Business news

23 Mar 2021

Lukashenko against privatization of Gatovo-based tannery

MINSK DISTRICT, 23 March (BelTA) – The privatization of the Minsk Leather Production Association is out of the question. Belarus President Aleksandr Lukashenko made the relevant statement as he visited this enterprise in Gatovo, Minsk District on 23 March, BelTA has learned.

Aleksandr Lukashenko stressed: “Any privatization of this enterprise is out of the question. The processing of raw hides is a strategic branch of the national economy.” He remarked that proper attention should be paid to this economic branch.

“We cannot give all the raw materials to one person however good they may be. You understand what may happen if we do,” the president added. Moreover, in his words, the terms of the possible privatization were not the best for the enterprise and the state.

The government had previously proposed privatizing the Gatovo-based enterprise. According to the government, privatization is the only way to resolve problems of the enterprise. The Belarusian footwear manufacturer Belwest was supposed to acquire the tannery.

Aleksandr Lukashenko gave instructions to provide the necessary support to the Gatovo-based enterprise so that the enterprise could focus on its work. The enterprise needs financial support: about Br8-9 million to pay overdue amounts to meat-packing plants for raw hides and $2.5 million to cover the cost of building waste treatment facilities. In exchange Aleksandr Lukashenko wants the enterprise to hit specific performance targets.

The president gave instructions to set up kind of an association made of meat-packing plants, which provide raw hides, leather processing enterprises, and the enterprises that consume leather. Producers of leather goods will have to direct the Gatovo-based enterprise towards making the products the leather consumers need and that satisfy their every requirement in order to switch to the consumption of domestic raw materials in the end.

As he met with workers of the Minsk Leather Production Association later on, Aleksandr Lukashenko explained his decision and revealed some details of the proposed deal. “Your products are consumed by 78 Belarusian enterprises that make apparel, footwear, and so on. The government suggests selling your enterprise to one of them. Will it be fair for the other 77 enterprises? No. I believe that the buyer has good intentions. Today. But when he becomes the owner tomorrow and starts dictating his terms to other enterprises, the competition will not be fair,” the head of state pointed out.

Aleksandr Lukashenko remarked that if the government cannot properly run some enterprise, then privatization is an option. But there is no need to sell the Gatovo-based enterprise. “The state can resolve the remaining problems here,” he said. “They requested the privatization of the enterprise and huge preferences, which means that taxes will not be paid. Are the preferences equal to the sum we are supposed to invest in modernization? There is no sense in that. This is why all the decisions have been made for you to be able to work.”

“Try to work and keep this enterprise in your own hands. Nobody is eager to welcome your children anywhere. This is why you should make a good enterprise so that your children could work here and get decent salaries,” Aleksandr Lukashenko added.

Asked about the import of raw hides, Aleksandr Lukashenko pointed out that measures to protect the domestic market have to be carefully implemented so as not to damage partnerships with other countries. For instance, if Belarus bans imports from Russia or Turkey, those countries may take reciprocal measures against Belarusian exports. “This is why you should get adapted to competition. [The protection of the domestic market from import] is a two-edged sword. I know what the responses may be. We are not that big. We are an average small European country,” the Belarusian leader stressed.

Workers of the enterprise also thanked Aleksandr Lukashenko for resolving the problem of reconstruction of waste treatment facilities. “We have to resolve the problem. It is the key thing. People live in Gatovo after all. This is why it is a very important state matter. We will make the first step little-by-little this year. Later on we will work constantly because a considerable amount of money is involved,” Aleksandr Lukashenko said.

The president assured that other issues raised by citizens will be resolved as well, including the housing problem. “You show eagerness for work. It is good. A lot of people visited the enterprise before my arrival. I’ve been briefed on your attitudes. You have a good team. This is why we should help you because you will return the favor some day in taxes and the rest,” Aleksandr Lukashenko noted. “We’ve agreed that the [Minsk Oblast] governor will help you build homes as many as we can. We will also provide rented housing while you should hire people: they will live in this housing as long as they work at the enterprise. This is why we should provide support. Yes, workers can be transported here by bus but if you think about it and accumulate all the expenses, it will be more expensive for your enterprise than building a house. So, we’ve made a comprehensive decision.”