Russian_Direct_Investment_Fund

Russian Direct Investment Fund

Russian Direct Investment Fund

Fund established by the Russian government in June 2011

The Russian Direct Investment Fund (Russian: Российский фонд прямых инвестиций, RDIF) is Russia's sovereign wealth fund established in 2011 by the Russian government to make investments in companies of high-growth sectors of the Russian economy. Its mandate is to co-invest alongside the world's largest institutional investors, direct investment funds, sovereign wealth funds and leading companies.

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RDIF's reserved capital under management equals $10 billion. RDIF has invested and committed for this purpose 2.1 trillion rubles, of which RDIF invested 200 billion rubles and 1.9 trillion rubles came from co-investors, partners and banks. RDIF also attracted over $40 billion of foreign capital into the Russian economy through long-term strategic partnerships.[1] Kirill Dmitriev is the RDIF's chief executive officer.

History

RDIF was founded in June 2011 under the leadership of both Russian President Dmitry Medvedev and Prime Minister Vladimir Putin.[1]

In June 2012, RDIF and China Investment Corporation (CIC) established the Russian-Chinese Investment Fund.[2] On 2 June 2016, President of the Russian Federation Vladimir Putin signed Federal Law on the Russian Direct Investment Fund changing the status of RDIF. According to the law, RDIF became the sovereign wealth fund of the Russian Federation.[3]

Value

In June 2023 Russia claimed the fund exceeded 2.1 trillion rubles invested in the Russian economy.[4]

Sanctions

On 28 February 2022, as a result of the 2022 Russian invasion of Ukraine, the United States placed RDIF and its chief executive on its list of sanctioned Russian entities and people.[5][6] The European Union, Ukraine, United Kingdom and Australia followed later in February and in March.[7] In the recital of the sanction decision, Office of Foreign Assets Control labeled RDIF as a slush fund for Vladimir Putin and as emblematic of Russia's broader kleptocracy.[6][5]

Restrictions also apply to parties entering investments with the Fund. The EU prohibit investment, participation, or contribution to projects co-financed by RDIF.[8]

RDIF Management

RDIF Management structure includes Supervisory board with the government representatives,[9] and International Advisory Board.[10]

Strategic Partnerships and Investment Platforms

The Russia-China Investment Fund

Together with China Investment Corporation (CIC) RDIF created a $2 billion Russia-China Investment Fund.[11][12]

RDIF and Mubadala co-investment fund

RDIF and Mubadala Development company (Mubadala), the Abu Dhabi-based investment and development company, agreed to launch a $2 billion co-investment fund[13] to pursue opportunities in Russia.[14]

The Russia-Saudi Investment Fund

RDIF and Saudi Arabia’s sovereign wealth fund, the Public Investment Fund (PIF), have created a partnership[15] to invest in attractive projects in Russia, in areas including infrastructure and agriculture.[16]

The Russia-France Investment Platform

RDIF and Caisse des Dépôts International (CDC International) have launched the Russia-France Investment Platform,[17] which will seek attractive investments across a broad range of sectors and asset classes.

RDIF and Qatar Holding co-investment fund

RDIF and Qatar Holding, the Qatar sovereign wealth fund, announced the launch of co-investment fund.[18]

The Russian-Italian investment platform

RDIF and Fondo Strategico Italiano (FSI) agreed to establish a €1 billion Russian-Italian investment platform.[19] The two financial institutions will invest in companies and projects promoting the development of foreign trade and increase of FDI between Italy and Russia.[20]

The Russia-Japan Investment Fund

RDIF and Japan Bank for International Cooperation (JBIC) established a Russia-Japan Investment Fund (RJIF). RJIF will seek and realise attractive investment projects to promote economic, trade and investment cooperation between Japan and Russia. Under the MoU, RDIF and JBIC have agreed that each of them will invest $500 million[21] for the joint investments through RJIF and a joint investment framework.

Collaboration with Kuwait Investment Authority

RDIF launched an automatic co-investment mechanism, with the first $500 million from Kuwait Investment Authority (KIA).[22] Later KIA doubled its investment[23] with RDIF to $1 billion.

Memorandum of Understanding between RDIF and Mumtalakat

RDIF and Mumtalakat, the investment arm of the Kingdom of Bahrain, signed an MoU to promote investment cooperation between Russia and Bahrain.[24]

Collaboration with Rönesans Holding

RDIF and Rönesans Holding, the leading construction, real estate development and investment company, have reached an agreement to expand the scope of their joint investment activities.[25] The parties are focused on attractive investment opportunities within the Russian Federation; and have identified healthcare, construction, infrastructure and commercial real estate as priority sectors.[26]

The Russia-China Venture Fund

RDIF and Chinese company Tus-Holdings agreed to establish a joint Russia-China Venture Fund (RCVF).[27]

RDIF Investments

RDIF investments are focused on 6 areas:

Improving quality of life

  • Mother and child[28]
  • Geropharm[29]
  • Nationwide cancer diagnosis and treatment network[30]
  • Nationwide waste to energy eco-friendly programme[31]
  • Detsky Mir[32]
  • City hospital No. 40 in St. Petersburg[33]
  • Кaro Film[34]
  • World Class[35]
  • Alium[36]

Infrastructure development

Import substitution and export potential

Regional development

Efficiency growth

Technological development

See also

References

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  2. [2]
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  3. [3]
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    "Supervisory board".
  10. [10]
    "International Advisory Board".
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