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Economy
25 May 2022, 14:25

Snopkov: Belarus' economic sovereignty relies on import substitution today

An archive photo
An archive photo

MINSK, 25 May (BelTA) – Import substitution is a matter of economic sovereignty for Belarus today, First Deputy Prime Minister Nikolai Snopkov said at a joint meeting of the House of Representatives and the Council of the Republic, BelTA has learned.

“The actions of unfriendly countries have prompted us to realize how important it is to increase our own production. Today, import substitution is a matter of economic sovereignty for our country. We are working on two major fronts. The first one is finding alternative suppliers. Import applications have been compiled and sent to China. We are working with Russia. In the first quarter alone, the import of raw materials (excluding energy resources), component parts from these countries (Russia and China) increased by $473 million. We are working on issues of parallel imports. The corresponding list has been compiled and a bill has been drafted,” Nikolai Snopkov said.

The task is to cut costs for enterprises that purchase materials and components in foreign markets. “For this purpose, three packages of anti-crisis measures have been adopted by the Eurasian Economic Commission. These measures provide for reducing customs duties on critical imports. The package will be in place until September. I would like to emphasize that this is an emergency package that seeks to confine the problem. We will revisit this matter in September and consider expanding customs and tariff regulations on commodities that our country will be ready to export to Russia and the EAEU member states in the long and medium term,” the first deputy prime minister noted.

The second area of focus is the production of domestic substitutes for imported products. “Russia-Belarus working groups were set up to facilitate import substitution in the automotive industry, agricultural engineering, machine tool industry, electronics, light industry, chemical industry and pharmaceuticals. Joint projects in mechanical engineering and chemical industry worth $2.6 billion have already been developed. The task is to involve small and medium-sized businesses as much as possible in the technological chains of our flagship companies to replace foreign suppliers who have left the market. A list of import-substituting products featuring more than 2,700 product names has been drafted. It will be a benchmark for businesses. In addition to that, there are plans to introduce incentives to encourage manufacturers to launch import-substituting production,” Nikolai Snopkov said.

The Development Bank is running a loan program “Import Substitution Support” with the interest rate equal to the refinancing rate plus 2%. Eight projects worth Br6.6 million have already been financed. In addition, the Development Bank is developing a financial instrument for SMEs that want to launch import-substituting projects. They will be able to apply for bank loans and budget transfers to reimburse 25% of capital costs. “In order to involve small and medium-sized businesses in cooperation chains, a nationwide subcontracting information resource was launched. Its database contains about 1,500 entities. In addition to information support, business matchmaking sessions are held. This year, negotiations were arranged between 43 large enterprises and 77 SMEs. As a result, small and medium-sized businesses replaced imports worth almost $17 million. In total, in the first quarter, SMEs produced import-substituting products worth about $750 million,” Nikolai Snopkov added.

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