Specialty – Government Relations A new method for solving old problems

So, what does the term “government relations” really mean except for its literal meaning?

Some may say that it means: “establishing close ties with key specialists of government structures, including decision-makers or people influencing decision-making”. Another possible option would be: “providing the awareness of your company in government agencies”. However, the most precise formulation reflecting the essence of government relations would be the definition of goals of such activities. In particular, we are talking about representation of the organization’s interests in government agencies. Some large Ukrainian companies have already used services of global legal firms focusing on government relations and having representative offices in Europe and the US for resolution of important issues of international cooperation.

Looking into the prospects of Ukraine – UAE cooperation, it is necessary to emphasize the fact that professional and efficient presentation of Ukrainian companies at the top level in Ukraine and UAE is the first and most important step towards long-term cooperation. In this context, we would like to underscore that at this time there is a well developed infrastructure in existence with good experience in this field.

Government relations in reality

On May 30, 2005, upon solicitation from the General Director of Dubai Chamber of Commerce and Industry Mr. Al Mutaiwi and upon approval of the Court of His Highness the Ruler of Dubai, the Economics Department of Dubai registered the first and only Ukrainian Trade Center in Gulf countries (UTC). The very history of creation of Ukrainian Trade Center in Dubai is rather typical because it has reputable referrals from government structures of UAE that looked approvingly at the possibility of establishment of the UTC, the activities of which is focused on increase of political and economical influence of Ukraine in the Gulf countries.

On Ukrainian side, the Trade Center was established with the assistance from the Ministry of Economy of Ukraine and the Chamber of Commerce and Industry of Ukraine, with additional support from the Embassy of Ukraine in the UAE. This guaranteed high representation level of the organization and over time had positive effect during organization of negotiations and concluding contracts on supply of Ukrainian goods. By the way, today Ukrainian Trade Center represents the interests of The Chamber of Commerce and Industry of Ukraine and all its 27 regional representative offices. Also Ukraine Trade Center is the sponsor of the informational project “Ukraine-Emirates: Property Business Investments”, which is the part of “Business Emirates” magazine. Among prominent readers of “Business Emirates” magazine, which contains the articles both in Russian and English languages, are topbrackets of management in the UAE and Ukraine, including Chamber of Commerce and Industry with its 27 branches in the regions all over Ukraine; more than 7.000 managers of top Ukrainian companies in the sphere of metallurgy, chemical, mechanical, agricultural, civil construction and oil industries; members of Ukrainian Chamber of Commerce and Industry.

“Business Emirates” magazine is delivered to the employees of Secretariat of Ukrainian President, Ukrainian Government, and Parliament of Ukraine, managers of the first 20 top banks,tour companies, and real estate developers. In UAE “Business Emirates” Magazine is distributed in Jebel Ali free Zone and delivered personally to the managers of the enterprises from the prestigious list Fortune 500.

The main goal of Ukrainian Trade Center is the promotion of products made by Ukrainian manufacturers on the Gulf countries’ markets. The management of Ukrainian Trade Center at once took into account the fact that Gulf countries have their unique specifics due to the peculiarities of making business in the Islamic world.

Therefore, UTC does not limit its activities with traditional consulting technologies. Even the knowledge of legislation is not enough for finding a solid niche on this specific market. Personal contacts in the local business community and in the government offices are sometimes more efficient than following the marketing schemes.

Out of the numerous contacts with different organizations and agencies of UAE, special attention should be paid to the cooperation of UTC with the Chamber of Commerce and Industry of Dubai and the UAE. Virtually all large scale events, forums and conferences organized by UTC in Dubai were prepared and implemented in close cooperation with the management of CCI of Dubai and UAE, in particular, with the Business Trade and Industrial Development Support Department headed by Mr. Sultan Lutah. For instance, a real breakthrough in the field of cooperation of businessmen of Ukraine and the UAE was the international forum organized by UTC and titled “Spheres of Cooperation between Ukraine and UAE”. Government support of the forum and participation of Velentyna Semenuk, the Head of State Property Fund of Ukraine, ministers of the Autonomous Republic of Crimea and parliament members supported the status of Ukrainian Trade Center as the organizer of this event.

Cooperation between UTC and the Administration of Jebel Ali Free Zone (JAFZA) turned out to be very effective. Today, Jebel Ali is the leading free economic zone in the UAE and one of the most successful FEZ in the world. After many months of diligent work performed by UTC, long negotiations and visits of Ukrainian delegations to Dubai and representatives of JAFZA to Ukraine, the cooperation agreement was signed between Javza and Ukrainian Fund for Support of Investments and Privatization, which now represents the interests of JAFZA in Ukraine. With immediate support from UTC, last year a few branches of Ukrainian companies were registered in Jebel Ali Free Zone. Now these companies enjoy all the benefits and preferences provided by the FZ administration. Today, these companies use actively the highly beneficial taxation mode and geographical location of Jebel Ali and Dubai for entering the markets of other Gulf countries.

Early this year, UTC renewed the agreement with Javza now extended for the years 2007-2008. At this time, active negotiations are underway with the administration of another free economic zone in Dubai called Techno Park, which, together Jebel Ali FZ is part of the recently established holding company Economic Zones World. In the nearest future (possibly in October or November) memorandum with one of the most influential companies of Dubai called Limitless is to be signed.

Services provided by Ukrainian Trade Center to businessmen from Ukraine, CIS and Gulf countries help strengthening the trade relations between these countries. At this time, there is no other organization except UTC that would be willing to provide assistance to Ukrainian business representatives in organizing the meetings with representatives of government structures of Ukraine and UAE and assist in the establishing direct contacts with local partners. Many Ukrainian companies represented in UAE use the services of UTC in establishing contacts with the Chamber of Commerce and Industry of Dubai and UAE, in the startup phase, as a rule.

UTC has a particular field of activities confirming the high level f reliability of this organization, it being the preparation of information surveys and justification of reliability of information upon requests from government and commercial structures of UAE and Ukraine. The reputation of Ukrainian Trade Center in the United Arab Emirates becomes stronger with every new year. For instance, during the Kiev visit of a Government delegation of United Arab Emirates, the Head of the Delegation –Undersecretary of Foreign Affairs of the UAE in charge of political issues Dr. Tariq Ahmed Al-Haidan voiced the opinion that today, there is a serious consideration of the issue of expanding the authority of Sergey Pachkovskiy, the General Director of UTC either in form of a diplomatic mission or as an honorary consul of the Emirates in Ukraine. Also Director General of Ukraine Trade Center Sergey Pachkovskiy was invited to the Sheikh Mohammad Bin Rashid Al Makhtoum Award Ceremony. Vice President and Prime Minister of the UAE and the Ruler of Dubai. It is worth noticing that this was the first invitation ever of a company from CIS to an event of this scale. The latest confirmation of solid reputation of the UTC was the invitation of its management to the forum, where President of Russia Vladimir Putin was participating. In the frame of the forum the meeting between Director General of Ukraine Trade Center and Major of Moscow City Yuri Luzhkov took place. During the meeting were discussed the questions of establishment of joint holding company Emirates- Ukraine-Russia-Austria for development of Autonomous republic of Crimea.

It is also worth saying that both the Ukrainian Embassy and the Trade and Economic Mission of Ukraine are located in Abu Dhabi and that at the time of establishment of the UTC, Ukraine was not represented at all in the largest city of the UAE – Dubai. Now, after the establishment of the UTC, Ukrainian businessmen visiting Dubai have the opportunity to use qualified specialist services in the region that is considered to be the world’s most attractive business region. The efficiency of UTC operations is based on many serious factors including Government relations. And it was only logical that the license issued to the Ukrainian Trade Center by the Economic Development Department of Dubai stated in the Legal type section: “Government Relations Office”.

Business press begins to write more and more often about the fact that the increase of capital market globalization requires establishing relations with investors and business partners in many countries. However, it has been difficult to define a universal scheme, which, if followed, would guarantee establishing fruitful business contacts.

On the other hand, in fact, economic specialists and financial sector employees are at the top of Ukraine’s Top 20 prestigious professions. However, experience demonstrates that in order to build productive and efficient relationships with investors, or deliver the business to a new orbit, the efforts of financial and economic specialists are not quite sufficient. The actual problem is that progress in business sphere and especially in the field of bringing in new foreign investors is only possible under certain conditions. What is needed is comfortable and stable environment for business development, demonstration of social importance of such business for the region and stable conditions with dynamic changes in legislation.

In other words, success is guaranteed by good reputation with government structures. Today, people seldom mention the necessity of creation of a positive image of the company in government structures. The talk on corruption in the government created a stereotype that it is only possible to solve important problems using criminally punishable actions.

On the other hand, the rule that says good business should always have good public relations has been adopted and implemented. Today, almost all reputable companies have PR departments and in large corporations there is a preference for development of corporate, social and brand PR.

It is a commonly accepted opinion that standards of efficient management include establishing efficient communications with all “subjects of external environment”. However, until recently, this environment included all subjects but government agencies. It was assumed that government structures are absolutely objective and equal in their treatment of all subjects they contact with. It is good that lately the issue of relations between businesses and government has been treated more “technologically” and now we hear more and more about methodologies of wise communications with the government, or in other words - government relations.

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