Com­ing Closer

Be­larus and Saint Peters­burg have plans to ramp up trade and eco­nomic co­op­er­a­tion

Economy of Belarus - - CONTENTS - Olga BElYAVSKAYA

Be­larus and Saint Peters­burg have plans to ramp up

trade and eco­nomic co­op­er­a­tion

Part­ner­ship En­ergy

The Be­laru­sian head of govern­ment as­sured Saint Peters­burg Gov­er­nor Valentina Matviyenko of Be­larus’ strong com­mit­ment to deep­en­ing the com­pre­hen­sive co­op­er­a­tion with Rus­sia’s north­ern cap­i­tal across all ar­eas of mu­tual in­ter­est, in­clud­ing trade, econ­omy, in­vest­ments, sci­ence and tech­nol­ogy and hu­man­i­tar­ian ac­tiv­i­ties and cul­ture. The par­ties have al­ready made much head­way in these fields. The steady growth of the bi­lat­eral trade is a tes­ti­mony to that. In 2010 the trade be­tween Be­larus and Saint Peters­burg amounted to $1.3 bil­lion, up al­most

Saint Peters­burg has long been Be­larus’ im­por­tant and re­li­able trade and eco­nomic part­ner. Busi­ness, man­u­fac­tur­ing, hu­man­i­tar­ian and cul­tural links be­tween the par­ties get even stronger year to year. in 2010 alone, the trade be­tween Be­larus and Saint Peters­burg reached $1.3 bil­lion, up 29.2% from the pre­vi­ous year. how­ever, the par­ties are con­vinced that many more co­op­er­a­tion op­por­tu­ni­ties have yet to be ex­plored. Be­larus’ del­e­ga­tion led by Prime Min­is­ter of Be­larus Mikhail Myas­nikovich took part in a re­cent ses­sion of the Be­larus-saint Peters­burg Busi­ness Co­op­er­a­tion Coun­cil to dis­cuss promis­ing co­op­er­a­tion projects, ex­pan­sion of the bi­lat­eral trade and re­brand­ing on the in­ter­na­tional mar­ket.

30% over 2009. Be­larus’ ex­port soared by 42.5% to $828.6 mil­lion, the im­port went up by 9.8% to $440.8 mil­lion. Be­larus posted a for­eign trade sur­plus of $387.8 mil­lion. Be­larus’ ma­jor exports to Saint Peters­burg were food­stuffs, in­clud­ing fresh, cooled and frozen beef, poul­try, pork, cheese, cot­tage cheese, etc. Be­larus’ ma­jor imports from Saint Peters­burg were fer­rous scrap, equip­ment for metal heat treat­ment, to­bacco and its in­dus­trial sub­sti­tutes, metal prod­ucts, etc.

In Jan­uary-april 2011, the bi­lat­eral trade main­tained mo­men­tum: it rose by al­most 45% over 2010 to $510.9 mil­lion. The ex­port to­taled $318.6 mil­lion (up 30.3%), the im­port made up $192.3 mil­lion (up 76.9%). Be­larus’ for­eign trade sur­plus was $126.3 mil­lion.

De­spite the im­pres­sive fig­ures, Be­larus and Saint Peters­burg have a con­sid­er­able un­tapped po­ten­tial to deepen the bi­lat­eral co­op­er­a­tion, Mikhail Myas­nikovich is con­vinced. In his view, the ef­forts should be pri­mar­ily chan­neled into the in­vest­ment field. The par­ties have amassed con­sid­er­able ex­pe­ri­ence in run­ning joint in­vest­ment projects. Thanks to them, modern fa­cil­i­ties to man­u­fac­ture Be­laru­sian ma­chin­ery have been set up in Saint Peters­burg, while our coun­try has as­sim­i­lated state-of-the-art Saint Peters­burg tech­nolo­gies.

The Be­laru­sian head of govern­ment still warned against com­pla­cency. The two par­ties can find even more ar­eas of com­mon in­ter­est. Be­larus, for ex­am­ple, seeks Rus­sian in­vest­ments into the phar­ma­ceu­ti­cal in­dus­try. Our coun­try is will­ing to con­sider all co­op­er­a­tion forms – from sim­ple in­vest­ing to set­ting up joint ven­tures. Ev­ery year Be­larus spends hundreds of mil­lions of dol­lars on for­eign medicines. In the short­term per­spec­tive Be­larus is go­ing to con­sid­er­ably cut down on drug imports, and the Saint Peters­burg ex­per­tise and knowl­edge might be of great use to our coun­try.

The par­ties are highly in­ter­ested in other high-tech fields as well, in­clud­ing in­for­ma­tion and com­mu­ni­ca­tion tech­nolo­gies. To ma­te­ri­al­ize the plans, par­tic­i­pants of the ses­sion made the de­ci­sion to draft a sep­a­rate sci-tech and in­vest­ment co­op­er­a­tion pro­gram. This pro­gram en­vis­ages, among other things, the es­tab­lish­ment of a re­search and pro­duc­tion base to carry out joint transna­tional projects.

Be­larus has in­vited the busi­ness com­mu­nity of Saint Peters­burg to take part in its pri­va­ti­za­tion pro­gram, which of­fers a great out­look for the two par­ties. About 250 Be­laru­sian com­pa­nies are slated for pri­va­ti­za­tion, in­clud­ing those in the con­struc­tion in­dus­try, light in­dus­try and agribusi­ness. Be­larus gives pref­er­ence to the Cus­toms Union mem­ber states and ex­pects a more proac­tive stance and greater en­thu­si­asm from Rus­sian com­pa­nies.

“We in­vite busi­ness cir­cles of Saint Peters­burg to take part in the pri­va­ti­za­tion pro­gram. We are open to most am­bi­tious pro­pos­als,” Mikhail Myas­nikovich said. He re­as­sured the Rus­sian part­ners that pri­va­ti­za­tion will be hon­est and open. Be­larus is will­ing to co­op­er­ate with those busi­ness cir­cles that strictly abide by the so­cial part­ner­ship prin­ci­ples. Peo­ple’s prob­lems should not be marginal­ized giv­ing way to profit mak­ing.

Be­larus and Saint Peters­burg give a spe­cial pri­or­ity to man­u­fac­tur­ing co­op­er­a­tion. Be­larus took part in the con­struc­tion of enterprises to pro­duce small-size trac­tors, el­e­va­tors in Saint Peters­burg. The con­struc­tion of a trol­ley­bus assem­bly fa­cil­ity is near­ing com­ple­tion. The Busi­ness Co­op­er­a­tion Coun­cil de­cided to boost and ex­pand these pro­duc­tions. The two par­ties will keep work­ing on joint man­u­fac­tur­ing projects. Be­larus, on its part, is ready to do its ut­most to bring these projects into be­ing.

Be­sides, Be­laru­sian com­pa­nies could of­fer ben­e­fi­cial con­tracts to Saint Peters­burg to sup­ply ma­chines for the city’s needs. Be­larus seeks to com­pete on equal terms with other pro­duc­ers for mu­nic­i­pal ten­ders. In re­turn, it could of­fer re­li­able ma­chines and mu­tu­ally ac­cept­able pay­ment schemes.

One of such projects could be the de­sign and pro­duc­tion of the so-called hy­brid trol­ley­buses that can travel with­out over­head wiring. This will help re­duce traf­fic jams. Be­sides, these trol­ley­buses are eco-friendly and have an im­proved de­sign. This au­tumn the new trol­ley­buses will be tested in Rus­sia’s north­ern cap­i­tal. If they pass the test, Saint Peters­burg is ready to ne­go­ti­ate new con­tracts to pur­chase them.

“We have come up with a pro­gram to in­tro­duce new types of pas­sen­ger trans­port which will be more ad­vanced and in­no­va­tive. We have put for­ward these re­quire­ments to our Be­laru­sian part­ners. Be­laru­sian spe­cial­ists are ready to start test­ing this type of ve­hi­cles as early as this year. We ea­gerly pur­chase Be­laru­sian trol­ley­buses as well as buses, trac­tors and other ma­chines. They are com­pet­i­tive and have a good qual­ity,” Valentina Matviyenko said.

Sat­u­rat­ing the De­mand

A key area for at­ten­tion at the ses­sion was co­op­er­a­tion in the food in­dus­try. Be­laru­sian prod­ucts earned an ex­cel­lent rep­u­ta­tion in Rus­sian re­gions long ago, in­clud­ing Saint Peters­burg. There our dairy prod­ucts, cheese and cot­tage cheese are ex­tremely pop­u­lar. These prod­ucts have be­come a tra­di­tional treat for many Rus­sians. The Saint Peters­burg Govern­ment sup­ports Be­laru­sian pro­duc­ers and helps Be­laru­sian food com­pa­nies to make their way to Rus­sian cus­tomers. Ev­ery year mu­nic­i­pal and district au­thor­i­ties of Rus­sia’s north­ern cap­i­tal al­lo­cate fair sites and additional shop­ping space for Be­laru­sian

com­pa­nies to get a stronger foothold on the Rus­sian mar­ket.

The con­struc­tion of chain stores Belorussky Gostinets (the Be­laru­sian Gift) in Saint Peters­burg is ex­pected to boost the sup­plies of food­stuffs from Be­larus to Saint Peters­burg. Eight stores have al­ready opened, an­other twelve are due to open by the end of the year.

“The project will make it pos­si­ble for Be­laru­sian man­u­fac­tur­ers to ship their prod­ucts to Saint Peters­burg with­out any me­di­a­tors and markups. The city ad­min­is­tra­tion has al­ready al­lo­cated plots for such stores. The projects will be com­pleted in two or three years,” Valentina Matviyenko said.

Mikhail Myas­nikovich, in turn, em­pha­sized Be­larus’ in­ter­est in de­liv­er­ing more food and new types of food to Saint Peters­burg. This will re­quire new forms of work, in­clud­ing more ac­tive use of lo­gis­tic cen­ters. At least 35 lo­gis­tic cen­ters will be built and com­mis­sioned in Be­larus be­fore 2015. Un­der the lo­gis­tics de­vel­op­ment pro­gram, 23 in­vest­ment projects are im­ple­mented in Be­larus to con­struct lo­gis­tic cen­ters at 22 sites out of 50 des­ig­nated ones. The to­tal in­vest­ments in the projects are es­ti­mated at over Br3 tril­lion. This year three new cen­ters have been in­au­gu­rated in Be­larus, in­clud­ing Minsk-belta­mozh­ser­vice, BrestBelta­mozh­ser­vice and Twenty-four. The first phase of an­other two lo­gis­tic cen­ters will be com­pleted this year: Lo­gis­tic Cen­ter Prile­sie, Belvinges­lo­gis­tic as well as the sec­ond phase of Blt-lo­gis­tic. Their po­ten­tial can be suc­cess­fully uti­lized while ex­port­ing agri­cul­tural prod­ucts to Rus­sia, in­clud­ing Saint Peters­burg.

In gen­eral, the head of govern­ment be­lieves that the de­mand for Be­laru­sian prod­ucts in Rus­sia will be grow­ing. Be­larus is ready to promptly re­spond to this trend and sat­isfy the de­mand.

In Jan­uary-april this year, ex­port of cer­tain agri­cul­tural prod­ucts from Be­larus to Saint Peters­burg rose sig­nif­i­cantly. For ex­am­ple, the sup­ply of fresh and chilled beef rose by 83%, or by $18.3 mil­lion, that of pork was up 3.2 times ($8.7 mil­lion), meat and poul­try ed­i­ble of­fal dou­bled to $6.8 mil­lion.

“Our food prod­ucts have a high rep­u­ta­tion on the mar­ket of Saint Peters­burg. They are in de­mand, which con­firms their high consumer prop­er­ties and qual­ity”, said Mikhail Myas­nikovich.

The Prime Min­is­ter drew at­ten­tion to the fact that given the cur­rent eco­nomic sit­u­a­tion, it is in­creas­ingly im­por­tant for Be­larus to step up ex­port for the sake of additional hard currency rev­enues. The head of govern­ment stressed that Be­larus is in­deed deal­ing with cer­tain eco­nomic dif­fi­cul­ties, but cri­sis is not the word to use.

“The econ­omy is func­tion­ing, enterprises are work­ing, and ex­port is in­creas­ing. There is a real chance to im­prove the bal­ance of pay­ments. The sta­bi­liza­tion loan from the EURASEC An­ti­cri­sis Fund will not be used to ar­ti­fi­cially re­strain the ex­change rate. We will be tread­ing care­fully. We need to re­store con­fi­dence in the currency.”

In turn, Valentina Matviyenko said that Saint Peters­burg is ready to sup­port Be­larus in the cur­rent eco­nomic sit­u­a­tion.

“Saint Peters­burg has a spe­cial at­ti­tude to­wards the Be­laru­sian peo­ple. We em­pathize with the eco­nomic is­sues you are all fac­ing to­day. I be­lieve that the Be­laru­sian peo­ple will cope with these prob­lems and the sit­u­a­tion will sta­bi­lize. On our part we are will­ing to lend a help­ing hand to our Be­laru­sian part­ners,” she said.

From Joint Ven­tures To­wards In­ter­na­tional Al­liances

Ac­cord­ing to the Saint Peters­burg Gov­er­nor, in­dus­try, trade, en­ergy, agri­cul­ture and hous­ing con­struc­tion are the pri­or­ity ar­eas for fur­ther eco­nomic co­op­er­a­tion be­tween Be­larus and Saint Peters­burg. Spe­cial at­ten­tion, in her opinion, should be paid to new, in­no­va­tive projects to de­velop sci­ence-in­ten­sive high-tech­nol­ogy com­pet­i­tive enterprises.

“To­day, it is im­por­tant to es­tab­lish joint ven­tures and make glob­ally com­pet­i­tive high-tech prod­ucts. We are open to projects of new times, a new era. We are well po­si­tioned to suc­ceed. And we do not doubt the re­li­a­bil­ity of our Be­laru­sian part­ners,” she said.

The Prime Min­is­ter of Be­larus sup­ported this idea. Be­larus and Rus­sia are work­ing on sim­i­lar projects al­ready. For ex­am­ple, MAZ and KA­MAZ truck pro­duc­ers are now work­ing on a project to set up a hold­ing com­pany Ros­belavto. Ac­cord­ing to Mikhail Myas­nikovich, it is time Be­larus and Saint Peters­burg moved from sim­ple trade to more com­plex forms of co­op­er­a­tion – cre­ation of transna­tional al­liances.

Be­larus now seeks to join in­ter­na­tional cor­po­ra­tions to ex­pand the ge­og­ra­phy of its exports. The govern­ment is now look­ing into a pos­si­bil­ity to set up large national com­pa­nies and in­te­grate them fur­ther into transna­tional al­liances. The world is glob­al­iz­ing and in­te­grat­ing com­mer­cial, in­dus­trial and in­tel­lec­tual cap­i­tal into a sin­gle sys­tem. Be­larus in­tends to get ac­tively in­volved in these pro­cesses. The in­te­gra­tion should be com­pre­hen­sive cov­er­ing the man­u­fac­tur­ing in­dus­try, sci­ence, and ser­vices sec­tor.

“Sim­ple com­mod­ity co­op­er­a­tion is a good thing, but it has no fu­ture. We must unite into multinational cor­po­ra­tions to pro­duce new goods. I think that here we have good prospects,” the Prime Min­is­ter said.

In par­tic­u­lar, one of the first ma­jor joint projects may be the pro­duc­tion of LED lamps. Be­larus and Saint Peters­burg could work to­gether to cre­ate such a man­u­fac­ture on the ba­sis of the light-emit­ting diodes fa­cil­ity that op­er­ates in Saint Peters­burg.

Be­sides, Be­larus is in­ter­ested in im­ple­ment­ing an­other am­bi­tious project in the north­ern cap­i­tal of Rus­sia, namely a project to set up a joint high tech­nol­ogy park. Mikhail Myas­nikovich sug­gested think­ing over this project and also pro­vid­ing pref­er­en­tial con­di­tions for its res­i­dents.

By the way, sci­en­tists of both coun­tries have vast ex­pe­ri­ence of co­op­er­a­tion in such ar­eas as de­vel­op­ment of new ma­te­ri­als, bio and nan­otech­nol­ogy, IT in­dus­try, en­ergy, medicine and phar­ma­ceu­ti­cals, me­tal­lurgy, ma­chine tool in­dus­try and many oth­ers. Re­search in­sti­tutes and cen­ters of Be­larus and Saint Peters­burg have worked to­gether to de­velop new nano­ma­te­ri­als, struc­tural and func­tional el­e­ments based on them, re­source-sav­ing ecofriendly tech­nolo­gies in pro­cess­ing and stor­age of food raw ma­te­ri­als, new pro­duc­tion tech­nolo­gies based on pro­cessed peat, sapro­pel, and other min­eral raw ma­te­ri­als. Col­lab­o­ra­tive re­search was con­ducted in the field of the­o­ret­i­cal and ap­plied elec­tri­cal en­gi­neer­ing, in­tel­li­gent in­for­ma­tion tech­nolo­gies us­ing aero­space data.

To­day, sci­en­tists in Be­larus and Saint Peters­burg pur­sue quite am­bi­tious sci­en­tific goals. They are set to de­velop in­tel­li­gent sys­tems and ad­vanced tachographs for the trans­port sec­tor, new tech­nolo­gies for forestry and road trans­port, high­pre­ci­sion nav­i­ga­tion sys­tems for agri­cul­ture, a tech­nol­ogy for ac­cel­er­ated re­pro­duc­tion of breed­ing an­i­mals for agri­cul­ture, a new se­ries of san­i­tary and hy­giene ma­te­ri­als and prod­ucts for health­care.

It would be eas­ier to solve many of these and other prob­lems in joint sci­en­tific as­so­ci­a­tions – in­dus­trial parks, re­search cen­ters and aca­demic al­liances.

Peace­ful Atom

Of par­tic­u­lar in­ter­est for Be­laru­sian sci­en­tists is co­op­er­a­tion in nu­clear en­ergy. In 2017 Be­larus plans to put into op­er­a­tion the first unit of its own nu­clear power

plant. It will be built to the Rus­sian NPP-2006 project de­vel­oped by the Re­search and De­sign In­sti­tute Atomen­er­go­proekt (SPBAEP), which is part of the Rosatom State Cor­po­ra­tion.

While in Saint Peters­burg, Mikhail Myas­nikovich vis­ited the in­sti­tute where he talked about co­op­er­a­tion be­tween Be­laru­sian and Rus­sian ex­perts on the nu­clear power plant con­struc­tion project.

Ex­ec­u­tives and lead­ing ex­perts of SPBAEP told the Prime Min­is­ter of Be­larus that the project is dis­tin­guished by the ad­vanced se­cu­rity and techno-eco­nomic char­ac­ter­is­tics and is fully com­pli­ant with in­ter­na­tional stan­dards and IAEA rec­om­men­da­tions. Pro­to­types of the Be­laru­sian nu­clear power plant in­clude the Baltic nu­clear power plant in Kalin­ingrad and Len­ingrad NPP-2, which uses the so­lu­tions tested at the Tian­wan NPP in China, the first two units of which were built by Rus­sia and have been in op­er­a­tion since 2007.

The Be­laru­sian NPP will be out­fit­ted with four du­pli­cate safety sys­tem chan­nels, a fu­sion lo­cal­iza­tion de­vice, a dou­ble shell for the reac- tor’s build­ing, a sys­tem to re­move hy­dro­gen, sys­tems for pas­sive heat dis­si­pa­tion. The in­stal­la­tion will be able to sur­vive an earthquake of seven points on MSK-64 scale. It will use a water-cooled power re­ac­tor, which safety has been con­firmed by many years of ac­ci­dent-free ex­ploita­tion.

SPBAEP plans to send the tech­ni­cal doc­u­men­ta­tion of the prepara­tory pe­riod to the Glav­go­s­ex­per­tiza au­dit in­sti­tu­tion in Septem­ber this year. Earth­work op­er­a­tions to build the foun­da­tion pit for the Be­laru­sian nu­clear power plant are to start in au­tumn 2011.

Mikhail Myas­nikovich noted that Be­larus would like the NPP con­struc­tion project to run on sched­ule. Be­larus and Rus­sia have al­ready de­fined the ba­sic prin­ci­ples of fi­nanc­ing the project, from the con­struc­tion of the nu­clear is­land to en­gi­neer­ing in­fra­struc­ture. Be­larus has de­cided against a Rus­sian loan to fi­nance the con­struc­tion of so­cial fa­cil­i­ties. These works will be fi­nanced by Be­larus it­self.

Now the sides are fi­nal­iz­ing the con­tract and loan agree­ments to build the nu­clear power plant. Be­larus ex­pects to bor­row $6 bil­lion to $7 bil­lion from Rus­sia.

To­day, Rus­sian spe­cial­ists are help­ing Be­laru­sian coun­ter­parts to de­velop a national strat­egy for ra­dioac­tive waste treat­ment. This strat­egy should in­clude a range of re­search, de­vel­op­ment, de­sign work and the or­ga­ni­za­tional and tech­ni­cal mea­sures to cre­ate the in­fra­struc­ture for pre­vi­ously ac­cu­mu­lated ra­dioac­tive waste and for waste that will be gen­er­ated dur­ing the op­er­a­tion of the fu­ture nu­clear power plant. The strat­egy may be im­ple­mented within the frame­work of the Union State pro­gram “De­con­tam­i­na­tion and re­pro­cess­ing of ra­dioac­tive waste pro­duced dur­ing the op­er­a­tion of the nu­clear power plant”. Rus­sian ex­perts are ready to as­sist Be­larus in ad­dress­ing these is­sues be­cause they are in­ter­ested in con­struc­tive co­op­er­a­tion with the Be­laru­sian side.

It is ex­pected that in the fu­ture bi­lat­eral Be­laru­sian-rus­sian part­ner­ship, in­clud­ing part­ner­ship with Saint Peters­burg re­search in­sti­tutes and cen­ters, will be ex­panded. This ap­plies both to the con­struc­tion of the nu­clear power plant and nu­clear in­dus­try per­son­nel train­ing.

Promis­ing ar­eas of eco­nomic co­op­er­a­tion were dis­cussed

at a meet­ing of the Be­larusSaint Peters­burg

Busi­ness Co­op­er­a­tion Coun­cil, which was held in the north­ern cap­i­tal of Rus­sia on 23 June 2011.

Be­larus trol­ley­buses are in­creas­ingly pop­u­lar in Saint Peters­burg

Be­laru­sian cheese is in high de­mand in Saint Peters­burg, as well as in other

Rus­sian re­gions

Be­larus` pro­posal to es­tab­lish a joint High-tech Park was wel­comed by par­tic­i­pants of the meet­ing of the Be­larusSaint Peters­burg Busi­ness Co­op­er­a­tion Coun­cil.

Ex­ec­u­tives and lead­ing ex­perts of SPBAEP in­formed the Prime Min­is­ter of Be­larus that the Be­laru­sian NPP

project is dis­tin­guished by the

ad­vanced se­cu­rity and techno-eco­nomic char­ac­ter­is­tics and is fully com­pli­ant

with IAEA rec­om­men­da­tions

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