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2 May 2018

Chamber News: A Trade Mission to Tatarstan

After a trade mission hiatus of several years, the Russo-British Chamber of Commerce led one to Kazan, the capital of the Republic of Tatarstan, in April 2018.

As many of you will know, Kazan is located on the confluence of the Volga and Kama rivers and is commonly referred to as the “Third Capital” of Russia. It is now one of the most economically developed regions of Russia with agriculture and heavy machinery playing an important role in its economy. It is, however, petrochemicals that dominate, with “Tatneft” a household name throughout the region and Russia.

 

Despite the importance of oil and gas to the economy of Tatarstan, the government has implemented an ambitious diversification programme and has worked hard at creating a favourable investment climate for foreign businesses. It has established Special Economic Zones that have competitive tax rates for foreign and Russian companies that invest and locate there. Unsurprisingly, it is a popular destination for business missions and major trade exhibitions and is hosting 4 games during this summer’s football World Cup Championship.

Given all these advantages, choosing Tatarstan as the destination for the RBCC’s first trade Mission for some years was an easy one. Trade between the UK and Tatarstan has quite a narrow focus – the UK imports oil and gas and exports technical equipment and services. The Trade Mission defied this trend and included representatives from 4 very different sectors; Oil & Gas (Geomec Engineering), luxury foods (MacKnight), air charter (Air Charter Service) and IT (Axios Systems).


Given the current political headwinds we were not sure as to the reception the Trade Mission would receive in Kazan. Despite the snow and chilly temperature we need not have worried. Tatarstan is fabled for its warm hospitality and it did not disappoint. The Republic of Tatarstan’s Chamber of Commerce and Industry (RT CCI) had organised a fantastic programme that included a mix of meetings, visits and the opportunity to learn something more of this fascinating region’s culture and history.

The key event for the delegates was the roundtable discussion hosted by the RT CCI on the first morning of our visit. Each of the companies had the opportunity to present its products or services to an audience of interested local businesses and government organisations. Geomec's innovative services for oil and gas operators had a natural audience given the role this sector plays in Tatarstan’s economy. MacKnight generated a great deal of interest with its novel range of fish products including smoked salmon “bacon” and “sausages” as well as a luxury pet snack range.


On our second day, the Trade Mission had the honour of meeting the President of Tatarstan Rustam Minnikhanov and a number of his ministers. Again each company made a short presentation to the assembled audience. The President was well-briefed and engaged and asked his team to arrange follow up meetings with a number of the Trade Mission representatives. With the regional government playing such an important role in the local economy, this was an important opportunity for the delegates to promote their companies with the most senior of governmental decision makers.

Outside of B2B meetings our programme included a visit to Innopolis, a tech city built 40 minutes from Kazan, which has aspirations of becoming Russia’s “digital capital”. It is within its own Special Economic Zone with all the attendant tax advantages that implies. It is has attracted many Russian household tech names such as Yandex (a Google equivalent) as well as some well-known Western brands. To feed its need for a highly qualified workforce, a University has been built which turns out 600 graduates a year, all of whom have been sponsored by industry. On graduation a large proportion of these students simply walk across the road to start their new working lives.


The many meetings and visits were interlaced with a number of entertaining social events where we sampled some delicious Tatar cuisine. We of course had to try our hand at toasting our hosts with vodka and found it very easy to get the hang of! Our journey home included a stopover in Moscow where SCHNEIDER GROUP, one of the Chamber’s member companies, ran an excellent seminar on doing business in Russia. It covered essential topics such as the sanctions regime and Russian tax law.


All in all this was an intense, fascinating and very worthwhile experience. The participating companies met a range of contacts and interested parties, which will hopefully further their immediate business aims. In a political environment that is not without its difficulties, the Trade Mission demonstrated that the desire for business dialogue and contact endures, which can only be to the benefit of us all. We are already planning the next one!