Transport help offered

Forecasts cannot be relied upon. Several years ago, representatives of the Architecture and Construction Ministry calculated that exports of construction companies would reach $1bn by 2015
Forecasts cannot be relied upon. Several years ago, representatives of the Architecture and Construction Ministry calculated that exports of construction companies would reach $1bn by 2015. However, today’s reality is that it’s difficult even to raise $500m.



The Foreign Ministry cites falling export volumes as the main problem facing construction businesses, as in other spheres, due to devaluation of the Russian Rouble, reduced demand and weakening diversification of sales. Although producers have been encouraged to seek wider markets, many still prefer to find their niche on the Russian market, where they feel more comfortable, and enjoy simpler conditions.

Dmitry Gil, the Second Secretary of the Foreign Ministry’s Department for Export Assistance, tells us, “External conditions require geographical and commodity redistribution and new partners. We rely on the Russian market but the construction sphere needs to pursue other avenues, such as in the Southeast Asia. Vietnam, Indonesia and the Philippines need construction services and materials, and we shouldn’t underestimate such African states as Nigeria, Chad, Zambia and Ghana.”

Producers remain cautious. Zambia and Belarus are separated by thousands of kilometres, as Konstantin Kolomiets, a construction market analyst points out. He is wary of reaching too far geographically, arguing that sales beyond 500-600km are unlikely to prove profitable. In this vein, Russia is likely to remain our major customer. However, at present, the Russians are displaying a lack of funds. A solution could be an exchange scheme.

The Foreign Ministry emphasises that nobody is pressuring our producers to transport cement to Africa. In fact, it makes sense to look at traditional markets, and see what can be done to restore old sales figures, such as in Russia and Ukraine. It may be that reduced prices are needed, but there are other options, such as offering staff training, or provision of technical expertise. We have technologies, equipment and highly qualified specialists; we just need now to learn how to ‘sell’ them at the best price. 

МТ REFERENCE:

The Architecture and Construction Ministry plans to increase exports of cement to Europe by 500,000 tonnes in 2016; another 1.2m tonnes will be sold to Russia. 8.5m square metres of glass will be exported to Poland and Germany, and contracts have been signed with Ukraine to deliver 13m square metres of glass. Some volumes have also been sold to Turkey and Italy. Talks on road metal sales to new markets are in the pipeline.

EXPERT OPINION

Vladimir Pikulik, a representative of Belarus’ self-regulated Inter-regional Association of Constructors:

When service exports are discussed, our builders view only one market as promising — that of Russia, despite state bodies urging otherwise. Why is this so? Actually, the explanation is simple: this country is attractive to its transport shoulder, where the lack of borders simplifies procedures. So far this year, we’ve issued permissions to seven companies to work in Russia. Most are large construction trusts. The latter state that the domestic market has narrowed and they need to search for work abroad. Specialised companies can also offer the Russian market services, relating to such spheres as railways, electro-technical management and nuclear power stations.

There is no one recipe for export growth, and players need to understand that we need to address particular customers, rather than regions. With this in mind, we’ve given Russian companies a head start, particularly relating to engineering. In Belarus, 2,000-3,000 people are employed in this sphere: more than are needed. It would make sense for us to ‘send’ some to Russia, where they can share expertise, and earn income.

By Polina Kovalevskaya
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