Visiting Belarus visa-free

The Interview of Mr.Vladimir Serpikov, Ambassador of the Republic of Belarus to the Slovak Republic, for the magazine Dimenzie (Slovakia), February 2014

- Your Excellency, Belarus is a stable partner of the Russia and Kazakhstan Customs Union. Would Belarus survive if the country “left and cut off “from the Russian market and customs union?

 — I would like to point out that for the entire period after the collapse of the Soviet Union (USSR), it has not even happened once that the Republic of Belarus would have considered any „cutoff " , respectively, of another way of economic distancing itself from Russia. Relations with Russia have always been perceived as a priority and of strategic importance. All activities of the Belarusian leadership, therefore, show our sincere interest in strengthening and developing all-round cooperation with Russian partners on the principles of good neighborliness, mutual respect and mutual benefit.

Second, globalization processes objectively motivate states to more active operations in order to increase the efficiency of the national economy and the resilience to crises. These and other factors have become the backbone of our state policy, which aims to create the conditions for deeper integration in the post-Soviet space. Belarus, Kazakhstan and Russia were able in a short time to develop and implement the idea of creating a customs union within which there is free movement of goods, persons and capital.

- How does the Union help the Belarusian economy?

 — Benefits of creating a customs union are obvious. Mutual abolition of customs duties, unified billing in trade with third countries, coordinated policy in the field of technical regulation, the abolition of almost all types of internal border controls, reduction of prices on energy resources — it is far from a complete list of benefits now available to member countries of the Customs Union . Its successful operation allowed in a short time to establish a Common Economic Space (CES). Our three countries conducted coordinated macroeconomic policy, which is based on common principles and rules of competition, as well as on common rules for the regulation of activities of natural monopolies. Participating States apply common approaches to support industry and agriculture and the implementation of state purchases.

- Common Economic Space is now a huge market with a large number of consumers. What is the interest of other states to cooperate with the customs union?

 — The success of the integration project has sparked interest in stabilizing the free trade area between the Customs Union and those countries such as Vietnam, New Zealand and the countries of the European Free Trade Association (Norway, Iceland, Switzerland, and Liechtenstein). India and Israel expressed their interest in cooperation as well as other economic- economic groupings. Several CIS countries, especially Armenia and Kyrgyzstan About expressed their decision to join the Customs Union, respectively deepen contacts with it as they have already announced. Currently, we are working on the preparation of systematizing international agreement according to which the Eurasian Economic Union will be founded on January 1, 2015. The Declaration on the Eurasian Economic Integration, which laid the foundations for a common economic space, reads the proposal by Belarus for “integration of integrations”. It is based on the fact that the heads of the three countries expressed their common efforts to stabilize CES, equitable cooperation with the European Union, which should result in the creation of a free trade area between them.

- The Customs Union will from 1 January 2015 change into the Eurasian economic union. Which position will Belarus hold?

 — It is about the integration association of member countries of the Common Economic Space — Belarus, Russia and Kazakhstan. The main task of the Union is to strengthen primarily the economic cooperation and trade, coordinate the activities of member countries to take on the world markets, increase the global competitiveness of national economies and CES as a whole. The union wants to ensure sustainable economic development and raise the living standards of the population. The Republic of Belarus has repeatedly stated that Eurasian integration is a priority of its foreign policy. Belarus joined the Customs Union of Belarus, Russia and Kazakhstan, and consequently in the CES, because the process of integration is an important factor in the dynamic socio -economic development of the state. In this context, I would like to emphasize that in terms of strengthening the global competitive markets, countries shall associate an international character, because in this way, they seek to strengthen their own economic position. Currently, multiple integration groupings have been formed around the world — from Latin America and ending Asian- Pacific region. In Europe, it has also commonplace.

- Many political scientists in the EU and the U.S. argue that the Eurasian economic union is an attempt to restore the former USSR and the members of this Union will be political and economic satellites of Russia. How would you comment on those comments?

 — Such statements are nothing more than journalistic cliché. These are unsubstantiated allegations. As I have already pointed out, in order to create Eurasian Economic Union is to further strengthen economic integration. This union will be in their activities by the rules of international trade and standards of the World Trade Organization, which Russia is a member. Belarus and Kazakhstan have been negotiating accession to the organization. For a long time. I believe that we will succeed in the foreseeable future to implement WTO membership.

- How does the Eurasian economic union differ from the European Union? Which areas of national and economic policy will remain the responsibility of national states?

 — Participation in the Eurasian economic union in no way to imply total or partial loss of sovereignty and political independence of Member States. Three countries will implement a coordinated macroeconomic policy and foreign trade, which is based on unified principles and rules of competition. Decisions are made and implemented on the basis of equality and consensus. All the decisions will be binding for any member country. Our integration group is open to other countries that they share its goals and are willing to assume the essential obligations.

- Based on the decision of the Presidents of Belarus, Russia and Kazakhstan, in November 2011, the Eurasian Economic Commission (EEC), a permanent supranational regulator bodies of the Customs Union and the Common Economic Space were created. What are the priority tasks?

 — The main task of this commission is to ensure the conditions for the functioning and development of the Customs Union and the Common Economic Space, to develop proposals on integration within these clusters and provide the necessary macroeconomic and foreign policies for the creation of the Eurasian Economic Union. The Commission is currently completing preparatory work on the draft agreement establishing the Eurasian Economic Union, to be completed by May 2014. This contract provides the basic principles, Internal Regulations and the competence of the Member States in this integration groupings.

The proposal of Belarus and efforts to consolidate multilateral and mutually beneficial and equal cooperation of the Customs Union and CES with other countries and international groups, including the European Union was in the Declaration on Eurasian Economic Integration were reflected there. This declaration was signed by the Presidents of Belarus, Russia and Kazakhstan in Moscow in November 2011. Belarusian idea of “integration of integrations " is actively being promoted these days. Considering the fact that the purpose of establishing the Eurasian Economic Union is to create favorable conditions for participation in global economic processes, we are interested in building multilateral relations with individual states and with other integration groupings.

- Will the Eurasian Economic Union be open to the European Union and its member countries?

 — Integrative models of the European Union and Eurasian Economic Union are based on similar principles, they rely on the standards of the World Trade Organization. Both integration groupings, therefore, can complement each other and develop cooperation between them and surely, they will bring a significant economic effect on both sides. Potentials and prospects for establishing a common economic space from Lisbon to Vladivostok could prevent the emergence of new dividing lines in the region.

- What is Belarus experience with foreign investors?

 — According to the results of 2013, the total volume of foreign investments into the Belarusian economy (excluding banks) accounted for $ 15 billion. Fundamental investors were traders from Russia ( 48.6 % ) , the UK ( 21.4 % ) , Cyprus ( 7.1% ) , the Netherlands ( 4.9% ) and Austria ( 3.4% ) . The most money was invested in business enterprises (34.8 %), transport (28.6 %) and industry (23.4 %). The most important and successful foreign investment projects include Belarusian- German joint venture for the production of trucks (MAZ — MAN), start businesses of well-known foreign companies, such as Coca — Cola, Kronospan and Heineken. Known Swiss company Stadler Rail AG implement an investment project for the production of means of transport by rail and urban electric transport.

In terms of successful cooperation with the Slovak Republic, I would like to point out, in particular, the common projects with companies such as Konštrukta Industry, VIPO (modernization of tires in the Belarusian Company Belšina) and the cooperation with Vzduchotorg in the reconstruction of dairy farms in Belarusian regions. Slovakia also operates in a joint venture to manufacture tractors.

- What are the conditions and guarantees offered to investors by your country?

 — Belarus seeks to create an open and favorable conditions for business in the country. Now, it is the leader in improving legislation, which confirms the World Bank report entitled Doing Business – 2013. Compared to 2012, Belarus progressed in rating by 11 points and occupied the 58th position out of 185 countries. According to indicators, such as the registration of ownership (the 3rd place) and the opening of business (Rank 9), Belarus belongs among the most attractive countries not only in the region but also in the world.

State support and motivation is provided in accordance with the law, if the investment activities are carried out in the territory of medium and small urban centers, respectively, in the countryside. Or in conclusion, the investment agreement with the Republic of Belarus (State-level), the Hi — tech Park, the territory of free economic zones in Belarus — China industrial park.

Strategy for attracting foreign investments are directed to stimulate the inflow of capital and technology to the needs of the reorganization of the economic structure and innovative development of the country. As priority sectors are outlined: pharmaceutical, biotechnology and nanotechnology, hi — tech manufacturing, information and communication technologies, chemical industry, transport and logistics infrastructure, construction and production of building materials, agriculture and food.

- Belarus gets better every year and stabilizes its economic growth. Your country is one of those European States which achieves the highest GDP growth (7-9 %). As the government has managed to ensure such growth?

 — It's true. From 1996 to 2010 the Belarusian economy high growth rate, which according to the results of 1997 and 2004 exceeded the level of 10 percent. Overall, for the period 2005-2012, GDP grew by 53 %, making it one of the highest indicators in the framework of the CIS countries. In 2003, the Republic of Belarus, exceeded the level of economic development of the year 1990 (the last year before the disintegration of the USSR), which has so far failed to achieve several states post-Soviet space. The main factor of growth was mainly balanced economic policy of the government with targeted support production and export production, finding new outlets in conditions favorable foreign trade boom. At the same time, it takes steps to increase domestic demand, for example, actively develop housing.

- In 2011, Belarus survived a strong devaluation of the Belarusian ruble. It was said that Belarus will become bankrupt. It did not happen. What helped Belarus overcome the financial crisis?

 — The year 2011 was probably one of the toughest years for the Belarusian economy. Manifestations of crisis forced the government to adopt a variety of hard and sometimes unpopular measures for standardizing the socio-economic situation. Furthermore, it appears that the „safety margin” of the real sector of the Belarusian economy is higher than the assumptions of several foreign experts. In addition, the cheapening of Belarusian products due to the devaluation of the ruble led to unheard-of growth in exports. For example, in 2011 compared with 2010, Belarus has doubled exports to European Union countries. Anyway, this is just what Brussels promises only other Member States of the Eastern Partnership after the creation of a free trade zone with them. Calls to me note that Belarus is one of the leaders in the volume of exports to the EU per capita among the other member countries of the EU Eastern Partnership.

All this plus financial support of anti-crisis fund Eurasian Economic Cooperation and IMF allowed Belarus to overcome a significant part of the negative effects of the crisis back in 2012. And in 2013 the incomes of the population returned to pre-crisis levels. According to the average wage of the population is now Belarus in third place in the CIS after Russia and Kazakhstan.

- How is it possible that Belarus has a low unemployment rate (under 1 %)?

 — This was the direct result of the social policy of Belarus, in which State has implemented a number of measures to promote employment of the population, an increase in skills and retraining of human resources. Particular attention is paid to professional profile, employment and entrepreneurial activities of young people.

The uniqueness of Belarusian economy is in the fact that about 70 % of industrial production is in the hands of the state. Unlike other CIS countries and Eastern Europe, Belarus cannot just leave the most important national state-owned enterprises, but also develop their potential. Thus significantly increase their international competitiveness. I want to note that in the period since gaining sovereignty of our country has significantly increased export their own production to international markets. For example, since 1995, the total volume of Belarusian exports went up to eight times and exports to EU countries more than 10 times.

- What model of privatization of state property does the government enforce?

 — Currently, in order to make the most significant increase in the efficiency of the national economy, Belarus applied procedures of so- called voucher privatization. Based on the experience of several European countries (including Slovakia), the Belarusian government with the support of the World Bank and the IMF prepares and implements innovative approaches and tools to increase the investment attractiveness of the country. To be open and easier to understand for foreign companies to participate in privatization.