Industrial park seeking global investors
China-Belarus economic zone hopes to achieve sustainable development
The China-Belarus Industrial Park has been attracting increasing amounts of global investment since the completion of infrastructure construction in the zone.
By May 2018, 36 companies had registered in the park and signed agreements to invest a total of $1.1 billion.
“We hope to attract highvalue-added high-tech companies that are capable of achieving sustainable development, especially those that can fill the void in the Belarusian economy,” said Li Haixin, director-general of the ChinaBelarus Industrial Park Development Co.
Among the 36 companies, 20 come from China, 10 from Belarus, and six from other parts of Europe and the United States. The companies cover a range of high-tech industries, such as electronics, biotechnology, new materials and mechanical engineering.
“To build an internationalized industrial park, we are actively extending our influence to nearby regions, particularly Europe. The number of regional commissions visiting the industrial park has been on the rise recently,” Li said.
Six companies are currently operating in the zone, and the number will increase to 10 at the end of this year, he said. Chinese companies already settled in the park include Bel Huawei Technologies LLC, ZTE Corp and China Merchants Group.
“The first phase of construction of the industrial park, covering an area of 8.5 square kilometers, is expected to finish in 2020. According to our estimates, it will be able to host 70 to 100 companies by then, with contracted investment totaling $2 billion to $2.5 billion,” he said.
Enterprises that register in the park, with their effective management located in Belarus, will enjoy preferential tax policies. They will be exempt from corporate income tax for 10 years after their first profit, and will pay significantly reduced tax rates after the 10 years until 2062.
The personal income tax rate for their employees will be 9 percent until Jan 1, 2027, compared with 13 percent for Belarusian companies outside the industrial park.
Covering 91.5 square kilometers in total, the China-Belarus Industrial Park, also known as the Great Stone Industrial Park, is the largest China-invested overseas economic and trade park.
Construction of the park, which is a five-minute drive from the Minsk National Airport, formally started in March 2016.
“As a hub for advanced technologies and spreading new ideas, the China-Belarus Industrial Park will drive economic growth in Belarus. We regard it as a hub for the economies related to the Belt and Road Initiative … and will do our best to make this pearl of the initiative brighter,” said Alexander Yaroshenko, head of the Great Stone Industrial Park Administration.
Four Chinese companies, including China National Machinery Industry Corp and China Merchants Group, hold a combined 68 percent stake in China-Belarus Industrial Park Development Co, which has registered capital of $150 million. The remainder of its shares are held by the Great Stone Industrial Park Administration and Duisburger Hafen AG.
China Merchants Group pushed ahead with the project and invested $140 million in the first phase of construction of a commerce and logistics park in the zone — a center for commodities exhibition and trade, logistics and distribution, export processing, customs clearance services and cross-border renminbi settlement.
Bonded warehouses — areas in which taxable goods can be stored or processed without paying duties for a certain period of time — will open and begin operating soon. Customs clearing services will also be provided at the logistics park.
“What is most important for Belarus right now is to introduce good practices from other countries, create a favorable environment for foreign investment and encourage more investors to come to Belarus,” said Hu Zheng, CEO of China-Belarus Industrial Park Development Co, adding that the industrial park will become “a demonstration zone for international norms and standards”.
Due to differences in industrial standards between China and Belarus, the initial design of the industrial park did not meet certain Belarusian requirements.
To solve the problem, Beijing Jianyi Investment and Development (Group) Co Ltd invested 1.5 million Belarusian roubles ($733,000) in the national design institute of Belarus in April for a 60 percent stake.
As a result, architects from both countries can now better integrate the relevant standards and agree designs for residential housing, public construction, factories and warehouses. It will be much easier for the designs to obtain regulatory approval in Belarus, according to Su Lei, CEO of the design institute.
“Architects from both sides will meet many problems as they cooperate, because the two countries have different industrial standards, but we can work together and find the best solutions that meet the Belarusian standards,” said Viktar Skrobat, chief architect for the industrial park project at the design institute.
“China has many advanced design technologies and ideas. Belarus is learning from its experience,” he said.
Jianyi Group said it will promote the design institute among other Russian-speaking countries as an entry point into Europe.
The first phase of construction of the industrial park ... is expected to finish in 2020.”
Li Haixin, directorgeneral of the ChinaBelarus Industrial Park Development Co