The session of the Advisory Council on foreign investments under the government of the country has taken place in Minsk
If there were no such meetings, they should have been devised. The conference hall of the National library was absolutely full. The leaders of major companies and holdings adjoined the members of the Belarusian government; almost fully gathered diplomatic corps was nip and tuck to the youth of the leading higher education institutes. However, the Prime Minister of Belarus Sergey Sidorsky as the chairman of the Council was not the only one, who heeded the requests and expectations of the local and foreign businessmen. The officials of the Ministry of Economics, Ministry of Taxes and Duties, Governmental Customs Committee, National Bank, Supreme Economic Court were carrying on the dialogue, answering the difficult questions of the investors. 

What the investor pays attention to

— I think that many of our colleagues would also be pleased to communicate with the government representatives on the same high level, — remarked the chairman of the board of the German-Belarusian Economic Club in the Republic of Belarus Klaus Bayer. He is one of those, who made a report on the state of Belarusian economics. Mr. Bayer marked that with the creation of the national investment agency a great step forward was made towards the investment’s climate improvement, especially towards the promotion of Belarus as a profitable investment market.
According to Mr. Bayer data, 17.5 percent of the respondents estimated the investment climate as good. In comparison with 2006, this is a higher rate. 51 percent of respondents determined the state of affairs as a satisfactory one. An interesting fact is that more than 30 percent of respondents shared an opinion, that the investment climate has become better. 
The major problem of the Belarusian economy still stays the weak predictability of the legislative base. One can also add the high level of regulation of the private sector and economy. Other minuses are the high taxes rates, difficult system of taxation and customs procedures. Bureaucratic barriers elimination and faster integration of the Belarusian economy into international organizations such as WTO are also desired factors for respondents.

What the businessmen were talking about

Sergey Novitsky from the OJSC “Henkel Butechnik” suggested to educate the specialists in the field of international accounting and to hasten the concordance for the production building. Lorenz Shtotz, the founder of “Shtotz Agroservice” company suggested simplifying the credit system for small and middle-scale business. Sergey Kortyuchenko (“Priorbank” JSC) spoke in support of proposal of the alternative pension insurance creation, insurance and stock market development. Among his suggestions was also an idea to work more with dollar millionaires. Under the Kostyuchenko evaluation, there are 7–10 thousand of millionaires in Belarus, 50–70 thousand in Ukraine and 80 thousand live in Moscow. Konstantin Kolpakov, the founder of “Astanaeksimbank” CJSC, suggested to supply the corporate investors with an open access to the state bank sector. Among the proposals of the representative of the World Bank, Mr. Bell, there was an idea to simplify the tax administration and a wish of faster development for process small— and middle-scale business sector. Sergey Levin, the chairman of the board of CJSC “Syabr” wished that a government would comment the accepted acts of law more transparent. This would help the business representatives make right conclusions. He also suggested to reduce the privileges of governmental companies and to put their competitiveness on the same level with private companies.

What the governmental representatives were talking about

Vladimir Poluyan the first deputy of the Tax Minister informed that the taxation system shall be simplified and reduced until 7–8 basic taxes. The step-by-step cancellation of the circulating payments, taken according to the income, shall be finished by 2010. A system of electronic exchange of information will be created, so the accounting reports shall be checked electronically. In some time the monthly reports will become quarterly.  

According to Vladimir Groshin’s opinion, who is the deputy of the Governmental Customs Committee chairman, the registration of freights on the Russian border can take less than 30 minutes. The 30-minutes term will be real, if the Belarussian customs service will be able to become the information about the freights movements from the customs of the contiguous countries. Vladimir Groshin suggested the investors to conclude agreements about the freights movement preliminary data handing over. 

The deputy of the Supreme Economic Court chairman Liliya Kozyreva remarked that the investors trust to economic courts. In 2006 fifteen hundred actions were considered positively by the economic courts. This testifies the fact that the rights of businessman are effectively defended.

Under the prime minister evaluation the working conditions of investors in Belarus are transparent and understandable: they are regulated by the Investment Code, which is considered as law. In July, 2007 a Customs Code shall get into force and shall be considered as a law of direct action. One of the obligatory conditions for the investor is the transfer of high technologies into the Belarusian economics. The institutes of higher educations educate the qualified specialists, so the country can claim to world’s innovations. All the branches shall be developed, especially agricultural production, woodworking, conversion industry, local industry, medicine. According to Sergey Sidorsky opinion, the government attentively treats the investors, who work in Belarus, the legislative base takes their interests into consideration. In the National Park of high technologies the investors are provided with unexampled benefits. By the way, one of the foreign companies has already intended to invest more than 500 billion dollars to the Belarusian high technology development.

The question about the privatization as one of the means of investments attraction was also put into agenda. Shall there be an attempt to privatize the enterprises of the oil refinery and petrol chemistry, so the delivery of oil to Belarus can be simplified?

The prime minister remarked that the privatization program is approved by the government every year and it includes the enterprises which are in need of inner and external investments. “Our position towards the privatization of our first-rate enterprises is clear — the 100% of shares belongs to the government, the shares are revaluated every year. For instance, the oil costs have grown for the several past years in several times, therefore the capitalization of the enterprises also grows. We are not against their privatization, which is also regularly mentioned by the head of the state, but the investors shall participate in privatization in accordance with the real commercial value of those enterprises. After all, 100–200 billion dollars are invested in modernization of some of them; therefore the capitalization is quite high. If someone has plans to buy these enterprises at a low price — such thing won’t happen in Belarus”, — added the Prime Minister. 

In this context a matter of possible cancellation of the so called “gold share” was asked. It was cancelled in the bank sphere and in the opinion of the Prime Minister the right decision was made. The government uses the right of the “gold share” application in a right way and the matter about its cancellation is incorrect. The “gold share” is used as an instrument of effective property control in many countries. There are examples when an owner brings his enterprise to bankruptcy, as it was with “Alesya” enterprise. The government had to interfere with the help of right of the “gold share” so the conflict could be solved. The state, as the effective owner, installed technological equipment there and brought the working places back to people. The decree about the “gold share” doesn’t prevent the investor from joining the market and creating his own business.

The “gold share” doesn’t refer to this enterprise. If an investor decides to join the oil refinery enterprise, an agreement shall be concluded with him in accordance with the Investment Code. The rules of usage or non-usage will be reflected in the document. By the present time the government has used the right of “gold share” at 8 enterprises, mostly of municipal and republic property form. This is less than hundredth part from all the enterprises and stock companies of Belarus. It is obvious today that the “gold share” is not a barrier for the economical development of the country.

Klaus Bayer, the chairman of the board of the German-Belarusian Economic Club in the Republic of Belarus marked, that the matter of attracting the investors is closely connected with the governmental interference into the private enterprises’ affairs. The government strives for controlling the processes as much as possible. That’s why the investment matter is a matter of compromise. If both sides are able to meet half-way, the barriers will disappear without any assistance. That is also the main purpose of the Advisory Council on foreign investments creation. The Prime Minister Sergey Sidorsky supported the opinion of the foreign colleague about the fact, that in every state a compromise between the government and the businessmen shall be found.

Alexander Sokolovsky
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