Problems of entrepreneurship development in the context of large- scale sanctions in Russia

Problems of entrepreneurship development in the context of large-scale sanctions in Russia

Plekhanov University of Economics, Moscow, Russia

Abstract: The article deals with the problems and strategies of entrepreneurship development in the context of sanctions imposed on the Russian Federation. The purpose of this study is to examine the development of entrepreneurship in the context of large-scale sanctions in Russia.  

The methodology of the study includes a literature and market analysis, practical examples, and a survey of entrepreneurs. The results of the study showed that the most effective strategies for solving problems with the development of entrepreneurship are government support, diversification of the economy, international collaboration, innovation and technology development.

Keywords: entrepreneurship, sanctions, strategies, development, market.

Introduction:

Over the past few years, Russia has faced a series of large-scale sanctions due to the country's involvement in the annexation of Crimea and the conflict in Ukraine. These sanctions have had considerable impacts on the Russian economy, particularly on entrepreneurship development.

Entrepreneurship development is a critical component of any economy's growth and development, and it plays a particularly crucial role under the conditions of large-scale sanctions. Sanctions restrict access to finance, technology, and markets, making entrepreneurship development a major challenge. The Russian economy, which is heavily dependent on oil exports, has been significantly impacted by sanctions and has faced considerable challenges in developing entrepreneurship in these disadvantaged conditions.

Methodology:

To achieve the goal of the study, an analytical approach was used, methods of collection and analysis of primary information, such as surveys, interviews, observations, analysis of documents and statistical data were used, also SWOT-analysis was conducted, which allowed to evaluate the strengths and weaknesses of enterprises and the system, as well as to assess the external environment in which enterprises operate.

Research:

The analysis showed that the main problems in the development of entrepreneurship under sanctions are:

1. Challenges of Entrepreneurship Development under Sanctions

Russia's entrepreneurs face a range of challenges in the context of large-scale sanctions. Some of the most significant of these challenges include limited access to finance, limited access to technology, and restricted market access. The following section will examine these challenges in more detail.

1. Limited Access to Finance

One of the most significant challenges that Russian entrepreneurs face under sanctions is limited access to finance. Sanctions limit access to international financial markets, making it difficult for entrepreneurs to obtain the funds they need to start or expand their businesses. As a result, they struggle to find the capital necessary to innovate and remain competitive, resulting in limited growth prospects.

1. Limited Access to Technology

Sanctions have also limited entrepreneurs' access to technology. The sanctions prevent the transfer of technology to Russia, which limits entrepreneurs' ability to use cutting-edge technology, which is critical for product innovation and creating a competitive edge in the market. This technological disadvantage, combined with limited access to capital, further restricts entrepreneurship development in Russia.

1. Restricted Market Access

Sanctions also limit access to export markets, which poses a significant challenge for Russian entrepreneurs. These restrictions limit Russian exports to many Western countries, resulting in fewer market opportunities and an inability to operate on a global scale. This lack of access to global markets impacts the growth potential of SMEs and limits their development.

Strategies for addressing the problems of entrepreneurship development in the context of large-scale sanctions in Russia are:

1. Government Support: The government could support the development of entrepreneurship by providing grants, tax incentives, and regulatory support. Investing in training and development programs for entrepreneurs could ensure they have the skills and knowledge needed to succeed.

Evaluation: The effectiveness of this strategy will depend on the extent to which the government is willing to support and invest in entrepreneurship, and whether the grants and incentives are sufficient to overcome the challenges faced by entrepreneurs in a sanctioned environment.

2. Diversification of the Economy: Encouraging the growth of non-oil industries such as agriculture and tourism to diversify the economy could help reduce Russia's dependency on oil exports and create new opportunities for entrepreneurs.

Evaluation: This strategy can be effective, but it requires significant investment in infrastructure and regulatory reform, which can be difficult to achieve in a sanctioned environment.

3. International Collaboration: Encouraging international collaborations with other countries to access new markets, technologies, and capital can help Russian entrepreneurs overcome some of the challenges created by sanctions.