Japanese Investment in Russia: Far Eastern and Western Russian Regions Compared

Starting from Sakhalin projects and following the production facilities establishment by Japanese companies in manufacturing industries in Russia investment relations between the two countries started expanding rapidly during the recent couple of decades. Today investment cooperation has reached a new development stage, which reveals not only quantitative, but also qualitative changes in the pattern of FDI flows, especially in terms of structure and technological level. The paper addresses the aspect of regional differences in the approach of Japanese investors toward projects in Russia. The comparison of the major macro-regions that attract Japanese investment (Far-Eastern and Western regions, including Central and North-Western Federal Districts) allows to reveal the critical differences in the industrial distribution that reflect specifics of economic development and investment climate of these territories. However, the Western and Eastern parts of Russia complement each other in terms of investment attraction and contribute to the development of multifaceted and diversified framework for investment cooperation between Russia and Japan.