Business news

5 Aug 2022

Belarusian agro-industrial associations viewed as right strategy

POSTAVY, 5 August (BelTA) - The development of agro-industrial associations in Vitebsk Oblast is the right strategy, but their work should bring results, Belarusian President Aleksandr Lukashenko said as he hosted a government meeting in Postavy on 5 August, BelTA has learned.

“We need to keep consolidating farms, but this consolidation should not be artificial,” stressed Aleksandr Lukashenko.

According to the president, it is necessary to help the farms which take struggling farms under control. “These mergers should be well-thought. You should see the prospects,” the head of state said.

“What we are doing in Vitebsk Oblast is the right strategy. This decision is already half the way. I mean that we have defined the raw material zones for processing enterprises. What is even more important is to have our own branded trade. It should be expanded. It should be done not only in Belarus. We should reach out to Russia as well,” Aleksandr Lukashenko believes.

“Thus, integration structures in Vitebsk Oblast have a future. There should be no talking that it is wrong, that this is not the right way to go. Which one is right then? What other way is there to accumulate profits?” the president asked.

In his words, if enterprises can work independently and achieve their goals, then they should be allowed to work on their own. It would even contribute to healthy competition. “We do not put pressure on anyone. We do not force anyone into integration structures,” said the head of state.

The president, however, expressed dissatisfaction of the current work of the integration structures. “This decision is right whichever way you look at it. The only question is: Where are the results?” Aleksandr Lukashenko wondered.

The last time that this issue was discussed at the level of the head of state was a few months ago, during his March trip to Glubokoye. "We will revisit the issue regarding the integration associations very often," he warned.

At the beginning of the year, agro-industrial associations reported sale losses. Half of the associations posted negative profitability, overdue debt obligations.

"Back then you promised me to improve the financial indicators, to supply the farms and complexes with livestock, stock high-quality feed, improve executive discipline and responsibility of personnel," the president recalled.

In general, in H1 2022 the agro-industrial associations reported a 8% in production year-on-year. Despite some positive dynamics of certain financial indicators, the two largest agro-industrial associations, namely the meat processing plants in Vitebsk and Orsha, are operating at a loss.

"There was an instruction to make timely payments for milk and meat purchased from the population. Is it really such a lot of money?" Aleksandr Lukashenko expressed bewilderment.

In H1 2022, the agro-industrial associations reported a 12% fall in the production of livestock and poultry in live weight and 6.5% - in milk production. The dairy herd and average milk yields decreased.

"Due to the lack of raw materials, the processing enterprises are not operating at full capacity. Only two, namely Postavy Dairy Plant and Verkhnedvinsk Creamery, operate at 100%. Problems are snowballing. Some managers of indebted enterprises continue to hope for assistance, for debts being written off and so on. We will help everyone who works hard and gives results,” the president said.

At the government meeting Chairman of the Postavy District Executive Committee Sergei Chepik shared his opinion on the practical results of the work of the agro-industrial association. “This area is the only right and correct one. It is the future. There is movement forward. We clearly understand where we are going to move, there is a clear strategy for the future work,” he said.

Integration and implementation of measures taken as part of the corresponding presidential decree help to strengthen both technically and what concerns personnel, to build a better scheme of work on the development of the raw material base for the head enterprise, Postavy Dairy. “Most importantly, we have recruited highly-qualified specialists, true professionals. We gave them good salaries, created all necessary conditions for them,” said the head of Postavy District.

Konstantin Gailevsky, director of the plant, agreed with him. According to him, the primary problem in increasing the production of agricultural enterprises of the association was the lack of proper discipline - both technological and labor. He stated that this problem has not been fully eradicated, but this issue is being actively worked on. The association is fulfilling virtually all indicators of the business plan, including revenues and profits.

Aleksandr Lukashenko emphasized the importance of equipment safety: “There is a lot of power-intensive equipment which is expensive. If it is not stored properly, we will lose it. The safety of machinery, especially power-intensive tractors, is the number one issue for everyone.”

He recalled that he had recently visited a model machine yard in the new farm in Myadel District. “The machine yard in Myadel District was made an exemplary one in place of the old one. We should do like this. It did not cost much. We need a machine yard, a grain dryer and dairy complexes. Vitebsk Oblast need a dairy complex in the first place. We are probably not going to build additional pig and poultry complexes in Vitebsk Oblast. Let’s work with milk and cattle. It can bring good results,” the president said.

“This is the path we need to go. Yes, we will not be able to do everything at once. But if we do our best, we will be able to do a lot within five years,” the Belarusian leader stressed.

Discipline, order, personnel, safety of crops and equipment are these issues that the president made a special focus on and warned about personal responsibility. “No one will accept complaints about extremely rigid requirements. We need results! There is land, there is good machinery as well,” he said.

Additional financial support will be provided only for promising projects and results, the president added.

Deputy Chairperson of the Vitebsk Oblast Executive Committee Anzhelika Nikitina is directly responsible for the development of integration structures in the region. According to her, the association in Postavy is the best one today. The association led by Verkhnedvinsk Creamery goes second. The products are actively supplied to both the domestic market and abroad.

In general, there is a certain momentum in the work of agro-industrial associations, but it is still not enough for agricultural enterprises to fully provide themselves with the revenue to meet their debt obligations and secure further development, Angelika Nikitina told the media after the meeting.

However, the region is optimistic about the situation and expects the situation to improve in the near future and consolidate the successes already achieved.

“Processing is a marginal activity. We distribute the profit, which the processor has, downwards, so that this profit reaches agricultural organizations. We need to redistribute profits, invest in agricultural organizations, get products there, provide them for processing, sell them through the trade network and for export. Then this mechanism will be reversible, and in this way we will improve the economy of agricultural organizations. We support the raw material zones, develop rural areas,” the deputy head of the region said.



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