AEB Holds a Panel Discussion on How to Develop PPP in Belarus

As a part ofthe Global Entrepreneurship Weekin Belarus the Association of European Businesses held a panel discussion Public-Private Partnership as a Factor in the Investment Climate in Belarus.

During the discussion, business, state officials and non-profit organizations exchanged views on the ways of PPP development in Belarus and discussed problems that hinder implementation of joint public-private projects.

According to Ms. Lyudmila Istomina, a consultant in the field of socio-economic development, “PPP projects abroad have shown that they can attract billions of dollars in investments and be effectively implemented. In addition, involvement of the private sector serves as protection from inefficient and unsustainable projects, which has always been the danger in case of infrastructure capital-intensive projects. I would like to see Belarus follow foreign experience: Belarus is a country in the heart of Europe, and we need to use our potential in logistics, transit, roads, and export of services. Infrastructure should be considered not only as a serving component of a production cycle, but also as an independent industry that can strengthen the competitiveness of the country and lead to economic growth.”

“Nowthe government should make a state order for business and invite it to take part in significant social PPP projects,” said Ms. Istomina.

Mr. Sergey Riabukhin, managing partner of Zubr Capital, commented:

“PPP projectslast 25-30 years, therefore the first thing we need is to give confidence to a Western investor that all this time the project will work. Why a Western investor? Because none of the Belarusian companies is ready to invest: there is no long cheap money. But they are available at the Western investment banks, and they will invest, either directly or through someone else.”

“We are now reflexing on what PPP projects are and what projects can be implemented as PPP. PPP initiative is no doubt useful, and it is very important to start it, for the government and business to think how to implement it and in what ways.”

Mr. Valery Fadeev, an IFC expert, said:

“Taken one by one, Belarusian lawsare good. Taken together, also. However, there is a question of enforcement. This is an important aspect of PPP: Once a good PPP law is adopted, its provisions should be implemented (especially by the state), there should be guarantees of property rights, etc. Investors need confidence.”

Mr. Alexander Shvets, the chairman of BCIE(E), added, “in PPP, I would suggest focusing on small utility projects, in order to show that this scheme works in principle.”

Public-private partnershipis one of the possibilities for long money to enter Belarus without facing country risks.