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10 Questions

with Gautier Vasseur
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By Paul Voosen
Staff Writer, The Prague Post
June 27th, 2007 issue

KURT VINION/THE PRAGUE POST
Gautier Vasseur, senior partner at Pedersen, recently opened his firm's office in Kazakhstan.
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The Vasseur File

Job title: Senior partner, Pedersen & Partners
Nationality: French
Age: 31
Former positions: With car manufacturers Renault and Peugeot

While Russia and its fast-growing economy have drawn much investment attention, the other former members of the Soviet Union are doing some growing of their own. Fresh from helping to establish his firm’s new office in Kazakhstan, Gautier Vasseur, a senior partner with the Central European executive search firm Pedersen & Partners, talks to The Prague Post about the business potential of Central Asia, Kazakh optimism and the games great powers are playing.
➊ What prompted your firm to expand outside Central and Eastern Europe?
When we started Pedersen & Partners, we wanted to have an office in each new member of the EU, and we didn’t look further at the time. But then our clients told us they were having trouble recruiting in Russia. In Central and Eastern Europe [CEE] there is a pool of people who are well-educated and have some knowledge of Russia. So we opened offices in St. Petersburg and Moscow and saw that the market potential is huge. Now we’re expanding into what we call the CIS [Commonwealth of Independent States], with operations in Kyiv, Minsk, Almaty, the three Baltic countries, Azerbaijan. And we want to develop the rest of Central Asia.
➋ So you’re recruiting people from the CEE to work in Central Asia?
That’s what we’ve done. We’ve recruited Czechs to work in Kazakhstan or in Russia and Kyiv. The CIS is booming and this has changed the management culture, which tends to be more Western now. Meaning they need people with a different level of education, different level of initiative and drive, with language skills — and all of this is quite difficult to find in the CIS. So we recruit from all the people who can work in a Russian environment.
➌ How difficult is it to expand into Central Asia?
It’s difficult because they’re not looking to Europe. Almaty, the largest city in Kazakhstan, is 200 kilometers [124 miles]  west from China and 200 kilometers north of India. It’s between Russia, India and China — which could be the giant of this century — and those people don’t have a great esteem for what U.S. troops are doing in the world, for example. So the Kazakhs are skeptical of the Western approach.
There are also language issues. The Kazakh language has Turkish roots, and most Kazakhs are working with the Chinese and Russians rather than English speakers. Plus it’s a big country with few people: In terms of size, it’s the ninth-largest country in the world, but they have less than 15 million people. They’re spread around the steppes, the old nomad tradition.
➍ You’ve mentioned that there’s a great deal of regional difference between countries in Central Asia, such as Kazakhstan and Uzbekistan. Why is that?
Look at the history of Central Asia. First it was part of Mongolia — one of the largest empires in history — and then it was part of Persia and fell into a feudalist system based on the Great Silk Road. So Kazakhstan has always had a lot of nomads doing trade.
Uzbekistan was different, because they have water and developed agriculture. Now it’s a farmer state with people who don’t enjoy opening themselves to the world. It’s the largest country in Central Asia, with 30 million people, so it has a pull for companies that want to sell drinks or cigarettes. But it’s not a free market yet. On top of that, Kazakhstan has huge reserves of oil and natural gas.
➎ Are those reserves the reason Kazakhstan is drawing Western attention?
They’re of use. They’ve also financed a banking system. In Kazakhstan, the banking system is very developed, more than in Moscow. And this has been financed by the U.S., because of potential oil revenues. And not only do they have oil, but they have a lot of gas and uranium, which Russia, China and India need.
These reserves make the Kazakhs very positive, because they know they’re potentially one of the richest countries in the world, per capita.
➏ Are Russia, China and India competing against one another to win influence in Kazakhstan?
Yeah, they want to get in the Kazakh market and have a good relationship with them. Geopolitically speaking, it’s important. Western countries, if they want to have oil, they need to buy it somewhere in Africa, the Middle East or Latin America, where it’s not very stable. But in Kazakhstan you have all these reserves that haven’t been exploited. Europeans and Americans want to control what’s happening there. They don’t want to let it all go to China, India or Russia. That creates many games.
➐ What role does Europe play in the region?
The EU is now talking a lot with Kazakhstan. People there are ambivalent toward Russia because they were invaders; they don’t like Americans because they think Americans are against Muslims; they’re wary of China because of history; and India, they don’t talk about much. For them, Europe has nice countries and they’re keen to learn from us.
➑ Are most of the multinationals operating in Central Asia hiring from the West?
That’s a mistake. Multinationals aren’t finding Kazakhs to run their operations and they’re filling this gap with expats. They’re underestimating the potential of younger people in the region.
More and more you’ll see them try and have an expat working closely with a local, so when the expat leaves, the Kazakh can take over. This is developing, but it’s weak. It will take the time it took in CEE, where 10 years ago you had mostly expats, and today you have almost none.
➒ You mentioned stability. Is the region, with its many authoritative presidents, really stable for investment?
If you talk with a foreign journalist in Kazakhstan, they’ll tell you that democracy is not respected. But if you speak with the Kazakh people, they’ll explain that Kazakhstan was a feudal country, then become a Soviet country and they’re not sure if they’re ready to become a democracy. The president is popular. They believe he is clever in dealing with all these great powers and that he’s improving the quality of life in general.
But there are journalists who have been killed. And the president’s daughter is the head of all media. I’ve seen figures that say 80 percent of Kazakhstan’s resources belong to the close circle around the president.
➓ How developed is the consumer market in Central Asia?
The distribution system is not developed yet and the telecom infrastructure still belongs to the state, making it expensive. But the banking system is developed. It’s quite easy for a European to go to Almaty and open an office, get a flat and get working permits.
Since 2000, Kazakhstan has had double-digit growth. The people are consuming. And they’re thinking short term rather than long term. When they have money, they spend it. Pretty much anyone willing to go to Kazakhstan and sell something that does not exist yet is successful. You see that in all sectors. It’s booming. It’s good everywhere.
Want your top manager to answer our 10 Questions? Send a message to Paul Voosen at
pvoosen@praguepost.com


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