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20 Jul 2018

New mechanism of financial recovery for struggling farming enterprises under discussion in Belarus

MINSK, 20 July (BelTA) – A new mechanism of financial recovery for Belarus’ struggling farming enterprises was discussed at a government session chaired by Belarus President Alexander Lukashenko on 20 July, BelTA informs.

“We need to talk over the development of efficient instruments to help struggling agricultural enterprises get back to business. In late 2017 the government was instructed to work out the regulations enabling agricultural organizations to access special financial recovery mode avoiding legal procedures,” the head of state said.

Chairpersons of the district executive committees will be vested with the corresponding powers.

Alexander Lukashenko noted that a lot of work had been done to draft the law. “Before signing the document, however, I would like to ask the governors some questions,” the head of state said.

The president was primarily interested in the agricultural companies which have received support as part of the earlier adopted decisions. “We have taken so many recovery measures that these companies should have become profitable long time ago. Today we are considering another document. Has the number of insolvent economic entities reduced?” the president wondered.

“Secondly, has everything we agreed upon been included in the draft decree? We need decisions that produce results, look into the future. Will they help struggling companies to use their production potential in full and get back to stable operation?” the Belarusian leader said.

The head of state also asked governors of their vision regarding the implementation of the abovementioned measures.

“If there are problems, we need well-thought proposals to address them,” the president said.

Alexander Lukashenko added that there is also the need to discuss other agricultural issues, including forage conservation and the harvesting campaign.

At present, financial rehabilitation of agricultural enterprises is carried out as part of Decree No.253 of 4 July 2016 “Concerning measures for financial rehabilitation of agricultural enterprises". The decree applies to agricultural organizations which were steadily insolvent as of 1 July 2016. A total of323 agricultural organizations were selected for the pre-trial recovery procedure. There are about 1,300 agricultural organizations in Belarus. Currently, 283 organizations are undergoing the pre-trial recovery procedure (40 agricultural enterprises stopped performing their activities due to merger, sale or gratuitous transfer). 283 organizations continue working on their business plans, cooperating with investors, and restructuring financial obligations.

The new regulations will help create a special regime of financial recovery for agricultural enterprises and avoid the need to resort to legal procedures.

The new bill applies to farming enterprises that have been insolvent for a long time, including organizations undergoing financial recovery under Decree No.253, except for the organizations in the middle of the insolvent liquidation process.

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