Aleksandr Lukashenko meets with Russia’s Leningrad Oblast Governor Alexander Drozdenko

Belarus and Leningrad Oblast intend to step up cooperation in construction, agriculture and high technology. These and other promising areas of cooperation were discussed at a meeting between President of Belarus Aleksandr Lukashenko and Governor of Leningrad Oblast Alexander Drozdenko on 9 November.

Speaking about the cooperation with regions of Russia, Aleksandr Lukashenko underlined that it was these relations that saved the Belarusian-Russian relations in difficult times. “Further development of allied relations with Russia, mutually beneficial partnership with the regions is the main priority of our foreign policy,” said the Belarusian President.

The head of state noted that the potential of mutually beneficial cooperation would increase with the development of the Customs Union, the Single Economic Space, and the Eurasian Union in the future.

Leningrad Oblast is an important trading partner of Belarus among the regions of Russia. In recent years, the bilateral trade has been steadily increasing. However, Aleksandr Lukashenko noted with regret that the pre-crisis level of 2008 has not yet been reached and the current trade does not match the potential of bilateral cooperation. “Economic realities show that we cannot limit ourselves to the commodities traditional for our bilateral trade. Opportunities should be explored for diversification of mutual supplies, including through increasing the share of high-technology and high-tech products in our trade,” said the Belarusian leader.

According to the President, Belarus has sufficient resources to meet the needs of Leningrad Oblast in different types of modern technology. “We have the opportunities to step up cooperation practically in all areas,” Aleksandr Lukashenko said.

The President noted that Leningrad Oblast has achieved significant success in breeding livestock and aims to ramp up the capacity of its poultry industry. Belarus, in turn, has accumulated considerable experience in building agricultural infrastructure facilities, production of relevant equipment and development of technologies for the production and processing of agricultural products.

“Belarus is at a crossroads of transit routes between the East and the West and Leningrad Oblast has a powerful transport and logistics potential in the shape of four sea ports. It is interesting for us from the point of view of implementing modern transit projects, including the mutual transshipment of commodities to third countries by sea and by land,” said the Belarus President.

“We discussed the matter at the latest meeting with President of Russia Vladimir Putin very seriously. We made a fundamental decision to reroute large amounts of cargoes, including potash fertilizers, from ports of Baltic countries to your ports. We need to very seriously work on it. The President of Russia expressed a univocal approval of the initiative. We have to come to terms with the railway administrations of Belarus and Russia and implement these arrangements as soon as possible,” said the Belarusian leader.

“I think that even if you make some concessions for Belarusians, you will benefit a lot considering the volumes because we transship more than 10 million tonnes of cargoes via the ports of the Baltic states. Together with Vladimir Putin we agreed to implement the program,” said Aleksandr Lukashenko.

In turn, the Leningrad Oblast Governor remarked that it was necessary to come to terms regarding fair tariffs. “If we manage to come up with fair tariffs or if we get tariffs equal to those used in the Baltic states, the economies of Leningrad Oblast, Russia, and Belarus will only benefit from it. Today we are ready to use our port installations to transship machines, mineral fertilizers, oil products, and a lot of other commodities. We should do our utmost in order to achieve fair tariffs,” concluded Alexander Drozdenko.

Another promising area of cooperation is high technology. For example, Leningrad Oblast is in the middle of setting up an innovative cluster for medical, pharmaceutical industry and radiation technology. “As part of the governmental innovation development program, we are working on the cluster for nano-, bio-technology and pharmaceuticals. Here I see inexhaustible possibilities for fruitful interaction between our scientists and technology experts,” said Aleksandr Lukashenko.

In addition, the President drew attention to the considerable production potential of Belarus and Leningrad Oblast. There are opportunities to develop industrial cooperation. Leningrad Oblast can also get interested in the experience of Belarusian builders in design and construction of infrastructure, industrial, social facilities and housing. “We are ready to implement an integrated construction project “Belarusian Quarter” or “Belarusian Village” in one of the districts of Leningrad Oblast. We have agreed with some regions of Russia on the construction of agro-towns and similar objects, and, as I have been reported, we are switching to the stage of practical implementation,” the President added.

In turn, Alexander Drozdenko stressed that Belarus and Leningrad Oblast have close ties in social, cultural and economic areas. In his words, the parties are discussing proposals for further development of cooperation.

“Today we welcome Belarusian business in Leningrad Oblast. Your laws and our legislation allow for Belarusian companies to partake in all our programs financed from the federal and oblast budgets,” the Governor said.

Alexander Drozdenko invited Belarus to partake in the rural social development program. This program envisages construction of social facilities and housing in the rural areas. “Here the Belarusian experience will be useful for us. We have determined the cost of one square meter of housing (RUB32,000) and your specialists assured us that they are ready to partake in the program,” the Governor said.

Another program stipulates an upgrade of the utilities services in Leningrad Oblast. “We count on the supplies of the Belarusian equipment. Your utilities equipment is highly competitive in quality and price,” Alexander Drozdenko said. He added that there are plans to involve Belarusian specialists not only in agriculture but also in forestry.

Alexander Drozdenko said that negotiations on the supply of Belarusian buses to Leningrad Oblast had already taken place.

“We should take a closer look at other areas of cooperation. It can be state-of-the-art technologies, nanotechnologies, nuclear and pharmaceutical technologies,” the Governor said.

The meeting touched upon privatization matters. Aleksandr Lukashenko stressed: “Privatization should improve the performance of an enterprise. If it cannot, why privatize? You, in Russia, know what investors bring. We get Western and Russian investors like that, who want to pay as little as possible, who want to give bribes, in order to get the price reduced”.

The President remarked that Belaruskali is estimated to cost $33-36 billion today. “I said the price was $32 billion and they laughed at me. But it turns out I am right. Russians have attempted to buy Belaruskali for $15 billion. I told them ‘No thanks’. Now everyone admits that my price was absolutely adequate. Higher prices are named these days. If the market recovers, the price may reach $40 billion because everyone needs food. If you need food, you need fertilizers. There is no other way of doing it. Potassium is vital for the quality of food”.

The head of state underlined that Belarus practices a very careful attitude towards privatization and the merger of enterprises. “They criticize me regarding the MAZ-KamAZ merger. If only the enterprise that makes K-700 tractors could approach Minsk Tractor Works and suggest cooperation. Yes, K-700 tractors may not be that good these days, they should be replaced by something newer. And now looking at the MAZ-KamAZ merger, I start asking questions: what the merger is for? Will KamAZ invest $0.5 billion into a MAZ program? KamAZ won’t. Well, KamAZ may not have the money but does KamAZ have cutting-edge technology? No, MAZ is competitive and it is likely that the customer will walk away with a MAZ vehicle than a KamAZ one. Explain to me, please, what this privatization gives, let’s say, to MAZ. Nobody can. Markets? We can divide our markets and we do as it is. Even Russia profits from a small competition. MAZ is not a stranger in Russia. We import more than half of the components and the metal from Russia. It is a Russian vehicle, too”.

The Belarus President wondered: “Who needs this artificial merger? Some people are offended by me because politics plays a large role in Belarus. Forget politics. Give me economic answers what MAZ or KamAZ will get from privatization. There is no answer. They say the two companies just have to be united and that’s it. There should be a controlling interest and so on and so forth. Leningrad Oblast representatives come and say that they are ready to buy our buses. But these are MAZ-made buses. It means there is a demand. But still there are muddy waters involved. This is why we practice a very careful attitude to this matter”.

Aleksandr Lukashenko stressed that Belarusians and Russians should cooperate more tightly. “I have many examples that prove that we will not be able to avoid each other. And we have to build our own policy. May Europe deal with its markets on its own while we should take good care of ours”.