Translated material
A step towards liberalization
Minsk does not need duties and surcharges
Belarus stands for the expansion of the Customs Union of Belarus, Russia and Kazakhstan within the framework of the Eurasian Economic Community (EurAsEC). This was stated yesterday in Minsk by the First Deputy Minister of Foreign Affairs of Belarus Igor Petrishenko during a meeting of the commissions of the Interparliamentary Assembly of the EurAsEC: “The Customs Union is becoming attractive for other countries. In particular, Kyrgyzstan showed interest. A working group has already been created to review the participation of this country in this organization.” The EurAsEC includes Belarus, Kazakhstan, Kyrgyzstan, Russia, Tajikistan and Uzbekistan.Belarus, Russia and Kazakhstan intend to form a Customs Union by January 1, 2010, but obstacles remain to the implementation of this idea. In particular, Moscow intends to achieve the unification of import duties on passenger cars when creating the Customs Union. “We need to support our manufacturer. This is very important for Russia,” said Anatoly Vaskov, a member of the Russian Federation Council, Chairman of the EurAsEC Interparliamentary Assembly Commission on Agro-Industrial Policy, Environmental Management and Ecology, in Minsk.
The issue of car duties has been an issue since the creation of the Russian-Belarusian union in the mid-1990s. On this issue, the interests of Minsk and Moscow diverge, since, unlike Russia, Belarus does not produce passenger cars. “In Russia, many types of cars are subject to prohibitive duties. The introduction of similar duties in Belarus will kill the secondary automobile market and lead to an increase in the price of new imported cars by about 30%,” Irina Tochitskaya, deputy head of the research center at the Institute of Privatization and Management, told Vremya Novostei.
According to the VN expert, the unification of duties with Russia would be justified only if global car manufacturers created assembly plants in Belarus. However, the effectiveness of creating such production to supply the small Belarusian market is questionable: “If Minsk agrees to unify duties on cars, it will become a hostage to Russia, which will always try to have protective duties.”
The Belarusian side intends to continue negotiations on this issue in order to come to a mutually acceptable solution. Deputy head of the international commission of the Belarusian parliament Igor Karpenko said yesterday: “A supranational structure is being created - the Customs Union Commission, which will determine these import duties. A mechanism is being worked out, the problem will be solved... There are all the levers to conduct a dialogue and agree on the topic of customs duties.”
At the same time, Minsk has to move in the direction of economic liberalization and fulfill the conditions under which the Belarusian government received loans from the IMF and the World Bank. Yesterday, a government decree was officially published, canceling from October 28 maximum retail trade markups on all goods, with the exception of 50 socially significant ones. Until now, the state has not allowed the establishment of trade markups exceeding 30-60% of the cost of goods from the manufacturer.
“This is just a small step towards price liberalization. The government has reserved the ability to intervene in pricing,” Yaroslav Romanchuk, head of the Mises Research Center, noted to VN. According to the expert, a sharp rise in prices will not happen if the government abandons protectionist protection of national producers in the domestic market.