Victor Tchaikovsky: “You can issue hundreds of decrees like this but it won’t make Belarusian production more competitive”



On September 25 Aleksandr Lukashenko signed decree #477 “About some questions of entrepreneurs’ activities and introduction of modifications of Decree from April 15, 2009 #194”. The chairman assistant of Regional Public Organization “Perspective” Victor TCHAIKOVSKY tells the reporter of www.Euramost.org that this document “won’t simplify life of small business”.

The document foresees a simplified mechanism of import of wares of domestic manufacturers. This order will be in use till July 1, 2010. According to the decree, the entrepreneurs, who pay single sales tax in fraction of revenue got from activities connected with realization of goods abroad, are executed from payment of income tax, tax from a simplified tax system, added value tax and local taxes and charges.

Moreover, individual entrepreneurs are executed from obligatory deposits on subject accounts in Belarusian banks in foreign currency which was got from realization of goods out of the bounds of the republic. According to the decree a single sales tax amounting to 35 thousands rubles is put in for every calendar month for carrying out activities connected with realization of goods abroad. Payment of these duties must be carried out before buying goods to export them abroad. Individual entrepreneurs can also carry out automobile transportation of goods which are made on the territory of Republic of Belarus and are bought from Belarusian organizations without getting a special permission (license). But with the conditions that this transportation is carried out in an automobile predestinated for transportation of goods. And the maximum weight of such automobile must be no more than 3,5 tons including the weight of a trailer and a semitrailer.

- All decrees, acts and ordinances which the economics of Belarus is regulated by don’t lead to anything good, - says Victor Tchaikovsky. – The last events showed it perfectly: no credits, no production distribution, and at many enterprises in fact there is a concealed unemployment there. RPO “Perspective”, as we know, organized a summit lately where it put a question to the president about adequacy for the posts of some of the ministers. And, to my point of view, this decree about simplifying of export of local production won’t give anything.

- Why?

- Because Belarusian production isn’t competitive in European markets. And you can issue hundreds of decrees like this but it won’t change the situation anyway. Belarusian production has a very high price, low quality and an out-of-date design. For example in Brest at the hosiery plant market council chiefs were gathered and asked for yesterday’s scapegoats to retrain their warehouses. But they asked to make a prepayment. “But what if nobody will buy the goods abroad?” – Entrepreneurs asked a logic question.-“It’s your problems”. That’s how they trust entrepreneurs. Then what kind of cooperation can we talk about? I just want to say that revolution in minds of our governmental officials and heads of enterprises must happen first and only after it must happen on paper. Market mechanisms must work. If they work, all lossmaking enterprises which are supported only by credits will close in themselves. Only the strongest will survive.

- Is that how it happened in Brest?

- Yes, before the New Year there were approximately 500 hosiery firms. From January till September 300 of them went into bankruptcy – only the strongest ones survived. The same must be in governmental economy. Enterprises must go into free floating. And of cause proper specialists in marketing who would research competitive sets for us are needed. They would watch after market. Today our light industry in foreign market is practically unprofitable. Brewery industry also isn’t competitive abroad. We need investments to change the situation. And we need stability and predictable law to get investments.

- In your opinion, how many entrepreneurs will answer this presidential decree?

- The percentage will be miserly – nearly 1 percent. In this situation entrepreneurs are not the straw one can catch at. Today the entrepreneurs who sell Turkish, Chinese and Russian production in Belarus lead a dog’s life. Purchasing ability is low and realization of goods is bad. And the existing tax system doesn’t let to draw breath. So I don’t know what this decree will give us on practice. The reason for the today’s situation (overfilled warehouses) must be looked for deeper than in entrepreneurs.

Victor PAVLOV