MNCs in Russia should expect business sentiment to moderate even more this winter, further impacting demand and price sensitivity. Measures announced by the government to support business, including a one-time grant and loan at 3%, will be marginal in off-setting the additional pressure on businesses from these new restrictions amid such high and persistent cost pressures.


New COVID cases (beyond 30,000/day) and deaths (beyond 1,000/day) in Russia have accelerated again in this current fourth wave due to the still very low vaccination rates (only 35% of the population is fully inoculated). In Moscow, unvaccinated older adults must stay at home through the end of February, 30% of employees must work from home, and firms must ensure 80% of staff are vaccinated (up from 60%). St. Petersburg will tighten restrictions, requiring QR codes for retail and entertainment venues. A non-working week was announced at the national level from October 30 to November 7, though salaries will be maintained.

Our View

Now that Duma elections are over in Russia and officials less accountable, as anticipated, most regional leaders have implemented some level of mobility restrictions and/or vaccination mandates; however, no strict national level lockdowns—akin to last year—will be implemented. Most notably, QR codes are likely to be imposed for access to public venues after November 7 in Moscow and most regions in order to drive up vaccination rates. The government is likely seeking to get vaccinations up to over 50% of the population by the end of the year, and covering the elderly and vulnerable groups, which is achievable. As a result, most restrictions should be removed by Q1 2022, as the healthcare system should be better protected by that point, and popular resistance to restrictions is high.

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