Source Pravda.Ru

TACIS in Russia: Wasted Money?

Services of European consultants cost much; it’s cheaper to train domestic specialists

The time when Russians hoped that Cambridge graduates would come and improve life in the country is completely gone. Foreign consultants have already carried out reforms through the first Russian reformers: Gaidar, Chubais, Aven, and so on. After these reforms, practically the whole of the country’s population was brought to ruin. It is time to be more pragmatic and pay foreign consultants only for the services we need and not for those they themselves want to teach us, being completely unaware of the economic situation and specific nuances of Russia. The problem is that these foreign consultants are financed not by Russian clients (they have no money for such services), but by foreign foundations. This is the reason why Oxford consultants teach Russian businessmen not how to make Russia a prosperous and developed country, but instead they lecture them on the outdated experience of banana republics.

Yesterday, the TACIS leadership organized a press-conference in Moscow to inform that it was decided to spend 4.2 million euros on the third stage of the 2003-2004 TACIS Enterprise Restructuring Facility (TERF-3). Director of the program John Bakaraka told journalists about it. As nothing was heard about TACIS for the several past years, and journalists might have forgotten about the organization, the project director explained the ideas and objectives of the program.

The main objective of the TERF program, in the director’s words, is as follows. If Russian enterprises want to undergo restructuring with the view of becoming more attractive to foreign businessmen, TACIS will send “highly qualified European management consultants” to these enterprises. It is ridiculous, but often, such consultants are not only unaware of the economic situation in Russia, but even don’t speak Russian! However, this doesn’t seem to be a problem for Russian enterprises and European consultants. Interpreters can be hired for this purpose.

The problems is this. Consulting services of this level are too expensive for the majority of Russian enterprises. In this case, TACIS offers “help.” According to the program director, TACIS finances about 80% of the cost of consulting services, business trips to foreign enterprises, and training of Russian specialists by foreign enterprises. To tell the truth, events of this kind look very much like the seminars of foreign businessmen in Honolulu or Miami. However, it can’t be helped, as this is a tradition of the whole world.

What is also of great importance is that Russian businessmen seem quite satisfied with such trips abroad and training consultations. Vice-President of the Russian Union of Businessmen and Industrialists Viktor Dombrovsky said at the press-conference that TACIS spending on TERF-1 made up 6.5 million euros, which was the sum assigned by the European Union; TERF-2 cost the European Union 5.5 million euros. Since the project was launched, over 50 Russian enterprises from twenty regions of the country were consulted by foreign specialists. The Severstal company and United Machine Works were among them.

To tell the truth, the sums spent are too much for the rather modest result achieved. TACIS should have spent the money on teaching Russian students in foreign business schools so that Russia could also have thousands of highly qualified top-managers of its own. These specialists would be very useful for the country, as people aware of the domestic economic situation are more effective than foreign consultants. In fact, philanthropy isn’t among the plans of TACIS and European Union. They prefer to finance the services of their own experts who probably can’t find proper jobs in their own countries. However, unfortunate, consultations of this kind are practically of no use for Russia.

Kira Poznakhirko PRAVDA.Ru

Translated by Maria Gousseva

Read the original in Russian: http://economics.pravda.ru/economics/2002/7/21/64/2282_.html

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