Mr. shapp, how to survive the company with German capital in a crisis caused by the pandemic, what is the financial cost incurred?
Matthias Shepp: German business in Russia according to the results of our surveys have recorded losses in the hundreds of millions of euros. Entrepreneurs generally satisfied with the crisis management of the Russian government, but not satisfied with the measures to support the Russian economy. Our business wants more specific help from the Russian state. Unfortunately, the largest foreign investors that have received the status of strategic industries and non-Russian legal entities may not qualify for all measures of support, as their foreign parent own more than 50 percent of their capital. If the situation will remain so, it is alarming. This deters potential investors, and it looks like the penalties for those who have already invested. I rarely felt such indignation on the part of our firms, as this time. Our companies want them to be treated on an equal footing, when they invest here their money.
How to apply business to the restrictive measures of the Russian government, which wishes to speak?
Matthias Shepp: Managers able to provide the measures necessary to continue operation of the enterprise in the conditions of coronaries. We are talking about social distance, disinfection of the premises, and mandatory wearing of masks. The state must take restrictive measures, but factories and business needs to continue its work. The state has its tasks and business on your own. You can not measures against the coronavirus to jeopardize the economy. Tens of thousands of businesses go bankrupt, people are left without wages, would threaten social peace. Gets hurt the most vulnerable members of society. A cure for the virus should not be more bitter than the virus itself.
the Russian Government promises to help the backbone enterprises. Can we count on the additional support members VTP?
Matthias Shepp: We very much hope this support. The Russian-German chamber of Commerce came out with its proposals at the Federal level and in the regions and submitted the list of companies that, from our point of view, it was necessary to amend the list of strategic enterprises. It has dozens of member firms of the chamber. But, as practice shows, lists – and real support – often more. The decision of the government in respect of companies majority owned by foreign capital, has caused discontent. We wrote to the Prime Minister and relevant Ministers. We believe in the Russian market, many managers like Russia. But it is difficult for us to understand such decisionsE.
What is the situation with small and medium-sized enterprises?
Matthias Shepp: it is Clear that giants such as Siemens, Volkswagen or Bayer have established contacts with the government. A small business has no such ties, so he needs lobbying support VTP more than large companies. Our services are generally in demand as never before. The team of Russian-German chamber of Commerce work, without thinking of the time. German business has always been, is and will be a reliable partner of the Russian government. In the Russian economy invested heavily. According to the Bundesbank, last year direct investments in Russia amounted to 2.3 billion euros, if we compare the outflow and inflow of capital. And even during coronaries companies continue to invest.
what effect will the crisis in the development of economic ties, the contacts between the investors and the implementation of plans for the future?
Matthias Shepp: Wait and see. But today we can say that the interest in events held in Russia, in Germany even increased. Doubled and even tripled the number of participants in our online conferences. VTP in Russia is one of the most advanced organizations in the world among 143 VTP in the application of innovative technologies in their work. With the help of modern communications, we moved the event online. The other day I was on the phone with one hardware manufacturer from the former GDR, who wants to localize production in Russia. This is helped by the low exchange rate, availability of qualified personnel, including experts in the field of information technology. Over the past year, member firms VTP has made significant progress.
the EU does not want to lift sanctions in a crisis. What is the business response to this decision, were you able to adapt to work within the constraints?
Matthias Shepp: the Vast majority of our companies support the recent Russian initiative on the lifting of sanctions. VTP according to surveys, 93 percent of respondents favor the lifting of sanctions by the EU. It seems that in connection with the problems that caused the pandemic, the US does not launch new initiatives on sanctions. Although the ocean is always something you can think of. Unfortunately, this happened with the “Nord stream-2”. We do not think that sanctions will soon be canceled.
are There any changes in the investment climate in Russia, have any difficulties with the localization of production in the regions?
Matthias Shepp: Business associates hope with the arrival of Prime Minister Mikhail mishustina. The virus he won. I want to believe that Mishustin will be able to defeat and disease in the Russian economy. The first task is to increase the efficiency and productivity of the economy. The second is the fight against corruption. In General the situation in recent years has become better. Authorities were called to fight the pandemic. But the measures to fight coronavirus should not be forced to suffer private capital and the state to take more and more space in the economy. VTP stands for market mechanisms, where the state creates the framework for business, but with the important role of private production.
Every Governor realizes he needs to find a balance between the health of people and the interests of the economy. To prevent a wave of bankruptcies and the emergence of hidden unemployment. In the field you want to work effectively with foreign business. It can be noted the effective cooperation of the Governor of Moscow region Andrei Vorobyov. Thanks to him the other day managed to solve one of the problems of the company-member of the chamber of Commerce here has already invested tens of millions of euros to build a new warehouse to which it was necessary to bring electricity.
Russia is gradually restoring production. Can you make a prediction on investment of German business in Russia this year?
Matthias Shepp: Every crisis provides a chance. After the lifting of restrictions the localization of production will become the world trend. Export opportunities of the German economy narrowed. To build plants you need where you plan to sell products. Russia is a big market. To repeat the result of last year, net investment is hardly possible. Determining will be 2021 and 2022. The Russian government must give a clear signal to foreign businesses. You will also need time to restore production ties. Almost one third of businesses fear the emergence of problems. Of course, GDP growth in Russia this year will not be. In Germany, according to government estimates, three million people will become unemployed. Now every fourth worker received a state subsidy.
What are the Russian regions, in your opinion, are the most attractive from the investment point of view?
Matthias Shepp: you Can talk about cities and regions with high solvency of the population. Among them Moscow, St.-Petersburg, Novosibirsk, Yekaterinburg, Tyumen and other regional centres. Siberia is interesting for investors, as it produces oil, gas and other raw materials. The far East, ensuring the exchange of goods between Russia and Asia is of interest for German logistics companies. There are many prospects, with the normalization of situation there are always deals for investors.
What are the most important projects with participation of German capital. What is the degree of their readiness in 2020-2021 year?
Matthias Shepp: Major companies, including Linde AG with an investment volume of about 300 million euros, continues to operate successfully in Russia. For example, Volkswagen since the imposition of sanctions has invested in factories in Russia more than half a billion euros. The group signed with the Ministry of industry and trade of the Russian Federation the special investment contract (SPIC). And Volkswagen and other companies financing of investment projects have been frozen, but nevertheless I am sure that these projects are still being implemented.
the Government allocates considerable resources for waste disposal. How much demand in this area, the experience of the German enterprises?
Matthias Shepp: In this field the German company presented, from Kaliningrad to Vladivostok. So, in Tyumen on German technology operates the largest plant for recycling. In the ecological industrial Park in Kaluga, as well as in the Solnechnogorsk district of the Moscow region used equipment company TOMRA sorting household waste. Regional operator in Saransk, Mordovia, for more than ten years is “REMONDIS”.
How to solve the problem of personnel training for the companies VTP with dual education?
Matthias Shepp: In the preparation of young personnel VTP plays a key role. In a pandemic we conduct exams in online mode with participation of teachers from Germany. The promotion of dual education facilitated a meeting in mid-February in Berlin, adviser to the President of the Russian Federation Maxim Oreshkin, head of Department of Economics and Finance, Federal Chancellery Hans-Hendrik the Reller. Many large companies have to provide dual education, but often the exams and examiners provides VTP. All known Made in Germany (“Made in Germany”) applies to training.
In connection with the crisis, many employees work remotely. How to apply to this company, will not retain this practice in the future?
Matthias Shepp: pretty much everything depends on the economy. In the actual production is difficult to implement. To produce cars, tractors and dryers on remote is not possible. In office workers productivity at the beginning of isolation grew. But according to many studies and experience shows that it falls a few weeks or months. Some companies can save on office space. Rather, it is a global trend. But, as said Aristotle, “man by nature is a social animal”, zoon politikon, and can be held as a personality only in the human society.
