Expert Invokes Italian
Economic Miracle as Model
for Russia
31 July 2013
Removing obstacles that inhibit
the development and operation of small-
and medium-sized enterprises in Russia is
the key to economic recovery, an Italian
expert said.
Small businesses were instrumental
in rebuilding the Italian economy
and transforming a mainly rural nation into an
industrial powerhouse in the 1960s, a period
known as the Italian economic miracle,
Vittorio Torrembini, president of the Russian
branch of Confindustria, an organization
representing Italian manufacturing and services
companies, said in an interview with
The Moscow Times.
"Small businesses are just as important
for Russia as they have been for Italy," he
said. "But there needs to be a structure,
entrepreneur culture and favorable conditions
for small businesses to survive."
According to data available from the Federal
Tax Service, in May 2013 there were about
25,000 sole proprietorships run by foreigners,
some of whom see Russia as a land
of opportunities.
"Why did I decide to start my business
in Russia? Here, unlike in the EU member
states, no one complains much about
the global crisis, and the taxation system is
more or less moderate," says Marouan Sbai,
an architect from Morocco, Russia Beyond
the Headlines reported .
Despite the increasing numbers of small
businesses owned by foreigners, bureaucracy,
corruption risks and excessive red tape prevent
many others from entering the market.
"Unfortunately, it is difficult for a small
company to operate in Russia," Torrembini
said. "There is insufficient infrastructure
and small firms are not seen as important as
the large ones. But we can offer our
experience to change that."
He said the mission of his organization is
to make the Russian market safer and more
accessible for Italian businesses.
On Wednesday the association welcomes its
head, Giorgio Squinzi, who will come to
Moscow to meet with Russian bankers
and government officials and discuss business
opportunities beneficial to both countries.
Small business needs support and freedom
to develop, Torrembini said. "They often ask
me, what was the secret of the economic
growth in Italy in the 1960s? I answer them —
it is the absence of red tape and other
obstacles that would otherwise slow down
business operations."
The business climate in Russia is patchy like
a leopard skin, Torrembini said. A company's
success in different regions depends on how
effective the local government is and how
approachable people in authority are. "It is
not about cutting corners, it is about receiving
timely help when business needs it."
The issue of small business survival was
discussed at the St. Petersburg Economic
Forum in June. Some of the forum's
participants said startups and sole proprietors
need consistent support with taxation, finance
and business administration, rather than single
hand-outs, Rossiiskaya Gazeta reported.
A recent survey conducted by state-run
Russian Public Opinion Research Center, or
VtsIOM, identified prosecution of white-collar
crimes as the main deterrent from starting
a small business in Russia.
Personal experience, prejudice against small
business owners and the absence of an
appropriate training system are the reasons
why people prefer to work for someone else,
as opposed to starting a business, Valery
Fedorov, head of VTsIOM explained, as
reported by Kommersant.
Economic Miracle as Model
for Russia
31 July 2013
Removing obstacles that inhibit
the development and operation of small-
and medium-sized enterprises in Russia is
the key to economic recovery, an Italian
expert said.
Small businesses were instrumental
in rebuilding the Italian economy
and transforming a mainly rural nation into an
industrial powerhouse in the 1960s, a period
known as the Italian economic miracle,
Vittorio Torrembini, president of the Russian
branch of Confindustria, an organization
representing Italian manufacturing and services
companies, said in an interview with
The Moscow Times.
"Small businesses are just as important
for Russia as they have been for Italy," he
said. "But there needs to be a structure,
entrepreneur culture and favorable conditions
for small businesses to survive."
According to data available from the Federal
Tax Service, in May 2013 there were about
25,000 sole proprietorships run by foreigners,
some of whom see Russia as a land
of opportunities.
"Why did I decide to start my business
in Russia? Here, unlike in the EU member
states, no one complains much about
the global crisis, and the taxation system is
more or less moderate," says Marouan Sbai,
an architect from Morocco, Russia Beyond
the Headlines reported .
Despite the increasing numbers of small
businesses owned by foreigners, bureaucracy,
corruption risks and excessive red tape prevent
many others from entering the market.
"Unfortunately, it is difficult for a small
company to operate in Russia," Torrembini
said. "There is insufficient infrastructure
and small firms are not seen as important as
the large ones. But we can offer our
experience to change that."
He said the mission of his organization is
to make the Russian market safer and more
accessible for Italian businesses.
On Wednesday the association welcomes its
head, Giorgio Squinzi, who will come to
Moscow to meet with Russian bankers
and government officials and discuss business
opportunities beneficial to both countries.
Small business needs support and freedom
to develop, Torrembini said. "They often ask
me, what was the secret of the economic
growth in Italy in the 1960s? I answer them —
it is the absence of red tape and other
obstacles that would otherwise slow down
business operations."
The business climate in Russia is patchy like
a leopard skin, Torrembini said. A company's
success in different regions depends on how
effective the local government is and how
approachable people in authority are. "It is
not about cutting corners, it is about receiving
timely help when business needs it."
The issue of small business survival was
discussed at the St. Petersburg Economic
Forum in June. Some of the forum's
participants said startups and sole proprietors
need consistent support with taxation, finance
and business administration, rather than single
hand-outs, Rossiiskaya Gazeta reported.
A recent survey conducted by state-run
Russian Public Opinion Research Center, or
VtsIOM, identified prosecution of white-collar
crimes as the main deterrent from starting
a small business in Russia.
Personal experience, prejudice against small
business owners and the absence of an
appropriate training system are the reasons
why people prefer to work for someone else,
as opposed to starting a business, Valery
Fedorov, head of VTsIOM explained, as
reported by Kommersant.
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