Today we will talk about Russia's involvement into the international capital flows. This is a part of the foreign companies in the Russian market module. Within this part of the module, we will discuss the following issues. After a short introduction that will remind you of the key terms related to the phenomenon of foreign investment, we will deal with the general overview of foreign investments in the Russian Federation. In particular, kid drowns, sectoral distribution, and a leading contrasts investors. Then, we will discuss the Russian investment policy. This part is important to cover as an investment policy creates a legal framework for presence of foreign capital in the country. A special attention will be paid to the representation of foreign investment in Russian regions. As you learned from previous modules, Russia is a big country with many diverse regions. That is why the level of involvement of different regions in international capital movement will rise substantially. Before we approach Russia's involvement into the international capital flow, let us refresh the key terms of the subject. According to the most common classification provided by the United Nations Conference on Trade and Development, or UNCTAD, foreign investment or capital flows fall into three principal categories: Foreign Direct Investment or FDI, portfolio, and other investment. FDI is defined as an investment involving a long-term relationship, and reflecting a lasting interest and controlled by a resident entity in one economy, so-called foreign direct investor, or apparent enterprise. In the enterprise, resident in economy other than that of the foreign direct investor, foreign affiliate, or recipient. FDI implies that the investor exerts a significant degree of influence in the management of the enterprise resident in the other economy. FDI might take a form of greenfield, or brownfields investments. Greenfields are investments into new projects, while brownfields into the existing ones. Each of this category has it's advantages and disadvantages. You can try to figure them out. Portfolio investment means transactions in equity and debt securities. Other investments cover a variety of transactions such as, long-term trade credits loans etc. As with portfolio investment, this category has no influence on the management of the investee entity. Most of our attention will be devoted to FDI. Direct investors have different motives than two other categories of investors. They intend to have long-term relationship with the foreign companies by investing sufficient financial capital in their equities of those companies to enable them to have a significant influence on their management, and at the end of the day, influence the economic development of the host country. When FDI leaves a home economy, it is a outflow. At the same time, it is FDI inflow for so-called host economy. A host country itself might be a home country for it's investors abroad. For deeper understanding of foreign investment theories practice and trends, we encourage you to visit the Oncotype web page.