February 26, 2013
HELSINKI - Anton Suchkov and Andrei Ivanchenko, two Russian businessmen from St. Petersburg, never worked together in their hometown. But now they are starting a new business together in Finland.
In the fall they launched a new company and got their visas, and their families will be joining them soon.
At first glance, it seems like a strange choice. Finland is a small market, on the fringes of Europe. But Helsinki is a cosmopolitan city, and one is just as likely to hear English as Finnish. Around 4.8% of the population in Finland is foreigners, and most of them live in Helsinki.
The overwhelming majority of those foreigners hail from the former USSR. In the first 10 months of 2012, Russians filed 4046 applications for residency in Finland. China came in a distant second, with 1342 applications. Russian investment in Finland is around 600 million euros per year – but if you count offshore accounts, it rises to more than six billion euros.
Andrei Ivanchenko says there were lots of good reasons to do business in Finland. He owns a company in St. Petersburg with a yearly income of around 50 million rubles ($1.6 million), and has long been frustrated with Russia’s business climate. Now he’s had enough.
“You know, in Russia we have total taxes that are around 50%,” he says. “But we have another financial burden in the form of bribes and kickbacks. In some industries, kickbacks can reach 80% – no accountant can hide that kind of sum. So people go under the radar. Just like before, the government thwarts business. And if you’re one day late in paying taxes, you have all kinds of unpleasantness. There are no rules.”
On the other hand, in Finland, the rules are clear and understandable. The taxes are high - the VAT is 24%, and the income tax is progressive (fixed at 35% for non-residents). But there are no hidden costs - once you’ve paid your taxes, no one will bother you.
When asked if they were scared to work in a new market, the two Russian businessmen said they were not. Andrei got an MBA in 2009, and he and Anton had been thinking for a while that it would be nice to try to use their business skills in another country. Canada and the U.S. are too far away, and Western Europe isn’t too fond of Russians. But Finland feels both close in geography and close to the Russian soul.
Registering a business was a simple process, and once that was done, the business was able to sponsor temporary resident visas for the two entrepreneurs. The visa is good for one year, and then can be extended for another five years. If the entrepreneurs spend more than half of those five years in Finland, they can then apply for citizenship or permanent residence.
Another common way that Russians end up in Finland is to study in a Finnish university. After finishing school, students have six months to find a job, and if they do, they can stay in the country.
Finland does not sell residence permits, like many countries do. The most important thing is how useful an individual is to the workforce. Of course, there are a couple of other ways for Russians to move to Finland. One is by marrying a Finn. Lastly, there have been programs for ethnic Finns living in parts of Russia that were Finnish territory in the past, to resettle in Finland.
Like Russia, but less Russian
There are plenty of opportunities for Russians to do business in Finland. First of all, there are around one million Russian tourists who visit Finland every year, and there are more than a few Finnish towns that feel like they have been overrun with Russians buying up apartments. Now Russian entrepreneurs are also preparing to help Finnish tourists go visit Russia for the Sochi Winter Olympics.
Secondly, according to one businessman who runs a successful Russian cafe in Helsinki, even though the Finns still harbor historical grudges against Russians, at the same time, they are very interested in Russian culture. His cafe was so full of Finns during my visit that there was no place to sit.
Lastly, Russia is Finland’s largest trading partner, making up for around 14% of Finland’s foreign trade (Germany comes in second, at around 11.2%). According to the Russian chamber of commerce in Finland, the trade between the two counties creates 160,000 jobs in Russia and 53,000 jobs in Finland. There is nearly $10 billion of Finnish direct investment in Russia.
Many Russians in Finland have found a niche helping both Finnish and Russian companies overcome the language barriers to doing business in each other’s country.
Igor Khitukhin married a Finnish woman and finished a law degree in Finland. He now has his own firm specializing in Russian-Finnish trade and immigration issues. His firm has seven lawyers, two legal assistants and two secretaries. His business is likely to only increase. Just as always, Russians strive to live in a calm, stable and reliable country. Something that feels similar to home, but just a little bit more European.
Kommersant ("The Businessman") was founded in 1989 as the first business newspaper in the Russia. Originally a weekly, Kommersant is now a daily newspaper with strong political and business coverage. It has been owned since 2006 by Alisher Usmanov, the director of a subsidiary of Gazprom.
Keep up with the world. Break out of the bubble.
Sign up to our expressly international daily newsletter!
Anne-Sophie Goninet, Jane Herbelin and Bertrand Hauger
October 22, 2021
Welcome to Friday, where Joe Biden vows to protect Taiwan from China, Alec Baldwin accidentally kills a cinematographer, and can you guess what day it is TODAY? We also have a report from a researcher in San Diego, USA on the sociological dark side of food trucks.
[*Zdravo - Macedonian]
Iran-Saudi Arabia rivalry may be set to ease, or get much worse
The Saudis may be awaiting the outcome of Iran's nuclear talks with the West, to see whether Tehran will moderate its regional policies, or lash out like never before, writes Persian-language media Kayhan-London:
The Iranian Foreign Ministry spokesman Saeed Khatibzadeh said earlier this month that Iranian and Saudi negotiators had so far had four rounds of "continuous" talks, though both sides had agreed to keep them private. The talks are to ease fraught relations between Iran's radical Shia regime and the Saudi kingdom, a key Western ally in the Middle East.
Iran's Foreign Minister Hossein Amirabdollahian has said that the talks were going in the right direction, while an Iranian trade official was recently hopeful these might even allow trade opportunities for Iranian businessmen in Saudi Arabia. As the broadcaster France 24 observed separately, it will take more than positive signals to heal a five-year-rift and decades of mutual suspicions.
Agence France-Presse news agency, meanwhile, has cited an unnamed French diplomat as saying that Saudi Arabia wants to end its costly discord with Tehran. The sides may already have agreed to reopen consular offices. For Saudi Arabia, the costs include its war on Iran-backed Houthis rebels fighting an UN-recognized government in next-door Yemen.
Bilateral relations were severed in January 2016, after regime militiamen stormed the Saudi embassy in Tehran. Amirabdollahian was then the deputy foreign minister for Arab affairs. In 2019, he told the website Iranian Diplomacy that Saudi Arabia had taken measures vis-a-vis Iran's nuclear pact with the world powers.
He said "the Saudis' insane conduct toward [the pact] led them to conclude that they must prevent [its implementation] in a peaceful environment ... I think the Saudis are quite deluded, and their delusion consists in thinking that Trump is an opportunity for them to place themselves on the path of conflict with the Islamic Republic while relying on Trump." He meant the administration led by the U.S. President Donald J.Trump, which was hostile to Iran's regime. This, he said, "is not how we view Saudi Arabia. I think Yemen should have been a big lesson for the Saudis."
The minister was effectively admitting the Houthis were the Islamic Republic's tool for getting back at Saudi Arabia.
Yet in the past two years, both sides have taken steps to improve relations, without firm results as yet. Nor is the situation likely to change this time.
Iran's former ambassador in Lebanon, Ahmad Dastmalchian, told the ILNA news agency in Tehran that Saudi Arabia is doing Israel's bidding in the region, and has "entrusted its national security, and life and death to Tel Aviv." Riyadh, he said, had been financing a good many "security and political projects in the region," or acting as a "logistical supplier."
The United States, said Dastmalchian, has "in turn tried to provide intelligence and security backing, while Israel has simply followed its own interests in all this."
Furthermore, it seems unlikely Iran's Supreme Leader Ali Khamenei will tolerate, even in this weak period of his leadership, the kingdom's rising power in the region and beyond, and especially its financial clout. He is usually disparaging when he speaks of Riyadh's princely rulers. In 2017, he compared them to "dairy cows," saying, "the idiots think that by giving money and aid, they can attract the goodwill of Islam's enemies."
Iranian regime officials are hopeful of moving toward better diplomatic ties and a reopening of embassies. Yet the balance of power between the sides began to change in Riyadh's favor years ago. For the kingdom's power has shifted from relying mostly on arms, to economic and political clout. The countries might have had peaceful relations before in considerably quieter, and more equitable, conditions than today's acute clash of interests.
Beyond this, the Abraham Accord or reconciliation of Arab states and Israel has been possible thanks to the green light that the Saudis gave their regional partners, and it is a considerable political and ideological defeat for the Islamic Republic.
Assuming all Houthis follow Tehran's instructions — and they may not — improved ties may curb attacks on Saudi interests and aid its economy. Tehran will also benefit from no longer having to support them. Unlike Iran's regime, the Saudis are not pressed for cash or resources and could even offer the Houthis a better deal. Presently, they may consider it more convenient to keep the softer approach toward Tehran.
For if nuclear talks with the West break down, Iran's regime may become more aggressive, and as experience has shown, tensions often prompt a renewal of missile or drone attacks on the Saudis, on tankers and on foreign shipping. Riyadh must have a way of keeping the Tehran regime quiet, in a distinctly unquiet time.
🌎 7 THINGS TO KNOW RIGHT NOW
• Biden vows to defend Taiwan: U.S. President Joe Biden said the United States would come to Taiwan's defense if it were attacked and had a commitment to defend the island nation that China claims as its own. The White House clarified for the second time in three months that U.S. policy on the subject has not changed, and declined further comment when asked if Biden had misspoken.
• Call on China to respect Uyghurs: A statement from 43 countries denounced China's human rights record at the United Nations over the reported torture and repression of the mostly Muslim Uyghurs, as well as the existence of "re-education camps" in Xinjiang. The declaration calls on Beijing to allow independent observers immediate access. In response, Cuba issued a rival statement shortly afterwards on behalf of 62 other countries claiming "disinformation".
• Alec Baldwin fires prop gun, kills cinematographer: U.S. actor Alec Baldwin fatally shot cinematographer Halyna Hutchins and injured director Joel Souza after discharging a prop gun on the set of his new movie, near Santa Fe. The accident is being investigated.
• Berlusconi acquitted: Former Italian Prime Minister Silvio Berlusconi was acquitted of judicial corruption charges. The 85-year-old media mogul had been accused of seeking to bribe guests present at his infamous "Bunga Bunga" parties to lie about the evenings as part of an underage prostitution case.
• COVID health workers death toll: A new WHO working report estimates that between 80,000 and 180,000 health and care workers may have died from COVID-19 between January 2020 and May 2021. The same report also noted that fewer than 1 in 10 healthcare workers were fully vaccinated in Africa, compared with 9 in 10 in high-income countries, and less than 5% of Africa's population have been vaccinated.
• Seven killed in Russian gunpowder factory blast: An explosion at the Elastik gunpowder and chemicals plant southeast of Moscow killed at least seven people, while nine are still missing.
• Aye aye, CAP'n: HAPPY CAPS LOCK DAY, FOLKS!
🗞️ FRONT PAGE
Dutch daily De Volkskrant pays tribute to "sound master" and renowned classical conductor Bernard Haitink, who died at 92. Born in Amsterdam, Haitink made more than 450 records and led some of the world's top orchestras in the span of his 65-year career.
📰 STORY OF THE DAY
The food truck, a sign that the white and wealthy are moving in
In San Diego, California, researcher Pascale Joassart-Marcelli tracked how in the city's low-income neighborhoods that have traditionally lacked dining options, when interesting eateries arrive the gentrification of white, affluent and college-educated people has begun. In The Conversation she writes:
🥡 In 2016 in City Heights, a large multi-ethnic San Diego neighborhood, a dusty vacant lot on the busiest boulevard was converted into an outdoor international marketplace called Fair@44. There, food vendors gather in semi-permanent stalls to sell pupusas, lechon (roasted pig), single-sourced cold-brewed coffee, cupcakes and tamarind raspado (crushed ice). Just a few blocks outside the gates, informal street vendors — who have long sold goods such as fruit, tamales and ice cream to residents who can't easily access supermarkets — now face heightened harassment.
🤑 Cities and neighborhoods have long sought to attract educated and affluent residents – people whom sociologist Richard Florida dubbed "the creative class." The thinking goes that these newcomers will spend their dollars and presumably contribute to economic growth and job creation. Food, it seems, has become the perfect lure. It's uncontroversial and has broad appeal. It taps into the American Dream and appeals to the multicultural values of many educated, wealthy foodies.
🏙️ My analysis of real estate ads for properties listed in City Heights and other gentrifying San Diego neighborhoods found that access to restaurants, cafés, farmers markets and outdoor dining is a common selling point. San Diego Magazine's home buyer guide for the same year identified City Heights as an "up-and-coming neighborhood," attributing its appeal to its diverse population and eclectic "culinary landscape," including several restaurants and Fair@44. When I see that City Heights' home prices rose 58% over the past three years, I'm not surprised.
➡️ Read more on Worldcrunch.com
#️⃣ BY THE NUMBERS
The remains of "Big John," the world's largest triceratops skeleton ever found, were sold at auction for a European record price of 6.65 millions euros in Paris to a private anonymous collector from the U.S. The 200 pieces of the skeleton were unearthed in 2014 in South Dakota and reassembled by specialists in Italy.
👮🎮 IN OTHER NEWS
Police bust Mexican drug gang recruiting boys via online video games
Police in Mexico have intervened to rescue three minors, aged 11 to 14, from recruitment into a drug gang that had enticed them through online gaming.
A top Mexican police agency official Ricardo Mejía Berdeja, said the gang had contacted the youths in the south-central city of Oaxaca, chatting through a free-to-download game called Free Fire, which involves shooting at rivals with virtual firearms.
Calling himself "Rafael," another player of the same age, the suspected gang member offered one of the youths work "checking radio frequencies and watching out for police presence" in Monterrey, northern Mexico, reported national daily El Heraldo de México. The pay was unusually good — 8,000 pesos (almost $400) every two weeks — and the youth called two friends who also wanted to get in.
The three boys were set to take the bait, but an anonymous Mexican intelligence agent following the exchange while also posing as youth playing Free Fire, ultimately led police to a safe house in Santa Lucía del Camino, outside Oaxaca.
➡️ Read more on Worldcrunch.com
"I just want to make China understand that we are not going to step back."
— U.S. President Joe Biden vowed to defend Taiwan if it came under attack from China, an assertion that seems to move away from the U.S. stated policy of "strategic ambiguity." His administration is now facing calls to clarify this stance on the island.
📸 PHOTO DU JOUR
Paramilitary soldiers are conducting a check operation in Indian-administered Kashmir, following a spate of targeted attacks on the region's Hindu minority that have left at least 33 dead since early October. The region, claimed in full by both India and Pakistan, has been the site of a bloody armed rebellion against India since the 1990s — Photo: Adil Abbas/ZUMA
✍️ Newsletter by Anne-Sophie Goninet, Jane Herbelin and Bertrand Hauger
DO YOU FIND PEOPLE WHO WRITE IN ALL CAPS PARTICULARLY ANNOYING? Feel free to COMPLAIN, or otherwise let us know what the news looks like from your corner of the world!
Keep up with the world. Break out of the bubble.
Sign up to our expressly international daily newsletter!