Mr. Leonov is a leading partner of FertiKola, U.S-Russian business consulting firm since 1998.
I totally agree that European stock exchanges should lift their listing and reporting standards to those used by NYSE to better protect Western investors holding steadily appreciating stock of large Russian public companies. On the other hand, considering the size of the economies and available opportunities, the U.S.-Russian business volume is disproportionately small. Mid- and small size business, which provides the sound footing for further growth, is almost non-existent. The redundant Jackson-Vanik amendment is still in force and Cold War era stereotypes still prevail among U.S. politicians. No wonder Russian money goes to Europe, Asia and Canada, which offer friendlier investment environment for private businesses.
Political rhetoric does not go far with Russia these days and I do not see how U.S.-Russia relations can be “fixed” by political means under new presidents. I believe in a longer term solution – the grassroots solution, which involve a painstaking process of helping mid and small size businesses of both countries prosper, lay to rest old stereotypes and contribute to stronger foundation of relationships with Russia, the one involving interests of millions rather than the interests of the political elite.
For years our company has been helping start-ups, reviewing business plans, working on marketing plans. Few projects have enjoyed showcase success, most are moderately successful and some are struggling. The truth is, however, we have turned down more projects than those we have decided to get involved with. Why? Lack of understanding of the respective markets and realities of doing business is by far number one. Endless bureaucracy on the Russian side is number two. Neither government has made any tangible steps to facilitate any business dialogue in areas other than energy and mineral resources – three. It’s a process in the making, but we will not see any significant advance in the U.S.-Russian relations until small and mid-size companies have the freedom of doing business.
Andrei Leonov
www.fertikola.com
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