More than 30% of Belarus enterprises unprofitable

Belsat discussed the emergency situation with economic expert Andrei Yeliseyeu:

– Andrei, entire sectors of industry have started to disappear in Belarus at a rapid pace, namely, those which were famous in the country and even abroad. A striking example is the production of television sets in the “Horizont” and “Vityaz” plants. What went wrong, and what fate awaits these plants?

– The fate of these plants is solved. See for yourself: three years ago, Belarus made about 600 thousand TV sets, and only about 20 thousand in the past year, we see that the production has decreased 30 times over three years, and these plants are actively trying to switch to the production of other goods, since there is no luck with TV sets. The main problem is the socio-economic model, which the Belarusian authorities have been using for 20 years. State-owned enterprises with the low quality management are simply not able to compete with Western plants which are faster, more innovative competitors. The question was only when this crisis with a variety of industry sectors finally starts. The time has come partly under the influence of the economic crisis in Russia, since the lion’s share of industrial goods is shipped there.

– Production and exports have also dramatically reduced. Currently, 80% of car production is and 90% of bearings production is idling. What prevents the producers of this product from finding a buyer?

– The problem is that due to the economic crisis, Russia, which sold these and other industrial products, is not ready to buy so much. Secondly, Russia, entered the World Trade Organization and reduced the import rates for a number of goods, including trucks. Therefore, the Belarusian goods find it more difficult to compete with Western products in the Russian market, and even already on its own.

– Now the tragic fate may befall entire sectors of Belarusian industry. for example, giants of wood and cement-slate industry are suffering. It is surprising that this happened right after the modernization of plants, which received millions of dollars of investments. Why is this happening?

– Authorities are trying to solve problems at a low level. It is necessary to change the whole economic model, not to bury the money in the modernization of equipment with a deficit of good business plans. It is about the privatization of companies, so that the budgetary resources were not used on infinite maintainence of inefficient organizations. According to official statistics, one-third of enterprises in the industry are currently unprofitable. This figure is insane.