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from 22.04.2011

Prime Minister of Belarus urges to look for alternative sources of financing investment projects

Ministries and regional authorities should start using alternative sources of financing investment projects, Prime Minister of Belarus Mikhail Myasnikovich said at a session of the Council of Ministers on 22 April.

“We must find alternative sources of financing and sources of credits. We need to stop looking for simple ways,” underlined the Prime Minister. According to Mikhail Myasnikovich, we should not speculate but do our job. He reminded that the Governor is responsible for the territory and all that therein, the Minister for the type of activity, and the director for his enterprise.

Mikhail Myasnikovich demanded that ministries and local authorities work more actively with investors to find alternative sources of financing for investment projects. “Work harder with investors, use IPO and other modern mechanisms of investment," he said.

The Prime Minister stressed that investment means development, and development secures the future. “While addressing the issues of current importance, we should think of what our economy will look like in five, 10 or 15 years. The economy of the future is being built today by those investment activity plans which are currently discussed, those goals that have been set forth in the corresponding documents,” Mikhail Myasnikovich emphasized.

The Prime Minister added that the investment policy covers three major issues - efficiency, i.e. payback of investment projects, the structure of the investment portfolio and financing sources. “Our priority is export-based and import-substituting projects,” the Premier said. He added that foreign funds should account for at least 21% of the investment portfolio.

The Belarusian head of Government said he was concerned about the attraction of foreign direct investments in Vitebsk Oblast and stressed that the efforts of the administration in Brest Oblast, Gomel Oblast and the city of Minsk lack concrete results. “Several heads of oblast administrations have raised the issue of the lack of coordination between regional and industry branch levels. I see it as certain helplessness of the Economy Ministry and economy committee of the relevant oblast administrations”. According to the Prime Minister, all these matters should have been resolved in 2010.

Mikhail Myasnikovich pointed out that the efforts of the light industry to attract FDI are extremely worrying. “Investments have dropped by almost half. There are virtually no foreign sources and no future ones are expected,” he said. The situation is quite the same as far as enterprises of the Belarusian pharmaceutical concern Belbiopharm are concerned. They cannot reach even the smallest goals of attracting foreign investments. “Construction projects of the energy industry are in a very difficult position. They miss about a third of the funding for this year’s planned projects,” said the Prime Minister.

Mikhail Myasnikovich urged ministries, primarily the Economy Ministry, to speak openly about the identified problems. “It should be an open conversation instead of whining about what has not been accomplished,” he said. Proposals should be specific.

Speaking about the development of investment efforts in Belarus, Mikhail Myasnikovich added that a new edition of the Investment Code was being prepared. The head of Government criticized the development of documents, stressing the pace was extremely slow. “All kinds of deadlines have not been met. The situation is the same as far as the strategy to attract foreign direct investments is concerned,” he added.

The Prime Minister said that the share of investments poured into buying machines and equipment has reached only 38% of the investment portfolio while the target is set at over 50%.

The Prime Minister also stressed that privatization in Belarus is billable and is done via tenders. “If a state property or a municipal property or a part of it is sold, the money should not be wasted on daily expenses but diverted towards creating new state and municipal properties,” he said.

The Prime Minister dismissed claims about state property handouts as groundless. “I’ve instructed the Chairman of the State Property Committee to work on this together with oblast administrations using a complex approach,” he said.