The Peculiar Features of Russian Imperialism

A Study of Russia’s Monopolies, Capital Export and Super-Exploitation in the Light of Marxist Theory


A Pamphlet (with 6 Tables) by Michael Pröbsting, International Secretary of the Revolutionary Communist International Tendency (RCIT), 10 August 2021,


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Another Denial of Russia’s Imperialist Character


The Methodological Failure of our Critics


Russia’s Economy: Dominated by Domestic, not Foreign, Monopolies


Capital Export and the Problem of “Round-Tripping” Foreign Direct Investments


“Phantom FDI”: No Russian Peculiarity but a Global Phenomenon


Russia’s Leading Multinational Corporations and their Foreign Investments


Imperialist Super-Exploitation via Capital Export


Imperialist Super-Exploitation via Migration







In the last one, two years, it has become common knowledge among observers of the world situation that the escalation of the inter-imperialist rivalry between the Great Powers has resulted in a new Cold War. In fact, it is only a matter of time before this Cold War becomes hot, i.e. before it results in an armed confrontation between the powers.


Hence, the struggle for global supremacy between the Great Powers (U.S., China, Western Europe, Russia and Japan) has become a key axis around which the world situation revolves. This makes a concrete analysis of the respective Great Powers and the relations between them a crucial task for Marxists. Without such an analysis, it is impossible for Marxists to find a correct orientation in such conflicts. Only a concrete understanding of the imperialist nature of all Great Powers (i.e. both those in the West as well as those in the East) allows the elaboration and application of the Marxist approach; in other words, an approach which recognizes the reactionary character of any conflict between these states and the necessity of revolutionary struggle against all of the them.


Since its foundation ten years ago, the RCIT has published a considerable amount of works on these issues including our book Anti-Imperialism in the Age of Great Power Rivalry. [1] We analyzed the historic decline of the U.S. as the long-time hegemon among the imperialist states [2], the specific problems and contradictions of Western European imperialism [3], the extraordinary rise of China as a new Great Power and the consolidation of Russian capitalism after the traumatic 1990s and its emergence as a new imperialist power since then. [4]


It is the issue of China’s and Russia’s class character which has provoked most controversy among Marxists. Many Stalinists, Bolivarians and also some pseudo-Trotskyists still view China as a “socialist” or a “deformed workers” state. Others recognize the completed restauration of capitalism in these countries but characterize China as well as Russia as “semi-colonial”, “dependent” or “peripheral” countries which are supposedly dominated by the old imperialist powers. Clearly, it is much easier to repeat old formulas than to study and comprehend new developments!


At the time when we elaborated our analyses of the transformation of Russia (in 2001) [5] respectively of China (in 2010-12) [6], we were nearly alone at that time in recognizing the imperialist character of these states. This has changed to a certain degree over the years. Reality hits the face and even some of those Marxists, who usually proceed in their thinking without dialectics and creativity, can no longer deny the facts.


Nevertheless, there are still numerous self-proclaimed Marxists who emphatically deny the imperialist character of China and Russia. This thesis usually serves as justification for their social-imperialist policy of siding with these power in the inter-imperialist rivalry.


In the text at hand, we will focus on some issues concerning the analysis of Russian imperialism. The discussion about Russia’s class character has become once more highly actual given the shooting incident in the Black Sea between a British naval destroyer and Russian forces in June this year. At this point we will not deal with this incident which we have done extensively in other documents. [7]


The skirmish in the Black Sea has provoked widespread interest in Russia as a Great Power. Unsurprisingly, numerous Stalinist and semi-Stalinist forces were spurred by this event to launch two Joint Statements in support of Russia (and China). We will not repeat our critique of these social-imperialist supporters of the two Eastern Great Powers and refer interested readers to a recently published pamphlet dealing with this issue. [8]




Another Denial of Russia’s Imperialist Character




However, other – more thoughtful – critics of the Marxist analysis of Russian imperialism have also used the incident in the Blac Sea, to restate their case. An example for this is the “Bolshevik Tendency” (BT) – an organization which originates from the so-called Spartacist tendency, a notorious Stalinophile current which supported the repression of the Soviet bureaucracy against workers uprisings (e.g. in Poland 1980/81). It is the product of a split three years ago (with the IBT) and one of the main differences for this rupture was the characterization of Russia. While their former comrades recognized the imperialist character of Russia, the comrades, who are now in the BT, refused to do so.


A few weeks ago, the BT published an article on the skirmish in the Black Sea, in which they restated their social-imperialist support for Russia based on the thesis that the latter would constitute a “non-imperialist state”. “Genuine Marxists unequivocally defend Russia against NATO/UK/US bullying and aggression, just as we do Iran, Venezuela and other potential targets. We of course offer no political support to the anti-working class regimes in those countries, while at the same time stating unequivocally that in the event that escalating hostilities turn into a hot conflict we stand for the defeat of the imperialist aggressors and the defense of their intended victims.[9]


They also criticized those who recognize its imperialist class character. In this context they polemicized against the analysis of the RCIT (as well as against their former comrades in the IBT and the pro-Zionist British AWL group). Unsurprisingly, they criticize that the RCIT “openly took a dual defeatist position on any conflict between NATO and either Russia or China.


As part of their polemic against our analysis, they raised the following argument: “The many ostensibly revolutionary organisations that hailed the 2014 U.S.-engineered coup as a popular uprising, and opposed the accession of Crimea to Russia despite the overwhelming endorsement of the affected population, did so on the grounds that Russia is “imperialist.” Yet unlike actual imperialist powers, whose predatory relationships with colonies or semi-colonial countries centre on pumping value out of them, Russia’s weak capitalist class have not invested in establishing factories, mines or plantations; nor have they undertaken to build the transportation infrastructure—railway, ports, canals etc.—necessary to exploit such assets. In fact, rather than economically exploiting its dependents and allies in the Commonwealth of Independent States (all former Soviet republics), the Kremlin has been subsidizing their economies by supplying energy at prices substantially discounted from current world market rates. To our knowledge, none of the assorted impressionists and “Marxist” muddleheads who so glibly proclaim Russia to be “imperialist” have made any serious attempt by explain exactly how this is supposed to work. The economic inputs/subsidies are certainly no secret.


Let us note in passing, that the RCIT at no point supported or sympathized in any way with the reactionary Maidan uprising in the Ukraine in spring 2014. Quite the opposite, we denounced it from the very beginning. [10]


In the text at hand, we will focus on defending the Marxist analysis of Russia as an imperialist Great Power. The comrades of the BT are not the first and most likely not the last who deny Russia’s imperialist class character and in our past works on Russian imperialism we have already dealt with a number of these critics.


For such purpose, this pamphlet shall provide an update of our analysis of Russian imperialism. More concretely, we will deal with Russia’s economy, its monopolies and their relationship with other countries. Hence, we will not deal with the political and military aspects of Russian imperialism – something which we have done extensively in other works.


Such an update of our economic analysis of Russia is useful since the last time did such a comprehensive work is already seven years ago. However, there is also another reasons which makes such a study necessary. Various self-proclaimed Marxist organizations which deny Russia’s imperialist character base their position on the (supposed) weakness of Russia’s monopolies in terms of capital export. Related to this, they deny an imperialist relationship of super-exploitation between Russia and various semi-colonial countries in the Commonwealth of Independent States (CIS). [11]


As we have dealt already several times with the issue of theory of imperialism in general and with Russian imperialism in particular, we will not repeat our whole analysis and refer readers to the respective works. Hence, the pamphlet at hand should be understood as a continuation of our past studies in which we dealt with the Marxist theory of imperialism, the rise of China and Russia as new Great Powers and the subsequent acceleration of the inner-imperialist rivalry.




The Methodological Failure of our Critics




Those who deny Russia’s imperialist character often point to its relatively weak economy (compared with the U.S.). However, such an approach is incompatible with the Marxist theory of imperialism, it is rather a kind of economist caricature. As we have pointed out on various occasions, it is alien to Lenin’s or Trotsky’s approach to reduce the analysis of an imperialist state to the volume of its capital export. Certainly, this is an important criterion but by far not the only one. There have always been imperialist states with different features. As we substantiated by a number of historical statistics, there existed several imperialist powers in the past which were characterized by the Marxist classics as “imperialist” despite having only a relatively small amount of capital export or no net capital export at all. Examples for this are Russia before 1917, Italy, Austria-Hungary or Japan. [12]


We have demonstrated in past works that Russia before 1917 was not a net capital exporter, i.e. it received far more foreign investments from Western imperialist countries than it invested itself abroad. Here is the conclusion of another overview of Russia’s history of foreign investment in a recently published book: “[F]rom 1881–1914, Russia was an FDI (Foreign Direct Investment, Ed.) net importer, being not developed enough an economy to significantly invest abroad. In 1913, FDI inflow amounted to 553 million – a third of total capital investment in the Russian industry this year – and was markedly larger than OFDI (Outward Foreign Direct Investment, Ed.) in the balance of payments. France (31 percent of total), England (24 percent), Germany (20 percent), Belgium (14 percent), and the USA (5 percent) were the primary sources of IFDI. (Inward Foreign Direct Investment, Ed.) (…) The other way round, Russian enterprises began to invest abroad in the last two decades of the nineteenth century in China, Mongolia, and Persia. From 1886–1914, Russia’s cumulative capital exports amounted to about 2.3 billion. In 1914, the current value of Russian OFDI stock reached $3.8 billion, far below the British ($18.3 billion), the French ($8.7 billion), and the US ($7.1 billion) ones, but ahead of Canadian OFDI of $3.7 billion. Before 1914, a few Russian banks had settled agencies in Western Europe while a number of foreign banks had shares in the capital of Russia’s domestic banks. Linked to French purchases of Russian state bonds, the French banking industry had spread into Russia: in 1914, Société Marseillaise de Crédit Industriel et Commercial held a 21 percent share in the Bank of Azov on Don, Paribas a 37 percent share in the Bank of Siberia in Saint Petersburg, Crédit Mobilier a 57 percent share in the Bank for Private Trade in Saint Petersburg, and Société Générale a 65 percent share in the Russian-Asian Bank.[13]


Irrespective of these facts, Lenin and the Bolsheviks never had any doubt that Russia before 1917 was an imperialist Great Power. We have provided numerous quotes demonstrating this. [14] Obviously, the Marxist classics were fully aware of the economic weakness of Tsarist Russia. But they did not approach the question of imperialism in a mechanistic and economistic way but rather applied a dialectical approach. Such Lenin wrote in 1916: “The last third of the nineteenth century saw the transition to the new, imperialist era. Finance capital not of one, but of several, though very few, Great Powers enjoys a monopoly. (In Japan and Russia the monopoly of military power, vast territories, or special facilities for robbing minority nationalities, China, etc., partly supplements, partly takes the place of, the monopoly of modern, up-to-date finance capital.)[15]


Hence, Lenin’s theory of imperialism was never limited to the economic fields or even the field of capital export only. Hence, the RCIT has always emphasized that the class character of a given state is based not solely on a single criterion (like the volume of capital export) but rather on the totality of its economic, political and military features. It has been such an approach from which we derived our scientific definition for an imperialist state. As we have elaborated in a number of works, the RCIT considers the following definition as most appropriate: An imperialist state is a capitalist state whose monopolies and state apparatus have a position in the world order where they first and foremost dominate other states and nations. As a result they gain surplus-profits and other economic, political and/or military advantages from such a relationship based on super-exploitation and oppression.


This brings us to the next, and related, methodological mistake of many Marxists. They often compare a given state with the U.S. and conclude from this that this or that country (e.g. China or Russia) could not be considered as “imperialist” as it is substantially weaker than the U.S. Hence, they ignore that the U.S. – as the long-time hegemon among the imperialist states – has unique features and is not a “model”. As a matter of fact, a number of imperialist states have uneven developed features. Germany and Japan, for example, have not deployed their military abroad since 1945 (Japan) or have done so only as subordinated components of US/NATO-led interventions (Germany). Neither of the two has nuclear weapons – in contrast to economically weaker states like India, Pakistan or North Korea. South Korea has become an imperialist state with similar economic strength like France or Britain but remains far behind those in the military field.





Russia’s Economy: Dominated by Domestic, not Foreign, Monopolies


In contrast to Germany or Japan, Russia is a superpower in the military but not in the economic field. It is the second largest military power – only behind the U.S. It has a total inventory of nuclear warheads of 6,255 (the U.S: has 5,550) and its share of global arms exports is 20% (only behind the U.S. which has 37%). [16]


However, in terms of monopolies and capital export, Russia does not have a similar strong position. In the latest edition of the Forbes Global 2000 list, Germany has 6 corporations among the top 100, France 4, Britain 3, and Russia 2. [17] Other lists rank Russia even worse.


Nevertheless, as we have demonstrated in our 2014 study and other works, Russia’s imperialist character can be derived not only from its military but also from its economic features. We have emphasized that the starting point of the Marxist analysis of imperialism is the domination by monopolies. Such Lenin wrote in Imperialism and the Split in Socialism – his most comprehensive theoretical essay on imperialism: We have to begin with as precise and full a definition of imperialism as possible. Imperialism is a specific historical stage of capitalism. Its specific character is threefold: imperialism is monopoly capitalism; parasitic, or decaying capitalism; moribund capitalism. The supplanting of free competition by monopoly is the fundamental economic feature, the quintessence of imperialism. [18]


Various self-proclaimed Marxists characterize Russia as a “dependent” or “peripherical” and suggest – or explicitly claim (like David North’s WSWS/ICFI [19], the PO/Altamira/CRCI tradition [20] or the whole Spartacist tradition) – that Russia is dominated by or dependent of foreign monopolies (corporations, banks, etc.). As a matter of fact, this is not true. Russia’s economy is first and foremost dominated by Russian monopoly capital. A recently published academic book about Russia’s economy arrives at the conclusion that the proportion of investment in Russian, foreign, and joint venture companies kept the same for the past five years: 86.3%, 7.3%, and 6.4%, respectively.[21] (See Table 1)




Table 1. Share of Investment in Russia by Russian, Foreign, and Joint Venture Companies, 2015 [22]


Origin of Investment                                                                         Share of Investment in Russia


Russian Companies                                                                       86.3%


Foreign Companies                                                                       7.3%


Joint Venture Companies                                                            6.4%




This is also the case in the banking sector. In fact, as another recently published book outlines, the share of foreign capital in Russia’s banking sector has declined in the past decade. “In October 2018, 150 foreign banks operated in Russia, including 63 foreign-controlled banks with 100% foreign share; 17 foreign-controlled banks with foreign shares of 51-99%; and 70 foreign banks with capital participation of less than 50%. The number of foreign banks has steadily declined from 2014 to 2018, suggesting that foreign investors may be reconsidering their investment plans in Russia. Foreign-controlled banks with foreign shares of 51–99% and foreign banks with capital participation of less than 50% decreased by 63% and 54%, respectively. The foreign banks’ share in the total charter capital of the Russian banking sector declined from 23% in 2014 to 13.44% in October 2018. It should be noted that about 11% of foreign banks are significantly controlled by Russian residents.[23] (See also Table 2)




Table 2. Share of Foreign Banks in Russian Banking Sector, 2014 and 2018 [24]


                                                                                              2014                                                      2018


Share of Foreign Banks                                                 23%                                                       13.44%




In addition, Russia has no significant debts to foreign imperialist institutions (in contrast to many semi-colonial countries). Its public debt was only 18% of GDP at the end of 2020. “Out of Russia’s total foreign debt of $470 billion, only $66 billion was government debt, of which $21 billion was in foreign currencies and $43.8 billion in ruble-denominated bonds, according to the Central Bank of Russia. Of the remaining foreign debt, $72.5 billion was held by banks (presumably almost exclusively state-owned banks) and $318.5 billion by other corporations.” It has steady current-account surpluses and its international currency reserves is at $596 billion at the end of 2020 (making it the state with the fifth-largest foreign exchange reserve in the world). [25]


It is worth pointing out that Russia’s capitalism differs from the Western “model” insofar as the state occupies a crucial position. A considerable number of its monopolies represent a mixture of state-owned and private shares; hence state-capitalism is an essential feature of Russia’s economy (by the way, the same is true to an even larger degree for China). According to a recent IMF study, the share of the Russian state in the economy (calculated as GDP) in 2016 was in a range of 30-35%. The report continues: “Correcting for the size of the informal sector in value added and employment pushes the Russian state's share significantly up, to almost 40 percent of formal sector activity, and shy of 50 percent of formal sector employment.[26]


A group of Russian economists summarizes the peculiar character of Russian capitalism with its dominance by a few oligarchs who are closely linked with the state in the following way: “In the Russian private sector big business is dominating - 400 leading companies (with annual sales not less than $384 million in 2014 including state-controlled corporations) are producing 41% of Russian GDP. It is important to note that a typical Russian big private company is controlled not by numerous stake holders but a very limited number of individuals (i.e., oligarchs) many of whom hold posts of CEOs in their own companies. For instance, about 22% of stocks of the biggest Russian private company LUKOIL are owned by its president V. Alekperov, and 9.7% by vice president L. Fedun. The majority of Russian oligarchs has acquired their assets due to accelerated privatization policy of the 1990s being affiliated with federal and regional bureaucracy. (…) Therefore oligarchs are politically correct with this bureaucracy but to insure their assets they transmit their assets titles to offshores successfully combining it with tax evasion. For instance, all leading Russian metal companies wholly (100% of Metalloinvest) or partially (86% of MMK and NLMK, 51% of Severstal, substantial parts of Evraz and RUSAL) formally belong to offshore firms established by their Russian owners. This oligarch business capitalism co-exists with the state capitalism. For example, out of 19 leading Russian oil companies 13 are private (LUKOIL is the biggest) and 6 are state-controlled (Rosneft is the biggest).[27]


We see a similar picture in the financial sector which is dominated by state-owned banks with close relations with Russian oligarchs. According to another study “state-owned banks now dominate, distributing more than 65 percent of retail loans and 71 percent of corporate loans in 2016.[28]


This figure indicates that crucial role of state-capitalism in Russia. In fact, the role of the state has substantially increased since Russia has become an imperialist power and, in particular, since the acceleration of the Great Power rivalry. According to a study of Russian economists, “in 2015, the share (contribution) of state-owned enterprises in the GDP was near 29%–30% and the total contribution of the public sector was near 70% (compared to 35% in 2005).[29]


At this point we will not go into detail about the reasons for the prominent place of state-capitalism in Russia. Sufficient to say that this development is basically related to the weak nature of the domestic capitalist class which emerged as a new class after the collapse of the USSR as a degenerated workers state in 1991. Add to this the traditionally strong role of the state throughout Russia’s history. In any case, such a crucial role of the new capitalist state was an important precondition for preventing foreign capital to achieve a dominant position in Russia’s economy during the chaotic and destructive process of capitalist restoration in the 1990s. [30]


Capital Export and the Problem of “Round-Tripping” Foreign Direct Investments


Russia’s volume of foreign direct investment (FDI) is not insignificant albeit, as we will see later, there exist various problems with official statistics. But let us start the list of the top 15 countries which receive Russian FDI resp. from where FDI in Russia originates. In Table 3 we see the stock of accumulated capital with the list of the top 15 countries for each category for the years 2013 as well as for 2018.




Table 3. Top 15 Host Countries for Russian OFDI stock and Top 15 Sources of Russia’s IFDI Stock, in 2013 and 2018 (Millions of Dollars) [31]


   OFDI stock from Russia                                                                                  IFDI stock in Russia


   2013                                      2018                                                                      2013                                       2018


Cyprus                     152,702 Cyprus                  172,461                                 Cyprus                  183,276 Cyprus                 126,366


BVI                            74,412   Netherlands       40,415                                   Netherlands       48,948   Netherlands       40,309


Netherlands          45,012   Austria                 26,710                                   Bahamas             31,964   Bahamas             39,031


Austria                    25,500   Switzerland        17,760                                   Bermuda              29,565   Bermuda             29,830


U.S.                           20,943   BVI                         11,277                                   UK                          21,759   Luxembourg      19,561


Switzerland           12,096   Bahamas             8806                                      BVI                         18,925   France                   17,291


Germany                 9607      Turkey                  8229                                      Germany             18,898   Germany             16,410


UK                             7901      Germany             8125                                      U.S.                        17,979   UK                         14,933


Bahamas                 6416      U.S.                        7332                                     Sweden                 16,176   Switzerland        11,029


Ukraine                   5968      Spain                     6441                                      France                   14,075   BVI                         10,356


Turkey                     5277      UK                          6378                                      Luxembourg       12,780   Jersey                    9945


Spain                        4772      Belarus                 3960                                      Austria                 11,816   Ireland                  5824


Jersey                        4128      Singapore            3471                                     Switzerland        6040      Austria                 5604


Belarus                    4089      Kazakhstan        3302                                     Ireland                  5210      Italy                       4626


France                      3629      Ukraine                3104                                     Jersey                     5013      Sweden                 4531


Legend: BVI is British Virgin Islands; UK is United Kingdom; U.S. is United States




As the reader will recognize, this list includes a number of destinations which are well-known as offshore tax havens: Cyprus, the British Virgin Islands (BVI), Bahamas, Bermuda, Jersey etc. Likewise, the Netherlands are also a tax heaven highly appreciated by oligarchs. We have pointed to this issue already in our study of 2014. As we stated at this place, this does not necessarily mean that Russian FDI to such destinations is simply capital flight. As the Table shows, there is also a large volume of FDI originating from the very same tax havens. Economists call this round-tripping. Russian capitalists “invest” in foreign offshore destinations and, in turn, invest from these destinations in Russia. Hence, round-tripping leads to Russian FDI being overestimated in both directions. A major reason for Russian multinationals to “invest” in such offshore destinations is the strategy to minimize taxes. [32]


Furthermore, Russian monopolies also use such offshore destination for foreign investments in third countries. A Russian economist explains: “A company may consider investing in China from other jurisdictions commonly used by Russian business to accumulate profit, such as the Netherlands, or Cyprus. Importantly, the investing structure should not include Russian nationals as directors to avoid falling under “Russian investment check”, although, banks still have the discretion to request disclosure of the entire ownership structure, including the ultimate beneficial shareholders.” [33]


Another report by Russian economists indicates that while official Russian FDI in Kazakhstan is relatively small, in reality it might be much bigger given the large FDI originating from the Netherlands (which is a favorite destination of Russian monopolies as mentioned above). “For Kazakhstan, the situation is opposite: Russia-originating FDI adds up to only 2.5 percent of total inward stock. However, the Netherlands’ share is more than 40 percent. Many Russian companies are registered in the Netherlands, or arrange there their affiliates to conduct business abroad. Due to this, revealing the initial origin of Dutch FDI to Kazakhstan could increase the share of Russian FDI several fold.[34] Naturally, such FDI is not counted in the statistics as Russian OFDI.


As a result, a sizeable proportion of “foreign investment” in Russia is in fact Russian investment (“coming home” under favorable tax conditions). Furthermore, Russian corporations also undertake foreign investments in other countries from such offshore centers. Obviously, such complications make a concrete estimation of real Russian foreign investment resp. foreign investment in Russia difficult. A Finish university professor, who has studied this problem in detail, arrives at the following conclusion. “According to the Central Bank of Russia (CBR), as of the end of 2014, two-thirds of Russian OFDI stock has landed in the EU, including Cyprus. However, the geographical distribution of the Russian OFDI stock should not be taken too literally, as a great part of the Russian OFDI does not stay in the first foreign country it has been invested in. It is impossible to state precisely how much Russian capital has stayed abroad, and how much has returned to Russia. However, an analysis of six possible capital round-tripping countries, namely the Bahamas, Bermuda, the British Virgin Islands (BVI), the Cayman Islands, Cyprus, and Jersey sheds some light to this mystery. The share of the aforementioned six island states, in the Russian OFDI stock, was 40 percent at the end of 2014. Correspondingly, the share of these countries in the Russian inward foreign direct investment (IFDI) stock was practically the same. Due to such “islandization”, the true amount of Russian FDI abroad at the end of 2014, was probably closer to $250 billion rather than $432 billion, a figure reported by UNCTAD. This “offshorization” of the Russian FDI also leads the author to conclude that one could probably reduce Russia’s official IFDI stock by 40–50 percent, to discover the true size of Russia’s IFDI stock.[35]


However, the Putin regime tries to reduce the amount of round-tripping capital in order to raise the state’s tax income. “A new Russian anti-offshore law took effect in January 2015, aiming to prevent the cash drain from Russia to offshore centres, the use of cross-border tax evasion schemes and, thus, to reduce round-tripping investment.[36] While round-tripping still exists, it seems to have been reduced. The World Bank reports: The Russian anti-offshore law adopted at the end of 2014 is reducing the scale and scope of round-tripped FDI: from 2013 to April 2019, the FDI stock of Cyprus in Russia decreased by 25 percent.[37] Currently, the Putin regime tries to reduce also the volume of Russian capital moving to the Netherlands.The role of the Netherlands as a convenient tax haven may change in 2021 as the Kremlin, in its hunt for more tax revenues, is seeking to bring more Russian companies onshore and is threatening to end the double tax treaty arrangement that encouraged so many Russian firms to incorporate there. Cyprus has already succumbed to an increase in the duty, but Cyprus is much more heavily dependent on Russian business than the Netherlands, where talks are ongoing, so the outcome of this negotiation is still uncertain.” [38]






“Phantom FDI”: No Russian Peculiarity but a Global Phenomenon


The vast amount of Russia’s round-tripping foreign investment has been often cited as an example of the weakness of Russia’s capital and as proof of its non-imperialist character. In our 2014 studies on Russia, we argued against this view that Russia is not the only country where capital is flocking to financial offshore centers and that such phenomenon exists also in other imperialist countries. Since we stated this viewpoint several years ago, a few highly interesting have been published which analyzed this issue in much detail. This new research strongly confirms our assessment. One study estimates: “According to the Special Report of the Economist on Offshore Finance the world has 50–60 tax havens, which serve as domicile for more than 2m paper companies, along with thousands of banks, funds and insurers. The Report estimates that over 30% of global foreign direct investment is booked through havens.[39]


Another more recently published study estimates that the share of such “Phantom FDIs” has even increased since then to 40% of all global FDI! “In 2017, the authors estimate that FDIs worth US$15 trillion out of US$40 trillion are not related to real activity and can be labelled ‘Phantom FDIs’. The share has been growing from just above 30 per cent in 2009 to almost 40 per cent in 2017.[40]


Some readers might assume that such “Phantom FDI’s“ are a feature only of weak economies of the so-called “Third World”. In fact, this is simply not true. First, it would be absurd to imagine that the poor countries would have so much capital. No, it is first and foremost the imperialist states where most of capital has its home. Furthermore, detailed research have shown that the Western imperialist states in the OECD are a major source of “Phantom FDI’s“. “The results shed new light on the determinants of offshore FDI. To start with, we show that it is pervasive, affecting wealthy as much as developing countries. Surprisingly, given its intangible nature, offshore FDI appears as sensitive to physical distance as real FDI. While colonial history seems to have little direct bearing on real FDI, offshore FDI links are particularly strong between colonial powers and their current and former colonies. With respect to economic agreements, we demonstrate that the OECD, while leading an agenda against tax evasion, has more actively suppressed offshore FDI outside of than within its membership. In the realm of taxation, both real and offshore FDI are routed along zero withholding tax pathways, confirming that firms organize themselves to maximize the tax efficiency of internal capital movements. In this respect, we find evidence of widespread third-country ‘treaty shopping.’ Finally, contrary to expectations, we find no relationship between offshore FDI and either rule of law or communist history.[41]


While there has been much talk about closing such tax havens, the reforms implemented by the OECD states only reorganized the system but did not abolish it (at least until now). “Politically, the most important finding is the apparent confirmation of widespread complaints that OECD-led anti-tax haven initiatives have had powerful, but ultimately perverse impacts on offshore finance. Rather than reducing the overall level of offshore tax evasion/avoidance, these appear to have produced a hierarchical reorganization of offshore finance within which ‘inside renegade’ OECD Offshore Financial Centers (OFC) have been the primary beneficiaries, and the weakest and most marginal OFCs have been the principal losers. In contrast, the EU initiatives appear to have had few if any effects as of year-end 2010.” [42]


In summary, round-tripping foreign investment or “Phantom FDI” are by no means Russian peculiarity but rather a global phenomenon. It takes place in Western as well as in Eastern imperialist countries. There is no justification to use the amount of Russia’s “Phantom FDI” as an argument for its alleged “non-imperialist” character.




Russia’s Leading Multinational Corporations and their Foreign Investments




As the quote above demonstrates, our critics assume that Russia’s foreign economic relations with semi-colonial countries are focused not on profit and exploitation but rather on subsidizing these economies. “In fact, rather than economically exploiting its dependents and allies in the Commonwealth of Independent States (all former Soviet republics), the Kremlin has been subsidizing their economies by supplying energy at prices substantially discounted from current world market rates.


Again, this is a caricature of true facts. As a matter of fact, Russia’s foreign investment is based – like foreign investments by other countries – on profit-interests by private and state monopolies. Let us provide a brief overlook about the leading Russian multinationals. In Table 4 we provide a list published by UNCTAD which shows the 15 largest Russian non-financial monopolies ranked by their foreign assets.




Table 4. Largest Russian Non-Financial MNEs, by Foreign Assets, 2017 [43]


Rank          Company                              Industry                                Foreign assets                       Share of foreign assets        State ownership


   (Billions of dollars)             in total assets (%)               (%)


1 Lukoil                                   Oil and gas                         24.3                                       27                                          


2 Gazprom                             Oil and gas                         19.5                                       6                                             50.2


3 Rosneft                                 Oil and gas                         17.6                                       8                                             69.5


4 Sovkomflot                         Transportation                  5.7                                          78                                          100.0


5 Severgroup                         Conglomerate                    5.4                                          ..                                            


6 En+                                        Conglomerate                    5.0                                          23                                         


7 Atomenergoprom            Nuclear energy                  4.7                                          9                                             100.0


8 Evraz                                    Steel                                      3.7                                          36                                         


9                 Russian Railways            Transportation                  3.5                                          5                                             100.0


10              TMK                                      Steel                                      2.0                                          36                                         


11              Eurochem                           Chemicals                          1.7                                          17                                         


12              Sistema                                Conglomerate                    1.5                                          8                                            


13              NLMK                                  Steel                                      1.5                                          14                                         


14              Zarubezhneft                     Oil and gas                         1.2                                          38                                          100.0


15              Polymetal                            Non-ferrous metals         1.0                                          32                                         


Total or average                                                                                  105.1                                     12                                          ..




There are several noteworthy facts deriving from this table. First, these 15 leading monopolies play a very dominant role in Russia’s outward FDI. Its combined foreign assets of $105.1 billion represent a large proportion of Russia total foreign capital stock – even if the total amount is not $250 billion but $432 billion. UNCTAD calculates that “at the end of 2017, the 15 largest Multinational Enterprises (excluding such big State-owned banks as Bank VTB and Sberbank) accounted for 28 per cent of the country’s outward FDI stock.[44]


Secondly, we see that state-owned corporations play a prominent role, but private monopolies dominate the list (9 out of 15). An economist reasonable assumes that “Phantom FDI” is undertaken by private and not by state-owned monopolies. However, even if one takes this into account, private multinationals will still account for about ¾ of Russian outward FDI. “However, if it is assumed that private corporations are behind the majority of the capital round-tripping, which accounts for roughly 40 percent of Russia’s OFDI stock, this may lead to a situation where up to a quarter of Russia’s “real” foreign assets could be in the hands of Russian SOEs. This would, nevertheless, mean that three-quarters of Russia’s OFDI stock would still be in private hands, and thus the author argues that Russian OFDI continues to be dominated by private corporations with versatile relations to government policies.[45]


Thirdly, we see that the oil and gas sector and the metal industry play a leading role in Russia’s investments abroad. However, as an economist points out, Russia’s monopolies play a role in a wide range of business sectors. “The oil and gas sector and the metal industry dominate Russian OFDI. The three largest Russian corporations in the hydrocarbon business outside Russian borders are Lukoil, Gazprom, and Rosneft. In the metal business, Russia’s global leaders are probably Evraz, Severstal, Mechel, and Rusal. However, Russia’s foreign business expansion is not limited to natural resource-based sectors: Companies operating in manufacturing and services have also expanded outside Russian borders. As an example, machine building (GAZ and OMZ), electricity generation (INTER RAO UES and Atomenergoprom), chemicals (Eurochem and Agron), foodstuffs (Wimm-Bill-Dann), telecommunications (Sistema, Vimpelcom and MTS), information technology (LANIT, IBS and Kaspersky Lab), transportation (Sovcomflot, Globaltrans, Russian Railways), banking (Sberbank, Gazprombank and Alfa-bank), and media (CTC Media and Interfax) among several other sectors can be mentioned.[46]


Another, more recent, study of Russia’s multinationals presents the following picture. “Out of the 15 leading non-financial Russian multinationals ranked by foreign assets in 2017, four were in metallurgy, four in oil and gas, two in transportation and one in chemicals and one in nuclear energy. Three leading Russian multinationals are conglomerates. In contrast, the industrial distribution is much more diverse in the second echelon of Russian multinationals. In Europe, Asia and Africa, the sectoral distribution of Russian OFDI is quite diversified, while in North America, Russian FDI has mainly been delivered by metallurgical multinationals. According to IMEMO’s FDI project database, in non-CIS Eurasia, at the end of 2016, most Russian OFDI stock was directed at oil and gas (34.3 per cent), communication and IT (19.7 per cent) and finance (12.9 per cent). Ferrous metals have witnessed the most noticeable decline in their share of the Russian OFDI stock. According to Eurostat, the service sector accounted for 80.7 per cent of Russian FDI stock in the EU at the end of 2016. The electricity, gas, steam and air conditioning supply sector (4.0 per cent) and private real-estate activities (3.3 per cent) are still also worth mentioning. Foremost among service sectors are financial and insurance activities (47.9 per cent), though professional, scientific and technical activities (22.4 per cent) play a notable role as well. However, in our view, this gives a distorted picture due to SPEs and transactions via third countries.[47]


As the quote above shows, our critics claim that Russian monopolies operating in semi-colonial countries would not refrain from investments. An UNCTAD report from last year reports about the decline in profits for Russian (as well as many other) multinationals. [48] At the same time, the report also provides figures which reflect substantial capital accumulation of these monopolies financed by their massive profits. After the onset of the COVID-19 crisis, the projected earnings of the 36 largest Russian MNEs were revised down 41 per cent, similar to the revisions for other emerging-market MNEs. This development limits the capacity of Russian MNEs to reinvest their earnings, which accounted for almost two-thirds of their outward FDI in 2019 and more than one-third in the previous three years.[49]


In short, we see that Russian multinationals investing abroad suffer the same problems as other capitalist monopolies. They make substantial profits, suffer losses during recession and reinvest a large proportion of their earnings. No, there is nothing strange about Russian monopolies. They are not benevolent force subsidizing poor countries as our confused critics suggest. They look like imperialist monopolies, they smell like imperialist monopolies … they are imperialist monopolies!





Imperialist Super-Exploitation via Capital Export


Like other imperialist monopolies, Russian capital is investing both in imperialist states as well as in semi-colonial countries. For reasons mentioned above (“round-tripping”), there are some difficulties to get an accurate picture of the destinations of Russia’s capital export.


IMEMO (The Institute of World Economy and International Relations) – one of Russia’s most prestigious think tanks – has tried to identify the major destinations of Russian capital export. It arrived at the following conclusion concerning foreign investment in countries outside the semi-colonial CIS in Eurasia. “Using a different methodology, IMEMO’s FDI project database, incorporating projects for which FDI stock exceeds USD 3 million, perhaps gives a much more accurate picture than official data. Accordingly, at the end of 2016, the main destinations in non-CIS Eurasia were Italy, Germany, Great Britain, Turkey, Switzerland, Iraq and Bulgaria. This database shows minor Russian FDI stock in Cyprus. Likewise, real Russian FDI presence is much smaller in Luxembourg, Spain, Ireland, Latvia and the Netherlands than officially registered.” [50] Among the Eastern European countries, Bulgaria, Serbia, Romania, Czechia and Poland did also receive substantial amount of Russian foreign investments. [51]


Russian monopolies also play an important role in the Eurasian countries albeit more in some than in others. Two Russian economists provide the following assessment. “In 2014, Russian OFDI to the EAEU was close to $15.4 billion, which is equivalent to 4.0 percent of the total Russian OFDI. Both figures nearly doubled in two years (2012-14) after the creation of the Customs Union between Russia, Belarus, and Kazakhstan. This modest share could be twice as high, after the subtraction of FDI turnover from the total figures (about half of the $388 billion Russian OFDI stock is located in Cyprus and the BVI). The role of Russian investments varies by country. For Belarus, Russia is the country of origin for 57 percent of FDI inward stock, while Cyprus and similar territories are responsible for less than 15 percent of that stock. For Armenia, Russian FDI are also significant (35 percent of the total inward stock). For Kazakhstan, the situation is opposite: Russia-originating FDI adds up to only 2.5 percent of total inward stock. However, the Netherlands’ share is more than 40 percent. Many Russian companies are registered in the Netherlands, or arrange there their affiliates to conduct business abroad. Due to this, revealing the initial origin of Dutch FDI to Kazakhstan could increase the share of Russian FDI several fold. Russian investments in Kyrgyzstan are minor, both in absolute and relative terms. Substantial investments were promised for Kyrgyzstan, in order to make its EAEU accession more attractive, but the Russian economic problems of 2015-16 have put their implementation into question. [52]


The same authors conclude: “Russian OFDI to the EAEU appear modest in comparison with overall Russian OFDI. Precise calculations are difficult, due to capital round-tripping. Real flow are much higher than officially reported by the CBR or UNCTAD, since large Russian companies frequently arrange their acquisitions via offshore countries. Company data more adequately reflects the real presence and influence of Russian business in the EAEU countries.[53]


A. V. Kuznetsov, a renowned Russian economist, calculates that Russian foreign investment is substantially underestimated in Eurasian countries while overstated in Latin America and the Caribbean. “In 2014-2016, the CBR had significantly expanded the detalization of published data on Russian FDI. However, when analyzing their geography, the main problem remains unresolved, namely, account of investment in third-world countries through offshore companies and similar jurisdictions. Distortions in the official statistics, including mirror data of the central banks of countries that receive Russian FDI, are common to all of the recipient countries. However, in the post-socialist countries with their dysfunctional investment climate and desire of many businesses not to advertise their assets that were obtained in dubious privatization transactions, Russian companies use transshipment bases particularly often, which results in an underestimate of the role of Russian transnational corporations (TNCs) in the neighboring countries. In particular, as shown by monitoring mutual investments in the CIS countries, which have been ongoing in IMEMO since the end of 2011, the volume of Russian FDI stock is understated by at least 2.5–3 times in Ukraine, by 3–4 times in Kazakhstan, and by about 50% in Belarus. In contrast, in Latin America and the Caribbean, where a considerable part of offshores popular among Russian investors are located, the presence of Russian TNCs is overstated. According to our estimates of the size of Russian assets abroad at their actual location, Russian FDI in the Americas outside of the United States and Canada make up about 3 billion USD. This is about 15–30 times less than the figure officially published by the Central Bank data.” [54]


There exist also figures for individual countries in the Eurasian region albeit one has to take into account the above-mentioned issue of distorted origin of foreign investment. According to one report, Russia is the fifth-largest foreign investor in Tajikistan with a share of 7% (China is the largest foreign investor). [55]


In Kazakhstan, Russian monopolies are officially the fourth-largest investor. However, as mentioned above, its real share is certainly substantially higher given the fact that Netherlands – a major destination of Russian offshore investment – is suspiciously by far the largest foreign investor (29.1% in 2017). [56]


Russian multinationals have an absolute dominant position in Uzbekistan. 55.6% of all foreign investment originated from Russia, with China being the second-largest investor (15%). “Russia is a major foreign investor in Uzbekistan. Investment projects with investments from Russia include oil and gas production (9,016.3bln soms), information and communications (467.4bln soms), production of non-metallic mineral products (10.5bln soms), metallurgical industry (10.4bln soms) and many others.[57]


Having listed Russia’s investments in some Eurasian countries, it is also important to recognize its limitations. It is, in particular, Chinese monopolies which are increasingly taking the lead – something not surprising given the economic superiority of the new Great Power. However, Moscow tries to find a modus vivendi with Beijing. [58]Russia and China also reached an understanding on Central Asia. As described by analysts of their relations, “Moscow and Beijing found ways to divide their influences, with China dominating the energy realm and Russia the security realm”. Russia’s power in Central Asia was primarily, though not exclusively, based on military capabilities. (…) While Russia has the ambition to preserve economic influence in the region, it is increasingly unable to compete with Beijing and has learned to accept China’s lead in exchange for Beijing’s recognition of Russia’s military and political dominance in the former Soviet region. In the mean time, Chinese military attention is directed less at Central Asia than the regions of East Asia and the Asia Pacific. In the Central Asian region, Beijing deployed no troops and expressed no desire to lease any military facilities. Therefore, from a military standpoint, Russia remains the regionally dominant power.[59]


UNCTAD reports that Russian monopolies are also trying to build a presence in Africa. “Russian MNEs are expected to continue searching for investment opportunities on the African continent, encouraged by a public initiative adopted at the first Russia–Africa Summit and Economic Forum in 2019. The annual volume of Russian FDI in Africa is usually small. However, there have been exceptions. In 2019, for example, the Congo received Russian FDI flows of $779 million as Lukoil, the country’s largest outward investor, bought 25 per cent of gas company Marine XII, currently in the exploration stage. Other Russian companies engaged in Africa include State-owned Alrosa (investing in Angola, Botswana and Zimbabwe), Bahamas-registered but Russian-owned Renova (mining in Gabon, Mozambique and South Africa), Stateowned nuclear operator Rosatom (investing in Egypt and Nigeria) and State-owned Rosneft (investing in Egypt).


The Russia–Africa Summit in 2019 also provided an opportunity to sign deals for new projects, the most important of which for FDI were the following:


* State-owned IT security firm Avtomatika (part of Rostec Corporation) signed a contract with Angolan mobile operator Movicel to protect the company’s IT infrastructure.


* Russian specialized-fats producer EFKO Group and United Oil (Egypt) signed an agreement of intent to create a joint venture for a production facility worth about $300 million.


* Rosatom and the Government of Rwanda signed an agreement to build a centre for nuclear science and technology in Kigali.


* Cyprus-registered but Russian-owned Uralchem and Angolan Grupo Opaia Holding (operating in civil construction, solar energy, drinking-water systems, tourism, agriculture, finance and other industries) signed a memorandum to build a urea plant in Angola for $1 billion.


* State-owned bank VEB signed a deal to build an oil refinery in Morocco for $2.2 billion.[60]


In summary, it is evident that Russian monopolies have substantial foreign investments both in imperialist as well as in semi-colonial countries. These investments are no acts of benevolence, as our critics suggest. No, they are profit-driven investments of imperialist monopolies.




Imperialist Super-Exploitation via Migration




Finally, when we talk about Russia’s super-exploitation of the semi-colonial countries in Eurasia, it is crucial to point also to the role of migration. [61] As we have elaborated in much detail in other works, migration is one of four major forms of imperialist super-exploitation of colonial and semi-colonial countries as it provides substantial value transfer from the oppressed to the oppressor country. (The other forms are capital export as productive investment, capital export as money capital (loans, currency reserves, speculation, etc.) and value transfer via unequal exchange). [62]


As we pointed out in our 2014 study, Russian imperialism enormously gains from super-exploitation of migrants. We referred to official statistics which calculated that approximately 11.6 million legal migrants reside inside Russia. By June 2019, there were officially 10.13 million foreign citizens in Russia [63] albeit this number did temporary drop during the height of the Lockdown policy provoked by the COVID-19 Counterrevolution in 2020. [64] The vast majority of these legal migrants (8.59 million or 85%) come from the semi-colonial CIS countries in Central Asia and Eastern Europe. (See Table 5)




Table 5. Foreign Citizens from CIS Countries Living in the Russian Federation, 2019 [65]


Country                                                Number


Azerbaijan                                          650,495


Armenia                                              491,767


Belarus                                                655,846


Kazakhstan                                        496,096


Kyrgyzstan                                         716,118


Moldova                                              326,178


Tajikistan                                            1,303,302


Uzbekistan                                         2,188,835


Ukraine                                               1,763,930


CIS, total                                             8,592,567




With an official population of 146,7 million (2019), legal migrants constitute 6.9% of Russia’s population. To this figure, one has to add an unknown number of migrants living illegally in Russia. There exist various estimations about the total number of illegal migrants, ranging from 1.5 to 15 million. Naturally, we are not in a position to know the exact number, but several academics settle on the figure of 3-5 million illegal migrants. [66] If this figure is accurate, one can assume that about 13-15 million legal and illegal migrants are currently living in Russia (about 9-10% of the total population).


In addition to these legal and illegal migrants, one should add an unknown number of migrants from Russia’s internal colonies. As an old Empire, a sizeable minority of Russia’s population (about 19%) are non-Russians. As we pointed out in our 2014 study, these minorities are nationally oppressed peoples who mostly live under worse economic and social conditions than the majority population. As a result, many of these oppressed minorities leave their native place and move to larger cities – in areas dominated by the Russian majority population – in the hope to find there a job.


For example, about 100,000 Chechens migrated to the Moscow region during the 1990s. Later the number dropped to about 25,000. However, many Chechens who are living there are either not registered or possess a temporary residence registration. Likewise, several tens of thousands of Chechens are living in St. Petersburg. [67] If one takes into account that the Chechens are a numerically small people with only about 1,2 million living in Chechnya, one can see that the proportion of migrants originating from Russia’s internal colonies is substantial. Of course, we are aware that the share of Chechens living in diaspora is certainly particularly high given the horrific oppression which they have suffered by the Russian army in two wars (in 1994-96 and 1999-2009) and during which up to 200,000 Chechens were killed and many more were forcefully made refugees. [68]


Naturally, the share of migrants among the labor force is significantly higher than that among the total population as most migrants come to Russia in order to work and earn money. On the other side, there is superannuation of the native Russian population. In Table 6 we can see that migrants (the figure covers only legal migrants) constitute a sizeable proportion of key sectors of Russia’s economy.




Table 6. Employment Rates of Migrants in the Russian Federation in 2016 (%) [69]


Economic sector                                                                  Share of migrants employed in the sector,


                                                                                              % of the overall number of employed


Manufacturing industry                                               14.4%


Construction                                                                     7.2%


Service sector (retail trade, home/other


technique appliance maintenance, etc.)                   15.9%


Agriculture                                                                         6.5%




One can fairly assume that the number of migrants in Russia will increase in the next years. This is, on one hand, because of the global capitalist crisis hits the poorer countries particularly hard. As a result, the process of migration from such countries to the imperialist states will continue to increase.


On the other hand, Russia faces a long-term demographic problem as its native population is shrinking. (By the way: Western Europe, Japan and the white majority population of the U.S. have the same problem.) The Putin regime tries to counteract by attracting more migrants and allowing them dual Russian citizenship. “In April 2020, Putin signed a law allowing dual Russian citizenship for foreigners in hopes of attracting up to 10 million migrants, mostly from countries with sizable Russian-speaking populations.[70]


Similar to other imperialist countries, migrants in Russia are super-exploited as cheap labor force. A team of three Russian university professors calculates, that “as a rule, the wage of migrants is approximately 70% of the wages of Russians.[71] They estimate the contribution of migrants to Russia’s output. “Based on the fact that in 2016 the GDP amounted to 86,044 billion rubles, additional 5,592.8 billion rubles were received due to the use of foreign labor, which is 6.5% of Russia’s total GDP.[72] They also quote other experts who estimate the contribution of migrants as 7.56% of Russia’s GDP. However, one has to be aware that these three economists make this calculation based on the assumption that the share of legal and illegal migrants in Russia’s labor force is only 6.5% which is certainly an underestimation given the fact that the share of legal migrants (i.e. without illegal) among Russia’s total population is 6.9%. in addition, one has to take into account that the share of migrants among the labor force is always higher than the share among the total population. Hence, we can assume that the real contribution of migrants to Russia’s economy is not insignificantly higher than 6.5%.


In summary, similar to other imperialist countries, imperialist Russia is home to millions of migrants who are exploited as cheap labor force in order to increase the surplus-value of the bourgeoisie.








We conclude our survey by confirming the RCIT’s analysis of Russia as an imperialist power which we have established a number of years ago. Russia’s imperialist character is evident not only from its political and military features but also from its economy. It is neither dominated by foreign corporations, nor does it suffer from financial dependency of foreign imperialist institutions. It is a relatively strong economy dominated by domestic monopolies, with a low level of foreign debts and large foreign exchange reserves. Russia’s monopoly capitalists – the so-called “oligarchs” – are closely linked with the state apparatus which plays a strong, regulating role.


Russia’s capital export is dominated by these monopolies. Here too, the state-owned corporations play a significant role albeit the majority of these corporations are privately owned. Russia’s foreign investments are directed both to imperialist as well as semi-colonial countries. Naturally, Russia plays a stronger role in semi-colonial countries which were part of the USSR. Today, several of these states are members of the “Eurasian Economic Union”, a Russia-dominated Eastern version of the European Union.


Contrary to the assumption of our critics, Russia’s monopolies are exporting capital in order to make profits and not for any benevolent reasons. The economic relations with semi-colonial countries in Eastern Europe and Central Asia are orientated towards creating a surplus-value and not to subsidize these countries for any abstract political goals.


All this does not deny the specific nature of Russia which is much stronger as a military than as an economic power. But, as we have demonstrated, many imperialist states are developed in an uneven way where the economic, political and military strength can substantially differ. However, Marxists never applied an economistic definition of imperialism, ignoring the political and military aspects, but proceeded on an understanding of imperialist states in the totality of their economic, political and military features.


Having established the imperialist character of Russia, the RCIT repeats that it would be politically criminal for socialists to side with such a state in a conflict with Great Power rivals. Supporting Russia in any conflict with Western European states, the U.S. or Japan is paramount to social-imperialism, i.e. serving one or several imperialist powers masked by socialist phrases. In contrast, the RCIT advocates the strategy of revolutionary defeatism as elaborated by Lenin. We oppose the Great Powers of the West as well as of the East. [73]


At the same time, we support the national liberation struggles of oppressed people against any of these imperialist powers. Hence, we have supported the resistance struggle of the Afghan people against the U.S./NATO occupation since 2001 [74] Likewise, we have sided with the resistance of the Iraqi people against the Western imperialist aggression [75] and with the African people in Mali against French imperialism [76]. And for the same reasons we support the struggle of the Syrian people against Russian imperialism and its allies [77], and we defend with the Uyghurs against the oppression by the Chinese state. [78]


For us in the RCIT it is an irrevocable axiom that one can only fight for a socialist future, if this includes the intransigent anti-imperialist struggle against all Great Powers (U.S., China, Western Europe, Russia and Japan) as well as the unconditional support for the liberation struggles of all oppressed people!


Trotsky once remarked: „The vast practical importance of a correct theoretical orientation is most strikingly manifested in a period of acute social conflict of rapid political shifts, of abrupt changes in the situation. In such periods, political conceptions and generalizations are rapidly used up and require either a complete replacement (which is easier) or their concretization, precision or partial rectification (which is harder). It is in just such periods that all sorts of transitional, intermediate situations and combinations arise, as a matter of necessity, which upset the customary patterns and doubly require a sustained theoretical attention. In a word, if in the pacific and “organic” period (before the war) one could still live on the revenue from a few readymade abstractions, in our time each new event forcefully brings home the most important law of the dialectic: The truth is always concrete.“ [79]


Indeed, it is in historic periods like the current one, where theoretical conceptions are tested. A wrong analysis, the inability to apply the Marxist method to the concrete reality, can lead one into the camp of social-imperialism – irrespective of the “best Marxist intentions”! Hence, we do not quarrel with our critics because of this or that theoretical formulation. What is at stake is simply the question if one joins the right or the wrong side of the barricade in the class struggle! For or against all imperialist Great Powers – this is the question at stake! Our critics unfortunately jump into the camp of Russian and Chinese imperialism. We have no reason to follow them!


Workers and Oppressed: Fight all Great Powers in East and West!




[1] Michael Pröbsting: Anti-Imperialism in the Age of Great Power Rivalry. The Factors behind the Accelerating Rivalry between the U.S., China, Russia, EU and Japan. A Critique of the Left’s Analysis and an Outline of the Marxist Perspective, RCIT Books, Vienna 2019,

[2] We have dealt with the decline of the U.S. in many works as it is a crucial feature of the changes in the imperialist world order. Our latest pamphlet which dealt with this issue is by Michael Pröbsting: “A Really Good Quarrel”. US-China Alaska Meeting: The Inter-Imperialist Cold War Continues, 23 March 2021,

[3] See on this e.g. by Michael Pröbsting: Marxism, the European Union and Brexit. The L5I and the European Union: A Right Turn away from Marxism. The recent change in the L5I’s position towards the support for EU membership represents a shift away from its own tradition, of the Marxist method, and of the facts; August 2016, in: Revolutionary Communist No. 55,; by the same author: Does the EU Represent "Bourgeois Democratic Progress"? Once again, on the EU and the Tactics of the Working Class – An Addendum to our Criticism of the L5I’s Turn to the Right and Its Support for EU Membership, 16.09.2016,; The British Left and the EU-Referendum: The Many Faces of pro-UK or pro-EU Social-Imperialism. An analysis of the left’s failure to fight for an independent, internationalist and socialist stance both against British as well as European imperialism, Revolutionary Communism Nr. 40, August 2015; see also (in German language only): Die Frage der Vereinigung Europas im Lichte der marxistischen Theorie. Zur Frage eines supranationalen Staatsapparates des EU-Imperialismus und der marxistischen Staatstheorie. Die Diskussion zur Losung der Vereinigten Sozialistischen Staaten von Europa bei Lenin und Trotzki und ihre Anwendung unter den heutigen Bedingungen des Klassenkampfes, in: Unter der Fahne der Revolution Nr. 2/3 (2008),

[4] The RCIT has published numerous documents about capitalism in Russia and its rise to an imperialist power. See on this e.g. the above-mentioned book by Michael Pröbsting: Anti-Imperialism in the Age of Great Power Rivalry. See also several pamphlets by the same author: Russia and China: Neither Capitalist nor Great Powers? A Reply to the PO/CRFI and their Revisionist Whitewashing of Chinese and Russian imperialism, 28 November 2018,; The Catastrophic Failure of the Theory of “Catastrophism”. On the Marxist Theory of Capitalist Breakdown and its Misinterpretation by the Partido Obrero (Argentina) and its “Coordinating Committee for the Refoundation of the Fourth International”, 27 May 2018,; Lenin’s Theory of Imperialism and the Rise of Russia as a Great Power. On the Understanding and Misunderstanding of Today’s Inter-Imperialist Rivalry in the Light of Lenin’s Theory of Imperialism. Another Reply to Our Critics Who Deny Russia’s Imperialist Character, August 2014,; Russia as a Great Imperialist Power. The formation of Russian Monopoly Capital and its Empire – A Reply to our Critics, 18 March 2014, in: Revolutionary Communism No. 21, See various other RCIT documents on this issue at a special sub-page on the RCIT’s website:

[5] Our first analysis of Russia’s transformation into an imperialist power (“Political and Economic Problems of Capitalist Restoration in Russia”) was written in the year 2001 and has been republished as an appendix in the above-mentioned pamphlet Russia as a Great Imperialist Power (2014).

[6] Our thesis of China as an emerging imperialist power was first established by comrade Peter Main in our predecessor organization (“League for the Fifth International”) in the year 2010. It was adopted at our congress in the same year. However, the L5I – which expelled the founding group of the RCIT in April 2011 – failed to elaborate a comprehensive analysis to proof this thesis. This was done in 2012 in a pamphlet by Michael Pröbsting: China‘s transformation into an imperialist power. A study of the economic, political and military aspects of China as a Great Power (2012), in: Revolutionary Communism No. 4, Since then, we have updated and expanded our analysis in a number of works. See e.g. by the same author our above-mentioned book “Anti-Imperialism in the Age of Great Power Rivalry”. Other works relevant for this issue by the same author are an essay published in the second edition of The Palgrave Encyclopedia of Imperialism and Anti-Imperialism (edited by Immanuel Ness and Zak Cope), Palgrave Macmillan, Cham, 2020,; How is it possible that some Marxists still Doubt that China has Become Capitalist? (A Critique of the PTS/FT), An analysis of the capitalist character of China’s State-Owned Enterprises and its political consequences, 18 September 2020,; Unable to See the Wood for the Trees (PTS/FT and China). Eclectic empiricism and the failure of the PTS/FT to recognize the imperialist character of China, 13 August 2020, See many more RCIT documents at a special sub-page on the RCIT’s website:

[7] For the RCIT’s analysis of the skirmish in the Black Sea see the following documents: RCIT: Russia Fires Warning Shots against UK Warship in the Black Sea. Down with Cold Warmongering! No support for any imperialist Great Power – neither UK, US nor Russia! 24 June 2021,; Michael Pröbsting: “Next Time We Will Bomb the Target”. Shooting incident in Black Sea between UK and Russia shows that capitalism in decay is stumbling towards war, 24 June 2021,; Laurence Humphries: Skirmish in Black Sea: Imperialist Patriotism in the UK, 27 June 2021,; Michael Pröbsting: Examples of Pro-Russian Social-Imperialism. British Stalinism and the misnamed “World Socialist Web Site” on the shooting incident in the Black Sea between UK and Russia, 28 June 2021,

[8] Michael Pröbsting: Servants of Two Masters. Stalinism and the New Cold War between Imperialist Great Powers in East and West, 10 July 2021,

[9] BT: UK/NATO: stay out of Russia’s territorial waters! Neutrality equals ‘conscious or unconscious’ support for imperialists, 10.7.2021,

[10] See on this various RCIT statements like: Ukraine: Neither Brussels nor Moscow! For an independent Workers’ Republic! 18.12.2013, in: Revolutionary Communism No. 18,; Right-Wing Forces Take Power in the Ukraine: Mobilize the Working Class against the New Government! 25.2.2014, in: Revolutionary Communism No. 19,; Ukraine: Rivalry between Imperialist Powers escalates after Right-Wing Coup: Stop the Imperialist Saber-Rattling! 2.3.2014, in: Revolutionary Communism No. 21,; in particular we draw attention to the pamphlet by Michael Pröbsting: The Uprising in East Ukraine and Russian Imperialism. An Analysis of Recent Developments in the Ukrainian Civil War and their Consequences for Revolutionary Tactics, 22. October 2014, See also the contribution by comrade Petr Sedov: On the Donbass Uprising in Spring 2014. A necessary correction of our assessment of the early phase of the “anti-fascist” Uprising in the Eastern Ukraine, July 2019,

[11] The Commonwealth of Independent States is an institution including most of the former members states of the USSR. It is dominated by imperialist Russia while all other countries have a semi-colonial capitalist character.

[12] See on this e.g. our above-mentioned book “Anti-Imperialism in the Age of Great Power Rivalry”, pp. 94-102. We have also dealt with this issue in the above-mentioned pamphlet “Lenin’s Theory of Imperialism and the Rise of Russia as a Great Power”.

[13] Wladimir Andreff: Maturing Strategies of Russian Multinational Companies: A Historical Perspective, in: Kari Liuhto, Sergei Sutyrin and Jean-Marc F. Blanchard (Eds.): The Russian Economy and Foreign Direct Investment, Routledge, New York 2017, pp. 26-27

[14] See e.g. the selection of quotes presented in our above-mentioned book “Anti-Imperialism in the Age of Great Power Rivalry”, pp. 127-129

[15] V. I. Lenin: Imperialism and the Split in Socialism (1916); in: LCW Vol. 23, p. 116

[16] The most updated statistics can be viewed in the chapter “A View on the Military Strength of the Great Powers” in our above-mentioned pamphlet ”Servants of Two Masters”.

[17] Andrea Murphy, Eliza Haverstock, Antoine Gara, Chris Helman and Nathan Vardi: How The World's Biggest Public Companies Endured The Pandemic, Forbes, 13 May 2021,

[18] V. I. Lenin: Imperialism and the Split in Socialism, pp. 105-106 (Emphasis in the original)

[19] See on this e.g. the above-mentioned article by Michael Pröbsting: Examples of Pro-Russian Social-Imperialism.

[20] See on this e.g. the above-mentioned pamphlets by Michael Pröbsting: Russia and China: Neither Capitalist nor Great Powers? A Reply to the PO/CRFI and their Revisionist Whitewashing of Chinese and Russian imperialism, 28 November 2018,; The Catastrophic Failure of the Theory of “Catastrophism”. On the Marxist Theory of Capitalist Breakdown and its Misinterpretation by the Partido Obrero (Argentina) and its “Coordinating Committee for the Refoundation of the Fourth International”, 27 May 2018,

[21] Veronika Chernova, Sergey U. Chernikov, Alexander Zobov, and Ekaterina Degtereva: TNCs in Russia: Challenges and Opportunities, in: Bruno S. Sergi (Ed.): Exploring the Future of Russia’s Economy and Markets: Towards Sustainable Economic Development, Emerald Publishing Limited, Bingley 2019, p. 188

[22] Ibid, p. 188

[23] Victor Gorshkov: Fundamentals and Recent Trends in Russian Banking, in: Steven Rosefielde (Ed.): Putin’s Russia : Economy, Defence and Foreign policy, World Scientific Publishing, Singapore 2021, p. 81

[24] Ibid, p. 81

[25] Anders Åslund and Maria Snegovaya: The impact of Western sanctions on Russia and how they can be made even more effective, The Atlantic Council, May 2021, p. 10 and 18; see also Anders Åslund: The Russian economy in health, oil, and economic crisis, May 27, 2020,

[26] Gabriel Di Bella, Oksana Dynnikova, Slavi Slavov: The Russian State's Size and its Footprint: Have they Increased? IMF Working Paper WP/19/53, March 2, 2019, p. 13; see also Congressional Research Service: Russia: Domestic Politics and Economy, 9 September 2020, pp. 29-30; Alexander Abramov, Alexander Radygin, Maria Chernova: State-owned enterprises in the Russian market: Ownership structure and their role in the economy, in: Russian Journal of Economics 3 (2017), pp. 1–23

[27] Alexander Bulatov, Alexey Kuznetsov, Yuri Kvashnin, Alice Maltseva and Ninel Seniuk: Russian MNCS: Empirical and Theoretical Aspects; in: Rob van Tulder, Alain Verbeke, Jorge Carneiro, Maria Alejandra Gonzalez-Perez: The Challenge of BRIC Multinationals, Progress in International Business Research Volume, Emerald Group Publishing Limited, 2017, pp. 398-399

[28] David Szakonyi: Monopolies Rising. Consolidation in the Russian Economy, PONARS Eurasia Policy Memo No. 491, November 2017, p. 4

[29] Alexander Abramov, Alexander Radygin, Maria Chernova: State-owned enterprises in the Russian market: Ownership structure and their role in the economy, in: Russian Journal of Economics 3 (2017), p. 2; see also p. 14

[30] This has been also noted by bourgeois economists. “Many of these systemic obstacles in the Russian business environment relate to the shift in corporate ownership during the transition to a market-based economy. State-owned enterprises (SOEs) were privatised through schemes that resulted in a heavy domestic concentration of wealth and rendered FDI negligible. The high degree of vertical integration of former SOEs provided few opportunities for foreign companies.” (M. Domínguez-Jiménez and N. Poitiers: FDI another day: Russian reliance on European investment, Policy Contribution 03/2020, Bruegel, p. 2) And another author reports: “Alongside staffing key positions with his connections, Putin also acted to increase the control of the state over the oil sector through renationalisation. As outlined in the section on ownership, between 2003 and 2016, Yukos, Sibneft, TNK-BP and Bashneft were all effectively renationalised by being sold to the state oil company Rosneft, or in the case of Sibneft, to the state gas company Gazprom. In 2016, of the original dozen vertically integrated companies, the only two not under state control were LUKoil and Surgut, and the proportion of oil output from state-owned companies increased from a post-Soviet low of 15% in 2004 to 57% by 2016, and was set to increase further with Rosneft’s ambitious plans to expand production. In this way Russia in the period after 2000, by reversing much of the privatisation of the oil industry of the 1990s, re-established itself alongside its counterparts in most other major oil-producing countries in the world where the state controls a majority of a nation’s oil output.” (Nat Moser: Oil and the Economy of Russia. From the Late-Tsarist to the Post-Soviet Period, Routledge, New York 2018, p. 108)

[31] Csaba Weiner: Russian Multinational Direct Investment in East Central European Countries, in: Ágnes Szunomár, eds, Emerging-market Multinational Enterprises in East Central Europe, Palgrave Macmillan, Cham 2020, p. 159

[32] Ibid, pp. 184-185

[33] Maria Kotova: Russia’s 2021 Trade And Investment Turn To Asia, Dezan Shira & Associates St.Petersburg, March 8, 2021,

[34] Elena Efimova and Vladimir Sherov-Ignatev: Russian Foreign Direct Investments in the Eurasian Economic Union in: Kari Liuhto, Sergei Sutyrin and Jean-Marc F. Blanchard (Eds.): The Russian Economy and Foreign Direct Investment, Routledge, New York 2017, pp. 160-161

[35] Kari Liuhto: Does Ownership Matter in an OFDI Decision of a Russian Firm? The Case of Russia’s Ten Largest Investors Abroad, in: Kari Liuhto, Sergei Sutyrin and Jean-Marc F. Blanchard (Eds.): The Russian Economy and Foreign Direct Investment, Routledge, New York 2017, pp. 248-249

[36] Csaba Weiner: Russian Multinational Direct Investment in East Central European Countries, p. 155

[37] World Bank: Russia Economic Report #42. Russia's economy loses momentum amidst COVID-19 resurgence; awaits relief from vaccine, December 2019, p. 27

[38] Maria Kotova: Russia’s 2021 Trade And Investment Turn To Asia

[39] Daniel Haberly and Dariusz Wójcik: Tax havens and the production of offshore FDI: an empirical analysis, in: Journal of Economic Geography 15 (2015), p. 75

[40] Kasper Brandt: Illicit financial flows and the Global South. A review of methods and evidence, WIDER Working Paper 2020/169, December 2020, p. 10

[41] Daniel Haberly and Dariusz Wójcik: Tax havens and the production of offshore FDI: an empirical analysis, p. 78

[42] Ibid, p. 94

[43] UNCTAD: World Investment Report 2019. Special Economic Zones, p. 59

[44] Ibid, p. 58

[45] Kari Liuhto: Does Ownership Matter in an OFDI Decision of a Russian Firm? p. 260. Another economist arrives at the following conclusion: “Contrary to the Chinese case, Russian outward expansion is mainly driven by private companies. State support for Russian multinationals is quite weak due to the lack of developed policy instruments.” (Csaba Weiner: Russian Multinational Direct Investment in East Central European Countries, p. 166)

[46] Kari T. Liuhto and Saara S. Majuri: Outward Foreign Direct Investment from Russia: A Literature Review, in: Journal of East-West Business, 20, 2014, p. 201

[47] Csaba Weiner: Russian Multinational Direct Investment in East Central European Countries, pp. 163-164

[48] The top 5,000 MNEs worldwide, which account for most of global FDI, have seen expected earnings for the year revised down by 40 per cent on average, with some industries plunging into losses.” (UNCTAD: World Investment Report 2020. International Production Beyond The Pandemic, p. x)

[49] UNCTAD: World Investment Report 2020. International Production Beyond The Pandemic, p. 58

[50] Csaba Weiner: Russian Multinational Direct Investment in East Central European Countries, p. 161

[51] Ibid, pp. 184-185

[52] Elena Efimova and Vladimir Sherov-Ignatev: Russian Foreign Direct Investments in the Eurasian Economic Union, pp. 160-161

[53] Ibid, p. 167

[54] A. V. Kuznetsov: Prospects of Diversifying Russian Direct Investment Abroad, in: Studies on Russian Economic Development, 2017, Vol. 28, No. 1, p. 79

[55] Samruk Kazyna: Overview of investment attractiveness of Central Asian countries, January 2018, p. 28

[56] Ibid, p. 19

[57] Ibid, p. 19 and 22

[58] See on this also Andrei Kazantsev, Svetlana Medvedeva and Ivan Safranchuk: Between Russia and China: Central Asia in Greater Eurasia, in: Journal of Eurasian Studies, 2021, Vol. 12(1), pp. 57–71; see also Ariel Cohen and James Grant: Foreign Investment in Central Asia: Actors and Drivers, International Tax and Investment Center, December 2020

[59] Andrei P. Tsygankov: Russia’s “Turn to the East”, 2012–2018, in: Steven Rosefielde (Ed.): Putin’s Russia : Economy, Defence and Foreign policy, World Scientific Publishing, Singapore 2021, p. 8 in: Steven Rosefielde (Ed.): Putin’s Russia : Economy, Defence and Foreign policy, World Scientific Publishing, Singapore 2021, p. 477

[60] UNCTAD: World Investment Report 2020. International Production Beyond The Pandemic, p. 60

[61] For the RCIT’s analysis of migration see e.g. Michael Pröbsting: Patriotic “Anti-Capitalism” for Fools. Yet Again on the CWG/LCC’s Support for “Workers’” Immigration Control and Protectionism in the US, 30.5.2017,; Michael Pröbsting and Andrew Walton: The Slogan of “Workers’” Immigration Control: A Concession to Social-Chauvinism, 27.3.2017,; Michael Pröbsting and Andrew Walton: A Social-Chauvinist Defence of the Indefensible. Another Reply to the CWG/LCC’s Support for “Workers’” Immigration Control, 14.5.2017,; RCIT: Marxism, Migration and Revolutionary Integration,; Michael Pröbsting: The Great Robbery of the South, chapter 8.iv) and 14ii),; Michael Pröbsting: The British Left and the EU-Referendum: The Many Faces of pro-UK or pro-EU Social-Imperialism, August 2015, Chapter II.2,, RCIT-Program, chapter V:, RCIT-Manifesto chapter IV:; and various actual statements and articles here: See also Michael Pröbsting: Migration and Super-exploitation: Marxist Theory and the Role of Migration in the present Period of Capitalist Decay, in: Critique: Journal of Socialist Theory (Volume 43, Issue 3-4, 2015), pp. 329-346, We have also published a detailed study on migration and the Marxist program in German language. See Michael Pröbsting: Marxismus, Migration und revolutionäre Integration (2010); in: Der Weg des Revolutionären Kommunismus, Nr. 7, pp. 38-41,

[62] For our theoretical analysis of the different forms of imperialist super-exploitation, see e.g. chapter VI in our above-mentioned book The Great Robbery of the South.

[63] Wikipedia: Immigration to Russia,

[64] The Moscow Times: Russia Lost 5M Migrants During Pandemic, Dec. 16, 2020,


[66] Yelena B. Yakovleva, Nataliya P. Kuznetsova and Oleg A. Drozdov: External labor migration in the context of marketing research (evidence from Russia). Innovative Marketing, 15(1), 2019, p. 35

[67] Chechens in the Russian Federation. Report from Danish Immigration Service’s fact finding mission to Moscow and St. Petersburg, the Russian Federation 12 to 29 June 2011, pp. 13-14; see also European Asylum Support Office: EASO Country of Origin Information Report: Russian Federation. The situation for Chechens in Russia, August 2018, pp. 13-15

[68] The RCIT unconditionally defended the Chechen people in both wars and called for the defeat of the Russian aggression. See e.g. “Where does the RCIT Stand on Russia's Occupation of Chechnya?”, and “Russian Troops Out! Self-determination for Chechnya!”,

[69] Yelena B. Yakovleva, Nataliya P. Kuznetsova and Oleg A. Drozdov: External labor migration in the context of marketing research (evidence from Russia), p. 34

[70] Kristyna Foltynova: Migrants Welcome: Is Russia Trying To Solve Its Demographic Crisis By Attracting Foreigners? June 19, 2020,

[71] Yelena B. Yakovleva, Nataliya P. Kuznetsova and Oleg A. Drozdov: External labor migration in the context of marketing research (evidence from Russia), p. 33

[72] Ibid, p. 35

[73] For our programmatic approach on inter-imperialist conflicts see e.g. RCIT: Theses on Revolutionary Defeatism in Imperialist States, 8 September 2018,; see also chapters XVI to XX in the above-mentioned book by Michael Pröbsting: Anti-Imperialism in the Age of Great Power Rivalry. See also the German-language essay by the same author: Lenin, die Bolschewiki und ihr Kampf gegen den imperialistischen Krieg. „Umwandlung des imperialistischen Krieges in den Bürgerkrieg“,

[74] For our latest statement on the U.S. defeat in Afghanistan see: Afghanistan: Good Riddance, Yankees! The Meaning of the U.S. Retreat from Afghanistan and its Consequences for the inter-imperialist Cold War with China, 17 April 2021,; for statements which our movement published in 2001 see the compilation of articles here:

[75] See on this e.g. chapter 13 in our above-mentioned book The Great Robbery of the South.

[76] The RCIT has published a number of statements about the French intervention in Mali. See e.g. RCIT: Expel French Imperialism from West Africa! Macron and his G5 Lackeys plan to intensify their colonialist “Operation Barkhane”, 15 January 2020,; Michael Pröbsting: Au Revoir, Français! Popular resistance is forcing French imperialism to reduce its troops in Africa’s Sahel, 13 June 2021,

[77] The RCIT has published a number of booklets, statements and articles on the Syrian Revolution which can be read on a special sub-section on this website:

[78] For the RCIT’s analysis of the oppression of the Uyghurs see e.g. Michael Pröbsting: China: Defend the Muslim Uyghurs against Oppression! 18.10.2018,; Michael Pröbsting: 37 Signatures Are Worth a Thousand Words. On a letter of 37 states, including Muslim countries, sent to the United Nations defending China's treatment of the Uyghurs in Xinjiang, 16 July 2019,

[79] Leon Trotsky: Bonapartism and Fascism (1934), Trotsky Writings 1934-35, p. 51