How business in the East of Russia is adapting to today’s economic realities

Andrei Nikolayevich, how do you assess the state of the business climate in the region?

Andrey Veretennikov: At the end of 2022, 49.6 thousand small and medium-sized businesses were registered in the Khabarovsk Territory, which is slightly less than a year earlier – then there were 50.3 thousand. But it is connected to a greater extent with the re-profiling of the business. For example, if we take the catering industry, then today there is no longer a need for such a volume of delivery as in the midst of a pandemic. Accordingly, there are fewer legal entities that provide such services. Or another example: before, entrepreneurs could afford to have a factory-kitchen, which is designed for ten or more enterprises, if there are three. Today these processes are optimized.

The overall assessment of the business sector shows real growth. The number of people employed in the SME sector increased by 20 thousand over the year and reached 235 thousand people. It is important not to forget about the self-employed – there are almost 45 thousand of them in the region, while at the beginning of 2022 there were 24.5 thousand.

Nearly doubling in a year?

Andrey Veretennikov: In fact, there is nothing surprising here. A person can very easily legalize his income, get out of the shadows. This is a great motivation for personal growth, business development. There are many examples when the self-employed expand their project and move into the category of individual entrepreneurs.

Tax revenues from the self-employed are also growing significantly: more than twice a year – from 52.8 million rubles to 120 million. At the same time, the total turnover has already exceeded five billion.

What areas do you consider the most promising for starting and running a business, given the current conditions?

Andrey Veretennikov: Based on my own experience, I can say the following: to be successful in business, you need to find your niche. It can be absolutely any area, the main thing is to clearly understand the market, sales opportunities and competitive advantages.

Of course, against the background of external restrictions, import substitution and technological independence are more relevant than ever. And here for entrepreneurs there are several types of motivation. Among them, the most important is the attitude of the state. Those support measures that are being implemented today can indeed be called unprecedented. First, informing up to working cases. Previously, it was necessary to hire analysts who, for example, assessed the need for a particular federal franchise to enter the region. Such services are very expensive. Today, the state itself gives you all the layouts for the industry. Secondly, property and financial assistance. Thus, over the past year, 349 microloans were issued to entrepreneurs at preferential rates for 648 million rubles.

The support of the IT industry provoked businessmen to create new software products that were not needed before. After all, you could pay a foreign company, and it provided you with a platform. Today our guys do it.

It’s not about some obsessive positive, but about logic. If we study world history and economy, we will see that in difficult periods, states took a course to create their own technologies.

The hospitality industry and domestic tourism receive serious development in the conditions of support from the state. The pace of both construction and local production of building materials has increased significantly. Here’s another niche for you.

The food industry is growing like never before. Cheese dairies have appeared in Khabarovsk, where they make cheese according to the technologies of Russian manufacturers. The light industry is gaining momentum. Entrepreneurs are significantly expanding their presence in the market, helping to provide our fighters in the NVO zone. Moreover, Khabarovsk residents go for export.

Continuing the theme of export, tell us, with which countries do we develop business contacts?

Andrey Veretennikov: Russia maintains mutually beneficial relations with the vast majority of countries in the world. As for the Khabarovsk Territory, the main export partner countries for us are China, the Republic of Korea, Kazakhstan, Japan, the Philippines, and Belarus. We supply food products, engineering products, fuel and energy, chemical industry, wood, pulp and paper products, metals.

Of course, we cannot remain silent about the difficulties. Due to external restrictions, the business activity of the business has slightly decreased. Polls show that two-thirds of enterprises have encountered problems with import supplies of raw materials, materials and components. Companies began to work out alternative production and logistics chains, switch to domestic analogues, and look for new markets. Much remains to be done in this direction, but the situation has somewhat stabilized.

Infographic “RG” / Rafael Zaripov

Will we have enough resources for full-fledged import substitution?

Andrey Veretennikov: Of course. And the point here is not some obsessive positive, but logic. If we study world history and the economy, we will see that in difficult periods, states took a course towards creating their own technologies, building infrastructure through internal forces. The example of the USSR is very indicative. If we develop all sectors of the economy at the current pace, we will be able to replace imported products and ensure technological sovereignty. This is a strategically important task of the state.

Promising areas for the Khabarovsk Territory are engineering technology, IT, food, light industry, mechanical engineering, and manufacturing industries. We traditionally have a high level of competence.

But the personnel problem often comes to the fore, entrepreneurs note the lack of qualified employees.

Andrey Veretennikov: Indeed, the situation is not easy. But we must understand that the training and recruitment of personnel is a two-way process. The Ministry of Economic Development of the Territory annually collects data on the need for specialists in a particular industry. Thanks to this, the number of budget places in colleges and universities is adjusted, new departments appear. And today we can say that entrepreneurs themselves began to participate in educational processes, from kindergarten to university. Many have already stopped attracting specialists from the west of the country, and even more so foreigners, relying on local guys. I think this is the right strategy.

Has the business of the Khabarovsk Territory joined in helping the participants of the NWO?

Andrey Veretennikov: Yes, and quite active. This is usually not advertised, but the amount of support is really serious. Sleeping bags, overalls and equipment, first aid kits, medical supplies are supplied. Entrepreneurs help with technology, donate cars, electronics. Assistance is also provided to the families of military personnel.

Without any pathos I will say that patriotism is fueled by the logic and sincerity of compatriots. The support is completely voluntary and has a very broad scope. The government has created a special system so that there are no excesses, corruption, and everything reaches our guys in a targeted and timely manner. Entrepreneurs already know exactly who and how to help.

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