Belarus: People & Economy
Agnihotri, Newal K., Presidents & Prime Ministers
What are your country's resources for funding major infrastructure and industrial products in your country?
Belarus possesses considerable intellectual resources (scientists, engineers and qualified workers) which represents the main resource for economic growth.
As far as material and natural resources are concerned, basic resources required for industrial development (metals, oil and coal), unfortunately, are limited in Belarus. For example, the total amount of the known oil reserves in Belarus is 40 million tons. The annual oil extraction is 2 million tons, while Belarus requires 17 to 20 million tons of oil annually.
At the same time, Belarus possesses large reserves of minerals, such as potash, potassium salt, rock-salt, limestone, granite, sapropelic and peat. Gold and diamonds have also been discovered.
The most valuable natural resource is timber with forests covering 35% of the entire nation's territory. The total reserves of industrial timber in Belarus amount to 1 billion cubic meters.
46% of land in Belarus is used for agricultural production. This is one of the reasons why Belarus completely satisfies its needs in all types of food products and is an exporter of food products to other countries, especially Russia.
Along with the raw materials, industry, and highly developed agriculture, Belarus has a highly developed processing industry represented by machine-tool building, production of automobiles and tractors, electronics, electrical engineering, chemistry, telecommunications and others.
In the former Soviet Union, Belarus was the most developed industrial region. The break-up of the Soviet Union caused a powerful shock. Belarus was left with huge industrial potential but no financial and material resources. That is why in 1992 through 1996 the GDP dropped more than 40%. Belarus struggled to maintain the functioning of the remaining 60% of the production capacities using its own resources. At the same time, it managed to make minimal investments to introduce new technologies at the expense of rigid macroeconomic policies and centralized distribution of resources. Thanks to this, despite the financial crisis in the national economy, the processing industry on the whole, and its leading branches (production of automobiles and tractors, electronics, chemistry, and light industry), have managed, within these years, to renew their production at least thrice.
Attracting both domestic and foreign investment into the Belarusian economy is one of the most important issues to be dealt with by the Government. The total investment requirements for the next five years amount to over 20 billion US dollars. A favorable legislative basis has been set up for foreign investors. Both long-term lease and sale of land has been allowed, a 5-year tax holiday has been introduced, a government guarantee can be provided as a form of insurance against risks, a renationalization of private property of foreign owners is prohibited, easy to read investment forms have been introduced, including equity, portfolio investments, joint ventures, and long-term credits under the government guarantees. There are already practical examples of successful cooperation with foreign investors, including those from the United States. These are facilities opened in Belarus by Coca-Cola and McDonalds. The most active investors in Belarus are from Germany, Austria, Poland and Italy.
In the near future, considerable investments are planned to be attracted through privatizing large-scale enterprises, including Petroleum Processing Plants in Mozyr and Novopolotsk, and chemical fibers and polymer production plants and Beltelecom. A large-scale privatization program for the next three years has been developed by the Government. The Government of Belarus also invited an American partner, Price Waterhouse, to provide assistance in large-scale privatization. …