Retail trade is divided between major retailers and the state

April 22, 2016 18:25

On February 8th, at the meeting to hear reports of the Belarusian Cooperative Union (Belkoopsoyuz), privatization of consumer cooperatives was declared inadmissible.

Belkoopsoyuz remains the last major state-owned retailer. The state does not allow private retailers in the rural areas not to lose its monopoly and high incomes. Retail market will be further consolidated and other means will be used to increase government revenues from retail sales. 

Retail sales in Belarus are one of the most dynamic economic sectors. In 2012 the largest private Belarusian retailer Evroopt alone increased the number of shops from 68 to 120. Large chain retailers are actively buying smaller chains and shops. The reasons behind the active retail market expansion are increased incomes and insufficient number of shops. The state is a passive observer in the confrontation between the small and large private businesses, not preventing the disappearance of private entrepreneurs-retailers. 

Belkoopsoyz is the largest state-owned retail chain. It counts over 10 000 retail shops, most of which are in the rural areas. Despite the desire of large private retail chains to increase their presence in the rural areas, the state declares inadmissibility of Belkoopsoyuz shops privatization in order to maintain the monopoly on retail sales in rural areas. The reason is high financial performance of Belkoopsoyuz enterprises. Belkoopsoyz net revenues in 2012 were BYR 459 billion, significantly exceeding net revenues of the largest private retailer. The state will not abandon its significant profits in favour of private business.

Small business, represented by business associations, came out with a proposal to limit the expansion by large retail chains by law. Private entrepreneurs cannot compete with large retailers and will be forced to cease operations. The state has proposed to limit the share of large retailers in certain markets within 30%. This will not stop chain retailers from taking over small businesses. It is easier for the state to control a dozen major networks, rather than thousands of entrepreneurs. Therefore, if Trade Ministry takes no action, in a few years the share of private entrepreneurs in the retail market will be reduced to the minimum.

Thus, on the one hand, the state makes things easier for itself by allowing large chain retailers to have a lions’ share of the retail market, and on the other hand, sets expansion limits, keeping control over retail sales in villages and small towns for both, social and economic reasons. In the future, taking into account the attitudes about private property in Belarus, it is possible that the control over the retailers will grow in order to increase financial returns and to continue the retail market’s consolidation.

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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.