Andrei Kobyakov assessed the prospects of the Vitebsk region's industry

The Head of Government took part in a meeting held last Thursday at the regional executive committee, which addressed the development of the region's industrial complex and its operational challenges. Before the meeting, the Prime Minister visited OJSC "OrshaStroyMaterialy", foreign enterprise «Linpak Packaging East», LLC "PO "Energokomplekt" and OJSC "Vityaz". As noted by Andrei Kobyakov, these enterprises differ in their profiles. This provides an opportunity to take a certain cross-section, allowing for an assessment of the situation in the region's industry.

During the visit to PO «Energokomplekt» , the focus was on the issue of implementing import-substituting products. The enterprise is the largest cable manufacturer in Belarus. Several years ago, a new line was installed here, enabling the production of high-voltage cables. As explained by the Development Director, Andrei Golomuzdov, «Energokomplekt» currently produces the highest quality products that meet European and global standards. This is evidenced by the obtained certificates and awards from international exhibitions. Last year, over 5 thousand km of cable were produced – a record of sorts for the enterprise, and in terms of production volumes of self-supporting insulated wire, Vitebsk residents have surpassed Russian leaders.

– This product is high-tech. In case of disasters, when concrete supports fail, our cable remains undamaged. Currently, the enterprise is working on a know-how – the production, within the framework of the program "Fiber Optic to Every Home", of a cable within a cable, which not only conducts electricity but also transmits information, – noted Andrey Golomuzdov.

More than 75% of the products are exported. However, supplies to the domestic market have significantly decreased. If in 2012 they accounted for 55%, in 2013 – 36%, then last year – only 20%. In a conversation with the Prime Minister, the Chairman of the Board of Directors of the enterprise "Energokomplekt" Sergey Podgaisky drew attention to the fact that Belarus spends hundreds of millions of dollars on purchasing cable, although a similar product is manufactured in Vitebsk. Often, low-quality goods are imported from abroad – cheap counterfeits, which a serious manufacturer cannot compete with and loses tenders. There have been cases when a Belarusian enterprise was not admitted to Russian bidding. Despite the fact that we are in a single economic space, Russia actively protects its market.

– The stated facts require serious study, one might even say – an investigation. The enterprise produces high-tech products, and many far-abroad countries buy them, which is the best indicator of their quality. We will look into it, – noted Andrey Kobyakov.

At OJSC "Vityaz" the head of government familiarized himself with the manufactured products. Once the largest TV plant, it is currently in a difficult economic situation. Due to a lack of working capital, the enterprise has practically ceased TV production and is engaged in other areas. In particular, household appliances, medical equipment, fire-fighting equipment, as well as furniture, building materials, and fish processing lines. Digital set-top boxes for televisions, as well as for interactive television "ZALA", are in demand. General Director Sergey Gunko demonstrated Vityaz's own developments in software and the production of special equipment for the military-industrial complex and spoke about promising areas. One of them is a joint venture with a Dutch company for the production of commercial equipment for hypermarkets. It is planned to start operations in September 2015. However, it is fundamentally important to maintain TV production as well.

Andrei Kobyakov supported the General Director in this and expressed his conviction that "Vityaz" televisions will be in demand in the market.

– Buyers have slightly forgotten this brand, but I think they will appreciate its value again, – emphasized the Prime Minister.

He also added that with the arrival of the new head, the enterprise is actively searching for different areas of activity, focusing on market demands. "The prospects for "Vityaz" are good, but it is necessary to untangle the financial knots, and then the enterprise will take those positions that will allow it to work normally", – concluded Andrei Kobyakov.

The discussion about the pain points of the industrial complex and the prospects for its development continued at a meeting in the regional executive committee. It was also attended by the Chairman of the State Control Committee of the Republic of Belarus Leonid Anfimov, heads of concerns "Belneftekhim", "Bellesbumprom", "Belleghprom", and representatives of the Ministry of Industry.

Gennady Grebnev, First Deputy Chairman of the Regional Executive Committee, who delivered the report, emphasized that the industry of the Vitebsk region is the foundation of the region's development and a budget-forming sector. More than 1,200 enterprises operate in the region, employing about 120,000 people. Industry accounts for over 47% of all budget revenues and 33.6% of the gross regional product. Today, many enterprises have felt the negative impact of the falling exchange rates of the Russian and Belarusian rubles, increased interest rates on loans, rising energy prices, etc. As a result, in January, the volume of production output decreased by 4% in actual prices, and warehouse stocks increased. Exports of goods to the Russian Federation in January amounted to 58.8% of the 2014 level. However, sales to other countries, including the European Union, increased by almost 23%. This means that the company managed to balance its operations in foreign markets. The industrial complex of the region has sufficient potential to overcome negative trends. "Every manager has an action plan that will allow them to level the situation and cope with the assigned tasks," noted Gennady Grebnev.

The Prime Minister drew attention to the fact that restoring the normal operation of the industrial complex is a key issue.

– Our main task is to maintain the calmness of the people, the teams, their competence, to get through difficult times and then quickly occupy the niches that have become available during the crisis phenomena, – emphasized Andrei Kobyakov.

The Prime Minister also visited a construction products manufacturing enterprise, OJSC "Orshastroy ماтериалы".

Here, the production of aerated concrete wall blocks, as well as paving slabs and curbs, has been established. To date, the plant is experiencing certain economic difficulties due to a large debt and creditor package – debts exceed annual revenue turnover.

Problems and ways to solve them were discussed during the Prime Minister's familiarization with the enterprise's operations. As explained by Igor Shikun, General Director of Orsha Building Materials OJSC, the old production of third-category blocks is technically obsolete and absolutely unprofitable. A proposal was voiced to stop it, which, considering the costs of maintenance, energy resources, and salaries of the service personnel, will allow saving 360 million rubles monthly.

Thanks to the investment project implemented in 2011 for the modernization of aerated concrete block production, the output of gas silicate blocks has reached 600 cubic meters per day. Within its framework, technological equipment was purchased and installed in the summer of last year, which has already ensured more efficient operation of the enterprise and reduced costs. According to calculations, to achieve profitability, cost savings should amount to about 1 billion 200 million rubles per month. Therefore, the management, together with the district executive committee, has developed a set of measures that will help resolve the current situation. In particular, the construction of a state-of-the-art line for the production of wall blocks is planned, which will enable entry into the Russian market with new products. And with the help of existing equipment, the domestic market will be fully saturated.

The issue of production restructuring was also discussed.

Andrei Kobyakov noted that the geographical location of Orsha, its proximity to Russia, with proper organization of work, will contribute to achieving positive economic indicators, and also approved the measures developed and being taken by the management.

Andrei Kobyakov also visited the foreign enterprise "Linpak Packaging East" with English capital, which was opened in 2014. The Prime Minister gave a positive assessment of the work established here, as well as the quality indicators of economic development. He expressed a wish to increase the production capacity of expanded polystyrene packaging.

Tatsiana PASTERNAK and Alena LEBEDZEVA, "Vitsiebskiya Naviny"