Sergiy Kozin, Vice-President of the International Chamber of Commerce in Ukraine (ICC Ukraine) on public-private partnership and interaction with the authorities speaks of ICC Ukraine Exchange of Investment Projects, risks for Ukrainian and foreign business in Ukraine, financial literacy of entrepreneurs, as well as protection of the rights of investors and entrepreneurs – exclusively for Fashion Diplomacy.
Ukraine has a new investment platform – the Exchange of Investment Projects. What are the main goals and objectives of this project?
ICC Ukraine has been long engaged in the establishing of communication projects aimed aimed to facilitate a communication between entrepreneurs from different countries. When it comes to other countries, we should also talk about their legislative framework in business, existing platforms for business communication in these countries and, also, we should adopt the useful experience of these countries in the legislative initiatives branch and the business communication branch.
Business is motivated by profit. If the entrepreneur has a task to sell goods or services abroad, what specific issues are interesting for it in this case? Logistics and profit!
The International Chamber of Commerce creates opportunities for effective communication between entrepreneurs from different countries. We are interested in other countries, their business rules, taxes, the work of future counterparties, currency, security matters and risk management only when the answers are clear and when it makes sense to implement a business model.
And due to the fact the Ukrainian business and economic development of the country requires investment and financial resources for development, joining the efforts of the Ukrainian interbank currency exchange and other exchange platforms with the communication capabilities of the International Chamber of Commerce allows to attract foreign capital to participate in Ukrainian projects.
This way, a joint project, namely the ICC Ukraine Exchange of Investment Projects, was created. Ukrainian entrepreneurs can submit projects that through several partner platforms can be offered to potential owners of capital in order to join the implementation of Ukrainian projects. Therefore, this project was called “exchange” and the attraction of projects and resources for their implementation is done on a competitive basis.
What the world modern business trends are adopted in Ukraine in the most active way?
Digital technologies are improving the business conducting efficiency, attracting consultants for conducting business, the socalled energy intensive and other sources efficient technologies that save people’s time, space. Consulting is also a modern trend, as well as using. Using communication ideologies like Scrum and Agile. These business ideologies build team’s not vertically, but horizontally.
Their team’s member is not just an employee who is selling own time for money, but a team member who is personally interested in business development and achievement of the results. It is this ideology that is now coming to Ukraine.
How would you assess the current activity of Ukrainian entrepreneurs in international business missions? How active is international business cooperation in general?
As for business missions, I would not put emphasis on the promotion of the goods at such meetings, because now there is more business communication (networking) – a person needs a person and business is conducted, in fact, by people. A foreign partner is also a person with certain values and opportunity to conduct business with a person who understands this.
Therefore, the exchange of business experience and principles of communication takes place during such communications, because to buy or sell something, there are many trading platforms, in particular those supported by the state or exist by the aid of the Internet.
Ukrainian business needs to get rid of this “teenage period”, and become businessmen who conduct business on the principles of justice of the recognized in the foreign trade world rules that allow each participant to have equal rights and receive profit at the same time.
Trade is a “win-win” strategy, that is, everyone has won, both the seller and the buyer have benefited. But sometimes for various reasons misunderstandings occur that can be resolved in arbitration courts.
To what extent do Ukrainian companies follow the international business rules?
Any information regarding their following the sustainable rules can be obtained through the media. If the company violates something when conducting business, we see it at the level of arbitration issues or other disputes arising in the legal field of the country where our Ukrainians conduct their business.
Of course, we can compare some figures regarding the confidence of foreign capital in conducting business in Ukraine.
After analysing the situation in Ukraine our organization asked foreign business why it does not invest, and it turned out that the first thing that foreign investors complain of is financial institutions and the low level of conducting business in Ukraine, the low level of business culture, certain violations of the concepts of business language and business principles.
However, despite everything, we see a growing trend in Ukrainian business, for example, in the IT sector, where Ukrainian IT specialists sell services directly through the Internet.
If we are talking about the European vector, we must understand that it is a certain culture of business paying taxes, providing legal jobs. In Poland, the taxes are not lower than ours. Belgium has the highest taxes in the European Union, you have to give more than 50% from personal income to taxes. Do these countries provide an opportunity for any enterprises, where people work off the books, to be established? No. And Ukraine provides. Moreover they can even receive salary in an envelope. Is there an opportunity for business abroad not to pay taxes? It would be destroyed then. And in Ukraine there is such an opportunity.
The usage of the same ICC Ukraine Exchange of Investment Projects resources requires a financial literacy. By the way, if we raise the question of how we can develop this culture of conducting business, then this is why business missions and meetings with representatives of foreign business take place in order to exchange experience, how we conduct business and how they do it. In the early 90s and in the 2000s, such meetings were very popular in Ukraine. We welcomed foreign companies, and the Chamber of Commerce and Industry and the International Chamber of Commerce and etc. practiced this. Meetings of certain layers of entrepreneurs are held to create a networking where they share the culture of conducting business.
Ukraine needs qualified personnel able to work and produce the results.
To your mind what three initiatives should be implemented in Ukraine in the near future to develop the international trade and business in general?
The first thing that should be developed in Ukraine is exchange platforms. To legalize the cryptocurrency exchange at the legislative level. Because international trade of the countries that have already done this is growing, cryptocurrency and digital money are already being used all over the world, Ukraine needs to become one of the players so that we could get into global trends as blockchain technologies accelerate and support trade. Ukraine has no such cryptocurrency exchange yet, so a foreigner can not purchase goods for cryptocurrency on the territory of Ukraine. It is impossible to calculate the tax on bitcoin in Ukraine due to uncertainty of the cost of the goods in terms of hryvnia.
Therefore, making a cryptocurrency exchange is the first thing to do.
The second thing I would do is to reduce the risks for business on the part of the state. We need to work for Ukraine raising in Doing Business ranking to protect the rights of investors and entrepreneurs. There are steps in this regard, but we must work to ensure that the state and the authorities do not have the opportunity to influence business. Now this influence is very noticeable.
And the third thing is to develop business education to allow business to raise its level of education and financial literacy, to be able to use all the resources and financial instruments that exist in the market-securities, letters of credit and so on. This is a culture of conducting business, and business should learn from it. The moment of training can be the meetings with representatives of foreign business, which can ensure penetrating of the culture of conducting business to Ukraine, and our involvement in it.
