Have you ever wondered why small-medium sized businesses don’t seem all that keen on investing in Russia? The same reason that smaller domestic businesses generally don’t flourish in Russia – bureaucracy. The endless number of forms to be filled in and hoops to be jumped through costs money – and quite a lot of it.
A few months back, as my department’s resident Russia guru, I was asked to arrange a Russian visa for a colleague of mine. Once I’d done everything, I sat down and calculated that the cost to the company, simply to complete the paperwork needed to get him into the country, came to a staggering $2,000.
Here’s (roughly) how I broke down the costs:
$350: My time for one full day (approx 1 full day)
$500: My colleague’s time (approx 3 hours)
$250: My Partner’s time (approx 30 minutes)
$500: Our Moscow office’s time (approx 1 full day)
$200: Actual visa fee (we were in a hurry, so had to express it)
$100: Travel agent (for courier to stand in line)
$100: Couriering documents back and forth
And this wasn’t even a particularly difficult appplication – the only challenge was that it had to be put together in 3 working days.
The expenses though, mostly in the form of time that could be better used, mounted up quickly. Here’s a small sample of the work we had to do:
I had to liaise with our Moscow office, going back and forth, to ensure that my colleague provided enough information about his stay for them to fill in the forms and stand in line for hours at the Ministry of Foreign Affairs – just so they could get an official invitation My colleague had to head out into town to get new passport photos taken (in matt finish, of course – and where can you find a machine printing those nowadays?), before collating all the documentation necessary to fill in his own visa application form I had to write an introductory letter, signed by a Partner, confirming that my colleague was indeed employed by the firm, and that they would be financially responsible for him We had to employ a courier from a specialist firm, whose only responsibility was to queue up for hours on end at the Russian embassy, handover the paperwork, then collect the finished visa.
Now, for the company I worked for was a big multinational – this was a cost that could be borne. In the grand scheme of things,the cost was relatively insignificant. But for a small to medium business wanting to invest in Russia, $2,000 is a pretty significant chunk of change. If I was a small business presented with the choice of flying to another European Union country – Poland, for example – or first going through the hoopla of arranging a visa and then flying to Russia, I know which I’d choose.