On March 6th more than sixty business leaders, trade representatives, visiting Russian entrepreneurs, faculty and students attended this half day conference at the UCLA Faculty Center on developing trade relations between Europe, Eurasia and the United States, sponsored by the Center for European & Eurasian Studies.
Is Russia still the Wild Wild East?
Is it time to rethink Russia and Eurasia? According to Tanya Shuster, Deputy Director of BISNIS, the US Department of Commerce's business information service for the newly Independent States of Russia and Eurasia, the answer is yes. She, along with a panel of specialists and business representatives, offered their perspectives on the current state of Russian trade to more than sixty business leaders, trade representatives, visiting Russian entrepreneurs, faculty and students who attended this half day conference on developing trade relations between Europe, Eurasia and the United States. The conference focused on the prospects for improving trade relationships, Russia's joining the world market, and the economic outlook for Russia. In particular, the development of information technology and partnerships in communication and high tech manufacturing were discussed by the invited panelists.
The panel of speakers offered insights that ranged from practical tips and advise for establishing business relationships with Russian companies by seasoned American entrepreneurs, John Ehret, President of TPL Communications and Jason Horowitz, Manager of Sun Microsystems Russian Program to available assistance for both American and Russian companies from Tanya Shuster, Deputy Director of BISNIS, the US Department of Commerce's business information service for the newly Independent States of Russia and Eurasia.
John Ehret, speaking from eight years or more of personal experience, observed that doing business in Russia is about establishing personal connections. Business relationships are developed in the same way that traditional Russian friendships are cultivated. It is more like entering into an extended family than it is a business partnership. Jason Horowitz agreed, describing Sun Microsystems partnership as very personal and one built on long-term patience and sensibilities attuned to broader questions of US-Russian interests.
Shuster observed, on the basis of reports from a variety of companies doing business there, that Russia is still a bit like the "Wild Wild East," but there are also indications that Russia has entered the mainstream of the global economic community. She also warned, that European companies have been aggressive and less risk averse. They have a strong presence in the Russian marketplace, so US companies trying to break into the Russian market will find European competitors, in some cases well established. (Click here for more of Tanya Shuster's presentation http://international.ucla.edu/euro/bisnis.ppt)
DJ Peterson, an analyst at The RAND Corporation, confirmed Shuster's view as he discussed Russian progress in developing web-based information technology and improved global perspectives on doing business. Russian companies are trying to be more investor friendly and to promote Russian industries using information technology. For Russians, information technology is not simply about trade, it is a political, social and cultural imperative to increase information flows and create transparency in the economy.
A perspective from Russia was offered but Dr. Leonid Grigoriev, Deputy Director of the Expert Institute under the Russian Union of Entrepreneurs and Industrialists. He discussed Russia's progress as an exporter of energy, oil and natural gas in particular, and the flows of capital out of Russia. For Russia the question has been, "is it better to be rich but sick, or poor but healthy." Russia is rich in natural resources and exportably commodities but economically still in malaise. In general, he was optimistic about recent developments in the Russian economy and prospects for the future.
In addition to a wealth of the practical information, an analysis of Russia's prospects for joining the World Trade Organization was offered by Anthony Gooch, European Union Fellow at the University of Southern California The Center for European and Eurasian. He explained the steps in the process that had already occurred and what was necessary in order for Russia to join the World Trade Organization. A major step has been taken with the signing of a bilateral agreement between the European Union and Russia, the four pillars of which are: cooperation in energy and the environment; political dialogue; cooperation in justice and home affairs; and finally in trade and economic cooperation. With this agreement, a legal basis for Russia to enter the WTO is possible. The rapidity with which this might occur depends on Russia. The other issue looming on the horizon is whether or not Russia will join the European Union. Gooch commented that, "Russia has not asked to join the EU; it is not an issue that is on the table yet, but the cooperation agreement is already a means to do much of what is needed right now."
For more information on the conference, please see the attached summary remarks by Dr. Anthony Gooch. In addition, The RAND issue paper on "Russia and the Information Revolution," can be ordered from the RAND publications website: http://www.rand.org/publications/IP/IP229/