MOSCOW (Pakistan Point News / Sputnik - 06th August, 2020) None of the Italian companies working in Russia left market during the COVID-19 crisis, Vittorio Torrembini, the president of the Association of Italian Entrepreneurs in Russia (GIM-Unimpresa), told Sputnik in an interview.
"No company closed so far. Normally � even during the 2008 crisis � no one leaves [Russia]. Of course, the companies were hit hard and had to restructure, but to the best of my knowledge, no Italian company has so far left the Russian market. Quite the opposite, all of them are trying to find new modes of presence," Torrembini said.
The coronavirus lockdown brought about several trends in the Russian business environment that Torrembini said might currently be challenging for Italian entrepreneurs.
This primarily applies to the new business-to-consumer (b2c) forms of interaction where e-commerce has disrupted the traditional retail and new logistical chains began to emerge.
"Unfortunately, the Italians are not used to this. I think that the combination of e-commerce and physical display of goods and equipment is the new edge of business. I believe Italian businessmen should find new forms of interaction. These are the lessons we learned from the coronavirus," the GIM-Unimpresa head said.
Another challenging issue that he mentioned is that Russia currently pursues to favor domestic production over import and the government does not spare support to domestic producers for that reason. On the one hand, it is an opportunity window for the Italian companies to sell equipment and technology relevant for facilitating Russia's domestic production, Torrembini said. On the other hand, this limits the Italian businesses' room to arrange their own production in Russia.
"That is a new challenge. The next step is to arrange production here in Russia, and it is also a reason to modernize the manufacturing and technologies. Italian companies are already present in Russia, but they should make the next step and begin producing right here. That is the next step for Italian companies struggling to figure out how they can remain on the Russian market. The only way is to set up local production," Torrembini said.
According to the GIM-Unimpresa head, the association reached out to the Russian government to request the support of such initiatives aimed at engaging the Italian companies in enhancing Russia's domestic production and the new government evidently was more responsive than the previous one.
Last year, trade between Russia and Italy surpassed 20 billion Euros ($24 billion), of which Italian exports to Russia accounted for 8.7 billion.
According to the statistical information collected by the Italian Trade Agency and provided to Sputnik by Torrembini, as of May, the bilateral trade fell 20.6 percent compared to 2019, with Italian exports to Russia dropping 7.9 percent and Russian imports to Italy dropping 28.3 percent.
