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Opinions & Interviews

11 Apr 2019

Belarus, Russia negotiating on state support for joint ventures

Belarus, Russia negotiating on state support for joint ventures
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MINSK, 11 April (BelTA) – Belarus’ Industry Ministry and Russia’s Industry and Trade Ministry continue talks about terms on which joint assembly enterprises in Russia can receive state support. The countries seek to reconcile their positions, BelTA learned from Belarusian Industry Minister Pavel Utyupin.

Russia has introduced measures to support its enterprises, for example, subsidies up to 25%. The leasing company Rosagroleasing offers programs which provide for convenient terms and long periods to buy equipment. “Products of joint ventures, however, do not fall under these terms despite our close cooperation. We are now in negotiations with the Russian Industry and Trade Ministry, trying to reconcile our positions and solve this problem,” Pavel Utyupin said.

The minister referred to Bryanskselmash as an example where a joint venture assembles harvesters, with localization degree past 50%. According to the minister, the countries have agreed to include forage harvester assembly into subsidy programs. “We are holding talks on grain harvesters. I believe we will be able to come to terms,” Pavel Utyupin added.

BelTA reported earlier that at a session of the Economic Policy Commission of the Parliamentary Assembly of the Union State of Belarus and Russia Pavel Utyupin stated that the terms, on which Belarusian-Russian assembly enterprises in Russia can receive state support, are disadvantageous.

Such plants as Bryanskselmash and the Cherepovets casting and mechanical plant cannot use the support available in the Russian Federation. The legislation requires a certain set of technological operations to be performed in Russia, the minister noted and warned that these terms will ultimately worsen the economic situation of both Belarusian companies and Russian ones. If these technological operations are relocated, the joint ventures will not have the necessary effect of the production scale that the Belarusian tractor maker MTZ can provide. Apart from that, manufacturing cooperation ties will be affected and purchases will be reduced.

Belarus has dragged the problem of state support into spotlight. If the joint ventures could use state support, they could offer cheaper vehicles, machines, and equipment to agricultural consumers in the end, Belarus’ Industry Ministry believes.

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