In 2003, Gomel region was the first among the country’s regions to try attracting potential investors via forums. Its favourable geographical location (bordering Russia and Ukraine), strong industrial potential — with export orientation — and good levels of training made it a natural leader for the south-east of the country, attracting foreign investments into the republic as never before.The first forum gathered representatives from just five countries, with most participants representing diplomatic missions and government agencies. However, as the years passed, the situation significantly changed. The 2008 forum aroused interest among two dozen states and resulted in six signed protocols regarding a range of large investment projects — all now underway.
This year, the organisation of the forum met an obstacle in the shape of the global financial crisis. However, pessimistic forecasts didn’t stop the organisers. They were confident that business (by definition) never stagnates, even under difficult conditions. For the first time in the history of the forum, the number of businessmen exceeded that of officials.
“Today, investors are looking for new niches. They want to change their strategies and geography of business during these crisis conditions. If they are interested in Eastern Europe, our task is to force them to come to us!” the organisers of the forum assert.
Over recent years, Belarus has made great progress, ranked among the world’s top four for active reforms. Moreover, it ranks 85th among 181 states regarding business conditions. The number of companies with foreign investments has doubled — to reach around 5,000. Preferential taxation terms are available to businesses in small towns and free economic zones. Plans are now afoot to open a bank offering loans to small businesses, with a decree on the pledge of property and financial market development in the pipeline.
This year’s forum attracted those eager to explore the region’s prospects after using Internet resources. Businessmen already active in Belarus also attended, such as Heineken (which purchased the controlling share of Rechitsapivo JSC and took its first steps at the forum in 2008).
“Over the next two years, our company plans to completely modernise the enterprise’s production facilities and invest around 5m euros,” reveals Henk van Gelderen, the Head of Heineken’s office in Belarus. “In 2009, we plan to spend $1.5m — which we see as a timely investment. Support from state authorities helps us greatly. Of course, the crisis does affect us; however, those who invest in the Belarusian economy today will receive great results,” he stresses.
An investment project is underway to develop Podkamenie and Shirokoe chalk deposits in the Vetka district and to construct a cement plant on their premises. It is being handled by Iranian Azarab IND.CO. Company representative Ahmad Mahdi Soltani tells us that investigations into the first deposit are complete and specialists will soon start working on the second field. The project is estimated at $250m.
Businessmen also discussed other large investments. With Austrian capital, Gomel Glass Container Plant has begun manufacturing glass jars; another glass container production facility has come into operation with the help of a Russian investor. Gomelsteklo is successfully modernising its float glass facilities, supported by German banks, while a trade and public centre is being constructed in Svetlogorsk using Iranian capital. Additionally, the manufacture of light aircraft is being organised with the help of investors from Austria and Russia.
The organisers of Gomel Economic Forum–2009 presented over 100 investment projects dealing with various branches. Three of the most topical were presented at the opening. “We propose to set up a transport and logistics centre at the intersection of three transport corridors, 15km from Gomel on a 200 hectare site,” noted Igor Skvortsov, the Head of the Gomel-Raton FEZ. “We’ll be able to create a whole range of services for the acceptance, processing and dispatch of cargo, accompanied by the necessary service complex: an insurance company, a bank, a business centre, a hotel, a restaurant and other facilities. The project should be complete within three years. The first stage (worth $110m) includes the construction of customs terminal facilities. Storage facilities and offices will come into exploitation during the second stage (worth $204m) while the third stage envisages the construction of infrastructure.” Another Gomel-Raton project relating to the production sphere is the manufacture of glass-fibre reinforced plastic pipes — unique in Belarus. They are much in demand both domestically and abroad.
Gomel’s Palace and Park Ensemble has grand tourism plans, which it shared at the forum. The creation of park and estate facilities on the former estate of Khalch village (Vetka district) will be unique in Belarus, boasting picturesque landscapes, an ancient manor, a museum, a hotel, a restaurant and a beach area. Around $2m is being invested.
Other proposals were discussed in various sections, such as ‘Successful Investments — Efficient Economy’, ‘International Co-operation in Small Business’ and ‘From Partnership to Mutually Beneficial Trade’. Signed investment agreements included those dealing with the manufacture of packaging materials — jointly with Linpak Packaging Ltd. (UK) — the manufacture of passenger railway carriages and the development of hotel business. The total sum of these injections exceeds $250m.
The forum received a positive response, with official figures from diplomatic missions and the regions eager to share their opinions. The Head of Poland’s Lubuskie voivodship, Helena Hatka, is confident that the forum will bear fruit, while acquaintance with people, traditions and legislation will bring us closer. “There is much we can learn from you. We can also teach you in return,” she stresses. “I’m sure that opportunities for co-operation, which have opened up here, will be realised.”
The Ambassador Extraordinary and Plenipotentiary of Israel to Belarus, H.E. Mr. Eduard Shapira, admitted that he was delighted by the high level of organisation at the big event. He has his eyes on several investment projects, which he’ll pass on to Israeli businessmen. “Don’t be surprised if my countrymen appear soon in Gomel with definite proposals. The High-Tech Park is promising, as are the medical and agrarian spheres. The excellent level of education in Belarus gives your country great advantages.”
The forum has been successful but time will show its results. There’s no need to wait for another forum to start business in Belarus. The country is ready to welcome investors at any time.
Violetta Dralyuk
