Reform of Public Property and Privatisation

The reform and privatisation of public property in the Republic of Belarus is carried in conformity with the legislation which ensures openness and democratic transformations, as well as the protection of interests of population and of the State.

During the entire period of institutional transformations in Belarus, over 4000 public property facilities have been reformed, including over 1000 facilities of the republic’s property and about 3000 facilities of communal property. Over 1900 enterprises have been converted into open joint-stock companies; the majority of them have been formed on the basis of republican property where the State has its share in their authorised funds. Twenty-five republic’s facilities and 1369 communal facilities have been sold at auctions. More serious transformations have taken place at enterprises of the woodworking sector, agricultural products processing sector, as well as in the trade and public catering sector, where over 70 percent of the facilities have been reformed.
 The share of the nongovernmental sector of the economy has about 60 percent of the total industrial output. The privatised enterprises employ over 950,000 persons, which makes about 23 percent of the total population employed in the national economy.

A new market economic system is developed in the country using the approach oriented towards stability of reproduction conditions and preservation of social partnership in the society. Preference is given to evolutionary transformation methods with active participation of the State in the development of the market infrastructure and support of the essential sectors of the national economy.

Privatisation is based on the principles ensuring the required volumes of investment and know-how, development of market relations and preservation of the State involvement in management bodies of new business entities organised on the basis of the former state-owned enterprise.

Large enterprises of the national level are transformed according to specific projects. The so-called individual-based privatisation is in place, which allows the State to implement directly its policy in relation of specific facilities. The Government of Belarus adheres to this approach without artificially speeding up the reform of the state property.

In 2005, it is planned to reform public property in conformity with the tasks stipulated by the Concept of management of public property in the Republic of Belarus in 2001-2005. According to the Concept, it is planned to complete incorporation of public enterprises with the number of employees up to 500 and their shares will be sold to domestic and foreign investors. During reformation of large enterprises, a differentiated approach will be used to select strategic investors.

The reformation will be carried, first of all, among enterprises that have been inefficient or unprofitable for a long period as well as enterprises unable to compete. The process of their transformation will be preceded by a range of preparatory measures and operations for their financial rehabilitation.

Privatisation in the country is not considered as a universal means for the solution of the existing economic problems and for attraction of investment.

In the future, it is planned to use a balanced approach to taking decisions on the reformation of facilities and sale of state property. When it is proposed to sell facilities and shares owned by the State, it is also planned to use the “point” approach, the existing legislation and the mechanisms of sale of state property.

Proposals on the sale of state property and shares will be considered for each individual enterprise, with due account of specific proposals of investors, prospects for future development of enterprises and sectors and the preservation of the positions of the State in the economic management.

This approach to market transformations meets the general principles of the State to build a socially-oriented market economy.