Investments from offshore go to Belarus
- 19.03.2008, 16:38
One of the tendencies that have become noticeable over the last years in attracting foreign investment to Belarusian economy is growth of investments from offshore areas.
Switzerland stands out among these countries primarily (3rd position in the total volume of investment to Belarusian economy) and Cyprus (5th position). Their aggregate investments in 2007 were about 1 billion dollars. However, Cyprus and Switzerland cannot be considered standard offshore areas. But the role of traditional offshores in investment of Belarusian economy has considerably grown, “Zavtra tvoej strany” writes.
For instance, last year the British Virgin Islands took the 11th position in the volume of investments to Belarus (57.6 mln dollars). A little island colony state which lives thanks to little charges from firms using its favourable laws, has left behind Estonia, Sweden, Croatia, Lithuania, Poland, Italy and the Czech Republic.
The 19th position has been taken by the Republic of Seychelles. Companies registered in this offshore area, have invested 14.6 mln dollars. The 20th position is taken by another well-known offshore, the Principality of Liechtenstein, which recently appeared in the centre of an international row. Liechtenstein has invested 13.4 mln dollars to Belarus in 2007. Meanwhile, Seychelles and Liechtenstein have left behind Ukraine, Denmark, Japan, Slovakia, Israel, Belgium, France and Canada.
Panama, which has been included into the number of 40 most important investors of Belarusian economy (3.2 mln dollars last year), in its turn drew ahead of Slovenia, Finland, Turkey and Iran, which is called one of the main potential sources of investments to Belarus, and Belize (1.3 mln dollars), and Gibraltar (1.2 mln dollars) is in advance of Spain.
Last year investments from other offshore areas were received by Belarus as well (Dominca, the Marshall Islands, Saint Vincent and the Grenadines). As compared to the year 2006, the list of such a kind of investors has grown thanks to companies from United States Virgin Islands, Cayman Islands and Isle of Man.
As said by an independent expert Mikhail Zalessky in an interview to Deutsche Welle, before greeting influx of foreign capital, one should establish the structure of this money: “Three are certain large deals, for instance, with Gazprom, with phone companies, related to re-investment of the money sent abroad, as there are well-known offshore zones among investors. And it’s alarming”.
According to M. Zalessky, theoretically it would be understandable if large manufacturers of lamps would invest money to Belarusian lamp industry, car makers – to automobile industry, and TV sets manufacturers – to production of TV sets. However, unknown and non-core investors often come in sight, as well as companies that increase the total sum of investment many times thanks to large-scale deals. Besides, investment projects are often closed from public, which prevents from saying about attraction of investment as a smoothly running machine.
In his turn, former minister of foreign economic ties of Belarus Mikhail Marynich believes that even cancellation of golden share rule cannot change the present investment climate in the country significantly.
“The country doesn’t have normal conditions for development of economy, for presence of the market, and not of administrative control,” Mikhail Marynich said. According to him, for today the legal framework of Belarus is still “lagging behind for the market economy to be present in full measure”. And consequently it holds back involvement of serious investors to the country.