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By Beppe Mauro
At a time of economic and employment crisis like the one we are experiencing now, the protection of the quality of life, both at personal and social level, we have reached cannot be disjointed from the development of all business and employment opportunities, looking for new areas of intervention and borrowing virtuous models that already exist in other countries.
The hard realization that the crisis we are experiencing is not one of the “usual” cyclical crises we had been used to when facing a mismatch between market demand and offer or between real and speculative economy has now definitely dropped from specialist desks onto the table of lay families. This is a systemic crisis that will not resolve for those – either common people or companies – who will unable to live in new markets, finding the right place and manner to use most of their talents.
One area still too neglected in entrepreneurial and employment terms is the so called “third sector” or non-profit sector, comprising all those activities marked by social scopes that go beyond but do not exclude the simple dynamics of profit as a business principle.
Social enterprise, unlike the traditional business for profit, motivates its existence with the pursuit of socially useful objectives, e.g. to protect health, environment, architectural and artistic heritage, the promotion of cultural activities, sports, welfare. This however does not prevent social enterprise from operating through principles of economic logics that ensure its sustainability through the achievement of incomes and a fair remuneration of its employees.
In this context, Anglo-Saxon Countries and those influenced by Calvinist culture are much more ahead than Mediterranean countries. This may be due to a preconception, strictly Catholic, that being money the “Devil’s dung”, it is incompatible with the objective of “doing good”, which in Catholic countries often becomes synonymous with “volunteering” in accordance with the principle that a good action is either unselfish or it is not good.
In the Christian Protestant West, instead, and more than elsewhere, the idea that you can do actions which are noble and useful for others or the community has also been combined with the allowance that you can do it as a profession, which is earning your honest living as well. These different approaches have generated different legislative contexts, of course: more open and rich of opportunities in Northern Europe and in the USA, more restrictive and less favorable to social entrepreneurship in Mediterranean countries. Yet even in the latter, in most recent times and under the pressure of the crisis of the State’s social welfare, they have introduced new rules that allow to combine business and enterprise for purposes of public interest and social utility. The different historical direction above described has left a gap between countries advanced in social entrepreneurship and those who have a smaller number of business activities in this field, and often less capitalized and with less employees. But having to face similar levels of demand for social-utility services, e.g. health and socio-cultural services, sport and recreational activities, caring assistance etc. such a gap (made worse by the crisis of traditional providers such as the State or the Church) represents an important opportunity for business and employment. This is valid both for those wishing to practice within their country both for those who would rather join international or transnational projects to benefit from regulations and funding resources of other countries.
Before concluding, I’d also like to point out that social entrepreneurship fills a role of substitute for providers of social welfare and so it is often rewarded with favorable treatments like tax reduction and often the lifting of costs of labor through tax benefits and contributions. Other reasons to decide to go happily for “good actions production”.
Dr Giuseppe Mauro
Chartered Accountant & Surveyor Consultant for non-profit business and social enterprise at national and international level
VA Charge’ d’Affairs for UK and Argentina
INTERNATIONAL DIPLOMATIC BODY OF THE VENETIAN REPUBLIC
Diplomatic relationships have recently intensified between USA and Cuba. The improvement in relations has apparently been facilitated by pressures from the Jewish and Catholic worlds. The Vatican has had a great influence on Cuban Government since Pope John Paul II’s visit to Cuba and the new rapport established between the Pope and Fidel Castro. These relationships between the Holy See and the Cuban Government have been recently consolidated, in particular, by the Archbishop of Havana Ortega.
The influential Jewish community in Cuba, on its side, had been complaining about the difficulty of communication with other communities due to strong restrictions on the use of the Internet on the island. The American-Jewish community would make pressure on Obama to obtain a liberalization of the use of computer networks, even at the cost of giving up embargo.
Pope Francesco’s mediation seems to have been instrumental in the negotiations that have led, among other things, to the release of some political prisoners both from American side and Cuban side. Finally, we saw the end of an embargo that had been lasting for more than 50 years.
Raul Castro’s short term government has promised internet access to be broadened up for Cuban residents and relations and tourist exchanges with the United States to increase. Soon the US Embassy should reopen in Havana, although a building called the American Affairs Office (serving a similar role) has been present for years.
This improvement in relations between the two countries has not been welcome happily by the Cuban-American community, which is the hardest antagonist of the Cuban Government, and has been interpreted as a giving in. Even part of the Republican Party has shown diffidence and has promised to counteract these agreements at the Congress, where Republicans now have an overwhelming majority.
It is hard to predict how things will evolve.
Certainly opening to the Internet will result in new generations more willing to westernize themselves, conforming to tastes and trends of their American peers. The ease of communication with friends and relatives in Florida will also establish the conditions for a westernization of the island. This lays down conditions for profound social and political changes in the medium term. It is also true that a drastic and immediate exit from socialism would lead to severe unrest and great economic difficulties for a large portion of the population. It appears the intention is of a softening of the repression of the various forms of dissent in order to arrive gradually at a fuller democracy.
Tourism in Cuba continues to be the main revenue entry, while facing issues like the reduction of supports (money and oil) from Venezuela. The possibility of returning to export Cuban cigars and rum to the United States, could help to readdress a difficult situation.
This is a time where you can buy and make good investments in Cuba, but with the opening of relationships with the United States it is also possible that, in future, International Courts will give back properties to the legitimate owners that possessed them before Cuban revolution or to their descendants. This uncertainty in predicting the destiny of properties makes this type of investment rather risky in perspective.
Dr Giovanni Bertoldi
Venetian Diplomatic Consultant for the Republic of Cuba
By Alessio Zillio, Venetian Diplomatic Consultant for the Republic of Abkhazia. An entrepreneur who is interested in investing abroad will often explore various alternatives before choosing the country where to set up a new business and commit his forces. But nowadays a lot is missed due to misinformation and many important areas with good economic potential are also missed due to ignorance or prejudice. Yet the dream of those who want to start a business abroad remains that of finding a virgin territory, where to be the first to arrive and create something secure out of nothing. The Republic of Abkhazia is one of these unknown destinations, a State that is as internationally strategic for the geo-political status quo of the entire Caucasian area as it is neglected by most people. Including entrepreneurs. Indeed, to date from 1991, this small Transcaucasian country remains oneof the few in the world where foreign investment has been scarce.
The reason is simple. Abkhazian Republic is a State with limited international recognition; from 2006 it has been legitimized only by Venezuela, Nicaragua, Tuvalu, Nauru, Vanuatu and Russia, the latter being its only real trading partner.
Until 2006, therefore, Abkhazia was a nation forced to self-support, with few foreign commercial partners, such as Turkey, to which to export coal extracted from Tkvarchel Mountains District. Since then, national politics have addressed better protection for the environment, which is in iteself the real treasure of this country, given that tourism, both in summer and winter, is becoming its true vocation. Foreign entrepreneurs able to start a process of genuine national economic reconstruction have been so far almost exclusively Russians, with rare examples from other nationalities. Opportunities of investment are thousands, starting from infrastructures. This Republic fought for independence in early ‘90s and was left with great urban damages, as exemplified in the picture by the ruins of the historic headquarters of the Abkhazian Parliament. This building is located in the heart of the Capital, Sukhum, which in 1992 was the last battlefield in the war of liberation. Today, two-fifths of the city are still composed of tottering palaces and homes, some of them being historic buildings of the Soviet era as the magnificent Hotel Abkhazia. Cultural life in the Capital remains quite vivid. Sukhum is the only Abkhazian University, though also in need of major restoration works and left with a frame that still remembers the war of 1991/92. The Capital’s current state is partly due to the rapid development of the northern part of the country, which is bordering with Russia (City of Sochi is only 4 km from the border). This area has been lucky enough to not be touched by the war, and so it has been able to host, since mutual recognition between the two countries was signed, thousands of Russian tourists. Sukhum’s “recovery” plans should, however, end up with shadowing the importance of Abkhazian northern border towns. Government’s projects indeed indicate as key targets: a) the building of a new airport, few miles from the Capital, precisely in the adjacent province of Gulripsh, b) the restructuring and implementation of the old railway network, which ideally should link Moscow to Armenia crossing the centre of Abkhazia, and finally c) the creation of a trading hub to attract huge volumes of merchandise, like Sochi and Sevastopol are doing already. Russian entrepreneurs have already bid for themselves, but the Abkhazian administration would also welcome Europeans to become effective partners in the reconstruction of their capital. On top of economic infrastructures, are then needed all those initiatives necessary for the proper functioning of a city that, according to the forecast, within ten years will host an annual flow of more than 300.000 visitors. This involves the construction of an efficient network of hospitals, not only locally but also nationwide and at least in the major cape towns (which are nine). This would open a market for pharmaceutical sectors and those who manufacture medical equipment. Reconstruction needs would be the main drive for a series of renovation projects in all areas situated south of the Capital, especially for transports and the development of tourist activities. As for the latter it is important to know that Abkhazia, which overviews the Black Sea, has a very long summer, which runs from late May to early October, with average temperatures of 24 C grades. Only the northern part is enjoying tourism development, with sufficient infrastructures, albeit outdated, not touched by the war. Interior mountains and southern regions have not enjoyed prosperity since the end of Soviet era. For southern provinces investment scenarios are similar to those identified for the Capital and its surroundings, thus great potential but still poorly addressed. These are areas of mainly agricultural, wine-producing and cattle rearing activities, with typically small size Abkhazian bovines, not uncommonly loitering free in the downtowns. Gulripsh and Ochamchira districts enjoyed spa centers in the past, and today these are coming back alongside the restoration of several former Soviet sanatoriums. Business around welfare centres and the spa should however need more investors, focused not only on tourism but also on waters treatment, both for health and drinking usage. Abkhazian territory is widely crossed by thousands of streams that come down from the Caucasus, and that in Soviet times were a major resource for hydroelectric power. With the advent of independence many power stations and generators have been abandoned and would need substantial repair and refurbishing, especially in view of a growing population, both local and touristic, that requires more and more energy. Internal areas of Abkhazia are short of roads suitable to connect the mountain villages with the Black Sea centers; a parallel development of strategic roads would facilitate a steady stream of tourists who love mountain nature both in summer and winter.
At the moment tourist facilities are virtually non-existent, the only one worthy of mentioning being located at Lake Ritsa, where summer trekking usually alternates with white winter holidays. In fact Abkhazia could attract far more tourists even in winter months if there were good hotels and update facilities for skiing. In particular some private project proposals have suggested to learn from past cooperation between the autonomous province of Trento and the autonomous Republic of Adyghezia for skiing installations. In conclusion, Abkhazia represents a country full of opportunities and credit for young people and their future. Important co-operations between Italian municipalities and Abkhazians councils could ensure greater mobility for young people. To move forward, the Abkhazian Government is now aiming at building a dense net of schools so to improve education and reintroduce Abkhaz as main official language (today Russian is still the most spoken language). As a consequence there is need for a large information network, computer services, advertising and book printing shops that can employ lots of skilled young people from abroad. Investing in this country is easier than ever for foreign entrepreneurs, and the opportunities are many. Abkhazia has recently signed an agreement that grants important benefits for those who have business companies in Russian territory and wish to transfer them in this country. Customs check-points between the two countries have recently been wiped off, so far allowing for free trade, something unthinkable until just few years ago. Abkhazia is not far and it is a beautiful and in many ways still unspoiled country where creating safe and affordable economic relations is now definitely possible. Alessio Zillio, Entrepreneur Venetian Diplomatic Consultant for the Republic of Abkhazia
Your Excellent People of our Serenissima Republic, as your Venetian Ambassador to Denmark I am pleased to send you this first report, hoping to attract interest and investments by Venetian entrepreneurs:
Denmark is amazingly emerging as a new green economy prairie and few know it. This is why it is important to count on a network of contacts like the one VA is already consolidating here. We must find back the Venetian spirit of innovation and immense curiosity that made our ancestors become merchants and explorers of excellent reputation for centuries.
But first of all, a little introduction:
You should know that in Scandinavian countries successful trading is based on already established networks. If you want to succeed you need to be introduced through networks, which usually consist of pools of private companies, local council or governmental agencies, before starting any activity.
There is a sharing type of mentality; in practice through various networks you create and share tasks, knowledge, experience and market, and this is team work. Indeed the same word “competition” is difficult to place given this mental inclination to create business “monopolies”.
I am currently part of several of these networks and, on behalf of VA, I can put them safely at disposal of the Venetian entrepreneurs, given the interest on the new technologies that are already available in Veneto and that surely will find space and life in the Nordic market.
And here are some data that together with my co-workers we believe can be of sure appeal:
1) With regard to the environmental sector and in particular to the waste-recycling sector I can anticipate that in Denmark they still don’t practice separate collection. You could create a partnership with local companies and propose a project to collect, treat and recycle certain types of waste that today are lost (such as paper, cardboard, plastic, metal, etc.)
2) With regard to the health sector and the Infectious Waste Treatment, we believe that this is certainly an interesting activity given the possible solution for the disposal of toxic waste from hospitals, which now must be dealt with in very effective and safe manner by law nearly everywhere in Europe.
Danish Government has planned a 9.8 billion DKK (Danis Crowns) investment, equivalent of $ 1,313,250,000, for the renovation of hospitals starting from Sjellandia Island, the island where Copenhagen lays, and then extending into the remaining Danish territory for the next 5-8 years.
The technology which has already been offered by the most innovative Venetian companies could be installed directly in hospitals or in a great Disposal Centre which could serve several hospital all together.
We have evaluated both solutions and we deem both of them valid. Of course the political aspect of this choice will also be important given the opportunity to enjoy advanced technologies and create new jobs in a period of economic crisis from the perspective of local communities as well as national politics.
For this you can count on networks such as the Association of Danish Industries and its offices or the Area/Territory networks, depending on the type of local organization.
Of course, I would consider exploring the possibility of installations (and so new jobs creation) even in the most deprived areas of Denmark, not just in the well off ones like those next to the Capital.
3) As for electric vehicles, we believe there is good chance in investing in electric scooters coupled with charging power stations.
4) As for renewable energy I do not think there will be great opportunities for photovoltaics, but there could be some for energy saving LED technology, a field where I am aware Venetian entrepreneurs can show a very interesting and comprehensive range of products.
Our proposal is then to create an on-site company that can promote Venetian technologies straight from here and I would advise the creation of a corporation called APS here (which can be started with the modest sum of 1 DKK which would correspond to 0,13€). In addition you would have the possibility to offset for 2 years the money needed to financially optimize the company, for as much as 58,000 DKK, corresponding to about $ 8,000.
That company would enjoy all securities and protections of a capital based company and would have the opportunity to grow into a real corporation without requiring any statutory change.
Very importantly, taxation will never exceed 25%. By Danish Law you even have the opportunity to create within the corporation a financial hub where to convey undistributed profits for the benefit of the central fund and gain some level of independence from banks (so to be protected risk of credit crunch).
Our Danish accountants are already available to Venetian entrepreneurs who can be presented directly by VA. We have consultants in the boards of many leading Scandinavian companies and excellent relations with the Danish Government. Our accountants would be happy to assist Venetian entrepreneurs for their start-ups in Denmark, offering their technical knowledge and their professional network.
They can also find potential Investors who can be Financial Partners of the company they intend to set up.
Place for investments can be Denmark, Norway, Sweden and possibly, given the extension of our contacts, they could reach even Finland.
I think a new structure like this would represent for our entrepreneurs the possibility of having an operational base on site (at a low cost) that can give international visibility to our excellent Venetian enterprises, too often penalized by an inefficient Italian diplomatic representation.
As you know, here institutions work well and laws are systematically applied. Cost of bureaucracy is cheap and most things work electronically with the support of
public authority which have a “friendly” policy towards them, given the social weight they represent.
I hope I have been comprehensive and clear enough in this initial report and I hope
there will be eagerness to invest in the Scandinavian market where innovations and new “Green Technologies” are more than welcome.
May I greet you all sincerely while I remain available for any further information or enquiry you may need to address me for.
VI ses i Danmark!
Stefano Nicoletto, Venetian Ambassador in Denmark
Kopenaghen, December 16th , 2014
Central VA DC.
ADDRESS: PEOPLE OF THE REPUBLIC OF VENICE
SUBJECT: REPORT ON GREEN ECONOMY OPPORTUNITIES IN DENMARK FOR VENETIAN ENTREPRENEURS/01
SENDER: Stefano Nicoletto, Venetian Ambassador to Denmark
DATE: 16 December 2014