Russia is known to investors as one of the largest emerging markets. It has about 141 million people living in the natural-resources-rich country that's about 1.8 times the size of the United States.
Russia has been emerging from its autocratic and Communist past, and deliberately moving from a planned economy to a free-market one since the early 1990s, Russia grew an average of 7.3% per year from 1999-2007, according to a report from the Moscow office of the World Bank, and 8% in the first half of 2008, before feeling the punch of the worldwide economic slowdown. Inflation was at 5.3% during that latter time frame.
In the latter half of 2008, Russia was impacted by lack of credit and falling oil prices; oil is its main export. The country has large deposits of oil, natural gas, and coal, as well as timber and minerals, although geography and climate can make it difficult to get at the resources. Also, domestic demand for electricity is outpacing supply and oil exports are believed to be nearing a plateau
Russia is a highly industrialized society, and a member of the Group of 8 (G-8) major industrial nations.
As an emerging market, Russia, is popular among investors, often teamed with Brazil, India, and China, to form the acronym BRIC, a quartet of countries predicted to grow their economies dramatically in coming decades. For most of the first decade of the 21st century, the average investment in the BRIC countries has done very well, outperforming the S&P 500 and other U.S. asset classes.
Some investors remain worried that Russia's government -- seen by many as arbitrary and corrupt -- could suddenly undermine investment returns in Russian companies. There is also concern that Russian businesses could suffer if the country becomes involved in more regional conflicts. The nation comprises the majority of the former Soviet Union.