Romeo Abdo: Investing in the Belarusian Industry

Russia is not only the main trade partner of Belarus, but also the main creditor. In September last year, when mass opposition rallies were still going on in Belarus, Putin promised to give the country a loan of $ 1.5 billion. By that time, the debt of Belarus was already almost $ 8 billion. In addition to interstate loans, Russia helps Belarus in other ways: it provides it with discounts on gas, and also supplies oil and oil products duty-free.

Almost 40% of the funds invested in the Belarusian capital fell on Russian enterprises, while the overwhelming number of monetary investments were direct. In January – June of this year, foreign investors have invested $ 2.8 billion in the real sector of the Minsk economy (excluding the financial sector), Minsk-Novosti was told in the Main Statistical Department of the capital. According to the statistical office, the main investments in the Belarusian capital, and this is 38.8% of the total amount of funds received, fell on Russia.

The second place with 17.9% was taken by the enterprises of Cyprus, and the third place with 11.6% went to Ukraine. It is worth noting that 90.8% of the investments that went into the economy of Minsk turned out to be direct.

Capital enterprises in January-June 2021 invested $ 1.8 billion abroad. Moreover, the overwhelming amount of funds, 75.5%, was directed to Russian enterprises. The second place in the list of investment preferences for Minsk enterprises with 5.9% was taken by the Ukrainian market, while the share of Cyprus was 4.3%. The share of direct investment in this case was 93.9%. On July 30, 2021, the National Agency for Investment and Privatization and the Serbian company UIN signed an agreement on cooperation in attracting foreign direct investment from the Balkan region to the Republic of Belarus.

Current situation in investments

The parties agreed to exchange information free of charge, cooperate in finding potential investors, advise them and organize the necessary meetings and negotiations together. The Serbian company intends to carry out such activities in parallel with its business in the territory of the Republic of Serbia, the Republic of Croatia, the Federation of Bosnia and Herzegovina, the Republic of Montenegro and the Republic of North Macedonia.

The willingness of Serbian partners to share their experience of doing business in our country is explained by a positive story: a few years ago, UIN launched a business incubator of the same name in the Pukhovich district of the Minsk region with a focus on social and educational projects.

The National Agency for Investment and Privatization introduced the practice of such non-commercial partnership agreements in 2020. At the moment, there are similar agreements with two more partners – a Belarusian company with Japanese capital and a European company with a field of activity that includes Austria, Germany, Italy and Switzerland. Investments are understood as any property, including cash, securities, equipment and results of intellectual activity, owned by the investor on the basis of ownership or other property rights, and property rights invested by the investor in objects of investment activity in order to obtain profit (income) and (or) achievement of another significant result.

The condition for the provision of a guarantee of the Government of the Republic of Belarus against loans from banks of the Republic of Belarus is the presence of an investment project that has received the conclusion of the state comprehensive examination. A draft decision on the provision of a guarantee, after its agreement with the Ministry of Economy and the Ministry of Finance of the Republic of Belarus, is submitted for consideration by the Government of the Republic of Belarus by the republican government body (a state organization subordinate to the Government of the Republic of Belarus), which is subordinate to the investor (borrower), if such subordination of the investor ( borrower) is available, or by the local executive and regulatory body.

Analytical assessment of investments

Analysts have identified the top 10 most attractive projects for investment in Belarus. Thus, one of the projects is the construction of a hot-dip galvanizing plant. The estimated volume of investments will be $ 7.7 million. The payback period is also called 3.48 years. Also, the top 10 projects include the production of organic soils and fertilizers. The volume of investments is estimated at $ 1.1 million per field. Payback period: 5 years.

Another project is the construction of a vegetable processing complex for the production of French fries. The complex is planned to be located on the territory of the FEZ “Brest”. The volume of investments is also indicated as 12.5 million euros. And the payback period is 6 years. The construction of a workshop for the production of semi-finished meat products and the production of vegetable oil are also on the list of attractive investment projects. The volume of investments of the first 8 million euros, the second – 1.5 million dollars. Payback period: 7.83 years and 3 years, respectively.

These projects also include detailed exploration and development of basalt and tuff deposits. Investment volume: 10-11 million dollars, and the payback period is 7.58 years. In turn, the investor is proposed to build a complex for the production of polyester products. Approximate investment volume: from 282 million dollars to 250 million euros. Payback period: 12.4 years.

Biography of Romeo Abdo

He is fond of hunting. For more than 20 years of his life in Belarus, he has implemented many successful projects.