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Foreigners in Moscow Are Glum on Business

By Michael Parks
October 5-6, 1991

MOSCOW — As desperate as the economy is for Western investment, technology and management know-how, the Soviet government has done so little to improve the business climate that the country ranks in the minds of the foreign businessmen here as a very difficult, even forbidding place to work, a new poll shows.

Office and store space are almost impossible to find, banking services are archaic, office supplies difficult to obtain, and goods and services greatly overpriced, according to the poll of foreign businessmen, diplomats and journalists in the Soviet capital.

Yet, the survey conducted by two San Francisco companies — The PBN Company and GLS Research — found that Moscow’s foreign residents felt that the business climate was improving and fundamental changes should come more rapidly as a result of the hardliners’ defeat in the August coup d’etat.

The pollsters questioned more than 600 businessmen, diplomats and journalists accredited by the Soviet government.

Despite their misgivings, 43 percent of the respondents said they believed the business climate had improved over the past year, compared with 25 percent who said it deteriorated. Two thirds said they believed change will be accelerated by the collapse of the conservative coup.

“There is a strong message from this poll that the Soviet Union is going to have to do much, much better at making it possible for foreign businessmen to work in Moscow if it is going to get investment on the scale it needs,” said Peter B. Necarsulmer, president of PBN, a public relations concern.

Results of the survey are likely to become an important element in the decisions of Western companies of whether to pursue trade with the Soviet Union.The survey showed 46 percent of the respondents regarded Moscow as a more difficult place to do business when compared with other international centers, and it reflected severe shortages of even the most basic needs of a company, such as office space, banking facilities and travel agents.

Living conditions were sharply criticized. Nearly two thirds of respondents found the Soviet capital inferior to other international centers, with complaints that ranged from pollution, potholed streets and litter to alcoholism, crime and prostitution.