Details: Belarus fails to stand its ground in EEU regarding compulsory range of home-made goods in retail

<p> MINSK, May 5 - PrimePress. Belarus’ partners in the Eurasian Economic Union (EEU - Armenia, Belarus, Kazakhstan, Kyrgyzstan, Russia) have recognised the existence of mandatory assortment lists established by Belarus’ Ministry of Antimonopoly Regulation and Trade (MART) as a barrier to the internal market of the union. MART will be obliged to terminate them by 31 December 2021. </p> <p>   </p> <p> Belarus fails to stand its ground </p> <p>   </p> <p> The Board of the Eurasian Economic Commission (EEC) in March 2021 recognized the requirement to maintain a compulsory range of Belarusian-made goods on the shelves of Belarusian retail shops in Belarus as a barrier in the internal market of the Eurasian Economic Union (EEU - Armenia, Belarus, Kazakhstan, Kyrgyzstan, Russia). Belarus has been notified about the need to comply with the EEU law. The government of Belarus has been requested to eliminate the violations within 30 calendar days fr om the date of enactment of the decision and to inform the EEC about the measures taken. </p> <p>   </p> <p> Belarus’ MART responded to the EEC notification. According to MART, Belarus is not in breach of its obligations to its Eurasian integration partners in terms of the application of assortment lists of goods. In this regard, the ministry is currently initiating the reversal of the decision taken by the Eurasian Economic Commission under EEU law. </p> <p>   </p> <p> However, Belarus failed to defend its position, and on 30 April 2021, the Eurasian Intergovernmental Council decided to extend the deadline for the Republic of Belarus to remove the barrier on the internal market of the Eurasian Economic Union (EEU) with regard to maintaining assortment lists for trading companies until 31 December 2021. </p> <p>   </p> <p> Thus, if Belarus fails to somehow resolve this issue in its favour by the end of the year, the assortment lists will have to be abolished from the beginning of 2022. </p> <p>   </p> <p> Assortment lists prove ineffective </p> <p> </p> <p> Experts refer to assortment lists as one of the mechanisms for forcing retailers to sell a wide range of Belarusian goods, and retailers constantly ask to abolish this practice. At the same time, it is worth admitting the low efficiency of this measure for the promotion of Belarusian goods. MART said in its response to the EEC: “Statistics show that during the period when this practice (assortment lists - ed.) was in force, imports of consumer goods to Belarus increased by 29.3%, from the EEU countries - 28.8%, including 35.2% from the Russian Federation.” </p> <p>   </p> <p> According to Belstat, the share of Belarusian goods in the country’s retail turnover declined to 58.5% in January-March 2021 against 59.2% in 2020 and 70.9% in 2013. </p> <p>   </p> <p> The share of Belarusian products in food sales dropped to 75.6% vs. 76.3% in 2020 and 82.2% in 2013. The share of domestic goods in the non-food group fell at a faster rate, from 55.2% in 2013 to 39.1% in 2021. </p> <p>   </p> <p> The progressive decline in the share of domestic goods in retail sales has been observed in the course of a decade. </p> <p>   </p> <p> The greatest displacement of Belarusian goods from retail turnover is observed in Minsk. In particular, in Q1 2021 the share of domestic goods in the non-food group amounted to only 28.1%. Minsk is traditionally a region with a higher level of income and large range of available goods. </p> <p>   </p> <p> Such a low share of sales of domestic goods indicates their noncompetitiveness compared to similar imported products. This is due to a number of factors: Belarus’ participation in the Eurasian Economic Union (EEU - Armenia, Belarus, Kazakhstan, Kyrgyzstan, Russia), a low share of the private sector in the economy, manufacturers saving on raw materials and other production components amid high taxes, retarded development of modern industrial design, sales technologies, lower business scale effects compared to Russian and Chinese producers of consumer goods. </p> <p>   </p> <p> In part, these problems have been recognised by the authorities themselves. April 1, head of the Ministry for Antimonopoly Regulation and Trade (MART) Vladimir Koltovitch said that in order to increase the share of domestic goods in the market “we should not fight against imports, but create a system to support domestic producers and stimulate the development of industries”. In his words, MART together with the Ministry of Industry, Ministry of Economy and the Belarusian Chamber of Commerce and Industry are busy working on a definition of the term “domestic goods” in order to improve the system of public purchases with a focus on such goods. </p> <p>   </p> <p> “We would like to work out such a procedure, so that we could use an increase of the level of local content as an element of the internal market protection,” Koltovitch said. In his words, such measures have been taken in Russia, wh ere the put a cap on the possible share of imports for each group of goods. </p> <p>   </p> <p> Three vectors of domestic market protection </p> <p>   </p> <p> On April 20, MART held the second meeting of the interdepartmental working group for the development and adoption of measures to protect the domestic market (the working group was established in March 2021, for details see Issue #12, 15-21 March 2021). According to Deputy Minister of Antimonopoly Regulation and Trade Oksana Konstantinovich, during the meeting of the working group the participants discussed in detail the measures to be taken to reduce the imports of food products, which are manufactured in Belarus in sufficient quantity. </p> <p>   </p> <p> The deputy minister points out that the increase in imports may be triggered by non-competitiveness of some Belarusian goods, first of all in terms of price and in some cases in terms of quality. </p> <p>   </p> <p> Konstantinovich pointed out three main vectors of domestic market protection. </p> <p>   </p> <p> Firstly, it is an assortment list of the domestically produced goods, which “is a guarantee of the availability of goods for sale during the entire working day of a retail facility”. </p> <p>   </p> <p> Secondly, control and analytical measures, which “are aimed at ensuring compliance with legislation in the spheres of trade and pricing”. </p> <p>   </p> <p> Thirdly, it is the establishment of trade rules, including statutory regulations. </p> <p>   </p> <p> Thus, officials plan to deal not with the cause but the consequence of the low competitiveness of Belarusian goods. The measures they suggest are aimed at market protection and protectionism, strengthening control over trade, and not at improvement of conditions for production of consumer goods, especially non-food products. The assortment lists still stand on top of the list of protection measures. End </p>

2021-05-06

Primepress