Q&A: Alexander Ivlev
Entrepreneurship is important for many reasons – and job creation is a critical one. Alexander Ivlev, EY's Country Managing Partner for Russia, says entrepreneurs currently create 10-15% of jobs in Russia, rather than the 60-70% as in other developed countries. As a new appointee to the Presidential Economic Council, Entrepreneurship Initiative Working Group, he's working to change that.
Q: In your new role, what do you recommend as a way to boost entrepreneurship in Russia?
A: Russia needs to look into the best ways to enhance and promote entrepreneurship in the country. I see it as a mutual effort from both the government and private sector. Specifically, government must concentrate immediately to lower the administrative barriers and get rid of bureaucracy – including corruption. It then can start to create a favorable business environment, which means protection of investor's rights, creating a fair playing field for businesses and ensuring that entrepreneurs can access financing. I think that businesses can best serve to promote entrepreneurship by working with young people and students; explaining what entrepreneurship is and how to start a business; and sharing their success stories.
Q: What shape is the Russian economy in today?
A: I think that Russia is dynamically developing its own economy. It's growing quite fast and, going forward. It is in a much better position than many other emerging-market economies.
Q: Are some industries more suited to entrepreneurial endeavors than others?
A: Clearly, we see that the retail and consumer products sector is pretty advantageous for entrepreneurs starting new businesses. Construction is also quite promising for new players. Different types of professional services and trade are booming in Russia as well.
Q: Who are the Russian role models when it comes to global entrepreneurs?
A: I can look to Russian entrepreneurs who achieved significant success both in the CIS and in the international arena. For example, we can talk about the great success of Viktor Vekselberg, with his businesses in Renova Group and other projects. We can see the success of Alexey Mordashev with Severstal expanding around the world quite quickly. LUKOIL is another great example of a growing business. We can look to Ruben Vardanian, [chair of the EY 2012 World Entrepreneur Of The Year judging panel in Monte Carlo] who built the investment bank Troika Dialog, which was successfully acquired by Sberbank. These are all great role models not only for Russia, but for many students and major business schools outside of the country as well.
The majority of entrepreneurs are playing in the domestic market, even though there are great examples of Russians going for outbound investment. Some of these examples are in the cases which I mentioned previously.
Q: What are you most encouraged about when you work with entrepreneurs in your country?
A: I am very encouraged by the growth, which is significant. More and more young people are starting to believe in entrepreneurship and starting to find opportunities to launch their own businesses. I predict that eventually Russia will become one of the most entrepreneur-friendly countries in the world. We can see that after 70+ years of the planned economy, and after several generations of people who didn't know what private property is. The new generation of entrepreneurs is coming up very quickly.