Belarus’ woodwork industry could be modernized, but only by private investors

April 22, 2016 18:40

Following Lukashenko’s visit to the Borisov woodworks last week, the company’s management and regional administration head have resigned.

The government has chosen the woodwork industry as a promising avenue for modernization. Although additional funds have failed to improve the industry’s financial performance, woodwork remains a promising industry for modernization which could be carried out by private investors. However Belarus’ government wants to remain the key player.

About 39% of Belarus is covered with forests, i.e. it has enough natural resources for woodworking. Exports of wood and products made of wood in 2012 exceeded USD 500 million and Belarus has a good potential for import substitution at circa USD 200 million per year (calculation is based on 2012 data). Belarus imported circa USD 100 million worth of woodchip boards in 2012 and in the future it aims to replace these imports entirely with domestic products.

The exact amounts allocated for the woodworking industry modernization are difficult to calculate, but Belarus has imported woodwork equipment worth at least USD 500 million. Some modernization loans date back to 2008-2009 and have not been repaid in full until now. The industry’s financial situation is critical: woodworking has been making profits only in May 2013. Compared with 2012, industry’s loss-making in 2013 increased by 2.4 times. New production lines have been launched, but imports of woodchip boards have not reduced.

In addition, there is a huge difference between how private and state woodworks develop. In Smorgon region, the privately-owned Kronospan woodworks is expanding according to a development plan, it produces goods for exports and for domestic consumption, and does not require constant monitoring by the head of state. State-owned woodworks companies are not developing so well. In general, state-owned woodworks have failed to implement modernization: imported technical equipment does not meet the technical requirements and is often stored outdoors. The only positive exception is Ivatsevichi woodworks, which has strengthened its exports on the Russian market.

Recent practices show that the state is unable to carry out effective modernization at state-owned woodworks due to the lack of incentives. Private enterprises can be successful, but that only shows the inefficiency of state ownership in this industry, which is unacceptable for the authorities. 

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The Belarusian authorities have launched a discussion on the moratorium or abolition of the death penalty under the pressure of Belarusian human rights activists and international community. Apparently, the authorities are interested in monitoring public sentiments and response to the possible abolition of the capital punishment. The introduction of a moratorium on the death penalty would depend on the dynamics in Belarusian-European relations, efforts of the civil society organisations and Western capitals.

In Grodno last week, the possibility of abolishing the death penalty in Belarus or introducing a moratorium was discussed.

The Belarusian authorities are likely to continue to support the death penalty in Belarus. During his rule, President Lukashenka pardoned only one person, and courts sentenced to death more than 400 people since the early 1990s. Over the past year, Belarusian courts sentenced to death several persons and one person was executed.

There are no recent independent polls about people’s attitude about the death penalty in Belarus. Apparently, this issue is not a priority for the population. In many ways, public opinion about the abolition of the death penalty would depend on the tone of the state-owned media reports.

That said, the Belarusian Orthodox Church and the Roman-Catholic Church stand for the abolition of the capital punishment, however their efforts in this regard only limit to public statements about their stance. Simultaneously, the authorities could have influenced public opinion about the death penalty through a focused media campaign in the state media. As they did, for example, with the nuclear power plant construction in Astravets. Initially unpopular project of the NPP construction was broadly promoted in the state media, and eventually, according to independent pollsters, was accepted by most population.