Getting to know Belarus: Recreation and Tourism
As the World Hockey Championship 2014 approaches, the organising committee and the Ministry of Foreign Affairs of Belarus announced that they plan to suspend the perplexing visa regime to facilitate tourist travel. Ticket-holders during the month-long event in May of next year can travel to Belarus without visas.
Though Belarus usually earns only a modest rank among world tourist destinations, lacking attractive sandy beaches, thrilling skiable mountains or other list-topping attractions, Belarusians eagerly anticipate opening their doors to the international tourism arena. From the walls of Mir castle to the depths of the Belavezhskaya Pushcha forest to the Minsk Tractor factory in the capital, Belarus offers hidden treasures to the adventurous person looking for diversions unlisted in the pages of a guidebook.
Ask any Belarusian for recommendations about the more typical tourist sites. However, genuine Belarus will not be found in the pages of a guidebook. Relics of Soviet history and sites of everyday life turn heads, remaining overlooked because of the country’s isolation. Calling them tourist “destinations” may be a stretch, but they guarantee a distinct Belarusian experience for the curious visitor.
Some sites in the capital, Minsk, warrant a visit whether or not your guidebook tells you to. A short Metro ride will whisk you off to the Minsk Tractor Factory, which is among the most remarkable remnants of the Soviet era. Though the namesake has been officially expunged, the front of the factory continues to proclaim its former affiliation with Vladimir Ilyich Lenin.
Still in production today, the tractor factory churns out thousands of tractors every year. Entering the factory is an impossible feat for those without diplomatic connections, but from outside the gates you can bear witness to a true relic of Soviet industry and even take a photograph with the vintage model tractor by the front entrance.
If the landscape of Belarus becomes tiresome, a visit to the chalk quarry by the town of Vaukavysk in the Grodno region will reinvigorate you. Keep in mind, that, due to limited public transportation to the region, you may need to rent a car to get there. Driving along the roads, you will notice that the dust starts clouding up more than usual. Sandy mounds rise out of the ground on the distant edges of fields and farmlands and beyond those mounds, giant craters sink into the ground. Park your car and walk a bit closer to find bright blue water pooled in deep golden basins edged with bright green flora. The natural colour palette of these grand canyons can surprise seasoned travelers and unsuspecting locals alike!
For the active traveller, seeing Belarus by bicycle will provide an authentic perspective on the more unseen parts of the country. Just beyond the city limits tourists can bear witness to the stark contrast between metropolitan and country life. Although the infrastructure leaves something to be desired for most, any cyclist can handle the mostly flat terrain, even without a bike path. If you need inspiration for a destination, the ethnographic parks of Strochytsy and Dudutki (located five and forty-five kilometers from Minsk, respectively) provide a number of interesting exhibitions and tourist services. Dudutki even offers the noteworthy opportunity to taste the otherwise contraband liquor, Samahon.
For Hockey Fans Only
Despite all the attractions available for tourists in Belarus, the infrastructure comes up short in the matter of serving potential visitors. Obtaining a visa, finding a hotel to stay in, communicating with locals and getting around, while possible, demands attention and commitment that other countries do not. Luckily, most of this is in the process of changing on the occasion of the World Hockey Championship, taking place in Minsk in April and May of 2014.
The visa regime in Belarus changes on a regular basis and its status will likely determine whether or not you will make your trip at all. Due to reciprocal visa policies, the Belarusian government requires at least single-entry tourist visas for visitors from most countries. Previously such visas cost a minimum of $160 for visitors from the United States, and this price increased depending on the length of the stay or the number of entries requested, pending approval from the Ministry of Foreign Affairs.
Further challenges include locating the necessary consular documents and communicating with government officials who do not know the meaning of “customer service.” For the average non-Russian speaker, these challenges may seem insurmountable. Fortunately, in an effort to diminish such difficulties and increase attendance, the government has decided to lift the visa regime for those holding tickets to World Hockey Championship games for the duration of the event.
Additionally, the Belarusian government has taken on to reshape hospitality, communications and operations for the upcoming hockey event. Development companies are building new hotels and hospitality management is insisting that staff speak English or some other foreign language. Even lower-level services, such as taxi companies are encouraging and teaching their staff to learn at least basic English in order to ease communication with international clients. The city of Minsk is bracing itself linguistically and technologically for the expected influx of foreigners, but at a price to its residents.
At what cost?
This spring, the Ministry of Education declared that the months of April and May would be school vacation periods for public universities in Minsk, requiring that students vacate their dormitories during that period. During the championship, the space will be used instead for cheap tourist accommodations. Furthermore, various Minsk firms are hiring students for translating and service jobs based on their specialties on “internship” terms. While they consider the break inconvenient, students hope that the professional experience will have long-term benefits for their careers and the Belarusian economy.
Though Minsk is getting made over for the world championship, much of the country will remain untouched by the new inflow of tourism. Though many consider secondary roads in Belarus better than their equivalents in Poland, Ukraine, and Russia, investment in improving these roads will likely be put on hold while the funds are rerouted to the capital. Other areas of interest such as the regional capitals of Vitebsk, Grodno and Brest may get some fraction of the funds, but while the spotlight shines on Minsk, the capital will be doing the best it can to impress visitors.
Despite reservations about the distribution of tourism investment, most Belarusians and would-be tourists hope that the lowering of the visa regime and the cleaned-up image of Minsk will provide tourists with a positive impression of Belarus. Such prospects would mean an increase of incoming tourism not just for the period of the Hockey Championship, but for the long-term as well. Since Belarus does have a surprising amount to offer, a boost in the tourist economy may be just what the country needs to cultivate a new sense of self-esteem.
Monika was a Fulbright scholar teaching in Belarus in 2012-2013.
Shadow Economy Threatens the Future of Belarus
Last month the Deputy Ministry of Labour and Social Protection of Belarus confirmed that the government wants to introduce a new tax on unemployed people.
The state wants to get money from economically active people without official jobs who benefit from free or subsidised services from the state such as hospitals, schools and kindergartens. The Belarusian officials started to think seriously what to do with the vast shadow economy of the country.
Although some label the Belarusian regime as totalitarian, in reality its control is far from absolute, particularly when it comes to the economy. As the Warsaw-based Solidarity with Belarus Information Office recently noticed, 10 to 25 per cent of the Belarusian economically active population engage in doing illegal business.
For example, according to the Ministry of Trade every second car repair facility works illegally and many in Belarus rent flats without a formal contract. The government effectively tolerates, or rather has to tolerate illegal activities. This reality undermines legal businesses, worsens the business climate and fosters legal nihilism.
Tobacco, Fuel and Alcohol For the EU
The most publicised example of illegal business is smuggling. Many Belarusians living in western regions engage in cross border illegal trading. They smuggle fuel, cigarettes and alcohol into EU member countries, mostly into Poland and Lithuania and, to a lesser extent, into Latvia. Smugglers operate also on the Belarusian-Ukrainian border in the South.
A survey conducted this year by a reputable global information and measurement company Nielsen demonstrated that three quarters of the cigarettes smuggled into Lithuania came there from Belarus. As a result of efforts of smugglers, the scale of cigarette smuggling into Lithuania is Europe’s second-largest. Up to 30 per cent of all cigarettes sold in Lithuania have not been legally imported according to Laurynas Bucalis of Philip Morris Baltic who gave an interview to the BNS news agency.
This illegal trade has existed since early 1990s, and first emerged along the Polish border after the Soviet government loosened their border control. The scale grew, the types of smuggled goods changed, and it is no wonder that now in the Hrodna Region about eighty thousand able body residents officially have no work and are neither students nor pensioners.
Shadow Economy Not a Problem for the Government
Most of those who work illegally work in the service sector. The most significant spheres include car repairs, flat and house repairs, organisation of festivities and events, photographic and video services and private tutorials to prepare for exams. In the first half of this year, in the south-eastern Homiel Region, the government’s tax agencies prosecuted 207 individuals who leased their flats, houses or parking lots illegally; over the same period of time the Homiel police caught 69 illegal taxis.
Even those who officially register as so-called “individual entrepreneurs” tend to hide some of their revenues to pay less in taxes. According to official information, the state tax agencies find violations of the tax legislation in 99.8 per cent of the cases they audited in the first half of this year.
The government downplays the issue. In August, the minister for taxes and customs Uladzimir Paluyan said, “We shall not say that it is too large a sum for our country.” He estimated the share of shadow economy in Belarus at $5-6b, i.e., 8-10 per cent of GDP, while emphasising that this sum includes also such revenues like vegetables grown by citizens in their own personal plots and the selling of private property. In 2009-2010, the same ministry estimated the share of the shadow economy to be even higher – at 10-15 per cent of the GDP.
Belarusian Government’s Social Contract With Business
At first glance, it appears that the government is losing a lot of its tax revenues. A year ago, after the Trade Ministry lamented the scale of illegal repair workshops’ business in the country, Deputy Prime Minister Anatol Tozik proposed to introduce the obligatory declarations of income for every citizen. “Specialists say that we have too high a percentage of a shadow GDP. And official statistic data absolutely do not correspond with those realities which we see ourselves. How many cars do we have per capita? Why is it impossible to get a table in [overcrowded] Minsk restaurants?”
Yet these losses apparently do not concern the government as nothing has changed since then. The government regularly conducts inspections but does not go after the roots of these phenomena. The shadow economy helps the Belarusian leadership to relieve economic hardship while wild underground business destroys legal business by proposing lower prices that work well outside of the law.
Nevertheless, the government apparently understands that it is better off leaving illegal businesses alone. Precarious businesses hold illegal businessmen and workers in check as they realise the instability of their own situation. Illegal entrepreneurs and their employees do not actively engage in oppositional activities, at least no existing evidence suggests that they provide funding to the opposition.
This social contract – a tolerance of illegal business in exchange for not engaging in active politics – works not only for common people but also for state officials. Numerous public servants in the eastern regions of Belarus have their own business enterprises in neighbouring regions of Russia. Usually they work in retail or own cafes or restaurants.
Tip of the Iceberg?
The shadow economy in Belarus encompasses not only some shrewd individuals. Presidential edict 510 prohibited audits by tax agencies of new firms in the first two years from the date of their establishment. It created a loop hole for fraud as fake firms appear, operate and close down before tax agencies can check their work.
The Customs Union with Russia has led to new massive illegal capital transfers from Russia through Belarus. They apparently remain under the radar of Belarusian governmental agencies. Meanwhile, a major Russian journal Expert deemed it “Trading with Emptiness,” and explained last month, “Conditions for illegal capital transfers from Russia through “gray” [opaque – ed. BD] mechanisms inside the Customs Union seems to be very suitable. Measures taken by the Russian Central Bank against them are arguably useless.”
According to the Russian Central Bank, fictitious imports from members of the Customs Union made up a bulk of capital runoff in last year as $15b have been transferred out of Russia to offshore accounts by using “doubtful” contracts with Belarusian exporters alone. Inside the Customs Union no customs control exist and a mere goods consignment note suffices.
In fact the Belarusian government is far from omnipotent and state control in Belarus has certain limits. The regime tries to convince people who are doing illegal business that the state agencies are aware but will tolerate unrestrained entrepreneurship, provided that illegal businessmen behave properly towards the regime.
This is a very loose form of control which allows economic freedom and even huge profits without any connection to the state – be it official registration or the payment of taxes. Lukashenka may lash out at these rather dubious kinds of businesses and called people engaged in them “lousy fleas,” but business goes on. While it does not threaten the regime, it damages the future of Belarus as a country based on the rule of law.