Economic Conditions- In the early 90’s Russia’s economy underwent a ride through unfamiliar waters. At first it was the collapse of the centrally planned economy that was a stamp of the state-controlled economy and then it was the stand-in by an economy working on the basis of market forces. It was difficult to implement financial reform to raise government revenue and there was a further crisis from dependency on short-term borrowing to help finance budget deficits in 1998. However, the Russians were able to overcome the financial crisis in 1998 and achieve 9 years of growth while implementing economic reform. From 2001-2008, Russia had a budget surplus which stemmed from the stabilization of inflation and exchange rates due to well executed fiscal policy. In 2008 Russia was hit with another economic crisis. This time they were much better prepared. Farms were able to adjust quickly to the new economic conditions, acknowledged the profitable channels to sell their products, restructured the production according to the requirements of the market, and effectively created the processing of agricultural product, selling them through a network of stores in Russia, and trusted wholesale agents at better prices

Political- In Russia the powers between the central, regional, and local authorities are still growing. Its federation is made up of 83 administrative units, in addition to Moscow and St Petersburg. In 2000 the president at the time Mr. Putin combined the regions into seven districts with six provincial capital in Moscow. Early in 2004 the constitution restricted the merger of some regional administrative units. Later that year direct election of regional leaders was eliminated. Today governors are nominated by the president.

Physical environment and its effects on trade- In 2010 trade among the U.S. and Russia jumped to 31.7 billion dollars that was up 35 percent from the previous year. The drastic increase in U.S. imports from Russia in just one year can be credited to the low base year and emerging economic recovery in the United States, but also due to the increased price of oil and other commodities. Russia is the 32nd largest market for US exports. Russia exports fuel oil, inorganic chemicals, aluminum and stones. The things U.S exported to Russia were machinery, cars, food, aircraft and electrical equipment. Today Russia still has a number of barriers with respect to imports, including tariffs.