COMMERCIAL SECTION

 

 

 

Republic of Belarus

Embassy Home

The Ambassador

Press Releases

Commercial Section Home

Cultural & Humanitarian Section

Consular & Visa Section

Contacts & Location

Site Map

 

Official Site of the President
of the Republic of Belarus

Council of Ministers
of the Republic of Belarus

Ministry of Foreign Affairs

Ministry of Economy

Ministry of Finance

Ministry of Industry

Ministry of Statistics and Analysis

Ministry of Architecture and Construction

Ministry of Labour and Social Protection

 

SMALL BUSINESS DEVELOPMENT

 

Small business occupies a special place in the private sector of Belarusian economy.

The share of workforce (including individual entrepreneurs) employed in the field of small business constituted 13 percent as of the end of 2002.

As of the beginning of 2003 2.9 small businesses (including state owned) fell on every thousand of Belarus residents.

The GDP share of the added value of small businesses constituted 6 percent in 2002 according to preliminary estimates. In countries of the European Union the GDP share of small and medium-size business constitutes 50-65 percent. However, due to the lack of criteria for referring companies to the medium-size category and lack of statistical data on their activity, it would be inappropriate to compare the level of development of small business sector in Belarus to that of western countries.

2001 and first half of 2002 displayed reduction in the number of privately owned small businesses and in the number of their employees. However, the situation not only stabilized, but even improved starting with the second half of 2002. 

As a result, the number of privately owned small businesses in the Republic came up to 26.8 thousand in the late 2002. Which is 1445 more than at the end of 2001. The total number of small businesses in the country (including state owned businesses) at the end of 2002 was 29 thousand.

The average number of privately owned small business employees increased by 10 thousand people if compared to 2001. These companies display greater growth rates of main economic indicators than companies in other sectors of economy.

The analysis of small business in various sectors of economy shows that retail and catering industries have the leading position in the small business sector. More than 45 percent of small businesses are concentrated in these particular sectors, whereas only a little more than 20 percent are concentrated in production industry, 11 percent in construction, 5.4 percent in transportation and 1.2 percent in science and scientific support.

 

____________________________

National Centre for Marketing and Price Study

____________________________

Online Catalogue of Belarusian Goods, Services and Companies
at the National Centre for Marketing and Price Study

____________________________
GUIDEBOOK ON DOING BUSINESS IN BELARUS
____________________________

Internet resource on investment potential of Belarus

____________________________

Belarus Investment Projects

____________________________

Belarus Innovation Projects

____________________________

 

 

 

Such a situation is typical of countries with transitional economy where companies aspire to obtain profit in the short-term.

2002 witnessed a steady rise in the number of individual entrepreneurs. It was greatly encouraged by the introduction of a more liberal taxation system and by the simplification of the state registration procedure for individual entrepreneurs in comparison with small businesses.

According to the Ministry of Taxation and Excise Duties, the number of individual entrepreneurs on the list of taxpayers rose by almost 10 thousand and constituted about 190 thousand as of the early 2003.

In the first half of 2003 positive dynamics of growth in the number of individual entrepreneurs listed as taxpayers persisted. Their number rose by 3.7 thousand over January-July 2003 and constituted 193.2 thousand persons as of July 1, 2003.

Figures represented in the table above show that the number of privately owned small businesses increased in all regions and in Minsk (except Mogilev region).

Over a half (57 %) of privately owned small businesses and a quarter of individual entrepreneurs are concentrated in Minsk. In the regions 50 % of small business are concentrated in regional centers.

In order to simplify the procedure for state registration, Decree 29 of the President of the Republic of Belarus was adopted in December 2002. It included the following amendments:

·                    registration of a private unitary enterprise is allowed at the place of residence (an apartment, a house). The recognition of a place of residence as a location of a private unitary enterprise is an important step on the way towards simplification of the small business state registration procedure;

·                    requirement to describe all fields of activity in the documents is abolished. A universal state registration procedure for everyone regardless of their field of activity is introduced. A simplified liquidation procedure is provided for companies commercially inactive over a period of 6 months. Whenever a legal entity is not in possession of funds, sufficient for liquidation, the expenses are covered out of the corresponding budget.

Decree 17 of the President of the Republic of Belarus On Licensing of Some Kinds of Activity was adopted in July 2003.

The Decree regulates basic issues related to licensing in general and establishes a common procedure for issuance, suspension, renewal, cancellation and extension of licenses. The list of activities which require licensing has been reduced from 165 to 49 items. Regardless of the field of activity, the license issuance fee is set to 90 euro; the application-processing fee is set to 10 euro.

Greater sustainability of small business entities development was encouraged by direct and indirect governmental assistance that was provided in the framework of implementation of republican and regional small business programs support. Their implementation costs were covered by state and local funds.

Financial support of small business entities was provided via partial coverage of their bank loans interest, lease payments, as well as via partial compensation of costs, associated with their participation in various exhibitions and fairs.

Small business entities were also given information support, consulting services via the existing small business support network that comprised 43 centers as of July 1, 2003.

The activity of the centers was concentrated on the following aspects: information support, marketing research, consulting on practical aspects of conducting a business, development and evaluation of business-projects, personnel training and partner search.

In 2002 43.588 people used the services of these centers (17.017 in the first half of 2003), 592 workshops and training courses were held at the centers (241 in the first half of 2003). 11.065 people attended these workshops (8.888 in the first half of 2003).

System of support of small businesses has the following structure:

 

The Department on Entrepreneurships of the Ministry of Economics

The main tasks of this Department are support and development of entrepreneurship in the Republic of Belarus, and coordination of activities of the national bodies of state government, local executive and administrative authorities in this sphere. The department drafts bills of the Republic of Belarus, decisions of the President and of the Government, regulatory and legal acts on issues of support of entrepreneurship, elaborates annual national programmes of state support of small businesses, assists in formation of the entrepreneurship support infrastructure, and renders organisational and information and methodological support on issues of financial and credit support.

 

The Fund for Support of Small and Medium Businesses of the Ministry of Economics

The main tasks of this Fund are: providing financial support of state policy of support of small entrepreneurship through participation in funding of respective state, sectoral and regional programmes, giving financial, organisational and information and methodological aid on preferential or free basis to subjects of the small business support infrastructure, control over targeted use of resources allocated to the infrastructure subjects, or received by such subjects with assistance of the Fund.

 

The Belarusian Fund of Financial Support of Entrepreneurs and Regional Funds of Financial Support

These funds provide credits and micro credits on preferential conditions to subjects of small businesses and to individual entrepreneurs.

 

Subjects of the entrepreneurship support infrastructure

At present, the system of subjects of the small entrepreneurship support infrastructure includes the Fund called "The National Entrepreneurship Development Agency", entrepreneurship support centres and small business incubators. The Republic has 43 centres and 6 incubators, which provide comprehensive and targeted support to small businesses along different lines: information, counselling, training, prognosis and analysis, science and technology. Subjects of this infrastructure conduct marketing research, development and expertise of business plans, organise training seminars, courses and other actions.

 

Programmes of state support for small businesses

Annual national and regional programmes are elaborated and implemented for providing state support and develop small businesses. They include improvement of the regulatory and legal frame, financial and credit as well as investment support of small businesses. The national Programme of state support of small businesses include actions aimed at creating preferential conditions for access of small business subjects to financial resources. Regional programmes of state support of small businesses are implemented along the following lines: improvement of the regulatory and legal frame; resource and financial support of development; formation of the infrastructure of support and development; information, training and methodological support of businesses.