Cooperative Business Ventures between U.S. Companies and Russian Defense Enterprises

Policy Briefs

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April 1997

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As a result of the rapid changes following the breakup of the Soviet bloc, there were suddenly new markets of hundreds of millions of people, covering a large portion of the earth, containing large fractions of many of the world's natural resources, possessing extensive research and production capacity, with a highly educated workforce, and utilizing many advanced technologies. Russia contained a large fraction of these factors, especially those oriented toward high technology, and hence it behooves international companies to formulate and implement strategies for doing business in Russia.

This particular study was undertaken because the quest for cooperative ventures has been a major portion of the strategy of many Russian defense enterprises and U.S. companies in addressing these changes. We deemed it important to gain a better understanding of the factors affecting companies' and enterprises' decisions regarding cooperative ventures and some of the determinants of success, as well as to analyze strategies for U.S. companies and Russian enterprises contemplating or participating in cooperative ventures.

The conclusions in this report are based on case-study interviews with companies and enterprises engaged in cooperative ventures. All of the Russian enterprises in our study, with the exception of some start-ups, had been heavily involved in military work; the American companies were from both the military and civilian sectors.

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