Aleksandr Lukashenko meets with Belarus Prime Minister, Minsk Oblast Governor
The implementation of the investment project to make cars in Borisov District, Minsk Oblast was discussed at the meeting of Belarus President Aleksandr Lukashenko with Prime Minister of Belarus Mikhail Myasnikovich and Minsk Oblast Governor Semyon Shapiro on 14 January.
“Before we start, I can say that what many Belarusians and, above all, I have been dreaming about has come true,” said the head of state. “We have made Belarusian cars together with our Chinese friends. According to my data, we sold roughly 2,500 cars last year. There is demand for this type of cars not only in Belarus but abroad, too”.
The President was interested in learning about possible problems pertaining to the production and sale of the cars. “You understand perfectly well that by making these cars in Belarus together with the Chinese friends we encroach upon the sanctum sanctorum of Russia, first of all. We are going to sell the cars all over the world, including in Russia and Kazakhstan,” noted the Belarusian leader. “I am interested in today’s reaction of the Russian automobile industry lobby. The car has been granted all the permits and certificates in Russia, I understand. We can indeed sell the cars in Russia. Therefore, I’d like to know what is being done about the car recycling tax. I think it is necessary to get our Chinese comrades involved and resolve the problem if there is one”.
“It is our honor to make these cars in the amounts and on the schedule we have planned,” stressed Aleksandr Lukashenko.
“The car is a good one, it sells well. It means it should be manufactured and promoted. Moreover, a number of our large enterprises get orders for component production. Therefore, it is a very important science-intensive project and we should definitely implement it,” said the head of state.
The production of Belarus-made cars on par with global standards is as important as space exploration projects and the construction of the nuclear power plant, the President said.
According to Mikhail Myasnikovich, the first stage of the project to set up an enterprise to assemble 10,000 cars per annum has been implemented in the town of Borisov already. Plans have been made for an export-oriented enterprise with the output capacity of 120,000 cars per annum in the future. The project is supposed to be implemented together with the Chinese company Geely. “We use their experience. It is a large company, one of the leading ones that makes several hundred thousand automobiles per annum and enjoys quite a good reputation on the market. On the whole, the project is estimated at roughly $650 million, including about $450 million in fixed-capital investments,” he said.
The government has put together a draft presidential decree to regulate the organization of car manufacturing. “We didn’t rush the decree because it was necessary to create the capacity for semi-knock-down assembling and see the market’s response to the emergence of yet another car maker,” said the Prime Minister.
Mikhail Myasnikovich admitted that sale terms are not simple because at present about 30 car assembly enterprises operate in Russia alone. It is necessary to reduce prime costs and maximize the added value in Belarus, which will result in salaries of the workers and tax revenues. At the same time the Chinese side should be interested in working in Belarus and making automobiles together. “One-sided benefits are not an option. The project should be mutually beneficial and we are working for it. It is part of the draft decree,” stressed the Prime Minister.
Speaking about certain difficulties, including the introduction of the car recycling tax in Russia, Mikhail Myasnikovich said that in order to secure the proper level of profitability and competitive ability, these matters will be handled using economic and political methods.
The government has also instructed the Industry Ministry and the joint venture to enable the proper aftersales service for the Belarus-made cars. “We don’t expect major issues regarding quality. At least we haven’t heard any big complaints from those, who have bought these cars for personal needs or business needs,” noted the Prime Minister.
Taking into account the vigorous development of the automobile market, plans have been made to design and make new models with better quality parameters at affordable prices.
The head of state also gave instructions to gradually increase car manufacturing localization.
“In line with the legislation we should have 30% and more as far as industrial assembly is concerned. We believe that we can get close to 30% with car bodies (assembly, painting, and welding). We can secure at least 20% by relying on automobile components and rubber goods,” said Mikhail Myasnikovich.