Russia Raises Minimum Wage Level, Comparable to South-East Asia
Russia has raised the monthly minimum wage level from January 1 to 9,489 rubles (US$165).
In Russia, the minimum wage is the monetary value of monthly wages, below which workers may not be offered or accept a job. The minimum wage is guaranteed by the Constitution of the Russian Federation (Article 7).
On September 29, 2017, the cabinet submitted the draft law “On Amendments to Certain Legislative Acts of the Russian Federation Regarding Raising the Minimum Wage to the Subsistence Level of the Working Population” to the State Duma, which is the lower house of parliament. The State Duma adopted the draft law on December 15, and on December 26, it was approved by the Federation Council, the upper house of parliament.
Russia has a competitive wage level when compared with many Asian countries. Although the minimum wage is somewhat irrelevant when it comes to primary cities, such as Moscow and St. Petersburg, it can be of use to measure wage demands in rural factory areas, many of which are within easy reach of Russian cities, and especially so in Siberia, which Russia wishes to develop and make productive. Arguably, Siberia is part of Asia, so comparing wages with other Asian nations makes sense. It should be noted, however, that Russia’s minimum wage is based upon the ‘subsistence level’, meaning the minimum amount needed to live, and should not be taken as a base for workers’ salaries. Nonetheless, it does provide a useful benchmark.
|Country||Minimum Monthly Wage (US$)|
(1) Figure applies to Peninsular Malaysia only. For more details, click here.
(2) Mean average China figure. For a complete national breakdown, click here.
(3) For more information about Thai minimum wages, click here.
(4) For more information about Vietnamese minimum wage levels, click here.
(5) Average subsistence level. For more information about India’s minimum wage levels, click here.
“It is interesting to note that Russian minimum wages are similar to minimum levels found in South-East Asia”, comments Chris Devonshire-Ellis of Dezan Shira & Associates. Siberia and Far East Russia, especially, are becoming increasingly integrated with Asia as a whole, and will begin to compete over time with manufacturing and production centers elsewhere, given current Western sanctions. This shows that opportunities are there for Asia-based investors to have a look at the costings for Russian manufacturing to access that market, and also to take advantage of Russia’s membership of the Eurasian Economic Union (EAEU). With the EAEU poised to sign off on Free Trade Agreements with China, India, and several ASEAN nations, and the EAEU itself acting as a transport and land bridge between China and the European Union – these wage comparisons could not be more apt.”
Dezan Shira & Associates advise foreign investors on business intelligence, corporate establishment, tax, and operational issues to international SME’s and MNC’s throughout Eurasia. With offices in Russia, China, India and ASEAN we are uniquely poised to assist business development throughout the region. Please contact us at email@example.com or visit our website at www.dezshira.com
Dezan Shira & Associates´ Russian investment brochure offers an overview of the services provided by the firm – both foreign investment into Russia and Russian investment into Asia. It is Dezan Shira´s mission to guide investors through Russia´s complex regulatory environment and assist with all aspects of establishing, maintaining and growing business operations in the region.
Doing Business in China 2017 is designed to introduce the fundamentals of investing in China. Compiled by the professionals at Dezan Shira & Associates in January 2017, this comprehensive guide is ideal not only for businesses looking to enter the Chinese market, but also for companies who already have a presence here and want to keep up-to-date with the most recent and relevant policy changes.
An Introduction to Doing Business in India 2017 is designed to introduce the fundamentals of investing in India. As such, this comprehensive guide is ideal not only for businesses looking to enter the Indian market, but also for companies who already have a presence here and want to stay up-to-date with the most recent and relevant policy changes.
Doing Business in ASEAN introduces the fundamentals of investing in the 10-nation ASEAN bloc, concentrating on economics, trade, corporate establishment and taxation. We also include the latest development news in our “Important Updates” section for each country, with the intent to provide an executive assessment of the varying component parts of ASEAN, assessing each member state and providing the most up-to-date economic and demographic data on each. Additional research and commentary on ASEAN’s relationships with China, India and Australia is also provided.