Belarusian Milk Exports: Success in the East, Failure in the West
On 17 September, Alexander Lukashenka publicly explained to Vladimir Putin the process of milk production and to Nursultan Nazarbayev the functioning of the market economy. In this way the Belarusian state leader responded to critics who have questioned the quality of Belarusian milk.
Milk in Belarus plays a significant role in the economy, as the country ranks at 5th in the world milk market, and the President's Property Administration owns several dairy plants.
Despite the large scale of production, Belarus exports milk mainly to Russia thus rendering Belarus's position vulnerable to pressure. Moreover, Russian businessmen remain eager to privatise some Belarusian dairy factories.
Belarus tries to enter the European Union and other markets, but it still has problems with obtaining the necessary quality certificates.
It seems that nowhere else in the world do government elites have such close connections to the dairy industry as they do in Belarus. The President's Property Administration owns the largest Belarusian agricultural complex "Machulishchy," which is the biggest milk producer in Eastern Europe.
The rapid growth of the agricultural complex began in 2013, when Viktar Sheiman, often called the last soldier of Lukashenka, became the head of the President's Property Administration, the biggest state-owned business empire and the financial backbone of Lukashenka's regime.
According to estimates of the Belarusian web-site Ej.by, the Machulishchy conglomerate now produces more than 300 thousand tonnes of milk a year. This is twice the amount produced by the main producer in the Russian market, and three times the amount of the main producer in the Ukrainian market. The large scale of milk production in Belarus becomes more significant when considering that Belarus is a much smaller than Russia or Ukraine.
Milk production remains one of the biggest priorities for agriculture. Over 10 years Belarus increased its milk production from 4 to 6.5 million tonnes, and now it ranks fifth in the global trade of milk with 4% of the market. However, the export of milk has almost only one direction, which is to Russia.
Dairy products export in terms of milk, thsd tons
|2 614||3 390||3 780||3 815||4 136||4 484|
|Export share in milk production, %||42.0||51.5||57.0||58.3||61.1||67.4|
Officials say that the government remains reluctant to subsidise the production of milk, like other sectors of agriculture. Although in practise, they do not deny that they have issued large loans for the modernisation of the dairy industry. As Andrej Jurkou, an expert in the field, says, "nobody knows how much budget money went to pay off the interest rates.”
Despite the traditional protectionism in agriculture, the Belarusian authorities allow businessmen to have shares in the dairy market. Currently, private entrepreneur Yauhen Baskin owns the largest farm for cows in Belarus. Milk producer "Savushkin pradukt" remains one of the most efficient dairy companies and remains the most trusted brand in the industry. It belongs to Alexander Mashensky, a businessman closely affiliated with the government. This shows that the Belarusian government sees a strategic development sector not only for themselves, but for the country at large.
Problems in the East
Dairy products are important for the Belarusian authorities. That’s why Alexander Lukashenka took criticism of the Belarusian milk at the Forum of Regions of Russia and Belarus so personally. On September 17 at a panel discussion with Vladimir Putin Lukashnka told Nursultan Nazarbayev, Kazakhstan's president off, when he said that Belarusian milk is not actual milk, but rather a ‘milk-drink.’
Lukashenka described the process of milk production in detail and stated that “Nazarbayev as a free market promoter should understand that if Kazakh consumers buy such milk, Belarus would deliver it to them.”
Lukashenka directed his answer primarily towards Kazakhstan, while Belarus also has had problems on the Russian market for a long time. In 2009, Kremlin temporarily banned Belarusian milk deliveries. Lukashenka won by promising to return customs controls on the Belarusian-Russian border and he refused to participate in the summit of the Collective Security Treaty Organisation. That conflict received the name the ‘milk war.’
Then Alexander Lukashenkа accused Russia that it wants to privatise a number of Belarusian dairy producers. But, according to him, Lukashenka said to the Russian government "goodbye, we will die, while drinking this milk, but the Kremlin will never put the question of privatisation in this way."
Later, in 2010 the Kremlin once again for a short time period imposed restrictions on the import of Belarusian dairy products. In 2014 Russian Prime Minister Dmitri Medvedev threatened Belarus with an anti-dumping investigation of potential subsidies in the dairy industry. So, milk always remains the focus of elites in Russia and Belarus.
Belarus Tears Open a Window to the World
The Milk war in 2009 forced Belarusian producers to think about other possibilities for milk export. Since that time, many Belarusian entrepreneurs have attempted to acquire the appropriate quality certificates to enter the European Union market.
Belarusian milk has failed to become successful in the EU market for three main reasons Firstly, the amount of bacteria and antibiotics in Belarusian raw milk remains several times higher than allowed by European standards. Secondly, EU countries have a protectionist policy in agriculture. Third, Belarusian milk lacks special features to compete with Western producers.
Export possibilities of Belarusian dairy to other countries, besides the EU and the Eurasian Economic Union remain nonexistent, while New Zealand, the European Union, the United States and Australia confidently hold the lead in their markets.
Thus, Belarusian milk manufacturers have problems with the stable eastern markets, but at the same time they are incapable of solving their product quality issues. This situation blocks any possibility for fully fledged cooperation with the West and other countries. Belarusian milk in many ways resembles the general trajectory of Belarusian foreign policy.
What Do Belarusians Think, Forum Of Enterpreneurs – Belarus Civil Society Digest
Perspektiva organises a National Forum of Entrepreneurs to enable them to share opinions how they see their future in Belarus.
Fountain on Grushevskaya street in Minsk will be restored for the money of locals. The local residents decided to take the matters into their own hands and save the fountain by raising funds for its reconstruction.
The Office for European Expertise and Communications (OEEC) invites to a new debate under the series What do Belarusians Think. This time participants will be discussing gender issues.
Public Debates and Conferences
Perspektiva organises a National Forum of Entrepreneurs on 28 September. The Forum aims to present the Perspektiva's policy proposals for 2015-2020 and enable entrepreneurs to share opinions how they see their future. Meanwhile, the head of a business union Perspektiva, that brings together individual entrepreneurs and small businesses, Anatoly Shumchanka declares his political ambitions and does not exclude that he could run for the president or member of parliament.
Fifth International Congress of Belarusian Studies. The Congress is to take part on 2-4 October in Kaunas, Lithuania. The preliminary programme is available. The International Congress of Belarusian Studies is an annual meeting of Belarusian and foreign scholars, experts, analysts and representatives of civil society and government institutions, which are involved in studying Belarus.
Gender Equality: Why is it Profitable? The Office for European Expertise and Communications (OEEC) invites to a new debate under the series What do Belarusians Think. The new meeting will be devoted to gender issues and take place on 23 September at the Minsk Gallery TUT.BY. A series of live discussions What do Belarusians Think aim to make the expert debate public and creates a space for discussion of researches on topical issues. Discussions are organised since September 2014 by OEEC in partnership with the Belarusian Research Council, Pact and supported by USAID.
Civil Society Initiatives
Fountain on Grushevskaya street in Minsk will be restored for the money of locals. Since the 1940s, the fountain was the centre of social life of the district, however by the moment it lost its well-maintained appearance. The municipality was going to dismantle the fountain to organise the flower bed instead, but the local residents decided to save the fountain and raise funds for its reconstruction. In total, they need to raise about 170 million rubles.
EuroBelarus.info website launches a new video project. The project Postmodern and Anthropotechnique is an attempt to understand the anthropological dimension of era of post modernism and multiculturalism, revolutionary technological and social change, unavailable for people to keep pace with. The first episode of the video project is a series of lectures of the Head of the International Consortium EuroBelarus, Vladimir Mackevich on political technologies of the third generation.
Students' Leadership Academy calls for fellows. The Academy implemented by the Centre for Development of Students' Initiatives is designed for active students who are not indifferent to the students’ problems and would like to resolve them. Fellows will be able to select one of the four areas of study: the protection of students' rights, improving the quality of education, belarusization of higher education, student media; or propose their own idea.
Gomel Democratic Forum releases a study on media space of Gomel region and a manual on planning and implementing of local media campaigns. Publications are prepared within the framework of a project aimed at promoting best media presence of local CSOs. Now Gomel Democratic Forum plans to continue to support local organisations and initiatives with media consultations.
Third Age University in Minsk announces the third call for students. The project aims to educate seniors and implemented by the Belarusian Association of Social Workers. For two years, the University courses in computer literacy, foreign languages, journalism, psychology, local history were attended by over two thousand Minsk residents of 60+ years old. In September, Grodno Golden Age University enrols students for the seventh academic year.
Fifth Festival of creativity of people with disabilities was held in Minsk on 13 September. The Festival aims to promote creativity of people with disabilities, establish a comprehensive system of social and cultural rehabilitation of the disabled and their active integration into society. Among organisers were Minsk municipality and non-governmental organisations such as Belarusian Society of Disabled People, Belarusian Association of Assistance to Children and Young People with Disabilities, etc.
BISS and CET present a new research on solidarity. On 29 September a research on the potential for solidarity in the Belarusian society is to be presented in Minsk. The study is a continuation and development of the research on the potential for solidarity among CSOs, conducted by the Centre for European Transformation (CET) and the Belarusian Institute for Strategic Studies (BISS) in 2014. The presentation will take place at 6 pm, at the Studio67 venue.
New cultural partnership program. The Association of Local Democracy Agencies ALDA (France) together with the International Consortium EuroBelarus announces the launch of the partnership program CHOICE – Cultural Heritage: Opportunity for Improving Civic Engagement. The two-year project is aimed to protect the cultural heritage and strengthening the institutional capacity of cultural CSOs. Presentation of the project will be held on 22 September in the TSEKH venue.
Contests and Awards
XII National competition of school teams about Europe. The contest What I Know about Europe is held annually since 2004, by the initiative group of Belarusian teachers and civic leaders with the support of public organisations. Competition tasks are designed for senior school pupils.
The first summer reality-competition of urban projects #RazamMіnsk awarded the winners. Among 11 finalists (selected out of 300 teams) the jury divided the prize fund ($ 1,000) between two projects – Beautification of Pond and Museum of Retro Computers. Minsk residents voted for Clean Business project on separate waste collection. The competition, organised by Onliner.by portal, Talaka.by platform and Velcom mobile company, has brought to Minsk a number of ideas implemented, like installation of bikes spots – facility for free repair bicycles.
Belarus Digest prepared this overview on the basis of materials provided by Pact. This digest attempts to give a richer picture of the recent political and civil society events in Belarus. It often goes beyond the hot stories already available in English-language media.