Positive changes in the development of the industrial complex took shape in Belarus last year
Yuri CHEBOTAR, the Head of the Industry, Transport and Communications
Department at the Economy Ministry of the
Republic of Belarus
In 2012 a program document was adopted in Belarus defining the main targets of the industrial policy for the period till 2020. The program is built around structural changes of the production sector. The state management of the production sector has to improve, quality-based targets to evaluate the development of the production sector are supposed to be introduced. The program also envisages manufacturing cooperation with other countries, the choice of growth points and promising market niches. The program outlines conceptual guidelines for accomplishing these tasks. In practice the tasks will be fulfilled by adopting annual forecasts of the social and economic development of the production sector and its branches. Analyzing the progress that has been made since the program was adopted, we see several successful accomplishments.
New Approaches and Forms of Work
Since the program was launched, the approaches to providing state support to the production sector have changed. In order to stimulate the implementation of innova- tive and highly-effective projects, a number of legal acts have been passed to guarantee state support for the projects. The amount of support will be commensurate with the importance of a project. These legal acts are Belarus President’s Decree No.357 of 7 August 2012, which regulates the replenishment and use of innovation funds, Decree No.231 of 6 June 2011, which stipulates measures to encourage the development of highly-effective manufacturing, and Decree No.301 of 8 July 2013, which stipulates measures to encourage investment projects with a high added value. For the sake of supporting the modernization of existing enterprises Belarus President’s Decree No.182 of 28 March 2006 has been amended. The decree provides for measures to optimize the provision of state support to legal persons and self-employed businessmen.
Within the framework of the Single Economic Space and the Commonwealth of Independent States work is in progress to shape a unified industrial policy for the sake of expanding the use of manufacturing cooperation, increasing localization of assembly projects, and expanding cooperation with foreign transnational corporations.
The draft treaty on establishing the Eurasian Economic Union has a section dedicated to the production sector. It was prepared by experts of the Single Economic Space member states. The section outlines universal approaches to implementing national industrial policies in the member states as well as common rules for
providing industrial subsidies. Belarus’ approach to integration terms relies on the need to enable competitiveness and successful operation of Belarusian enterprises in the medium term and the long term. Pushing jointly manufactured products to third countries is the idea.
Work is in progress to create an industrial policy ministry. Making the transition to a branch-wise policy is the ultimate goal. Instead of managing individual enterprises ministries will enable conditions for the development of entire industries.
The improvement of the organizational and legal forms of industrial enterprises continues via reorganization and establishment of holding companies.
In 2013 the share of holding companies in the overall industrial out- put rose by 4 percentage points from 2012 to reach 15.8%.
The Industry Ministry alone has created 12 holding companies. The companies are Horizont, BelOMO, Autocomponents, BelavtoMAZ, Amkodor, Belarusian Metallurgical Company, Belstankoinstrument, BelAZ Holding Company, Lidselmash, Bobruiskagromash, Minsk Motor Plant, and Integral.
Work has begun to hand over non-core assets to municipal authorities. Those are halls of residence, sanatoriums, and health camps. In theory these assets are supposed to enhance the basic benefits package. In practice, however, they suffer from ineffective management.
The practice of outsourcing repair, guard, cleaning, and other kinds of secondary services is getting more and more popular. The subcontractors are sometimes former structural divisions of the customer company, which have been converted into independent daughter enterprises. After the conversion they are free to offer their services not only to the parent company but to the entire market.
Outsourcing has proved to be an efficient solution for the Belarusian state-run petrochemical industry concern Belneftekhim. Last year Grodno Azot set up five unitary enterprises, Svetlogorsk Khimvolokno set up one enterprise, with another enterprise established by Mogilevkhimvolokno. Plans have been made to set up another 14 enterprises in 2014, including in Belshina, Gomel Chemical Plant, and Naftan.
Work is in progress to create an industrial policy ministry in Belarus. Making the transition to a branch-wise policy is the idea. Instead of managing individual enterprises ministries will enable conditions for the development of entire industries