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Industry’s key highlights
The industrial type of the Belarusian economy is characterized by the dominance of the industrial sector (data for 2017): the share of industry's value added in GDP is 27%; production exceeds USD 45 bn, with about 60% of export.
The Belarusian industry is represented by almost all sectors and sectors characterized by multidirectional development: the most developed are petrochemical complex, engineering, construction materials, food and light industry, while the innovative production of final products remains less developed.
At the beginning of 2018, there were 12 thousand industrial organizations in Belarus: 35% of the total number is wood-processing and small-scale manufacturing organizations. Almost 25% of all registered industrial organizations are located in Minsk. However, the largest share in production is occupied by the food industry (25%). In technological aspect, over 60% of production is represented by low- and medium-tech products.
The main factors of competition in the industry are: resource base, profitable sources of financing, public sector, export markets (traditional – CIS market) and new countries.
Representatives of the industry are large state-owned companies / with a state share (Mozyr oil refinery plant, NAFTAN, MTZ, MAZ, Krasnoselskstroymaterialy, Granit, BMZ, Belmedpreparaty and many others) and numerous private companies (Involux, Izobud, Kronospan, Alutech).
Investments in the industry
The main volume of investments in the industry is carried out by the enterprises themselves as part of their own development programs (modernization), as well as state sector development programs (wood-processing, pharmaceutical industry modernization). Thus, over the past 5 years (2013-2017), the volume of investments in fixed assets amounted to about USD 30 bn.
The volume of foreign direct investment on a net basis in 2017 exceeded USD 430 mn in to establishing new industries, modernization and reconstruction (-7.5% compared to the previous year). The most attractive areas are the production of computing, electronic and optical equipment (+53%); production of wood and paper products, printing activity (+ 26%); production of machinery and equipment not included in other groups (+65%); production of rubber and plastic products, other non-metallic mineral products (+36%); production of basic pharmaceutical products (+48%). Geographically, the most attractive regions are Minsk and the Minsk region. They collected 2/3 (about USD 850 mn in 2017) of the total volume.
The largest project in Belarus is the implementation of Industrial Park “Great Stone”, a joint Belarusian-Chinese project, which involves the creation of fundamentally new industrial production (the end high-tech products).
UNITER’s competence in the industry
UNITER provides professional advising services to Belarusian industrial enterprises, as well as to foreign investors who planned to enter through the acquisition of assets or implement greenfield projects in the Belarusian industrial market.
The company has a long history of providing investment and financial advisory for strategically important production facilities of the petrochemical complex in Belarus - Mozyr Oil Refinery Plant, Naftan - preparing financial memorandum, development strategies and market researches.
UNITER Investment Company took part in significant transactions for the country. For instance, Alutech Group acquired assets abroad (one of the first major out-bound transactions in Belarus); acted as an investment and financial adviser on the sell-side (Alutech Group) in the process of supporting a merger and acquisition transaction, negotiations with banks for the purpose of selling the company's shares to a foreign strategic investor (Hormann).
UNITER pays attention to promising areas in which foreign investors are interested: preparation of an information memorandum, searching for a foreign investor, holding negotiation with an investor and supporting the transaction with one of the largest pharmaceutical companies in Belarus.
The company provides services to Belarusian companies and foreign investors to ensure the sustainable development of the building materials industry: Due diligence of the Belarusian Cement Plant OJSC (revenue over USD 100 mn) for HeidelbergCement; Comprehensive in-depth analysis of the cement market and the construction industry in Belarus and the CIS countries for a major international player in the cement industry (CRH).
UNITER specialists took part in preparation and analysis of high-tech technologies and products to prepare a strategy for the fundamental development of the Chinese-Belarusian industrial park “Great Stone”.
UNITER’s activities focus on achieving specific goals of investors or business owners (the heads of the company) and also large state-owned companies. UNITER pays attention to private business and foreign investors, providing services for analyzing markets and industries, financial advice for new investment projects, modernization, new market entry strategies.
DisclaimerThese industry outlooks were prepared for informational purpose only and does not constitute an offer or solicitation of a strategic transaction. Points of view, forecasts and evaluations presented in these outlooks reflect our opinion as of the publication date and may be changed without notice. Although the information contained herein has been obtained from sources we believe to be reliable and although we ensured their accuracy as of the publication date, we cannot guarantee, expressly or impliedly, practicality of these outlooks regarding future events or current or future value evaluation. Any investment decision based on these outlooks should be made only at the discretion of the investor and UNITER or its employees or any third party shall not be responsible in any form and in no circumstances for any action of any party taken on the basis of these outlooks. Nor UNITER, nor any of its employees, nor any third party shall be responsible for losses that result from such actions.
Cluster analysis of economic sectors, recommendations for determining the list of privatization enterprises for the World Bank.
Investment Policy Strategy for Schneider Electric. Development of the company's investment policy strategy in various sectors, including residential and commercial real estate. Analysis of investment projects implemented in the residential real estate industry, as well as promising investment projects.
Making the development strategy of Polymir Plant Naftan OJSC together with Euro Petrolium Colsuntancy.
Business plan of creation a new mining and processing complex for the production of potash fertilizers with a capacity of 1.8 million tons (Slavkali).
Financial memorandums of investment projects for modernization of the Mozyr Oil Refinery.
Financial modeling for restructuring the credit debt of Gomelhlebprom OJSC (EBRD pilot project).
Business plan for the creation of a pharmaceutical cluster in Georgia and Azerbaijan (a group of private investors).
Financial advising on the side of the investor in concluding a concession agreement between the Government of Belarus and the investor on the construction of a mining and processing complex on the basis of the Starobinsky potassium salt deposit.
Research for the World Bank Group: benchmark of the largest state-owned enterprises in Belarus, analysis of the private sector role by industry.
Research for the European Bank for Reconstruction and Development: analysis of forestry and woodprocessing industry, banking sector, small business, etc.
Various studies of building materials markets (for clients - Granit, CRH, Heidelberg Cement, Knauf, etc.).
A number of researches in the woodworking industry for various clients, including large global companies.
A number of researches in the pharmaceutical industry for various clients.
Restructuring of stressed debts (about $ 30 million) of a state enterprise - OJSC “Gomelkhlebprom”, with the support of EBRD.
Restructuring of Alutech Group's debt to banks as part of attracting a large foreign investor to the business in cooperation with Rothschild. The entry of a foreign investor was provided by a one-time repayment of all debts to banks.
Support of mergers and acquisitions transaction (ALUTECH GROUP and Hörmann Group), negotiations with banks.
Assistance in the process of debt restructuring and attracting foreign investment in one of the largest unfinished commercial real estate projects with worth more than USD100 mn in Belarus for BPS-Sberbank.