The Russian economy in crisis: credit crunch, capital flight and tougher sanctions on the cards. Can you still be positive about Russia? Saxo Bank’s Head of Equity Strategy, Peter Garnry, was in Russia a few days ago and says he didn’t sense impending collapse. “Our forecast for now is for positive growth in Russia with the current data at hand, between zero and one percent.” That’s despite some commentators predicting four percent contraction in the Russian economy.

Russian’s private companies have almost been entirely shut out of the global capital markets. Meanwhile, capital flight is now around $65 billion so far this year. Even so Peter believes that if you invest in emerging markets there will be a long term positive return, he still insists Russian stocks still offer investment opportunities.    

With EU ministers considering tougher sanctions and with Europe’s reliance on gas one of Moscow’s main bargaining chips, investment is risky and will remain so for the foreseeable future.     

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