Investing into Belarus

Investing into Belarus

September 2009

Disclaimer: This report was 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 this report 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 this report regarding future events or current or future value evaluation. Any investment decision based on this report 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 this report. Nor UNITER, nor any of its employees, nor any third party shall be responsible for losses that result from such actions.

2

1. Putting Belarus on the mapKey highlights 2008

Territory - 207 600 sq km ( ranked 86 in the world)

Population – 9.67 mln (ranked 79 in the world)

Population density - 49 per sq km

Workforce – 4.5 mln

Literacy - 99.6%

Capital – Minsk (1.81 mln people)

Regional centres: Gomel (480 thou), Mogilev (390 thou),

Vitebsk (360 thou), Grodno (320 thou), Brest (300 thou)

Total GDP – USD 59.9 billion

Real GDP growth rate – 10%; nominal GDP growth rate –

34%

GDP per capita (USD) - 6192

Inflation rate – 14.8%

Exports – USD 34.1 billion (46% of total external trade

turnover), Imports – USD 40 billion (54%)

Imports / GDP ratio = 0.66;

Exports/GDP ratio = 0.57;

Unemployment Rate = 1% (officially); 4.1 % (independent

estimates)

Current Account Deficit (% of GDP) - 8.4

FDI inflow (% of GDP) - 3.78

Gross Foreign Debt (% of GDP) - 28.4

Year-average government bond yield - Not issued

Moody’s Rating - B1

Average weighted exchange rate: (EUR/BYR)- 3045.9

Average weighted exchange rate: (USD/BYR)- 2149.4

The Republic of Belarus:

lies in the Eastern Europe and offers a favourable

geographical position as a transit country

possesses well-developed traditional industries that remain

key drivers of the economic growth

occupies leading positions in machine building, oil

processing, agriculture and food production, and

metalworking on the Russian and global markets

operates an open, export-oriented economy: external trade

turnover to GDP ratio exceeds 1 over the last 10 years

depends heavily on supplies of Russian natural resources

and raw materials and on exports of value-added products to

Russia

has 70% of national GDP generated by state-controlled

enterprises with share in total exports exceeding 80%

3

Key highlights 1H 2009

2. Economic Development: Results 1H 2009

Figures

Statistical 0.3% real GDP growth versus sharp decrease in neighboring countries

In 2001-2008 the Belarusian economy demonstrated a stable GDP growth. In 2008 the Belarusian nominal GDP reached $59.9 bln. (4.8 times increase compared to that in 2001). In 2008 real GDP growth amounted to 10%. Since the beginning of the economic crisis Belarusian GDP growth rates have been decelerating significantly. Based on 1H 2009 results, real GDP growth amounted to 0.3% and nominal GDP dropped by 16.22%.

Manufactured goods stocks reached 95% of monthly production

1H 2009 production volume was equal to 21 bln. $ in money terms compared to 29 bln. $ in 2008.Devaluation of national currency played a significant role. According to official statistics, over 1H 2009 the Belarusian industrial production declined by 3.6%, while, for example, in Russia industrial production decrease reached 14.8% over 1H 2009, in Ukraine - 31.1%.In Belarus the situation was accompanied by a sharp growth of stocks. While as of 01.06.2008 manufactured goods stocks amounted to 52.6% of monthly production, they reached 95% by 01.06.2009.

Real income dropped by 4.5% in dollar terms

In 2008 an average annual nominal income amounted to 3 582 $ per capita. In real terms (inflation adjusted) 2008 income growth reached 12% yoy. According to IMF`s requirements concerning stand-by loan arrangements, Belarus had to set a moratorium on salaries and pensions increase.Over 1H 2009 real income of the Belarusian population increased by 5.5 % according to official statistics. Nevertheless, in dollar terms 1H 2009 financial income of the Belarusian population dropped by 4.5%.

Nominal GDP fluctuations in Belarus over H1 of 2008 and 2009, bln. $

3,84,4

4,14,4

5,3

3,4 3,33,7

3,8 3,83,83,5

-1,3%

-5,2%

+2,2%+1,5%+0,4%

+4,2%

0,0

1,0

2,0

3,0

4,0

5,0

6,0

Jan Feb Mar Apr May Jun

-6,0%

-4,0%

-2,0%

0,0%

2,0%

4,0%

6,0%

2008 2009 Real GDP fluctuations in Belarus over H1 2009 (yoy), % (BYR)

Industrial output in Belarus over H1 of 2008 and 2009, bln. $

4,54,9 4,8

3,23,5

5,45,2

4,43,6

3,73,53,5

+1,20%

-2,60%-5,80%

-8,90%

-0,90%

-4,60%

0,0

1,0

2,0

3,0

4,0

5,0

6,0


-10,00%

-8,00%

-6,00%

-4,00%

-2,00%

0,00%

2,00%

20082009Fluctuations of real industruial output volumes in Belarus over H1 2009, (yoy) %

Income of Belarusian population over H1 of 2008 and 2009 (thou $ per capita)

2,52,6

2,5

2,7

2,9

2,6

2,8

2,62,6

2,5

+6,30%+6,80%

+1,40%

+5,30%

+7,70%

2,2

2,3

2,4

2,5

2,6

2,7

2,8

2,9

3,0

Jan Feb Mar Apr May

0,00%

1,00%2,00%

3,00%4,00%

5,00%6,00%

7,00%8,00%

9,00%

20082009Dynamics of real income of population in Belarus over H1 2009 (yoy), %

4

Key highlights 1H 2009

2. Economic Development: Results 1H 2009

Figures

High consumer and producer inflation negatively influences macroeconomic and financial stability

2008 CPI growth in Belarus reached 13.3% (December-to-December) and overcame that index of 2007. Average annual inflation rate reached 14.8%. Over 1H 2009, an average growth of CPI in Belarus reached 14.6% yoy, PPI grew by 18.9% yoy on average, while tariffs for cargo transportation soared by 45.6% yoy. Surely, high inflation rate negatively influences savings and income of population, and also leads to negative consequences for monetary policy, making cost of credit resources significantly higher.

Gradual devaluation of national currency does not influence foreign trade indicators

For the past 7 years stability of the national currency has become the most important stabilizing factor, influencing general macroeconomic situation in Belarus. However, in the context of chronic BOP deficit, this policy led to a serious imbalance. As a result of developing economic crisis, sharp demand drop for traditionally exported Belarusian goods and decline in foreign currency revenues, the Belarusian government had to held sharp one-time devaluation of national currency by 20% on 01.01.2009. Over 1H 2009 the Belarusian national currency was depreciated practically by 30%. However, the measures taken have not led to positive changes in foreign trade util present. At IMF`s demand, NBRB had extended a corridor of possible national rubble fluctuations versus currency triplex up to +/- 10% till the end of 2010.

Foreign loans – a single way to support macroeconomic and financial stability

As of 01.04.2009, the Belarusian aggregated foreign debt reached 16.3 bln. $ and grew by 7% over the Q1 2009. By now Belarus received $500 mln. from Venezuela, $1.5 bln. from the Russian Federation, and $1.48 bln. from IMF (the total amount of a stand-by loan to be received was increased to $3.5 bln in June 2009).

Prices and tariffs fluctuations in Belarus over H1 2009 (month-over-month), %

40,9%

15,1%15,7%

15,5% 14,7% 13,6% 13,4%

19,9% 21,4% 21,4% 19,2% 16,5% 15,4%

43,7%46,3%47,6% 47,0% 48,4%

0,0%

10,0%

20,0%

30,0%

40,0%

50,0%

60,0%


CPI PPI Cargo transportation

Official avarage exchange rate of BYR against key currencies in Nov-Apr

28432801

2832284428122639

21992153

3970

37973744372935983548

29212736 87,2

84,382,3

78,4

82,2

77,978,1

91,4

0

500

1000

1500

20002500

3000

3500

4000

4500

Nov Dec Jan Feb Mar Apr May Jun

70

75

80

85

90

95

USD EUR RUB

Growth of aggrigate foreign loan debt in Belarus, bln. $

16,3

4,23,93,0

4,9 5,16,8

12,715,1

-2,04,06,08,0

10,012,014,016,018,0

20

01

20

02

20

03

20

04

20

05

20

06

20

07

20

08

01

.04

.20

09

5

3. Internal and external factors influencing the Belarusian economy in 2009-2010

External factors Internal factors

Access to the

Russian market

Price increase for oil

products and potash

fertilizers

Access to credit resources Privatization and

liberalization

Conservation and

money issue

Yes

The growth of industrial

production, industrial

stocks reduction,

foreign currency inflow,

stable operation of

enterprises, tax

revenue growth,

national currency

stability

Growth of foreign

exchange earnings, ability

fully repay the Belarusian

external debt, reduction of

negative trade balance,

national currency stability

Ability to cover foreign trade

deficit and balance of

payments, ability to

refinance old debts,

maintenance of the national

currency, increase of the

debt burden on the

Belarusian economy to the

critical 60%, would require a

large annual expenditure on

external debt service,

reduction the investment

attractiveness of Belarusian

assets

Currency inflow to Belarus,

establishment of efficient

enterprises, reduction of

devaluation possibility,

reduction of

unemployment

Current trends

conservation, default

by the winter 2009,

currency devaluation,

hyperinflation

No

Production stagnation,

overstorage of goods

produced, low foreign

exchange earnings,

mass dismissals, threat

of ruble devaluation,

the loss of the Russian

market

The same level of foreign

currency inflow, chronic

negative trade balance,

devaluation of national

currency, high possibility

of default

Devaluation of national

currency, high possibility of

default

Current trends

conservation, default by

the winter 2009, currency

devaluation, hyperinflation

Currency inflow to

Belarus, establishment

of efficient enterprises,

reduction of

devaluation possibility,

reduction of

unemployment

6

4. Economic Development: Forecast 2009 (1)

Sources: EIU, IMF

Forecast real GDP growth in 2009

- Positive growth rate in 2009

- Negative growth rate in 2009

x % - GDP growth in 2009 (negative values in brackets)

2%

(3.3%)

(4%)

(3%)

(1%)

(2.4%)

(3.2%)

(3%)

(3.5%)

(10%)

(4.7%)

(3%)

(5.3%)

(3.4%)

(4.5%)

(7.3%)

(3.6%)

(15%)

(8.5%)

(1.5%)

(1%)

(4%)

(2%)

(0.4%)

(4.2%)

(1.8%)

(6%)

(0%)

(2%)

(1.5%)

(3.3%)

(5.3%)

(3.7%)

(4.4%)

(10%)

(4%)

7

Forecast

4. Economic Development: Forecast 2009 (2)

Figures

In 2004-2008, the Belarusian economy demonstrated high economic growth rates:Real GDP growth rates approached 10%The period was characterized by macroeconomic stability (stable national currency, significant slowdown in inflation, low foreign debt)

In 2009:

The IPM research Centre (Belarus) has prepared 2 scenarios of further economic indicators development until 2012 in light of the ongoing global economic crisis.

The difference between Scenarios 1 and 2 is devaluation towards the US Dollar in 2010: 5% according to the Scenario 1 and 70% for the Scenario 2.

Both scenarios foresee negative growth of real GDP in 2009 and 2010. However, in the subsequent years Scenario 2 looks more positive: both nominal and real GDP are growing faster than in Scenario 1. Nevertheless, in Scenario 2 the economy will face higher inflation rates, leading to much more higher National Bank refinancing rates as a cure.

Source: IPM research Centre (forecast)

Scenario 1

-10,0

-5,0

0,0

5,0

10,0

15,0

20,0

25,0

2009 2010 2011 2012

Nominal GDP growth Real GDP growthCPI inflation (annual average) NBRB refinancing rate

Scenario 2

-10,0-5,0

0,05,0

10,015,0

20,025,030,035,0

40,045,0

2009 2010 2011 2012

Nominal GDP growth Real GDP growthCPI inflation (annual average) NBRB refinancing rate

8

5. Most attractive industry sectors

Industry Sector Key DriversFinancial Sector (Banking and Insurance)

Most developed in terms of corporate governanceHuge potential for development (during 2002-2008 Banks’ equity grew 7 times, Total Assets soar more than 7 times but still the penetration is low if compared to peer countries)Insurance sector has a very low level of penetration if compared to peer countries

Telecommunications Less affected by the world crisisRoom for privatization (Beltelecom, MTIS – cable networks)Low penetration of telecom services if compared to peer countries (Cable Networks, Internet)

Pharmaceuticals Good production base in genericsStrong position at the local market (pharma market size is $500 m in retail prices) Privatization declared

Food and Beverages Sizeable domestic market (population of 10 m, significant bigger than Baltic States) and equal income distributionHigh-quality local resource base (agricultural sector heavily supported by the State)Low level of industry consolidation in some subsectors (milk and cheese production, meat processing)Open niches (juices)

Food Retail Low penetration of modern formats. Bad access of local firms to financing provides strong advantages to international players. So far little international competition.

Wood processing Rich local resources base (woods) if compared to EU countriesExcellent exports potential (EU markets)

Transports Transit opportunitiesUnderdeveloped logistic industry (by now - no logistic centers of “A” class operating)

Basic construction materials (cement, gravel, gypsum)

Heavy (100%) state domination in the sectorStrong domestic demand, strong exports potential due to closeness of Russian market

Construction Heavy state domination in the sector, underdeveloped facilitiesNo large private / independent construction companiesGrowing demand for high quality construction services (especially from foreign investors)

Machinery Strong position at a rapidly growing CIS countries market (tractors and agricultural machinery, road building machines, equipment and machines for mining)

Petrochemical complex Solid industrial base created in Soviet times (yarns and fibers, PET, basic petrochemical products, oil refining)Close oil and oil products transports links with Russia (main supplier of petroleum)

Energy sector Underdeveloped sector, a serious restructuring needed

9

6. Investment environment

Increasing FDI attractiveness was made priority by the President (Belarus is aiming to become a top 30 investment location by 2010)

Belarus became a Top 10 reformer (moving up from rank 115 to rank 85) in the World Bank’s Report “Doing Business 2009”

Opening opportunities for privatization

70% of GDP is still produced by state-controlled enterprises, including petrochemical, oil-refining, raw materials, automotive and machinery, agriculture and food industries;

Government takes clear steps towards liberalization of the stock market and privatization: abolishment of “golden share”; phase-out of the moratorium on circulation of shares acquired during preferential privatization; lists of hundreds of enterprises to be reorganized into open joint stock companies and list of companies ready for selling to investors; governmental program encompassing 52 clear steps towards further simplification of Doing Business in Belarus.

Key highlights 2008

Certain liberalization steps will be made (substantial changes in tax legislation, administrative procedures)

Significant deterioration in the external trade conditions for traditionally exported Belarusian products due to the global financial crisis, tension of competition in traditional industries and markets will lead to the governmental policy of aggressive search for external sources of the Belarusian economy financing (IMF funding, loans from Russia)

A more consistent privatization policy will be realized

2009 forecast

10

7. FDI and M&A activity in Belarus

The total estimated value of M&A deals in 2008 exceeded USD 1.5 billion showing a significant increase if compared to 2006-2007. The number of M&A cross border deals amounted to 21, with a total declared value of USD 831 mln.

These figures do not account for acquisition of Beltransgaz shares by Gazprom (the Belarusian budget to be paid USD 625 mln annually from 2007 till 2010). They also do not count for real estate industry transactions.

The majority of deals was completed in the financial sector (13 deals in 2008, 9 – in 2007). The value of M&A deals in the banking sector reached USD 175 mln.

In 1H 2009 there were no large M&A deals. At the same time:

a. The Belarusian government is negotiating with the Russian Sberbank sale of the BPS-Bank (#4 bank in Belarus)

b. Russian milk company Unimilk was allowed to establish a JV with the Belarusian Shklov milk plant. Russian investors such as Wimm-Bill-Dann and Unimillk have repeatedly shown their interest in acquiring milk enterprises in Belarus, however, the government was not ready to start privatization in the industry.

FDI inflow into the Belarusian economy speeded up in 2007-

2008. In 2007 it increased 5 times compared to 2006. In 2008 it grew by 28.9% yoy and reached USD 2.23 billion. This is a logical bottom line of consistent governmental steps made towards reformation of the investment environment and further economic liberalization of the Belarusian economic life.

In 2007 FDI inflows per capita amounted to 181 USD and for the first time during 1990s-2000s surpassed results of some neighboring countries (Ukraine). In 2008 FDI per capita reached USD 235.7.

Key highlights 2008 Quantity of M&A transactions

Value of M&A transactions, $ mio Industries

2007 2008 2007 2008

Banking sector 7 6 87 175

Insurance 2 5 n/a n/a

Leasing 0 2 n/a n/a

Retail 3 1 n/a 11

Machine-building 1 1 7 6

Transports 0 1 0 6

Food & Beverages 1 3 n/a 133

Telecommunications 1 2 350 500

TOTAL 15 21 444 831

FDI dynamics in Belarus in 2001-2008, mln.$.

96453

163303 351

1769

2279,8

170-20%

+404,0%

+374,7%

-62,4%

-4,6%

+86,2%

+16,0%28,9%

0

500

1000

1500

2000

2500

2001 2002 2003 2004 2005 2006 2007 2008

-100%

0%

100%

200%

300%

400%

500%

FDI,mln.$ Growth rates,%

11

GazProm is in the process of acquiring a controlling stake in BelTransGaz for USD 2.5 billion during the period 2007-2010

Russian banks and insurance companies strengthened their positions in Belarus through acquisitions of controlling stakes in 4 medium-sized Belarusian banks (VTB, Alfa Bank, VneshEconomBank, RosBank - SocGen) and in 2 insurance companies (RESO Group)

Mobilkom Austria Group acquired 70% of mobile service provider MDC (Velcom) for EUR 730 mln

Turk Cell acquired state-owned mobile phone operator BEST for USD 600 mln

Heineken NV bought Syabar brewery the second-largest beer brand in Belarus for EUR 70 mln and 51% stake in Rechitsa brewery (#4) for EUR 6.4 mln

Olvi plc (Finland) acquired a controlling stake in Lidskoe Pivo Brewery for USD 32 m

Baltic Beverages Holding (Carlsberg) acquired Alivariya brewery (#3)

Ergo Group acquired a private insurance company in 2008

Getin Holding (Poland) acquired small-sized Belarusian bank Sombelbank

FransaBank (Lebanon) acquired small-sized Belarusian Bank GT-Bank

Home Credit Group (Czech Republic) acquired a controlling stake in Lorobank

PPF / Generali created a risk insurance company in Belarus

Horizon Capital (US based PE fund) is the ever first PE fund that entered Belarus through acquisition of the Minsk Transit Bank in 2008

Silvano Fashion Group (Estonia) was the first company owning predominantly Belarusian assets (Milavitsa lingerie manufacturer) listed at foreign capital market (Warsaw stock exchange)

Kesko (Finland) acquired the leading construction materials retailer in Belarus

Largest transactions 2007-2008

8. Selected M&A deals

PE Case Study: Syabar Brewery

2002: Detroit Brewing established SPV named DBBC for investing into Belarus. IFC joined the project this year

2003: Successful negotiations with the Belarusian Government resulted in acquisition of an underperforming regional brewery chosen as the target for investments

2005: USD 19 mln were invested in re-construction and new equipment purchase. Beer production started

2006: The 2nd round of investments (USD 12 mln) allowed to move to the 2nd Belarusian market position

2007: Beer production increased 62% reaching 600 thou hectoliters

2008: Acquisition of Syabar Brewery by Heineken N.V. announced for as much as EUR 70 mlnAnnounced large privatization plans

In 2008 the Belarusian Government issued lists of enterprises to be reorganized into open joint stock companies (505 enterprises) and to be privatized (144 enterprises) in 2008-2010

Moreover, plans for privatization of the leading companies in the financial sector (banks and insurance companies) were declared. In addition, the Government is lifting constraints on sale of shares obtained by individuals during privatization in 1990s

Thus, by the beginning of 2009 privatization plans included:

4 leading Belarusian banks: sale of controlling stakes to strategic buyers or IPOs on the foreign capital markets

2 leading Insurance companies: sale of controlling stakes to strategic buyers or IPOs on the foreign capital markets

2 largest state-owned Belarusian breweries: sale of controlling stakes to strategic buyers

Leading pharmaceuticals manufacturers: sale of controlling stakes to strategic buyers, JVs

Energy sector: JVs and green field projects offered

12

Vnesheconombank acquired 53% of BelvnesheconomBank for USD 24 mln

Alfa-Bank acquired a 39% stake in MezhtorgBank for ca. USD12 mln

2007 June NovMay

VneshTorgBank acquired 50% of SlavneftBank for USD 25mln

May2008 Jul OctJuneApr

Russian gas giant signed an agreement with the Belarusian government on 50% stake purchase in Beltransgaz for USD 2.5 bln

Heineken brewery invested 6.4 Euro mln. in 51% stake in Rechitsa brewery

Mobilkom Austria acquired 70% stake in the Belarusian mobile carrier Velcom for EUR 730 mln

Turk Cell acquired formerly state-owned mobile phone operator BEST for USD 600 mln

Olvi plc acquired 51% of the Belarusian “Lidskoe Pivo” brewery for USD 32 mln

9. Privatization deals

Largest privatization transactions

13

10. Privatization structure (1)

In 2008 the Belarusian Government issued lists

of enterprises to be reorganized into open joint stock companies

(505) and to be privatized (144) in

2008-2010

Moreover, plans for privatization of the

leading companies in the financial sector

(banks and insurance companies) were

declared. In addition, the Government is

lifting constraints on sale of shares got by

individuals during privatization in 1990s

Banking sector

Insurance sector

•Belarusbank (#1)

•Belargoprombank (#2)

Fin

an

cia

l secto

r

•Belpromstroibank (#4)

•Belinvestbank (#5)

•Paritetbank (a small bank)

Sale of controlling stakes to strategic buyers

IPO on the foreign capital markets (London, Warsaw, Frankfurt) in form of

GDR issue

•Belgosstrakh (#1 in risk insurance)

•Stravita (#1 in life insurance)

Sale of non-controlling stakes to strategic buyers


Oth

er

secto

rs

Food and Beverages

•Krinitsa Brewery (#1)

•Brest Brewery (#5)

•Dairy and meat processing


Pharmaceuticals

•Borimed (#1)

•Other state-owned companiesSale of controlling stakes to strategic buyers

Other

•Energy generation and distribution, alternative energy Joint Ventures, green field projects

•Machine building and components

•Petrochemical complex

•Construction materials

•Telecoms

Joint Ventures, strategic alliances

The list of companies to be privatized is open, especially, in case strong international or regional buyers show interest.

14Privatized enterprise

PM / Other state bodies

Provides proposals to the President

Council of ministers

Issue the decision on the sale of state-owned shares

President of Belarus

Takes final decision on sale / privatization

State Property Committee

Prepares documents for the Council of Ministries:

a) The draft decisionb) The form of salec) Price determination

Ministry of Economy Anti-monopoly

committee

Approves in case of any requirements

Ministry of Finance

Registers the transaction

As the analysis of practice of privatization

in 2007-2009 showed, often privatization

ideas could be initiated by potential buyers /

investors. In this case the Government of

Belarus is rather flexible in defining

possible terms of privatization and in

amending lists of companies to be

privatized.

At the same time, the decisions on sale of

state-owned stakes in large state-controlled

companies are usually made individually and

approved personally by the President of

Belarus.


Existing privatisation decision making overview of Belarus

15


On January 12, 2009 the IMF Executive Board approved a 15-month Stand-By Arrangement (SBA) in the amount of SDR 1.6 billion ($2.5 billion, 418.8 percent of quota), and a first purchase of SDR 517.8 million was made following the Board meeting.In June 2009 the IMF Executive Board completed the first review of Belarus’s performance under the program. The conclusion was that all end-March 2009 quantitative and continuous performance criteria and structural benchmarks were met, except for the net international reserves (NIR) target, which was missed by $221 million. The Board recognized that the Belarusian authorities have committed to adjust exchange rate and monetary policies, to maintain a balanced budget despite lower revenue, and to deepen their structural reform efforts.As a result of discussions, the IMF Executive Board decided to increase the financial support to SDR 2.27 billion (about US$3.52 billion), equivalent to 587 percent of Belarus’s quota or 7 percent of its GDP. The Board also granted a waiver of nonobservance of end-March performance criterion on net international reserves.Moreover, the IMF Executive Board approved a modification of the end-June performance criteria. Among other criteria the IMF demads the following:“A stepped-up privatization effort. The government, working with the World Bank, will submit a draft Privatization Law to Parliament by September 2009. They will also submit to the President, by September, a draft decree on establishing a Privatization Agency charged with preparing enterprises for privatization, with power to hire advisors from banks, accounting firms, and other private companies to support the process. The Agency, once established, will consult with the World Bank and identify, by November 2009, five large SOEs as candidates for privatization. It will further select a reputable financial advisor to facilitate the process, with the aim of offering the controlling stakes in these SOEs for sale through an open, international, transparent, and competitive tender by February 2010.”“Structural reforms supporting business and investment. The authorities are committed to reducing further the list of social goods and services subject to administrative price controls. They will also take steps to stop the application of mandatory wage policy and output and employment targets to companies in which the government has a minority shareholding.”

Source: IMF Country Report No. 09/260. Republic of Belarus: First Review Under the Stand-By Arrangement, and Request for a Waiver of Performance Criterion, Augmentation of Access, and Modification of Performance Criteria—Staff Report; Staff Supplement; Staff Statement; Press Release on the Executive Board Discussionhttp://www.imf.org/external/pubs/cat/longres.cfm?sk=23203.0

IMF demands to step up privatization process

Contact details

CJSC «UNITER Investment Company»117a Nezavisimosti Ave., 12 floorMinsk 220114 BelarusTel: (+375 17) 385 24 61/63/65Fax: (+375 17) 385 24 64E-mail: [email protected]

Daniel KrutzinnaAssociate PartnerE-mail: [email protected]

Roman OsipovInvestment and Financial AdvisoryE-mail: [email protected]

mailto:[email protected]



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