Events

MINSK, 10 April (BelTA) – The Belarusian brewing industry is heavily underperforming. The statement was made by Belarus President Alexander Lukashenko at the government session held on 10 April to discuss the state and development prospects of the Belarusian brewing industry, BelTA has learned.

The President reminded that the previous time these matters were discussed about seven years ago. Back then decisions were made in favor of a large-scale retooling of the breweries. Rules to regulate the access of the world’s top brewing companies to the Belarusian market were stipulated. Back then instructions were given to create modern manufacturing facilities, increase the output figures, increase the production of Belarusian beer brands and substitute imports. “My judgment was based on the fact that beer is alcohol, too. While I don’t appreciate the taste of beer and drink virtually none of it, alcohol is a great source of revenue for the state budget. Why is the industry getting destroyed then? It is the key reason for today’s meeting,” said the head of state.

Alexander Lukashenko remarked that oblast governors and the government often suggest selling another factory or shares. “I wonder why you want to get rid of the highly profitable industry. Later on we will see that you have virtually destroyed it,” said the President.

Alexander Lukashenko remarked that 80% of the Belarusian brewing industry, which is supposed to be a highly profitable one, had been sold and privatized, with only 20% left in state hands. “We always seem to focus on private business as the way to salvation. Where is this salvation now? The way state-owned enterprises or those with a state-owned share operate is another thing entirely. I am afraid things will end bad for the minister, the vice premier, and these executives,” stressed the President.

As much as $300 million has been spent on modernizing the industry, including $30 million allocated by the state budget. As much as $160 million came as proprietary money of state and private companies, with considerable credit resources of Belarusian and foreign banks utilized. “We have fitted the enterprises with high-tech equipment made by internationally recognized companies just the way you wanted,” noted the Belarusian leader.

As a result, the manufacturing capacity has increased up to virtually 70 million decaliters of beer per annum. The amount is enough to satisfy the domestic market and then export some. “The raw materials base of the brewing industry has been modernized in the name of the revolution with this in mind. Every year over 150,000 tonnes of brewer’s barley is harvested in Belarus. The amount is sufficient for manufacturing and export,” noted the head of state.

The President was interested in learning about the economic effect from the massive investments in the brewing industry, about the profitability of the industry, whether the government plans for the industry had been implemented successfully, and whether export and foreign currency proceeds had been increased.

The President quoted some statistics figures that state that only 60% of the new manufacturing capacity is used. Over the last three years beer production in Belarus has been shrinking and import has been rising. “No other country with a well-developed domestic brewing industry allows import as large as 30%,” stressed the Belarusian leader. “Why can foreign manufacturers profit from hauling beer for thousands of kilometers while our companies, state-run and private ones alike, are losing the home market?”

Alexander Lukashenko drew attention to the failure to fulfill import substitution plans. For the last three years the majority of state and private brewing companies have been showing losses. “In other words, the Belarusian brewing industry surrenders to foreign competition. I believe this state of affairs is inadmissible!” stressed the President. “Why don’t you try to export Belarusian beer to the European Union? Will they allow you to? It is said that importers use dumping prices. Don’t we have laws to counteract it?”

Alexander Lukashenko admitted that while the overall picture is not good, individual breweries operate at a profit, keep high workloads on their equipment, and increase production. It means that it is possible to work effectively on the market, stressed the head of state.

Alexander Lukashenko said that he wanted participants of the conference to come up with solutions to invigorate the Belarusian brewing industry and, if necessary, raise additional investments, solutions to reduce import and increase the workload of the manufacturing facilities. Apart from that, the President wondered when state-owned breweries will become effective and whether the conditions once instituted for foreign manufacturers operating on the Belarusian beer market were fulfilled.