Belarus, Volga Federal District resume trade to pre-crisis level

Belarus and the Volga Federal District are restoring the volume of cooperation deliveries to the pre-crisis level, Vice-Premier of Belarus Andrei Kobyakov said at a ceremony to open the economic mission of the Volga Federal District of the Russian Federation in Minsk.

The Volga Federal District is one of Belarus' main trading partners among the Russian federal districts and ranks third in Belarus' trade with Russia. "Despite the global crisis, in 2008 we had a record high trade of RUB132 billion, with the cooperation deliveries reaching RUB4.1 billion per month," Andrei Kobyakov said. In February this year cooperation deliveries fell to RUB720 million per month. In September they were already up to RUB3.4 billion. "We have approached the 2008 level. This result has been achieved in many things due to the well-coordinated work between the government of Belarus and the administrations of the regions of the Russian Federation, "Andrei Kobyakov said.

The economies of Belarus and the Volga Federal District are closely connected, cooperation deliveries account for 30% of the total trade. "If GAZ Group operates it means dozens of companies operate in Belarus too. If Minsk Tractor Works operates, enterprises producing Belarus tractors and parts will also operate in Russia, Andrei Kobyakov said.

He is convinced that the economic mission of the Volga Federal District will promote the economic cooperation with the regions of the district and give a new impetus to the development of Belarus-Russia relations. Participants of the economic mission traditionally present advanced technologies and latest product samples, define promising avenues of cooperation of the industrial enterprises and trends in high-tech areas of economy in order to manufacture competitive production.

The time between the foundation of the Customs Union and the single economic space should be minimal, Vice Premier Andrei Kobyakov told media.

"We are now carrying out the first phase - the Customs Union foundation. The single economic space will be the next step. The Belarusian side believes that the time between the foundation of the Customs Union and the creation of the single economic space must be minimal," said the Vice Premier.

He remarked that outlining the external borders of the economic union is the first step. "When the decision to outline the borders is made, when the unified customs tariffs are adopted, interests of the countries that have their own national producers are naturally taken into account. The tariff protection and competition rules should exist together," remarked the Vice Premier. The signed documents take into account all these things. "But it is just the first step. It is not enough to protect the external border, it is necessary to build transparent and understandable economy operation rules inside this economic institution," said Andrei Kobyakov.

In H1 2010 efforts will be channeled into removing as many mutual trade restrictions as possible by 1 July 2010 when the single customs territory is created. The instruction has been given by the presidents. "We will also create the legislation base of the single economic space in a way to enable equal economic terms for all economic operators in this territory and to observe equal competition principles," remarked the Vice Premier. In his words, it is a complicated matter which includes equal prices for essential production factors (primarily energy resources) and equal subsidizing terms, creation of a competition environment in the three states. The observation of these proportional measures will signify that truly equal terms have been granted to all economic operators, stressed Andrei Kobyakov.

The unified customs tariffs give the proper level of protection to the Belarusian mechanical engineering industry, Vice Premier told media as he commented on the adopted unified customs tariffs of the Customs Union of Belarus, Kazakhstan and Russia.

Pointing out Russia's Volga federal district as an example, Andrei Kobyakov said that the unified customs tariffs protect interests of manufacturers. Belarus maintains tight manufacturing cooperation ties with the Volga federal district. "We took a very careful approach to these matters. For instance, the unified customs tariffs rather seriously protect our production of trucks, tractors, harvesters, agricultural machines," he said.

"Naturally our partners expected reciprocal favors in the relevant areas they are interested in," he added. The necessary compromises were made when documents on the unified customs tariffs were signed, said Andrei Kobyakov.

In turn, Grigory Rapota, Russia President Plenipotentiary in the Volga Federal District, remarked that the creation of the Customs Union envisages free transportation of goods and capital and will foster the expansion of economic cooperation. "The Customs Union will create a more favorable background for our collaboration. It is obvious," he underlined.

In turn, Plenipotentiary Representative of the President of the Russian Federation in the Volga Federal District Grigory Rapota noted that the sides have a large potential for development of economic cooperation. The sides are set to develop, produce and apply innovative technologies and products. "The tasks of the economic mission of the Volga Federal District are to turn these opportunities into contracts and increase the level of mutual investments, which are minimum so far," Grigory Rapota said.

Since 2005 the trade between Belarus and the Volga Federal District has increased more than two and a half times to reach a record high of RUB132 billion (.4 billion) in 2008. In January-September 2009 the mutual trade totaled 77.5 million, down 48.5% over the same period in 2008. The export reached 3.3 million, down 52.6%, the import made up 34.2 million, down 46.6%. Belarus posted trade deficit in the tune of 0.9 million.

Cooperation is mainly based on effective interaction between machine-building and petrochemical complexes, joint production of agricultural equipment, technological upgrading of the agricultural companies. Mutual cooperation deliveries account for 30% of the total trade turnover. The production of Belarus tractors in Yelabuga and Saransk satisfy more than half of Russia's demand in these tractors.

Belarus' main exports to the Volga Federal District include tractors, trucks, refrigerators, freezers, tyres, spare parts, combustion engines, cord materials, milk, cheese and curd, etc. In the Volga Federal District there are over 120 facilities of the commodity-distribution network that sell nearly 50% of Belarus' export deliveries to the regions.


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