Sanctions Hit SMEs

Sept. 29, 2014
Who are the sanctions really hitting

It seems that one more time European SMEs have gotten in bad situation due to politics. The “political crème de la crème of EU, Russia and the USA” do not seem to grasp the economic implications of their decisions regarding these sanctions.

“This political jetset” is playing their games and letting through the press, the public know how vital everything is they are doing. The fact is they have failed badly in managing their relations. The situation reminds of kindergarden quarrel badly needing an adult to get involved.

Ukraine , as most of the east European states and its citizens are lacking the basic understanding basics in democracy. As an example one very good family friend of mine from eastern Europe did say that she does not even understand why she should pay taxes. The state does nothing productive for its citizens. In my experience this is a prevailing attitude among people in eastern Europe.

While “EU political jetset” and other states are highly optimistically trying “teach” Ukraine politicians “democratic manners” and Russia is playing its typical game. A game that Russia has played this game for centuries and we should have learned how to react to it without causing further havoc to state relationships and economics.

Bureaucrats in EU have put on the sanctions lists products that have nothing to do with oil or agricultural products. For instance, ZF, the German gear and automotive technology company has had to fight with German bureaucrats to sell servo steering parts to Russia! Another company making chain saws finds it very bureaucratic to sell tiny pumps for chains saw fuel to Russia.

Big deal -– Yes it is. EU economy is still not at its best. We do not need more chaos. This is not only an employment matter, if these sanctions last longer, it becomes a competition issue. Will Russia produce more food products ever in the future.

One quarter of Finnish food and agricultural production is exported to Russia. Mostly these companies in food sector are SMEs. They are now forced to lay off people.

In politics, quite often and unfortunately right now, the left hand is not knowing what the right hand is doing.

If in a cynic mood, one might ask the question, is this crème de la crème trying to get the prices of EU agricultural products down and oil price up.  Go figure.

About the Author

R. Paul Vuolle Blog | CEO

R. Paul Vuolle's blog "The SME's Guide to European Manufacturing," has moved. You'll find his latest ideas and commentary on SME European Manufacturing on IndustryWeek's IdeaXchange. 

You'll find more articles written by Paul at

R. Paul Vuolle, CEO of Bellevue SME Advisors GmbH in Switzerland and Germany, works actively with small and medium (SME) size manufacturing companies in Europe in SCM/Outsourcing, logistics, turnaround and restructuring, market expansion, as well as succession planning and financing. He also frequently supports technology start- ups in building up their business. 

Paul has over 20 years operational industry experience in engineering, electronics, industrial automation, building automation, investment goods like electrical drives, automatic test & measurement systems, HV Transformer production systems. During his career he has worked in manufacturing industries in supply chain management, outsourcing, logistics, production, R&D and successfully selling to international large key accounts. Paul has also run a sizeable amount of M&A transactions in numerous countries around the world.

He has built up his experience working in various leadership positions and functions in large corporations, such as ABB, and having executive positions in medium-size family companies and as a technology entrepreneur.

Paul is MSc. E.E. from Swiss Federal Institute of Technology in Zürich as well as BSc.E.E. from Helsinki Institute of Technology.

Paul is a long time member of IEEE and of its Industrial Applications Society.

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