A key component of the Trump administration’s peace drive in Ukraine is a perception that revived commerce ties between america and Russia will stop the resumption of battle—and that American buyers will get wealthy within the course of.
However some who’ve performed a task in Russia’s financial sector are much less optimistic, casting doubt on the prospect that commerce might assure peace and that Russia is an untapped El Dorado.
Investing in Russia “can be a really, very troublesome setting for a really very long time,” mentioned Chris Weafer, the CEO of Macro-Advisory, a enterprise consultancy that covers Russia’s economic system.
The USA, Ukraine, and Russia have been engaged on a peace deal for months. The U.S. facet has been optimistic about its progress—at the same time as Russia has objected to key calls for from Ukraine. The newest spherical of negotiations was planned for Feb. 1, however rescheduled for later this week.
Steve Witkoff, a real-estate developer, pal of U.S. President Donald Trump, and chief envoy to Russia on the Ukraine battle, has framed commerce offers with Russia after a peace settlement as a assure towards future hostilities.
If “all people’s prospering and so they’re all part of it, and there’s upside for everyone, that’s going to naturally be a bulwark towards future conflicts there,” Witkoff told the Wall Avenue Journal in November.
In the meantime, the administration seems to be salivating over the amount of cash to be made if peace is said. “Russia has so many huge sources, huge expanses of land,” Witkoff instructed the Journal. Trump additionally appears optimistic: In February of final 12 months, Trump said that he and Russian President Vladimir Putin have been discussing “main financial improvement transactions” between america and Russia.
However a commerce deal is unlikely to ensure peace, mentioned Tatiana Stanovaya, a senior fellow on the Carnegie Russia Eurasia Heart suppose tank and the founding father of the Russian political evaluation web site R.Politik.
Partly, she mentioned, that’s as a result of cash doesn’t trump what the Kremlin sees as its core safety pursuits. Any U.S. actions that appeared to threaten Russian safety—which traditionally has meant something from inserting troops within the Baltics to stationing missile defenses in Romania—would nonetheless set off alarm for Moscow.
To some who have been concerned in Russia’s economic system within the Nineties and 2000s, the Trump administration’s considering is all too acquainted.
“Right here we’re as soon as once more, considering that enterprise can rework political relationships,” mentioned Charles Hecker, a geopolitical danger guide who served as managing associate of Management Dangers in Moscow from 2000 to 2008. “And I believe the reply to that assumption is that really, no, it could actually’t.”
After the autumn of the Soviet Union and the emergence of Russia as an unbiased state in 1991, U.S. direct funding in Russia rocketed, going from $1.7 billion in 1999 to $20.8 billion in 2009, in response to the U.S. Division of Commerce. The European Union went even additional, with Russia ranked within the bloc’s high 5 buying and selling companions for items exports and imports in 2021, the 12 months earlier than Moscow’s full-scale invasion of Ukraine.
Doubts, although, started to enter buyers’ minds because the Kremlin’s international coverage hardened and Putin clamped down on civil society. Russia’s 2014 occupation of Crimea “modified our perspective of Russia—though many people ought to have identified higher,” mentioned Ed Verona, who was beforehand a senior government at ExxonMobil Russia and a former head of the U.S.-Russia Enterprise Council. “We deceived ourselves into considering that, by way of engagement and appeals to mutual self-interest, issues would go in the fitting path,” Verona mentioned.
The administration’s imaginative and prescient of Russia as a significant funding alternative, in the meantime, won’t be fairly proper both.
For one, Russia’s economic system has lengthy dragged behind these of smaller nations. Russia’s prewar gross home product in 2021 was round $1.83 trillion—lower than Italy’s that very same 12 months. Weighed down by navy spending, low oil costs, and Western sanctions, Russia’s economic system is expected to develop simply 1 % this 12 months.
Even when peace have been declared tomorrow, Russia’s high navy spending would probably proceed, Weafer mentioned, so as to exchange its big losses of troopers and tools in Ukraine. There’ll solely “be a really gradual sort of shifting of state sources to financial restoration,” Weafer mentioned.
Russia’s funding local weather, through which highly effective, politically related actors repeatedly dominate enterprise companions, can be dangerous. In maybe probably the most well-known case, two Russian enterprise companions of Michael Calvey, a outstanding American businessman who spent a long time selling international funding in Russia, organized to have him arrested in 2019 over a dispute. Regardless of the intervention of outstanding Russians—together with Kirill Dmitriev, Witkoff’s present interlocutor with the Kremlin—Calvey then entered a Kafkaesque ordeal earlier than lastly being allowed to go away Russia in 2022.
“You actually need to do your due diligence,” Weafer mentioned.
Russia will probably be extra welcoming to corporations concerned in fuel, oil, and different industries which can be key for the Russian state, reminiscent of nuclear energy, crucial minerals, or agriculture, Weafer mentioned. Russia is the second-largest producer of fuel on the planet and the third-largest oil producer.
However it’s unclear what number of U.S. corporations will chew.
On the one hand, mineral and oil extraction offers are extremely profitable, and—not like personal buyers—these investments can be safer from predatory companions as a result of they’re dealing instantly with the Russian state, Weafer mentioned.
Corporations concerned in power are additionally used to coping with political danger, Hecker famous. “They’re used to enjoying at a really excessive stage of geopolitics.”
The Kremlin beforehand appeared to dangle funding in Russian fuel as a lure to the Trump administration. On the identical day of an August 2025 peace assembly on Ukraine with Trump, Putin signed a regulation that may make it simpler for ExxonMobil to win again shares in a significant fuel funding.
However, these corporations are additionally more likely to be cautious of the reputational danger of doing enterprise in Russia, Verona mentioned. “I don’t suppose [companies] would wish to sully their status only for some good buying and selling alternatives, particularly if sanctions are nonetheless [in force], if not from the U.S., then by the European Union.”
“Most will wait till they’re satisfied that the danger of an additional outbreak of battle is minimal,” Weafer mentioned.
That’s to not say that no U.S. buyers would have an interest. Certainly, some Trump-aligned businessmen are already making strikes. A minimum of two Trump allies have been in talks with Russia on investments, in response to the Wall Avenue Journal. Gentry Seaside, a pal of Donald Trump Jr., President Trump’s son, has been in talks to purchase a stake in a Russian fuel improvement within the Arctic. Stephen P. Lynch, a Trump donor with lengthy historical past of investing in Russia, has sought to purchase Russia’s Nord Stream 2 pipeline.
To the Kremlin, such linkages could also be acquainted—Russia’s personal economic system is dominated by businessmen with personal ties to Putin.
And whereas different U.S. companies won’t win favor from the Kremlin, Moscow is more likely to shield Trump-connected kinds of buyers from predatory Russian enterprise companions, Verona mentioned—making a peace deal a doubtlessly profitable improvement for them.
