POLITICS & INSTITUTIONS - ECONOMY

Economic missions in the age of covid: is in-person necessary?



The pandemic has disrupted the organisation of economic missions Shutterstock

The pandemic has disrupted the organisation of economic missions Shutterstock

The pandemic has forced institutions active in the promotion of the country and its financial centre to rethink their strategies. 

Economic missions are a very well-oiled mechanism, even if the pandemic has served as a fly in the ointment.

It’s impossible to measure the impact of these missions, and whether it really matters in the short term. Not doing so would be a mistake for a country like Luxembourg for which, given the size and openness of its economy, the only way for a company to develop is to look beyond its borders.

Historically, these missions multiplied in the 1970s in order to promote the diversification of the economy and find new markets. The idea was not to be too dependent on large US industrial and chemical companies attracted in the 1950s and 1960s. This boom went hand in hand with the extension of the network of ambassadors and of Luxembourg trade & investment offices (LTIO), dependent on the economy ministry, whose role is to develop knowledge of local markets, identify potential investors and support companies in foreign markets. 

Other private actors are playing their part, and working to identify new opportunities. This is the case with the Luxembourg Chamber of Commerce, Luxembourg for Finance (LFF) and professional associations such as the Luxembourg Association of Investment Funds (ALFI).

Between a state visit and a work mission, there is a whole range of events used for the purposes of promoting the country and prospecting. At the top is therefore the state visit led by the grand duke, always accompanied by at least one member of government. These political visits are often accompanied by an economic delegation. 

Then comes the official visit. It is led by a minister and often the hereditary grand duke chairs it. These missions are mixed, political and economic, and give rise to prospecting and promotion opportunities with known or potential investors. In terms of purely economic promotion, it is the economy ministry and the Chamber of Commerce which act as the linchpins. And in financial matters, the prime contractors are the finance ministry and LFF.

Each has its own methods. At LFF, the highlight of a visit is the seminar. The B2B component is less developed than that of the Chamber of Commerce. The reason? In the financial industry, players are more global than SMEs and are able to schedule their meetings on the sidelines of conferences. Conversely, the Chamber of Commerce has a majority of SMEs among its flock for which it has developed digital B2B tools to facilitate networking.

The action of the Chamber of Commerce, LFF and ALFI is not confined to these "high masses". Each has its programme of "small format" missions for which the objective is to prospect and maintain--even improve--already existing contacts.

But that was before. The "classic" organisation of travel-related missions has become impossible, as has the organisation of gatherings of people, and it has therefore been necessary to adapt.

For the Chamber of Commerce--whose competence in organising missions, fairs and conferences is recognised--it quickly realised these needed to adapt. “The obvious lead was digitalisation,” summarises Cindy Tereba, director of international affairs. “In practice, a mission is made up of several pillars: the official section, the inauguration with the personalities who will try to draw attention to a market, to an event; the information section, the analysis market potential and then provide information on these opportunities; and the third pillar, which is networking and B2B contact. On these three pillars, we looked for alternatives. We now invite ministers and representatives of Chambers of Commerce to intervene digitally on what are called e-missions. On the second pillar, we identify sectors that have potential for collaboration with the target country or region and we do dedicated seminars in these sectors with presentations and digital roundtables where people can talk. And for the third pillar, B2B, we try in a digital session to bring people together and give them a voice. A word they do not take during seminars. In addition, our companies can use our digital platform to make contacts and establish links with potential partners.”

The digital switchover is something LFF has also implemented. The traditional flagship event of any visit, the seminar, has been completely virtual since the start of the 2020 school year. “We launched 'Focus on', twice a month with alternate thematic and geographic presentations,” says Philipp von Restorff, LFF deputy CEO. Until the end of the year, the entire event programme will be digital. As for business development, "a face-to-face activity, as soon as we can get back on the plane, we will."

If the switch to all digital allows real follow-up of existing contacts, this poses problems for the markets to be cleared, recognises Marc-André Bechet, ALFI deputy director general. 

“For the most part, all the stakeholders with whom ALFI is in regular or episodic contact, public or private, have continued their interaction with us via digital. The existing network can be maintained electronically. It’s true that we suffered a bit from not seeing each other, but that didn’t stop us from working. ” Contacts mainly took the form of private interviews, roundtables or dedicated webinars, therefore not open to the public.

As for events open to the public, the traditional "roadshows", the switch to digital took place 14 months ago. Digi Pulse was established as the ALFI brand for online conferencing, and one which has been called upon not to disappear from the landscape once the health crisis has passed.

Indeed, this urgent switch to digital raised awareness of the daily benefits that the pre-covid routine could mask without suffering too much from efficiency or productivity.

The first advantage of the digital transition is that you don't have to move. “Setting up a delegation takes time and is expensive. It’s a huge financial and human investment,” says Bechet. "Working remotely allows for much more frequent, regular and much simpler contact. If we already have the right contacts."

The formula has found its audience. Tereba notes both a very high satisfaction rate on the part of its members--“over 90%--and a high participation rate--even higher than that of physical missions.”

The second advantage is that digital missions can be shorter, more targeted, more incisive, and extend reach. An observation made by ALFI, as well as by the Chamber of Commerce and LFF. “We have seen, with supporting figures, that we have succeeded in having an audience which is quantitatively more numerous than what we have succeeded in doing during economic missions, but also from a very high level qualitative point of view,” von Restorff explains.

And in future? It seems that digital and face-to-face will coexist, and that hybrid events will become the norm. ALFI will relaunch its physical roadshows. The events will be organised face-to-face, but those who wish will be able to connect remotely. The Chamber of Commerce is also considering how to combine digital and face-to-face. The Dubai World Expo should serve as a life-size test.

However, on-site visits will not disappear. They remain essential for maintaining contacts and opening up new markets. “The human aspect will always remain important”. For Cindy Tereba, it is clear that any mission must be completed with at least one site visit. But these visits will surely be more targeted and will now involve smaller delegations. LFF, as soon as possible, plans to get back on the plane with a focus on networking events and bilateral meetings. Just like ALFI: “We will partially return to site visits to renew contacts and have discussions. It’s always important,” says Bechet.

This article was originally published on Paperjam and has been translated and edited for Delano.