Boris Titov: Tatarstan finds correct ratio of openness and sanitary protection measures

“The fall of the Russian economy from April to July can be 20%”

The forum gathered over 300 entrepreneurs from different sectors of the economy, investors and experts, representatives of the banking sector, state and municipal managers. Chairman of the Board of the Mechanical Engineering Cluster of the Republic of Tatarstan Sergey Mayorov became the moderator of the anti-crisis meeting. Opening the event, he voiced bleak economic statistics.

“Oil has gone down in price. This led to a 30% reduction in the world economy by experts’ estimates. The fall of the Russian economy from April to July can be 20%. Budget losses in the Republic of Tatarstan and Nizhnekamsk have made up about 30%. 4,000 entrepreneurs and about 6,000 their employees didn’t work in Nizhnekamsk for two months. This means there are serious problems. We cannot remain indifferent to the fate of our entrepreneurs and gathered today to discuss the possibilities of recovering pre-crisis amounts,” Sergey Mayorov said.

Republic leader of Growth Party, Director General of Korib company Oleg Korobchenko reminded the audience that Tatarstan entrepreneurs received weighty financial support after the April online meeting with Ombudsman Boris Titov and head of the republic Rustam Minnikhanov.

“During the talk, the Tatarstan president asked Boris Titov to support the most affected sectors by giving them subsidies for temporary employment to save the staff. At this moment to obtain payouts through the employment centre, a company’s worker had to leave the job first, then sign up on a special website. The Tatarstan president offered to envisage subsidies precisely for enterprises so that they won’t have to lay off people. Then Boris Titov said that the issue would be considered, and in May SMEs already began to receive financial aid equal to 12,000 rubles per worker. Thanks to this, it became possible to save our staff,” Oleg Korobchenko noted.

First results of anti-crisis measures

The republican leader of Growth Party asked the experts what prospects businesses had because the partial opening of enterprises didn’t solve problems. The Russian president’s Ombudsman for Entrepreneurs’ Rights Boris Titov decided to answer this question. He said that anti-crisis measures had already given the first positive results.

“The situation is getting better, and it isn’t just a feeling, numbers show it. We are surveying entrepreneurs once in two weeks. We summed up this week yesterday. And the number of people who evaluated the state of their company as a catastrophe reduced by 12,6%. 40% anyway thinks this way. 30,8% of companies that were suspended (over 56%) resumed their activity. It is important that the share of entrepreneurs who took advantage of supporting measures has increased. It has grown from 35,4% to 57,3%,” Boris Titov said.

The ombudsman noted that Tatarstan was one of the first regions to take strict epidemiological measures and to lift the restrictions, which led to a reduction of the coronavirus incidence.

“Today we see a correct combination of openness and sanitary protection measures. The main ratio was found precisely in Tatarstan. But this was necessary at the first stage. And as a result, the republic isn’t even in the top 10 regarding the number of patients. However, the republic was one of the first regions to leave the quarantine and open the economy. Here a coefficient that correlated with the coronavirus situation is considered. Here we shouldn’t think about what happened, though it is a new situation. We should think of what we should do next and how to develop the economy. A real storm stroke us, and not only because of the coronavirus but also because of oil prices. Today we think what areas the country should choose to develop regardless of feedstock exports,” he said.

“We went into the water and didn’t know what awaited us ahead”

Sole trader from Nizhnekamsk Bulat Gayfullin said that due to technical debt he couldn’t obtain the right to cancel the rent for municipal property.

“I paid all debts, let me and all other entrepreneurs who paid off their debts take advantage of the supporting measures. It is also necessary to reconsider the terms when this regulation comes into force,” the sole trader addressed local authorities. Mayor of Nizhnekamsk Aydar Metshin promised him to turn to the city council’s deputies with this question.

Senator from Tatarstan Oleg Morozov also teleconferenced with Nizhnekamsk businesspeople. He shared opinion of how relations between authorities and businesses in the new conditions should be established.

“The only way to make reasonable decisions is a constant dialogue, to monitor the decisions that are made, look for weak links, correct decisions. This will help to find the optimal model to get out of the ideal storm. We went into the water and didn’t know what awaited us ahead, the loss we will have, how fast we will recover and how we will get out of this crisis, most importantly, to find a big stock of proposals that will come from the bottom. Monitoring from Moscow won’t give one the effect that is seen locally. Any measure that seems here optimal and reasonable is supported by the government’ decree, needs to be corrected while it is used in practice,” Morozov stressed.

Self-employed people will be given tax back and provided with financial aid

Yulia Yefimova addressed federal authorities on behalf of self-employed people. She was returned 69,000 rubles of the tax she paid last year and provided additional benefit at 12,000 rubles.

“It became great support for me. Could you tell us what else is planned to do next to develop the individual business platform, what will change and what other supporting measures there will be?” she asked the State Duma’s deputy Ayrat Farrakhov who initiated the law on professional tax for self-employed people.

“Today Russia has 650,000 self-employed people. Over 20 Russian regions joined this law. It is the lowest tax — 4,6%. According to Russian President Vladimir Putin’s initiative, you were returned the tax you paid last year. If this tax was paid to the budget of the Republic of Tatarstan, the federal centre will return the tax. Self-employed people were levelled to SMEs in many positions. This means significant preferences in government procurement. You have the same access to support at federal and regional levels that representatives of small and medium-sized entrepreneurship have,” Ayrat Farrakhov.

What awaits public catering?

Growth Party actively participated in the online forum, its office recently opened in Nizhnekamsk. The city’s famous entrepreneur, owner of commercial realty Rafis Mustafin chaired it.

“I represent over 3,000 entrepreneurs. I would like to learn when we can open public catering establishments. The small exemptions we have now don’t allow maintaining the staff. It is unprofitable for people to open: incomes aren’t covering expenses. We would like to work as soon as earlier meeting all measures,” Rafis Mustafin asked a question.

Tatarstan Business Ombudsman Farid Abdulganiyev answered the question. According to him, this issue remains one of the most topical in the Republic of Tatarstan. The Tatarstan business ombudsman’s hotline is daily receiving up to 650 addresses.

“We have already seen hairdresser’s, driving schools, mechanic’s shops open step by step. Summer cafes are going to open on 11 June — there is a decree of the Cabinet of Ministers. The landscape of questions from entrepreneurs on 12 May changed. On this day, almost all businesses were permitted to work in Tatarstan. It was one of the first regions to give businesses a chance to run their businesses. Shopping malls began operating in the countryside. They will open in big cities after the sanitary situation enables it,” the business ombudsman stated.

TAIF-NK products at online auctions

After the official opening of the online forum, the participants divided into discussion platforms. Managers of leading industrial enterprises of Tatarstan became experts on one of them.

Director General of TAIF-NK JSC Rushan Shamgunov familiarised the participants in the event with the production of the biggest oil refinery and told them about online sales and purchases of products in detail.

“TAIF-NK sells a part of its products via ONLINECONTRACT online marketplace. Last year, the main types of products were up for auction last year. In 2019, TAIF-NK sold goods for over 200 billion rubles. Some goods were sold at the auction via ONLINECONTRACT online marketplace. This year, understanding the interest of purchasers in online auctions, the company plans to increase sales volumes through this service,” Rushan Shamgunov said.

According to the TAIF-NK director general, ONLINECONTRACT online marketplace is considered one of the best sites in Tatarstan. The main goal of the process is transparency, openness, absolute honesty and availability of purchase. The online marketplace helps optimise costs, find suppliers or buyers in the shortest time possible maintaining robust competition of the process of purchases and auctions.

“Over five months in 2020, there have been purchased goods, works and services for over 4 billion rubles with the help of the online marketplace, the saving is almost 145 million rubles. The total commodity turnover of ONLINECONTRACT online marketplace during its existence has been over 788 billion rubles, the number of clients is above 64,000 from the Russian Federation, ‘near and far abroad’ countries,” Rushan Shamgunov stressed.

Representatives of Nizhnekamskneftekhim petrochemical company participated in the online meeting too.

How public catering survives

Entrepreneur Irek Muratov asked the speakers a question. He has been running a restaurant business for over 10 years. Six restaurants operated in the chain before self-isolation. Now there is only point left that delivers food and offers it to take away. It wasn’t possible to save the staff of the other restaurants.

Irek Muratov said he had turned to the Tatarstan Entrepreneurship Fund, but the fund asked him to provide collateral above 300,000 rubles to take out a loan. However, the restaurants were located in a rented building, this is why the entrepreneur didn’t provide the collateral and was denied.

“We have turned to public banks, but their interest rate is 18%. Our working capital fell, this is we were denied too. We didn’t manage to take out subsidised loans for the minimum wage to the workers either because the employees left the job, as the restaurants didn’t work. We received tax exemptions, restructuring in banks, and there were rent holidays for municipal property. I am asking you for a subsidised loan to support restaurants before the opening. We have debts to suppliers for March, neither have we paid utility bills,” Irek Muratov said.

Director General of Tatarstan Entrepreneurship Fund Aydar Salikhov replied to him.

“We have launched the second package of supporting measures. It includes a 1% financial product. It is designed for entrepreneurs that weren’t covered by the Russian government’s decree No. 404. Public catering is included in this decree, and this is why a restaurant can’t obtain this loan. Now we are elaborating the second package of measures and will hope that microfinance products for other categories will be considered there. Compensation for the interest rate of food delivery was adopted in the second package of measures precisely for public catering. If public catering uses Yandex or Delivery Club food delivery services, it can obtain up to 1,5 million rubles compensation for costs on food delivery. The presentation of this supporting measure is on the website of the fund and on the website of the Ministry of Economy,” Aydar Salikhov said.

He also said that at the moment they were receiving applications from entrepreneurs who weren’t included in the decree No. 404. The loan will be from 100,000 to 2 million rubles, the term is from 3 to 36 months. Seven applications have been received from Nizhnekamsk, two loans have been granted.

“A new economy awaits the country”

During the online forum Business in New Conditions, the entrepreneurs managed to ask tens of concerning questions. The speakers tried to answer each of them as frankly as possible.

“Today there have been voiced problems I even didn’t know about. It is time we thought about what will happen after the quarantine: a fallen demand in the domestic market, taxes, tariffs. A new economy awaits the country, we will start an active discussion of it,” Ombudsman Boris Titov concluded.

“All we have done was forced firefighting. We made decisions, made amendments in the process. We will see a new country and an economy after the coronavirus. We can’t do without your clear recommendations. We should hear you and understand what’s going on there, “on land”, “in the field” to make new decisions. Let’s establish a dialogue to make it mutually beneficial,” Senator Oleg Morozov expressed hope.