Doing business in Russia? No thanks.

The point of this summer school is to teach us how to do business successfully in Russia as a foreign company.  What it’s teaching us instead is that doing business successfully in Russia as a foreign company is nearly impossible unless you’re willing to work outside of the law.

You know corruption in a country is bad when the residents of said country don’t deny it.  You know it’s horrible when they advise that you accept it and work within it. Every presentation so far has shown far more negative aspects of working in Russia than positive ones.  The government controls everything.  If you make them unhappy by say, laying off a couple hundred workers, you should expect the Tax Authorities at your door within a couple weeks to wreck your office for 4 months before deciding that you have X number of violations, X amount in unpaid taxes, and are not fit to do business.  This is not the exception, this is the rule.

As one of our professors put it: “One of the bad things about Russia is the immense number of obstacles you will inevitably face.  One of the good things about Russia is all the small companies willing to ‘fix’ those problems….for a fee.”

As a capitalist, I don’t see the second point as “good.”  I want to run my business how I want to run my business without having to pay a bunch of little agencies to fix imaginary problems and without worrying about whether my business is “pleasing” the government officials and without being blackmailed by said officials into using domestic, low-quality materials, as often happens.  Add in the fact that the majority of Russians are poor and I really don’t see the benefit of doing business here.  I’d rather stay in the more civilized, lawful countries where I can actually make a profit–you know, since that’s what you’re supposed to do in business.

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