We Are Almost There
Compared to the 2010 figure, the number of exporting small and medium-sized enterprises has almost doubled in Russia. However, the overall picture remains the same: About one percent of entrepreneurs work in foreign markets to this day. Experts hope that the Eurasian economic space could improve the situation. Whether the companies manage to take advantage of the opportunities that it provides depends, among other things, on the Forum for Small Businesses from Regions of SCO and BRICS member-states.
On 1 and 2 December, Ufa became a platform for the discussion of issues of concern to small business for the second time. The first forum was held in 2015, 100 days after the SCO and BRICS summits, and this year, the expectation was for real help in establishing relationships between small and medium-sized enterprises, both in Russia and at the level of the Eurasian international community employing the R2R (‘region to region’) principle. The forum brought together more than 900 delegates from 34 Russian regions and 15 countries, including Egypt, India, China, South Africa, Kazakhstan, Kyrgyzstan, Tajikistan, and Malta.
Russian Prime Minister Dmitry Medvedev ordered the Russian Economic Development Ministry, the Ministry of Foreign Affairs, the Ministry of Industry and Trade, the Russian Chamber of Commerce, the SME Corporation, the Agency for Strategic Initiatives, ’Business Russia’, ‘Support of Russia’, the Russian Export Center, and many others to assist in the preparation of the forum. The close cooperation among such stakeholders elevated the event to a new level and attracted participants who are most interested in exchanging international experience and developing business relations between Russian and foreign entrepreneurs.Feedback
Oleg Fomichev, State Secretary - Deputy Minister of Economic Development of the Russian Federation:
One of the objectives of the forum is to help regional businesses enter foreign markets. These are large markets for our small and medium-sized enterprises, so there is much more opportunity for sales. This, in turn, will increase the share of these enterprises in the country’s GDP.
Elena Dybova, Vice President of the Chamber of Commerce of the Russian Federation:
Some 25 years ago, there was a huge number of free niches. Today, most profitable and commercially successful sectors are occupied by large corporations, and small businesses have to contend with what is left. Mostly, that’s services and trade, which do not require a large investment to set up production. The most important trend is to understand what small businesses can be engaged in, which sectors they can go into in order to grow their company.
Maxim Parshin, Director of the Department of Small and Medium Enterprises and Competition of the Ministry of Economic Development of the Russian Federation:
As a result of implementing the Strategy of Development of small and medium-sized enterprises by 2030, the SMEs’ sales volume will have increased 2.5 times, and productivity will have doubled. The priority is to expand the share of exporting SMEs, and our work within such integration associations as the SCO and BRICS will contribute to the success of the existing tasks.
Alexander Braverman, Director General of SME Corporation:
The forum program covered the most relevant issues. It also allowed participants to discuss small businesses’ access to financial resources and public procurement. In 2016, Russian small and medium-sized businesses participated in tenders totaling 1.4 trillion rubles. We are talking 31,000 suppliers and 80,000 contracts. We are seeing a radical shift: In 2015, the total purchase volume was 63.4 billion rubles. To develop further, it is essential to ensure transparency in procurement – at the Ufa forum, we managed to really dig into the problem.
Dmitry Sharonov, Prime Minister of the Republic of Bashkortostan:
The Second Small Business Forum is an actual tool for the development of small business through the lens of regional cooperation among regions of the participating countries of the SCO and BRICS in the effective R2R format. This kind of coordination within the boundaries of a single Eurasian economic space will help realize the full potential of the economy of Russia and its partner countries.
Vladislav Korochkin, First Vice President of the ‘Opora Rossii’ (Support of Russia):
The forum has become a platform for the exchange of successful regional practices. For example, in Russia today, SMEs may exist only if they benefit from the simplified tax system, as the general tax system is much too cumbersome. Changing this situation is in the interest of our country, as more domestic small companies consciously choose to be located in the country where the tax system and business climate are optimal. For example, Kazakhstan was able to overcome these difficulties, and Russia should be able to learn from its experience. Another regional practice that may be of interest to our country is the law on state control of the Republic of Uzbekistan, where, since 1 January 2017, all types of unscheduled inspections of business entities are canceled.
Maxim Shereikin, CEO of the Agency for Technological Development:
Today, we must build the necessary conditions to allow domestic manufacturers to increase their exports, especially non-resource exports. In other words, it is time to prioritize the development of high-tech products. In this segment, SMEs can take their rightful, well-defined place as suppliers of high-tech products. I am sure that the Ufa forum will help Russia forge relations with the SCO and BRICS countries in the area of technology transfer.
Vitaly Monkevich, President of the Russian-Asian Union of Industrialists and Entrepreneurs (RSPP):
Over the past five years, the cooperation between Russian regions and Chinese provinces has become more substantive. There is a shift from signing MoUs to specific investment projects. In order to increase the effectiveness of cooperation, we must gain a better understanding of the idiosyncrasies of each other’s markets. The forum in Ufa allows us to engage in the necessary dialogue and get to know each other better.
Dmitry Sharovatov, Chairman of the Board and CEO of BESK JSC, the forum sponsor:
I am sure that the forum will give a new boost to the development of small businesses, which will benefit the Bashkortostan Republic, the country, and large companies. For example, BESK JSC is working closely with small businesses: It offers them contracts for civil works and the supply of building materials and household inventory, and repair of equipment, overhead, and cable power lines. Moreover, we are actively fighting administrative barriers. As recently as three years ago, it took electricity consumers – including small businesses – weeks and sometimes months to go through the red tape of connecting to the electricity grid. Thanks to our initiative, this problem was solved, and, as a result, the region has seen an explosive growth in applications. For instance, during the first 10 months of 2016, 280 small businesses (individual entrepreneurs and farms) have been connected to the Bashkirenergo distribution grid. In general, the number of grid connections for consumers over 15 kilowatts, most of whom are small and medium-sized businesses, has increased by approximately 40% year on year.
Bakhtiyor Khakimov, Director of Asian and Pacific Cooperation Department, Ministry of Foreign Affairs of the Russian Federation:The forum in Ufa allows small businesses to come up with a specific proposal. The SCO is a platform that facilitates the development of relationships, and they are multilateral. Russian entrepreneurs can use this platform to develop further. Recently, the SCO adopted a strategy of development through 2020. In the near future, the organization intends to expand: It has already received membership applications from Egypt, Israel, and Syria. All this will provide small businesses with new development opportunities.