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What prevents to remove the barriers to the release of Belarusian enterprises on the European market?

Что мешает убрать барьеры для выхода белорусских предприятий на европейский рынок?

Belarus ‘ accession to the WTO will not help domestic enterprises to reduce the duties when entering the European market. This can happen if Belarus becomes a member of the European Union or will sign an agreement on associated membership with the EU. Neither one nor the second option, the Belarusian authorities are not considered.

Belarus is adjacent to the European market, and Belarusian officials are well aware of how it is advantageous market.

“If we have receivables in the big East with the countries of the EU, its almost not. So if we will develop and increase our exports to the EU at least 20-30%, it will be a reliable supply of the country’s currency”, — said the Director of the National center of marketing Valery Sadokho on the sidelines of the seminar-conference “exports to the EU of products of the concern “Belneftekhim” at the end of April.

About half of Belarusian exports to Europe – products “oil”

The government of Belarus a few years ago, has placed the export priorities in the following way: you need to get rid of monotonicity from one market and to achieve equal distribution of exports between EU, EEU and third countries.

Before you decide not to work. Although, based on the statistics, the movement in the desired direction indicated.

According to the statistics, Belarusian merchandise exports in 2018 increased by $ 4.5 billion to 33.7 billion dollars, which is 15.3% more than in 2017. Most of all, it increased in EU countries — 2.3 billion. At the same time in the EEU countries exports increased by 0.2 billion dollars, the region “far arc” and other countries — 1.9 billion. The share of EEU in total exports was 41.2% (vs. 46.7% in 2017), the EU — 30,2% (26,8%), other countries — 28.6 per cent (26.5 per cent).

The trade balance with the EU has improved with $ 1.2 billion in 2017 to $ 3 billion in 2018. Belarusian exports to EU countries rose by 29.9%, while imports from the EU — only 7.4%.

However, no reason to sound the fanfare no. Last year Belarusian exports to the EU increased mainly due to raw materials – oil, petroleum products, potash fertilizers, etc. has Changed the pricing environment in the best for us, grew and cost volumes of the Belarusian export.

Permanent representative of Belarus to the EU Alexander Mikhnevich at the seminar-conference vividly illustrated the situation with supplies of Belarusian products to the European market. According to him, currently about 45% of Belarusian exports to the EU is oil and petroleum products. 0.5 billion – products of petrochemical companies. This is quite a bit, given that the EU imports for the same position is about 20 billion dollars a year, and these products on the European market supply of the countries is not the first dozens, according to its economic potential similar to that of Belarus. But the Belarusian government encourages enterprises to increase exports to the EU products with a deeper level of processing.

“We are very concerned about the situation with the “Belshina” — tires we have the minimum possible exports to the EU”, — said Alexander Mikhnevich. Although externally it looks like well: according to statistics, the export of tires from Belarus in terms of value amounts to 32 million euros. But the Belarusian tyres in the EU are supplied by just 6 million euros, the supply of tires to 26 million euros is a re – export. That, as the Ambassador noted, “also gives us a penny.”
But the base tire which are most in demand in Europe, Belarus to the European market does not deliver. “Why, with great company and a great tire cord , which we buy with a whistle – only to expose the checkbox, we don’t sell it to the European market?” — asked the diplomat.

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Will the WTO?

Many Belarusian enterprises expect that the country’s accession to the WTO will help them open the European market. The government has set the task to the end of 2019 to complete the negotiations, and in 2020 to join the WTO. The next Conference of the WTO at Ministerial level will be held in Astana from 8 to 11 June 2020 — by this time, expected to conclude negotiations on Belarus accession to the WTO.

Although Belarus, as a member of the Eurasian economic Union (EEU) has already assumed certain tariff obligations and conducts trading activities according to the rules, very close to the WTO. That is, Belarus, not being de jure a member of the WTO, but as a country of the Eurasian Union and forced to work according to the rules of this organization, as WTO rules and the basis of the legislation of the EEU.

“We have, conditionally to the WTO. Upon accession to the WTO, we take, we can say, is mirrored conditions with Russia – 99% — of tariff obligations”, — said V. sadoha.

According to him, Belarus is in many has assumed such obligations in favor of integration processes. “But personally, I think that we went some sacrifices. Because we protect our market from imports, for example, non-ferrous metals, which we have not, some commodities, because in Russia they are, and we don’t. There is, for example, the agreement on aviation. We don’t build planes, but Russia builds them, so we went to make such sacrifices in favor of the integration processes and to hold in this case, the Russian Federation”, — said V. sadoha on the sidelines of the seminar-conference.

“By joining the WTO, we commit ourselves, according to which the tariffs will be reduced and we, and our partners. For some products there is a transition period when rates will decline over 5-7 years. But when Belarus will become a WTO member, the country will open the market of EU countries”, — said V. sadoha.

The three conditions for the lifting of duties for Belarus

In turn, Alexander Mikhnevich noted that the mere fact of accession of Belarus to the WTO does not mean that the EU will remove customs duties in respect of Belarusian products.

“Belarus’ membership in the WTO will not contribute to the removal from our duties. Only the customs Union with the States or group of States provides the opportunity to circumvent the duties. WTO membership this opportunity will not give” — said the Ambassador.

According to him, WTO membership will allow to avoid discriminatory measures against Belarusian goods and will also ensure free access to international schemes for resolving trade disputes — the WTO is the body that resolves trade disputes. According to Alexander Mikhnevich, this is the first advantage of WTO membership. The second is “pure investment,” the WTO membership will increase the investment attractiveness of the country, because for investors it means “that we have games at all obvious rules.”

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“We have assumed that the Belarusian enterprises to enter the European market interfere with duties. We often get letters: but if the decrease in duties on our products, we would become competitive on the European market. Stop writing these excuses. Reduced fees can only in one case: if they will fall for everyone. And if so, our competitors will again become more competitive”, — said the permanent representative of Belarus to the EU

He explained that at present the relations between Belarus and the EU are not preferential. And while Belarus will not enter into an agreement with the EU on free trade zone, duties are applied on both sides. And those tariffs, which the EU sets against Belarus or the countries of the EEU, Belarus will also be accordingly applied.

While the opportunity to evade customs duties for Belarusian exports to the European market. They are also clear. For that Belarus should become a member of the EU or to sign the EU Association agreement – such as Moldova, Ukraine, Georgia, etc. due to which these countries have received some relief in exports to the European market.

“While the agenda of Belarus is no such question”, — said Alexander Mikhnevich.

There is another option, allowing the country to get rid of European duties: to be the most underdeveloped country that also possess General system of preferences. But this option for Belarus is excluded.

One thing remains — overcome barriers

Thus, all three options providing for Belarus to facilitate trade regime with the EU, the Belarusian side considers to be unacceptable yet.

In this situation for Belarusian companies seeking to export their products to the European market, it remains the only way — to learn to overcome the barriers

“Capacity European market is huge. But we occupy in this market is a small niche due to the high competition and due to certain barriers. Therefore, to win the competition, we can only improve the quality and price, and in that case, if you learn to overcome barriers,” said Alexander Mikhnevich.

And this, according to him, Belarusian companies have to be present in these markets to participate in trade missions, to go on exhibitions, to get certified, etc.”, It is necessary to knock, a hundred times to meet etc., and then something will go”, — said Alexander Mikhnevich.

According to him, today the barriers to the release of Belarusian enterprises to the EU market associated with the registration, certificate of conformity, proper legal registration, completing the necessary control procedures in Belarus, etc. “Is sometimes a long procedure. It is time consuming and takes a lot of money and as a result, many fold their hands. This is wrong. After passing once this procedure, the company is experienced and opens up the market. All this can be done,” said the Ambassador.

He recommended the Belarusian enterprises to think about other methods to promote their products on the European market: logistic schemes, payment options, branding, package deliveries, etc. “Just to think, to work and to promote their products”, — said Alexander Mikhnevich.


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