BLCC Russia: 2021 is a time for uniting

BLCC Russia: 2021 is a time for uniting

Even in a pandemic, many Belgian and Luxembourgish entrepreneurs are successfully developing business in Eurasia

The Belgian-Luxembourg Chamber of Commerce in Russia (BLCC Russia) is accredited as part of the Belgian and Luxembourg Chambers of Commerce Abroad (BLCCA). BLCC Russia is the main active foreign business association in Moscow. In 2021, in times of crisis, it becomes especially clear how important business associations are, linking politics and economics. In 2018 BLCC and the Diplomatic World, concluded the memorandum in order to create favorable conditions for the development of business and friendship relations between European and Eurasian Entrepreneurs.

 

Mr. Prozorov, before we start talking about the economy, could you please tell us about your personal connection with Belgium and Luxembourg?

Oleg Prozorov: Belgium and Luxembourg have become my second homeland, I truly love the people of these countries and I feel at home in Brussels, Antwerp and Luxembourg. The first time I came to Belgium and the Grand Duchy was at the end of the 1980s. At that time I worked first in a large Russian transport company in Belgium in the field of export and import, later I created my own company in the development and promotion of modern Internet technologies in Luxembourg. It was a difficult but interesting time: Russia was undergoing a painful transformation of the economy, the business environment was in turmoil, the default of 1998 occurred. Belgium and Luxembourg seemed like islands of stability, but the adventurous entrepreneurial spirit, which I love, pushed the European business community to open up new, immense Eastern markets. I was not just a bystander – I experienced all these adventures together with my colleagues, being deeply involved in international trade, and at that time, I have often come across requests from European entrepreneurs for doing business whit Russia.

The idea of a Russian-Belgian-Luxembourg business association was in the air.  There are clues, that at the end of the 19th century, Belgian merchants met in St. Petersburg business clubs, to discuss new opportunities in the Russian Empire, these meetings was a kind of precursor of the Belgian-Luxembourg Chamber of Commerce in Russia, in Moscow. Created on the initiative of Belgian and Luxembourg business circles in 2013, organization – with which I was destined to tie my professional path.

 

Today, what does this organization mean for Belgian and Luxembourg businesses?

Oleg Prozorov: Our Chamber is the voice of Belgian and Luxembourg business in Russia and of the Russian business in Europe. We try to bring useful business initiatives to the governments in Moscow, Brussels and Luxembourg. We are a strong lobbying organization. Regardless of what happens – default, sanctions, devaluation of the ruble, pandemics – we are the strongest support for business. Actually, with offices in Moscow, Luxembourg and Brussels, the Belgian-Luxembourg Chamber of Commerce in Russia has different type of members, from corporate companies to family firms and SMEs. Working in Russia entails a number of difficulties with which European companies cannot always cope on their own. This is where we come to the rescue: we provide legal support, advice, and most importantly, the competence of our members.

 

How has the new type of coronavirus pandemic affected Chamber‘ member companies doing business in Russia?

Oleg Prozorov: Numerous restrictions and the associated risks have, of course, instilled uncertainty in entrepreneurs and investors. But despite the weakening of the conjuncture, Belgian and Luxembourg businesses retain faith in the Russian market. Proof of this is the opening of new offices, the acquisition and construction of modern production lines by companies from Belgium and Luxembourg in Russia in the third quarter of 2020. Compared to the period of the summer recession, the volume of trade increased in the autumn months. Even during the Corona crisis, many Belgian and Luxembourgish entrepreneurs are successfully developing business in Russia. This is due to the fact that they use modern technology, have a high level of organization and a high level of corporate culture.

 

What were the most serious problems faced by Belgian and Luxembourg businesses during the pandemic in Russia?

Oleg Prozorov: First of all, there are restrictions on entry. That is why we together with our partner Brussels Airlines – part of the Lufthansa group – helped top managers of Belgian and Luxembourg companies and their family members to return to Russia, we also supported the urgent arrival of technical specialists at the request of our members. Since June 2020 with our help many top managers of member companies have returned to Russia from Europe, technical specialists of Belgian and Luxembourg companies were able to come on business trips, and Russian citizens – shareholders of companies in Belgium and Luxembourg and corporate decision makers were able to visit Europe. We thank the Russian authorities and the Belgian and Luxembourg Embassies in Moscow for their assistance in obtaining these permits. In its official appeals, our Chamber was one of the first to advocate the abolition of the border crossing quarantine for entrepreneurs and technicians after a negative coronavirus test result. We believe that businessmen should be able to cross the border between Russia and the European Union in a simplified procedure. It is necessary to fight the virus by maintaining and preserving international communications. In November 2020, together with other bilateral chambers of commerce and associations, we asked the EU and Russian governments to resume flights.

 

Which sectors of the economy were particularly hard hit by the coronary crisis?

Oleg Prozorov: Along with the hospitality sector, industries with a high share of imported components probably suffered the most. Two factors played a role here. Firstly, the collapse at the European borders, many weeks of delays due to the restrictions imposed in the first wave of the pandemic. Secondly, due to the fall of the ruble, import prices increased significantly. Now the situation is stabilizing, but many foreign companies have begun to think about the importance of localizing the production of components in close proximity to the market. It should be noted that in 2020, the global income deficit of international corporations owning production facilities in Russia was compensated by the income of their Russian divisions.  I would like to point out that thanks to the high coordination of BLCC in Moscow and Russian regional governments, the production lines of our members did not stop a single day in 2020, each plant independently applied the prescribed sanitary measures, they themselves sewed up masks, spilled disinfectants, and so on. But there are areas of the economy that, on the contrary, benefited from the corona-crisis. Thus, the turnover of companies in the field of medicine, the pharmaceutical cluster, companies offering services in the field of telecommunications, very noticeable growth in the field of IT-services.

 

How has this period affected the work of the Chamber of Commerce itself?

Oleg Prozorov: The crisis is a time of important strategic alliances. Entrepreneurs are looking for reliable partners, with whom it will be easier to go through a difficult stage. We received a record number of applications for membership during the corona-crisis period. I am also glad of the fact that before the pandemic, our Chamber in Moscow signed memoranda of cooperation with several Russian regions. This allowed us to support our colleagues in a difficult time and now together we are able to face the new challenges with a united effort. We turned out to be well prepared for the transition of numerous offline events in 2020 to an online format. In a very short time we created a „BLCC Russia Web Lounge“ – our own platform for various kinds of events, from interviews with members to conferences, roundtables with participants from all over the world. The platform also proved its effectiveness with meetings in a hybrid format.

 

What other projects and achievements in 2020 is the Chamber particularly proud of?

Oleg Prozorov: In recent years we have seen the importance of improving the well-being and protection of our planet, the introduction of world-class technologies in the field of environmental protection, ecology. Supporting this idea, from 2019, the Chamber promotes its expert council on sustainable development and green financing. The area of fundraising directly related to ESG and the topic of environmental protection seems very promising to us, of course we support the development of hydrogen technology and projects related to it. BLCC help companies in Belgium and Luxembourg to export and import. We find new economic niches in the Russian regions, and promote projects of Russian companies in the Benelux countries. In different regions of Russia, Belgian and Luxembourg companies regularly open new factories, distribution, logistics and research centers. Our Chamber has joined the initiative of a common economic space „from Lisbon to Vladivostok“, we believe and help to develop a project of „green corridor“ between Russia and Europe.

 

What else would you like to add?

Dear readers, please contact us, our doors are open.

The motto of BLCC in Russia – is to Act and Succeed together!

BLCC website: https://www.ccblr.com

 

Oleg Prozorov, Member of the Board, since 2013 CEO at the Belgian-Luxembourg Chamber of Commerce in Moscow, answered Diplomatic World’s questions. He listed the main problems faced by business during the pandemic, spoke about the prospects for Russian-Belgian-Luxembourg economic cooperation and the role of the bilateral Chamber in the development of relations between Russia and the Belgian-Luxembourg Economic Union.