Virpi Herranen: The inventive win – even in crises

9/5/2014

On my summer holiday I had time to read local newspapers and to follow the Finnish media in other ways, as the crisis in Ukraine moved toward colder relations and hotter front-line situations.

In the SME column of one local newspaper one of who knows how many angry outbursts toward defenders of Russia, or commentators searching for the objective truth "Go to Russia, you pro-Russians, then you'll see", once again got me to think how difficult it is to evaluate any issue or situation on the basis of nothing but second-hand information.

Here in Russia things really are seen in a different light and in different ways. On the street the crisis in Ukraine is not seen in any way, and unless one happens to turn on an official TV channel, it could be easy to forget the whole situation.

Of course the situation of companies hit by sanctions, and companies exporting products to Russia is serious. The most important task of the companies would seem to be, once again, to reframe their Russia strategy and decide how trade with Russia is to be carried out in the future under these changed conditions.

The sanctions affect products left both in production and in storage, and also on getting funding and in some cases on licensing. Uncertainty might be raised by the interpretation of the sanctions set by the EU, which target products connected oil exploration and oil production, for instance. Or are the products to be seen as dual use products, whose exports are now subject to licence?

In the view of Russian experts, sanctions cannot bring about political changes in Russia. In their view, we Finns have understood this and we have drafted new policies in our communication with Russia. Conflicts will probably occur in the future as well, because it is my impression that people in Russia have a poor understanding of what is meant by European values and politics. Everybody suffers from the sanctions, and moves have been made to start changing them. Political scientists believe that there will be no sanctions in a year from now.

Fans of Valio in St. Petersburg are concerned about if the products can be replaced, and they exchange information on which of the products are already produced here, and which ones need to be brought in from Finland. However, most of them point out with a sigh that there are plenty of cows here too. Finnish food products have nevertheless been an advantage of the middle class, and nobody's basic living will be jeopardised even if some of those products might not be available for little a while. The Russians are even joking that soon they will be having Norwegian salmon from Chile and brie cheese from Belarus – an inventive nation is always ready to find humour in any situation. Besides, there is some truth to the fact that inventive rogues have always found a way to bring goods into the country for which demand exists.

All parties are hoping for a rapid calming of the situation. However, the truth is nevertheless that Russia has again turned a new leaf in its history, and we are again learning how to cope with the situation.

Bilateral science and technology cooperation is appreciated by both sides. Finnish companies that have been in Russia for a longer time use the moments of crisis for the strengthening of their activities and for new plans in order to be ready at the moment that things get better to maximise their success on the market.

No easy profits are in store, and Russia will not rank high on "doing business" lists in the very near future, but in spite of the risks, Russia remains the largest nearby market for the Finns without a doubt.

Crises have a habit of going away. Russian partners appreciate us Finns specifically because we continue our cooperation even in challenging times.

Virpi Herranen
Tekes St Petersburg

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