The German calculation: entrepreneurs of Germany discussed the work in Russia at Innoprom

The German calculation: entrepreneurs of Germany discussed the work in Russia at Innoprom


The Russian market remains attractive for German investors, however, administrative barriers and frequently changing legislation are main constraints to business development. A General opinion was expressed by the participants of the round table, devoted to prospects of work of machine-building enterprises with German capital, which was held on Tuesday at the exhibition “Innoprom” in Yekaterinburg.

“The Russian market is complicated, but interesting and promising. German business does not go away in any case. The number of companies with German equity participation has decreased in recent years, however, among them, I suspect, had a lot of inactive, so this is a somewhat misleading statistic. The number of subsidiaries of our members has not diminished and many are now opening new offices in Russia”, — said the head of the Russian office of the Union of machine builders of Germany Sven Glashoff.

“Hard talk” with the tax authorities

“It is worth noting in the last year of the tightening tax regime: if you had had a constructive dialogue with the tax authorities, to date, is constructive greatly reduced. This, I think, scares investors and spetsinvestproject in this respect, most likely, too does not help,” — said the President of the GEA in Russia, opened the plant on production of refrigerating equipment, Oliver Cescotti.

In the opinion of the investor, namely the lack of administrative barriers will promote attraction of foreign projects, because in Russia “a lot of opportunities there, cool country, great. Everywhere it is possible to do something, to sell something”.

The leadership of the German plant and construction of combine harvesters of CLAAS to meet the requirements of the legislation had to start in Russia, the production of components, production of which is economically feasible here.

“Now we localize and what not economically viable. That is, the cab and other items that are made in one place throughout the group. If I create the same production in a different place, you who are a bit literate, you know that it will be more expensive, considering that in Russia we produce only 5% of the total production of the concern” – shared experience, the General Director of the company “CLAAS” Ralph Bendish.

Also, the manufacturer is faced with the gaps in the law where no clear requirements that, for example, includes the concept of “cabin”, and should seat to her and produced in Russia. While government decisions are often not supported by regulations.

“Unfortunately, we are faced with a huge level of distrust. To talk very hard, usually the side that sits on the other end of the table, said, “we think so”. This is the strongest argument, when we ask explanations,” added Bendis.

“If there’s a market all to say”

“We see that German companies continue to invest. This means for us that the situation is difficult in terms of decision-making and planning very difficult. We help companies in that part in which we can, in terms of internal issues,” — shared her opinion the Manager of the attraction of residents of the development Corporation of the Middle Urals Nikita, Kosevich.

According to him, cheap energy and labor on the one hand and volatility on the other do not allow to clearly assess the attractiveness of the Russian market for the Europeans. Favorable conditions for beginning of work in Russia was given by the head of sales in the region “Europe” Contitech Belt Conveyоr Group Thomas Neumann.

“For my business it is important to the reduction of prices of gas and oil, global metals prices also fall, which gives an extra push in the direction of cost reduction, it increases the interest,” he said.

The businessman did not exclude that in the near future, the company may open production in Russia. “Everything depends on speed. If there is a market, you can everything to say” — said a potential investor.

With hope for a successful future

As a positive example of German investors roundtable participants cited the experience of the company Wika, which will conclude spetsinvestproject with the Moscow government in fall of 2017.

“With a few formal steps we are in September and October are going to make this city or regional spetsinvestproject, and in this case we from the city of Moscow received a very substantial preference in the payment of taxes. It seems to me that this could be the next step in the development of import substitution”, — said General Director of the enterprise Oleg Goncharov.

The Exhibition “Innoprom”

International industrial exhibition “Innoprom” held in Yekaterinburg annually since 2010, in 2012 the government of Russia has assigned the exhibition Federal status. This year the exhibition takes place from 10 to 13 July 2017 in Yekaterinburg, the topic was “Intelligent production”, partner country — Japan. The organizer — the Ministry of industry and trade of the Russian Federation, the operator of the GC “Formika”.

General media partner and the operator of the press centre of information Agency TASS.

Source