Sales of Belarusian products much worse than official statistics suggest
On September 17th the head of the Russian Association for Agricultural Machinery (‘Rosagromash’) and Rostselmash co-owner Konstantin Babkin complained about the dominance of Belarusian equipment on the Russian market.
Despite free access for some products to the Russian market, sales of Belarusian industry products in Russia, and other countries, are shrinking. So far, the government has managed to manipulate the numbers to hide the real situation. But the reality is much worse than the official statistics suggest. Belarus’ participation in the Customs Union and the Common Economic Space is unable to stop Belarusian goods from being pushed off the Russian market.
The 2020 Industrial Development Programme envisages that by 2020 Belarus will increase the sales of combine harvesters on the world markets from 10% to 15%. However, this task might be unattainable, given today’s problems with selling Belarusian equipment in Russia, which is Belarus’ major export market.
‘Gomselmash’ sells about 90% of its equipment through joint ventures and manufacturing facilities in Russia. At the same time, in 2013, supplies of agricultural machinery to the Russian market had reduced, despite the favorable conditions created by Russia. In February 2013 the Eurasian Economic Commission decided to introduce protective duty on combine harvesters, and on June 25th this measure was extended until March 14th, 2016.
The Rosagromash Head, Konstantin Babkin, said “The Russian market is open for Belarusian agricultural equipment, about 70% of Belarusian agricultural equipment is sold through Russian government structures using state banks loans and through ‘Rosagroleasing’”.
The production volume of combine harvesters in Belarus has been consistently declining since 2010 (2,035 units in 2010, 1,900 in 2011 and 864 in 2012). In H1 2013, Belarus produced 892 combine harvesters. As of July 1st, 2013 stocks of grain harvesters in Belarus were 408 units or 274% of the average monthly production volume. According to Babkin, there are 3,500 unsold Belarusian harvesters in Russia.
The discrepancy in the figures shows the real scale of the sales problem. Unsold Belarusian harvesters are transferred to the balance of dealers, distribution companies and trading houses, and reflected in the official statistics as exports. As of August 1st, 2013 the outstanding foreign receivables at Belarusian enterprises were BYR 2.8867 trillion, a 41.1% increase since January 2013.
A trend in ‘shrinking’ Belarusian exports to the Russian market persists. Neither the Customs Union, nor the Common Economic Space have stimulated the development of export-oriented economy in Belarus. In addition, after Russia’s WTO accession, the conflict of interests between Belarusian and Russian producers has grown in the face of stiffer competition from global brands.
The Belarusian authorities regard the Catholic conference as yet another international event to promote Minsk as a global negotiating platform. Minsk’s proposal to organise a meeting between the Roman-Catholic Church and the Russian Orthodox Church is rather an image-making undertaking than a serious intention. However, the authorities could somewhat extend the opportunities for the Roman-Catholic Church in Belarus due to developing contacts with the Catholic world.
Minsk is attempting to lay out a mosaic from various international religious, political and sportive events to shape a positive image of Belarus for promoting the Helsinki 2.0 idea.
Belarus’ invitation to the head of the Holy See for a meeting with the Patriarch of the Russian Orthodox Church should be regarded as a continuation of her foreign policy efforts in shaping Minsk’s peacekeeping image and enhancing Belarus’ international weight. The Belarusian authorities are aware that their initiative is unlikely to find supporters among the leadership of the Russian Orthodox Church in Moscow. In Russia, isolationist sentiments prevail.
In addition, for domestic audiences, the authorities make up for the lack of tangible economic growth with demonstrations of growth in Minsk’s authority at international level through providing a platform for religious, sportive and other dialogues.