How the Moscow Government Can Help Launch a Business in the United States

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Launching a business in the United States as a foreigner is often a long and complex process. However, some countries offer government-funded programs to support domestic businesses, free of charge, as they seek to establish a presence abroad.

In May of 2021, Russia’s total trade with the United States equaled $3.33 billion, an increase of 147.22 percent compared to May 2020. During the same period, exports increased 73.01 percent, with Moscow-based entities playing a leading role in the spike. The Mosprom Center for Export Support and Development reported that 2020 trade with the U.S. amounted to $23.87 billion (U.S.), with Moscow accounting for 52 percent of this activity, or $12.41 billion (U.S.).

What was behind Moscow’s success?

Moscow’s share of trade with the U.S. has steadily increased over the past three years, from 39.2 percent in 2018 to 47.7 percent in 2019 to 52.2 percent in 2020. This trend has continued into 2021 as well. From the first quarter of 2020 to the first quarter of 2021, Moscow’s share of the overall trade turnover between Russia and the U.S. increased from 53.9 percent to 55.3 percent.

To continue this growth, “Moscow companies need to focus on supplying finished products with a high degree of processing. Such products are categorized as ‘non-resource, non-energy products,’ which are characterized by a high level of innovation and therefore valued at higher price points,” said Vladimir Efimoy, deputy mayor of Moscow for economic policy and property and land relations. Efimoy’s department has aided numerous companies in successful ventures of this type through its specialized support program:

The Mosprom Buyer Program.

Mosprom’s Buyer Program is aimed at selecting counterparties and conducting quality negotiations with potential buyers in the U.S. The Center offers this Buyer Program to support Moscow-based manufacturers in the following areas:

  •       Business missions (virtual, in-person and international events)
  •       Technology tours (virtual and in-person)
  •       Reverse business missions
  •       Individual support for participation in international exhibitions and association with Moscow’s top manufacturers at international exhibitions (virtual and in-person)

In 2021, the Mosprom Center expanded its Buyer Program by incorporating a preexisting network of Moscow-based producers of interrelated goods. By doing so, participating producers are able to offer their unique, but complementary products to foreign buyers as a single, comprehensive package. Additional features of the program include:

  •   Individual support. Fundamental assistance on FEA offerings including: certification, overcoming trade barriers and customs regulations, dealing with current problems, and identifying the support measures required by Moscow’s exporters.
  •   Target market analysis and industry research. Tailored analyses including: macroeconomic reports on specific target markets; risk profiles; reports on barriers to entry, the current state of the industry within specific target markets, and target market dependence on exports and imports; and SWOT analyses of consumer markets. The Center’s experts also perform individual analyses to define the most effective strategy for entering a foreign market.
  •   Adept 7, a digital assessment model of export potential. This two-phase model

is designed to evaluate the export potential of a particular commodity to a specific country. A company’s export readiness is determined based on seven key factors: human resources, financial capabilities, adaptability of management model and infrastructure for foreign economic activity, environment, implementation capabilities, motivation, and objectives and product differentiation.

During the pandemic in 2020, Mosprom worked to ensure the adaptation and expansion of support measures for export-oriented, Moscow-based manufacturers. These measures were aimed at minimizing the negative effects of the current world situation, which impacted the exportation of products, among other things, by Moscow companies:

  •       Virtual “Office-to-Office” consulting. Virtual face-to-face consulting and support on FEA issues without the need for a physical meeting at the Mosprom offices.
  •       Virtual “pre-sales” activity preparation. Includes preliminary negotiations with trusted buyers, business MatchMaking events, adaptation of presentation materials, individual analytical and marketing recommendations for promoting products in the target market, and training on effective exhibitions and negotiation techniques. In the future, this online format will become a preparatory stage designed to first introduce companies and then discuss potential partnerships.
  •       Training for Moscow-based, export-oriented specialists. Webinars for specialists of legal, financial, accounting, and logistics departments engaged in conducting the foreign economic activity of enterprises. Each webinar is geared toward improving the competencies of Moscow-based exporters in regard to the basic and practical aspects of foreign economic activity.

“Our main goal is to increase the efficiency of Moscow manufacturers and improve their system of foreign economic activity. In fact, we fully undertake certain aspects of the work needed to develop the foreign economic activity of an enterprise: defining target markets, searching for buyers, preparing for and assisting at events. In essence, it’s consulting — only in our case we do not conduct operations for companies, but rather assist companies at no cost,” summarizes Natalia Shuvalova, general director of the Mosprom Center.

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