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21 Mar 2017

Kronospan to invest more in woodworking operation in Belarus

MINSK, 21 March (BelTA) – Kronospan Company intends to invest more in the development of the woodworking industry in Belarus. Belarus President Alexander Lukashenko was informed about the plans as he visited Kronospan’s enterprises in Mogilev on 21 March, BelTA has learned.

Alexander Lukashenko was made familiar with the investment projects that had been implemented or are being prepared for implementation in Belarus. Processing more wood, making more merchandise and exporting it is the idea. In 2017-2018 alone Kronospan intends to invest extra $211 million in its enterprises in Belarus. About 120 new jobs will be created.

Director of the company Kronospan OSB Tomasz Janczak informed the Belarusian head of state about the company’s willingness to work directly with Belarusian state-run timber harvesting enterprises and get the necessary amounts of timber as close to manufacturing sites as possible in order to minimize transportation costs. “We are ready to sign long-term contracts with forestry enterprises,” said Tomasz Janczak.

Alexander Lukashenko stated that such cooperation options are possible but the investor has to take into account state interests. “Take a look at Mogilev Oblast and the neighboring region. There are many areas we don’t explore. The investor will have to build roads, cut down trees, and take care of forest restoration,” the head of state told the responsible civil servants.

Alexander Lukashenko told Kronospan representatives: “If you prove yourselves to be decent people, we will let you rent more lands like that. It is profitable for us because forest lands are huge. We fall behind the optimal harvesting curve in some places.”

The use of Belarusian machines and vehicles to harvest timber and transport it was also discussed.

“It would be my pleasure to support you if you take into account our state interests,” stressed Alexander Lukashenko.

During the tour of the enterprise the head of state was made familiar with modern technological processes used to make oriented-strand boards and an exhibition of products the company makes. After that, Alexander Lukashenko talked to a number of workers representing the enterprises OOO Kronochem and IOOO Kronospan OSB.

Alexander Lukashenko stated: “I wish there were more companies like that in Belarus. It is easy for me to talk to you. I would like the critics, who attacked me when I decided in favor of modernizing woodworking enterprises, to hear it.” Alexander Lukashenko reminded that that decision had been made partially due to the need to effectively utilize the available forest resources. Work to attract foreign investors proceeded along with efforts to retool the woodworking enterprises. “I’ve come here to see how foreigners work in Belarus and what benefits we get from it,” said the President.

The head of state once again underscored that he is ready to consider proposals relating to the renting of forest lands for timber harvesting. “You are free to rent lands, starting small. Show me how you are going to work there. Roads and forest restoration are part of the deal. If investors undertake these obligations, they are welcome to work here and rent certain forest lands,” said Alexander Lukashenko. “There is one more condition. Timber harvesters and timber transportation vehicles have to be of Belarusian make. Belarusian enterprises make all of them. We will make sure the machines operate effectively and well.”

In 2010 Kronospan Company signed an investment contract with the Belarusian government. In line with the contract five major manufacturing lines were built in Mogilev and Smorgon in 2012-2016 to make particleboards, laminated particleboards, medium-density fiberboards (MDF), impregnated paper, and floor pavement.

In 2010-2016 Kronospan invested over €919 million in the operation in Belarus, creating 1,017 jobs with the average salary in excess of the equivalent of $650.

At present Kronospan enterprises account for up to 30% of the annual output of the Belarusian woodworking industry and up to 21% of the industry’s export.

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