Russia is becoming a steady blip on the radar screens of world finance.
And this year, investments into the Russian economy are poised to take off as the country turns into one of the most promising economies for long-term growth.
"I would say that every major multinational has Russia in its strategic plans this year," said William Browder, managing director of Hermitage Capital.
And deals, private investment funds, joint ventures and buyouts seem to popping up everywhere.
At the start of February, Heineken said it plans to buy St. Petersburg brewer Bravo International for $400 million. Last month, Baring Vostok Capital Partners set up a $205 million direct investment fund for Russia and its satellite countries, the biggest of its kind since 1998. Earlier this week, the Rossiyskaya Gazeta reported that U.S. non-profit pension funds are eyeing Russia as a place to plunge their pitchforks into.
"When the whole world seems to be in a recession except for a few countries, and with Russian GDP growth being a star in the world, it is obvious that smart money will flow to where it can be invested smartly. And probably, Russia is the place right now," said Slava Rabinovich, managing director of MDM Capital Advisors.
Capital flow into Russia could come in a variety of shapes, money managers said.
An array of investment funds from portfolio to fixed income funds could come onto the market this year. Otherwise, companies may set up their own pools of money to invest with. Or multinationals may opt to gobble up Russian firms.
For instance, MDM Bank may launch at least two funds this year directed at Russia. One is a portfolio fund for investment in publicly traded Russian stocks. The other is a fixed-income fund, which MDM's fund managers think could thrive, operating on the assumption that Russian companies would want to refinance their debts. The bank is also considering a direct-equity fund for Russia.
Whatever course capital takes to get into Russia, it will first need to be kick started. When that could happen is anyone's guess.
"Basically everyone will be investing in Russia when they see their competitors investing in Russia," Browder said.
Browder believes Russian oil companies will attract the most attention because of the country's new strategic importance in world oil supply. Russia, the second largest oil exporter, is eager to grab a bigger share of the world market. In addition, the United States is increasingly looking toward Russia as a major oil supplier.
"Russia now occupies a much more strategic place in the role of world oil," Browder said. And that makes investing in Russian oil companies the "sensible thing to do," he added.
But while Russia seems to be on the threshold of an investment avalanche, many financial analysts point to Russia's checkered investment history as a sure enthusiasm killer.
In the years leading up to the 1998 financial crisis, billions of dollars of investment poured into Russia. But a lot of it ended up down the sink, or languishing unused in investment funds.
"At the time when there were many direct-equity funds, many of them blew up," Rabinovich said.
"There are so many funds and they are doing nothing really," said Alexander Zakharov, a senior institutional- equity salesman at Alfa Bank.
But some money managers think Russia is not the weak-in-the-reforms bull market that it was back before the crisis.
"This time around the situation is nowhere near the bubble that we saw the last time in 1997," said Rabinovich. "There is a stable and predictable president with a more or less predictable government. Structural reforms are not just the talk of visitors to the Davos conference, but more a reality."
However, Zakharov questioned how much of a role foreign-equity investment could play in this changed Russian economy.
Zakharov said often Russian companies are unwilling to give up their control, as demanded by many equity funds. Instead, many companies are on the look out for small bank loans.
"Really, Russian companies are looking for loans rather than equity," Zakharov said. "For example, confectionary companies are not interested in seeing foreigners coming in and buying controlling stakes in the company because then they would have to show their books, and there are a lot of gray sales."
And the question remains, as it did before 1998, whether there is much to invest in.
"That's one of the big problems in Russia: where to invest," Zakharov said. He sees Russia moving along a path where the direct-equity stage is skipped and smaller companies are bought out by strategic investors, such as major companies, looking to broaden their horizons.
There's another factor that investors will be weighing up, and that is the price of oil, Browder said.
"The main risk is the oil price. The Russian economy is underpinned by a current good oil price," Browder said. "But if we see a continued recession in the West, oil prices may be affected, and Russia would not be in such a strong position as it is right now."