tone And Texture Of Arrogance

Defining Expectations- Theirs Or Ours

Wanting Made In Russia To Be Accepted In International Markets Like Made In China

More About Transactions Amongst Russian Federation-Based Entities

Despite Statements To The Contrary, BRICS is defensive and offensive

One St. Petersburg Hotel Thanks Guests In Special Ways

Russian Railways Providing Luxury Service

Observations From On The Ground…

From 18 June 2025 to 21 June 2025, the government of the Russian Federation hosts the annual St. Petersburg International Economic Forum (SPIEF). Thousands of government officials, company representatives, and journalists assemble in a state-of-the-art facility near the Pulkovo Airport on the outskirts of St. Petersburg. Organizers reported visitors from forty countries and territories.

SPIEF continues its recovery. SPIEF’25 has yet to resemble SPIEF’21 or its previous status among global companies and heads of state and heads of government representing the largest countries in terms of Gross Domestic Product (GDP).

What is apparent since 24 February 2022 when the armed forces of the Russian Federation invaded and invaded further into the internationally-recognized territory of Ukraine, is SPIEF has transitioned, albeit temporarily, from showcasing signing ceremonies between Russian Federation-based companies and those from other countries to signing ceremonies amongst Russian Federation-based companies and authorities and governments of areas within the Russian Federation.

SPIEF discussion panels continue to be devoid of chairmen and chief executive officers of the world’s largest companies. Delegations from countries with the largest marketplaces for imports and exports, and sources of capital and technologies, remain constrained and if present, remain in the background rather than pronounced.

There was consistency amongst the discussion panels where not the moderators, but the speakers, particularly those representing interests within the Russian Federation, focused not solely on platitudes, but focused upon how to get things done. The process of moving from talking- and talking about talking, and talking about cooperation, solidarity, and support, to what is the specific project, how much it will cost, who will pay for it, what will be the return on the investment. If there was a secondary theme, it was to be realistic about being realistic.

During private conversations, senior-level officials of the government of the Russian Federation expressed frustration with representatives of companies and with representatives of other country governments who fail to grasp that business is not charity. Projects must be rational. Investors want to not only be repaid, but to make a profit- and that profit needs to be easily repatriated. There was a concerted effort by the officials to insert the importance of two-way rather than one-way. Have investments, products, and services move both out of the Russian Federation and into the Russian Federation. The roadway must have multiple lanes in either direction.

On the third day of the four-day forum were remarks by Vladimir Putin, President of the Russian Federation (2000-2008 and 2012-2030); Prabowo Subianto, President of the Republic of Indonesia; Paul Mashatile, Deputy President of the Republic of South Africa; Ding Xuexiang, Vice Premier of the People’s Republic of China; and His Highness Shaikh Nasser bin Hamad Al Khalifa, Representative of His Majesty the King for Humanitarian Work and Youth Affairs, of the Kingdom of Bahrain.

In terms of Gross Domestic Product (GDP), China ranks 2nd, Russia ranks 11th, Indonesia ranks 17th, South Africa ranks 39th, and Bahrain ranks 94th.
At SPIEF’24, high-level participants were Luis Arce, President of Bolivia; Emmerson Mnangagwa, President of Zimbabwe; Aslan Bjania, President of Abkhazia; Milorad Dodik, President of the Serbian Republic of Bosnia. In terms of GDP, Bolivia ranks 89th, Zimbabwe ranks 102nd, Abkhazia GDP is unknown, and Serbian Republic of Bosnia ranks approximately 152nd.

The highlight for many participants of SPIEF is the multi-hour session where President Putin is seated along with the most senior foreign government officials attending SPIEF. This year, the session- four hours.

While what President Putin shared was not well received by officials of governments who are supporting the government of Ukraine, the opportunity to hear a head of state answer what were friendly moderator-presented questions (polite, leading, and misleading) was instructive- for some reinforcing the worst and for others a booster injection reinforcing what they needed to hear and wanted to hear. As always, nuances were important not to dismiss.

The session did have a “Dear Leader” feeling- with the four government officials seated next to President Putin delivering the familiar political platitudes to their host. This is not unusual. For those viewing Trump-Pence Administration (2017-2021) and Trump-Vance Administration (2025-2029) cabinet meetings at The White House, the participants view an utterance by the one before them as an opportunity to verbally genuflect further before Donald Trump, President of the United States (2017-2021 and 2025-2029).

A message from President Putin’s session, and as a theme presented by moderators throughout the panels at SPIEF’25 was about expectations.

Is the Russian Federation post 24 February 2022 to be judged, measured, and viewed by expectations from inside or by expectations from outside? Basically, are the expectations ours or theirs?

Those residing in countries who have experienced invasions in the 20th Century and/or the 21st Century appreciate adaptability, pain, and suffering in ways that permit a population to transition, temporarily or permanently, from what they had and liked to what they need and accept. That leads to the natural discussion of the role of government- what is its job? There is no one answer- whether that be in the Russian Federation or the United States.

Enlightening at SPIEF’25 was the relatively candid discussion among public sector representatives and private sector representatives in terms of where the Russian Federation was, where the Russian Federation is, and where the Russian Federation may be heading in terms of its internal and external commercial, economic, financial, and political sectors.

Maxim Reshetnikov, Minister of Economy, shared that the economy of the Russian Federation is nearing a recession. Elvira Nabiullina, Governor of the Central Bank of the Russian Federation did use the word recession, rather characterizing the trajectory as a necessary adjustment while confirming that excess resources (sovereign funds, reserves) which have been used to maintain economic stability and growth since 24 February 2022 are nearly exhausted.

Economists within the Russian Federation and outside of the Russian Federation differ as to whether the economy within the Russian Federation is performing less than the government presents. Is there a downward trajectory despite the official data? Can an end to the extraordinary level of military-related spending lessen inflation and interest rates? Has the government of the Russian Federation which has been increasing and varying commercial, economic, financial, and political sanctions since 2014 learned to adapt in such a way that it has become not sanction-proof, but sanction-resistant? Soon, the EU will begin crafting the 19th package of sanctions to be implemented upon the public sector and private sector within the Russian Federation. The Russian Federation-Ukraine war continues.

There were statements from representatives of the BRICS (Brasil, Russian Federation, India, China, South Africa) that the alliance was neither defensive nor offensive. The alliance is both.

The goals including demonstrating for the uninformed and reinforcing for members and prospective members that the “established commercial, economic, financial, political, and social order” is neither attractive, legitimate, or sustainable. They are correct. What remains unknown is the amount of time that the G7 and G20 have until their respective expiration dates. And, which is likely, to sustain relevance, both the G7 and G20 will first adapt- meaning expanding their membership- or in the case of the G7, returning one member (Russian Federation) and including two new members (China and India).

BRICS: Argentina, Brazil, China, Egypt, Ethiopia, India, Iran, Russian Federation, Saudi Arabia, South Africa, United Arab Emirates.
Group of 7 (G7) (in order of 2024 GDP): (2014-Present) includes United States, Germany, Japan, United Kingdom, France, Italy, Canada. The Russian Federation (which in 2024 ranks after Canada) was excluded in 2014 due to its military actions on the Crimean Peninsula in Ukraine.
Group of 20 (G20): Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Republic of Korea, Russian Federation, Saudi Arabia, South Africa, Turkiye, United Kingdom, United States.

During a panel discussion entitled “The Geopolitical Situation and the New Reality for International Business with Russia” neither the moderator nor any of the speakers mentioned the most important issue for any company engaging within the Russian Federation- the repatriation of revenue out of the Russian Federation.

Since 24 February 2022, both Russian Federation-based companies and non-Russian Federation-based companies have accumulated many hundreds of billions of Rubles which are locked, with a few exceptions, within accounts located in financial institutions throughout the eleven time zones of the Russian Federation.

One benefit to the government of the Russian Federation is companies have a choice- amass the funds in their respective accounts or spend them- invest and re-invest within the domestic economy. This activity can be inflationary. What has not happened? Significant and sustained increases in wages for employees, particularly in the hospitality sector, surpassing the rate of inflation (official and unofficial). The impact is increasingly destructive as employees see managers and owners of hotels, restaurants, and service providers earning substantially more due to the efforts of employees, but those employees are not receiving a commensurate share. NO matter how professional a person may want to be in their work, feeling unappreciated will show in their work- particularly to guests at hotels and customers at restaurants and service providers.

The good news is the then-U.S.S.R. model of hospitality has disappeared- construct expensive hotels, perform no or limited maintenance and watch the properties deteriorate- then demolish them. In today’s Russian Federation, managers and owners of hotels, restaurants, and service providers have no excuse not to maintain their properties. They have Rubles to spend.

Important to note that hotels in Moscow and St. Petersburg continue to offer service levels consistent with established global brands and independently-operated properties in any country. Three mentions: Corinthia Hotel in St. Petersburg (affiliated with the global Corinthia brand); Four Seasons Hotel in Moscow (no longer affiliated with the global Four Seasons brand), Swissotel Krasnye Holmy in Moscow (limited connectivity with the global Accor brand). They each have teams who anticipate rather than react. In challenging circumstances, they each surpass expectations on a consistent basis.

During SPIEF’25, the Corinthia Hotel provided guests with a special amenity each day. The amenities were creative and useful. There was an effort to be memorable- that goal was achieved. Given the rates increase during SPIEF, as would be in the instance for any property anywhere during a special event, it is immensely appreciative that management of the Corinthia Hotel used some of those extraordinary (windfall) profits to show appreciation to guests.

As the Russian Federation-Ukraine war transitions from military engagement within Ukraine to what will be continued and sustained political estrangement from Ukraine, slowly- as in turtle-like, will there be commercial, economic, and financial re-engagement from outside of the Russian Federation to inside the Russian Federation.

Until visitors are again permitted to use credit cards and debit cards, and internationally-recognized brands return to the Russian Federation, there will be constraints upon growth in the hospitality sector, both in real terms and in rate of change.

On a micro-level, visitors to the Russian Federation prior to 2025 could exchange United States Dollars for Rubles absent most restrictions. Then, a limit of US$400.00 was imposed per transaction. That meant a visitor could use multiple financial institutions (and currency exchange kiosks) each day to accumulate as much in Rubles as needed. The limit has since been increased to US$500.00, but some of the currency exchange kiosks permit even more. For visitors staying at hotels, this can mean having all members of a family- including children (with a passport) visiting to exchange as much currency as possible, then returning to the hotel to make payment. Sort of a currency exchange conga line. Or, a visitor may ask a Russian Federation citizen to visit a financial institution and make the United States Dollar exchange on their behalf as Russian Federation citizens have higher transaction authority.

Foreign Investment Is Needed

During a panel discussion entitled “Leaving Only to Return and Staying to Flourish. Does Russia Need Foreign Investment?”, Zhou Liqun, Chairman of the Union of Chinese Entrepreneurs in Russia, shared that the Russian Federation “needs foreign investment.” Valery Schapov, President, Mars LLC, Russia, shared that businesses are like flowers that may bloom or die. They need water like investment. For Mars LLC, Russia, selling pet food is priority with the Russian Federation having fifty million cats and twenty-five million dogs. Robert Agee, President of the American Chamber of Commerce in Russia, shared that for those United States-based companies which since 24 February 2022 continue to operate in the Russian Federation, “We’ve had really good dynamics. Businesses growing. The past three years’ situation is good. Half of the companies are thinking of returning. But, they want to create a level playing field. Create a good justice system. Many companies are afraid they will not have it.”

President Putin shared that Russian Federation-based companies have since 24 February 2022 created approximately 40,000 new product and service brands. Some of these are replacements for those previously imported, particularly from the twenty-seven country members of the Brussels, Belgium-based European Union (EU). For the overwhelming majority of the approximately 143 million residents of the Russian Federation, there is little concern with the absence of non-Russian Federation-brands (even though some of the products are manufactured within the People’s Republic of China). Most consumers are generally focused on availability, price, and quality, in that order. Origin is not as important for price-sensitive consumers. For the middle classes- upper, and for the wealthy and uber-wealthy, they continue to have access to the global brands- both directly at retail stores within the Russian Federation as some brands, including those located in the EU, continue to export, directly and indirectly, to the Russian Federation. And, they also have the means to travel outside of the Russian Federation- and not only to Turkiye and the United Arab Emirates (Dubai), but the EU continues to provide tourist visas for citizens of the Russian Federation, and to citizens of Belarus.

President Putin shared that one of his grandchildren speaks fluent Chinese due to the influence of her nanny, who is from China. President Putin shared that there is an increased interest by Russian citizens to learn Chinese. At Moscow State University, international relations classes- which are taught in English, have many students from China.

For Russian Railways, the period thus far since 24 February 2022 has been good for its business. Too good in some respects.

Due to sanctions upon the importation of equipment and upon international airline routes, as well as more recently drone activity near airports, Russian Federation citizens have increasingly migrated to train travel. Ironically, in the then-U.S.S.R., train travel was robust- but that was generally due to the poor performance of then government-operated Aeroflot Airlines. There was a joke in the 1980’s: What is the best frequent flyer award from Aeroflot? A year of not having to travel on Aeroflot.

While the high-speed Sapsan Valero RUS EVS trains servicing the Moscow-St. Petersburg-Moscow route are manufactured by Germany-based Siemens, new locomotives and rolling stock are manufactured within the Russian Federation.

Traveling from Moscow to St. Petersburg on Train 002 departing at 11:55 pm and arriving at 7:55 am in a Luxury Car where the compartments have en suite bathroom (with heated floor) and shower. There are personalized notes, as one might expect from a five-star hotel, from the Train Manager- a welcome note and one with the weather forecast. The amenity kit (with L’Occitane products) rivals that on any of the luxury global airlines. There is also a safe in the closet. Mercedes-Benz ground transportation at the destination is included. There are station lounges in both Moscow and St. Petersburg. The train arrived at St. Petersburg precisely on time- to the minute. The train manager was at the door to say goodbye.