Soviet Capitalists Forge Ahead
First-ever directory of private firms published
THE slippage in Soviet economic reform hasn't muffled the growing Soviet entrepreneurial spirit. ``There's still enthusiasm,'' says Jonathan Halperin, president of FYI Information Resources, a Washington firm that provides information on political, economic, and environmental conditions in the Soviet Union. Mr. Halperin, who returned from the Soviet Union this week, says, ``If anything, private businessmen have dug in their heels.''
From animals to art
Halperin should know. In conjunction with Soviet joint venture partners from the Ukraine, he recently published the first Soviet business directory, detailing 2,100 firms, all of whom he and his Soviet joint venture partners scrutinized. Categories in the 565-page directory range from ``animal husbandry'' to ``works of art and antiques.''
The project was borne of Soviet local need, says Viktor Reshetin, the Ukraine-based chairman of Cooperative Reserve, one of Halperin's partners. Mr. Reshetin's original work - a woodworking business - was one of the first independent cooperatives formed after a 1987 Soviet law permitting such activities.
``We decided to do this directory because we ourselves had no information on other businesses,'' Reshetin says. The difficult task of compiling this information - the first project of its kind - was complicated by Soviet inexperience in filling out forms. Fledgling entrepreneurs were wary of putting business information into print.
Published in Russian and in English, ``Soviet Independent Business Directory: 1991'' is designed to facilitate contacts between Soviets themselves and international businesses looking for potential business associates in the Soviet Union.
``We're defining the industry, finding out who's out there and actually operating,'' Halperin says. ``The directory is more realistic than the exaggerated official lists of firms now registered with government authorities - there are plenty of people who fill out papers and don't do much, if any, business.''
There are roughly 400,000 new Soviet cooperatives in the Soviet Union. But only about 20,000 independent enterprises ``are bigger than the Blini makers in the train station,'' Halperin says.
So far some 20,000 directories have been sold in the Soviet Union. US sales are more sluggish. The resurgence of hard-line communists and their influence on President Mikhail Gorbachev have done little to encourage US investors.
One potential US customer is Adam Taloni, president of NASH Europe Inc. in Norwalk, Conn. NASH produces engineered vacuum systems and compressors for industrial plants - including paper mills, food processing, chemical, and power plants. For the past 55 years, the firm exported its products to the Soviet Union through a Finnish licensee. Mr. Taloni concedes that ``with all the turmoil there, doing business in the Soviet Union hasn't been our highest priority.'' But he says a comprehensive business direc tory would help ``cut out the bureaucratic red tape.''
Increased trade with the West has been a stated priority of Mr. Gorbachev's perestroika (restructuring). Also, some laws were amended to permit and even encourage investment from the West. Since 1987, trade and travel restrictions were eased significantly to lure Western investment and technical expertise. By now, more than 5,000 Soviet firms are registered to engage in foreign trade.
Intimidated by the military and the Communist Party apparatus, ``Gorbachev lost his nerve,'' Halperin says. ``He backed off from pushing for more power released from Moscow. He stopped pushing for openness.''
Valentin Pavlov, the new Soviet Prime Minister, has repeatedly charged Western bankers and businessmen with conspiring to create chaos in the Soviet economy. He warned against selling off Soviet state-owned enterprises to corrupt Western capitalists. Halperin says such statements have done more damage outside the Soviet Union than inside.
Despite the Kremlin's seeming intransigence, local private business continues to flourish. ``This is most apparent outside of Moscow in the dozen or so cities with substantial industry and million-plus populations,'' Halperin says. There, businesses work out supply networks outside government control and market their goods and services more efficiently than they would under the chaotic government ministries.