This year the Belarusian economy had to deal with quite a number of challenges. The sluggish demand on major sales markets, the potash scandal and an array of other macroeconomic issues aggravated the imbalances in the monetary and fiscal sectors. It became obvious that some dramatic measures and a systemic approach were needed to rectify the situation. At the session to discuss the socioeconomic development of Belarus, the head of state instructed the government to undertake measures to resolve the existing problems. The joint efforts of the Council of Ministers and the National Bank resulted in the joint action plan to conduct structural reforms and raise the competitiveness of the country’s economy. The plan was adopted in October. It provides for both outofthebox solutions and longanticipated moves. The plan is structured into 12 chapters and features 70 measures. This strategic document will become a remedy for the domestic economy. It is expected to remove the negative symptoms and prevent relapses in the future.
The rational use of financial resources is crucial for balanced economic growth. To meet the macroeconomic targets and keep the economy running smoothly, a country needs an efficient monetary system. Indeed, “save today, safe tomorrow”. However, saving is not enough. It is also important to manage the available resources properly. Chairperson of the Board of the National Bank of Belarus Nadezhda YERMAKOVA unveils the details of the National Bank’s monetary policy for 2014 in an interview with the Economy of Belarus Magazine.
In 2013 the Belarusian economy did not escape the negative impact of the external and internal risk factors. As a result, the growth was inadequate to meet the projections. However, the economic slowdown was experienced by many advanced economies, including the main trading partners of Belarus. The main economic goal for next year is to achieve a compromise between the growth and balanced development given the shrinking foreign markets. What structural economic measures will ensure further growth? What can give an additional impetus to privatization? What to expect from prices, how to reverse the negative situation in foreign trade and all the main areas of economic development in the Belarusian economy? Belarus’ Economy Minister Nikolai Snopkov answers these and other questions in an interview with the Economy of Belarus Magazine.
The joint action plan of the Council of Ministers and the National Bank of Belarus to conduct structural reforms and raise the competitiveness of the domestic economy provides for the elaboration of an action plan to improve corporate governance at companies where central or local governments have a share. Why is it important to optimize corporate governance at companies with governmentowned shares? What measures and mechanisms should be employed for this purpose? How are they supposed to benefit the economy? Should the efforts to improve corporate governance be limited solely to the companies where the government has a share? These and other questions will be addressed by the action plan to improve corporate governance.
The situation on Belarus’ labor market is often described as calm, controllable and manageable. No one doubts that it is really so. However, looking at Belarus’ employment map you will also see some bottlenecks and the sources of possible problems.
A new holding company, Belarusian Leather and Footwear Company Marko, is being set up in Belarus. COOO Marko will act as the managing company. The holding company has set quite impressive objectives: by 2018 it is to start producing at least five million pairs of shoes per year, increase the return on sales up to at least 12% and sales revenues per one employee up to $40,000 at the minimum. These ambitious plans will be materialized by Director General of COOO Marko Nikolai MARTYNOV, the person who runs the successful business he built from scratch 20 years ago. He shared his plans and personal business experience in an interview with the Economy of Belarus Magazine.
The role of Latin America is increasing in the international scene. It is a promising and thriving market. Belarus boasts friendly ties with Venezuela and has maintained contacts with Cuba since the times of the Soviet Union. However, there are other countries in the region that are interested in closer cooperation with our country. Ecuador is one of them.
Belarus intends to expand cooperation in transport with Latvia, its longstanding partner in cargo transportation. At the latest meeting of the intergovernmental bilateral commission for economic and scitech cooperation in Riga on 2223 October the two nations agreed to open representative offices of transportation companies in each other’s territory. The administrations of the Belarusian, Latvian and Russian rail operators also consider a largescale cooperation project.
Chambers of commerce and industry (CCIs) are the oldest business organizations in the world. They are present in virtually all countries, except for maybe the Vatican, Nauru and East Timor. In the last few years, CCIs have been playing an increasingly prominent role in the development of business and commercial activities. At the local and regional level CCIs have been turning into permanent economic consultants of policymakers. They initiate new projects and support business activities hence facilitating integration of national economies into the global economic system. The Belarusian Chamber of Commerce and Industry (BCCI) is no exception. BCCI achievements in 20112013 and prospects for the next three years were in the spotlight of its 9th Congress.
Insurance companies from Western Europe must be jealous of the market opportunities available in Belarus. Here is why. European insurance companies have to operate on a very competitive and mature market established many centuries ago. They have already reached virtually everyone and covered everything, so the market expands by merely 23% per year. The fledgling insurance market of Belarus grows by dozens of percent and this trend is expected to remain in place for years to come. However, things are not as great as they look.
The promotion of exports has been a priority for the Belarus economy for the last few years. In order to foster export, in 2001 the government established the Belarusian import and export insurance enterprise Eximgarant of Belarus. Fully owned by the state, in 2006 the enterprise was granted the exclusive right to insure export risks on behalf of the Republic of Belarus. The effective operation of the national system of insuring export contracts and investments abroad is the strategic goal of the company. Export support instruments became particularly important in 2013 when Belarusian manufacturers were instructed to export more in order to reduce their finished goods inventory. The authorized fund of Eximgarant of Belarus was raised to virtually Br4 trillion; the amount available for insuring export risks with state support in 2013 rose by more than a half to the equivalent of $850 million. Several statelevel decisions were made to improve insurance terms and export insurance terms: the number of documents required to sign an insurance contract has been reduced, the time for processing the documents has been shortened, the insurance and credit procedures have been optimized as well as insurance rates.
Belarus is speeding up informatization processes, with both public and private sectors rapidly switching to electronic means of communication. Soon the Belarusians will have no need to wait in line to get a certificate and organizations will stop exchanging piles of paper documents. Although the state calls all the shots in the process, Belarus’ IT sector is ready to tune in. Overseas the private–public dialogue in IT is quite common: the majority of ideas are offered by experts or research institutes, the so called “factories of ideas”. Infopark Director General and Deputy Chair of the Confederation of Industrialists and Entrepreneurs Vladimir Basko reflects on informatization success stories, challenges and prospects in his interview with the Economy of Belarus Magazine
There is a great number of macroeconomic trends today. Yet companies and enterprises can get competitive advantages through efficient management and decision making. Every division of a company should work in sync with the management team. Modern ERP systems enable a real time communication between “the nerve center” of the company and its production, sales and procurement divisions. ERP systems cannot work miracles. However they can significantly increase a company’s flexibility, minimize the time lag in responding to the changing circumstances and allow getting information about internal issues virtually as soon as they
Sustainable socioeconomic development and independence of our country hinge on the reliable operation of the country’s energy sector. Companies affiliated with Belenergo generate over 93% of the electric energy and over 50% of the heat energy used by households and the manufacturing industry. They also supply nearly 100% of the natural gas used in the country. Their role in maintaining Belarus’ energy security is so big that if energy supplies reduce by one tonne of oil equivalent, industrial enterprises will lose over $4,000 in the form of unproduced goods. First Deputy Energy Minister of the Republic of Belarus Leonid SHENETS tells the Economy of Belarus Magazine about energy security factors and mechanisms, results of the Year of Frugality and development prospects of the Belarusian energy sector.
This figure is quite impressive, because at present SMEs account for about 22% of the country’s GDP. The entrepreneurship promotion program seeks to raise the figure to 30% by the end of 2015.
Private business is sometimes called the human face of economy. Using the same analogy we can say that corporate social responsibility is what makes this face attractive. It is not measured only by economic performance but also by the degree of the business involvement in the life of the society.
The radical modernization of OAO Baranovichi Cotton Production Amalgamation is still in full swing: the necessary equipment is being shipped in and preparations are underway in the shops where modern technological lines are being installed and tested.
Many can be jealous of ASBAgro Teterino, one of four agricultural companies of the ASB Belarusbank. In virtually no time, this lossmaking company has turned into a success story of not just Krugliany District but also entire Mogilev Oblast. Today ASBAgro Teterino boasts high yields in animal husbandry and crop cultivation. Its efficient use of financial instruments to raise profitability of agricultural production can serve as a model for many.
Slightly more than a year ago Vladimir KISELEV, former head of Belarusian Cement Plant, was appointed Chairman of the Kostyukovichi District Executive Committee. The company is the town’s largest employer and the local economy mainstay. It is the undisputable leader in terms of manufacturing performance and many social indicators. Belarusian Cement Plant’s influence on the district economy is significant.
The district is truly the most urbanized one in Minsk Oblast. Urban dwellers constitute more
than half of its 61,300 residents. Dzerzhinsk and Fanipol alone, which are satellite towns of
the Belarusian capital, are home to about 42,000 people.
The chances of getting even more urban dwellers are high. New modern enterprises are being built there, conventional enterprises are getting modernized, investors eagerly come there. Chairman of the Dzerzhinsk District Executive Committee Nikolai ARTYUSHKEVICH already sees the beginnings of a fullscale industrial cluster in the region.
Hotels are an important part of any city’s image. The matter has become particularly relevant in Minsk as the city is gearing up to host the 2014 IIHF Ice Hockey World Championship. So far, Minsk’s hotel capacity is two times smaller than that of Moscow, Saint Petersburg and Kyiv. However, the work is underway to build new hotels and renovate the existing ones. Experts say that by the time of the world championship Minsk hotels will be able to accommodate 9,600 people, well above of today’s 4,900. Who are the new industry players? Will there be enough businessclass and economyclass hotels? What will the hotels do to stay busy after the world championship?
The Minsk National Airport is the main air gateway of Belarus. Located 42km away from the capital it occupies a vast territory with 42 facilities and 38 departments manned by over 2,000 staff. Every year more than 1.8 million passengers go through the airport. Next May, it will welcome hockey teams and fans coming from all over the world for the 2014 IIHF World Championship. The airport is undergoing a major reconstruction project to improve the quality of passenger service. Once it is over, the biggest Belarusian air transportation hub, which marked its 30th anniversary in July 2013, will be even better looking and more functional.
Logoisk is a town in Belarus. It derives its name from the word “log,” which means a big long ravine. And this name really fits the town because you will hardly see much of it when driving along the Vitebsk motorway, except maybe for church steeples jetting high into the sky. The town is safely deposited in a low land edged with forests.
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