Tag der Belarussischen Wirtschaft, Berlin, 28. Oktober 2013

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1 Tag der Belarussischen Wirtschaft, Berlin, 28. Oktober 2013 Sergey Novitsky Stellv. Vorsitzender der Ständigen Kommission des Rates der Republik der Nationalversammlung für Regionalpolitik und örtliche Selbstverwaltung, Generaldirektor Henkel Bautechnik GmbH Сергей Новицкий Заместитель председателя Постоянной комиссии Совета Республики Национального собрания РБ по региональной политике и местному самоуправлению, генеральный директор СООО «Хенкель Баутехник» День белорусской экономики в Берлине, 28 октября 2013 г.

2 Investments to Republic of Belarus Sergey Novitskiy, Berlin,

3 Belarus Heart of the Europe 32

4 Why Belarus? Background for investment State programs of investors support State support of local production Land availability for investment project realization Growth of GDP during last years Growth of construction Stable social situation Sufficient raw materials Developed infrastructure Perfect logistic location Qualified personnel Membership in the Eurasian Economic Union and Customs Union 33

5 Why Belarus? Background for investment State programs of investors support Decree 10 «On creation of additional conditions for investment activity in the Republic of Belarus» on The investor is exempt from the payment of : fees for the right to lease the land; land tax or rent for the period of construction and design of the facility; custom duties and VAT on the import of technological equipment; state duties for the issuance of permits to engage foreign workers in BY, special permits for employment in BY; VAT and income taxes in connection with the donation of capital structures, assets under capital construction and other fixed assets for investment project realization into the investor property. 34

6 Why Belarus? Background for investment State programs of investors support Decree 6 «On stimulation of entrepreneurial activity in the medium, small towns, rural areas» on Preferential tax for 7 years from the date of state registration of company: Income tax rate 0% Property tax on the value of buildings, car parks rate - 0% Exemption from obligatory sale of foreign currency 35

7 Why Belarus? Background for investment Land availability for investment project realization - Auction - Investment project with government (Decree 10 on ). - Buying a ready-made building/ construction/manufacture (also for the 1 base value BYR ~ 10 EUR). 36

8 Why Belarus? Background for investment Support of the local production on the state level 37

9 Why Belarus? Background for investment Growth of GDP during last years 38

10 Macro Economics Real GDP, % ,4 9,4 10 8,6 10 7, ,5 4 4,7 2,1 2 0,2 1, Source: IMF 39

11 Why Belarus? Background for investment Growth of construction 40

12 Macro Economics Residential construction thousand square meters * * - plan 41

13 Macro Economics Residential construction on 1000 inhabitans square meters of the total area Square meters of the total area

14 Why Belarus? Background for investment Stable social situation 43

15 Macro Economics Private consumption, % vs. previous year ,9 11,4 9,6 14,8 12,7 13,4 15,9 9,3 10, ,4 5, , Source: IMF Source: IMF 44

16 Why Belarus? Background for investment Sufficient raw materials 45

17 Why Belarus? Background for investment Developed infrastructure 46

18 Why Belarus? Background for investment Perfect logistic location Russian Federation Poland Baltic States Belarus Ukraine 47

19 Why Belarus? Background for investment Qualified personnel 48

20 Why Belarus? Background for investment Membership in the Eurasian Economic Union and Customs Union BY- RU- KZ (170 mln inhabitans) Common Economic Space Single Custom Space Free Trade Area 49

21 Cons High interest rates on loans in BYR Large number of administrative procedures Total tax rate (% of profit) is high enough 50

22 Doing Business Project 2013: Country rating of Belarus 58 place of rd place among economies narrowing the distance to frontier the most since 2005 (+23,5%) 9 th place in ranking of countries where starting a business is easiest Income Category Upper middle income Doing Business 2013 Rank Doing Business 2012 Rank Change in Rank Population Doing Business 2013 DTF** (% points) Doing Business 2012 DTF** (% points) Improvement in DTF** (% points) GNI Per Capita (US$) ,1 64,7 2,4 51

23 Doing Business Project Topic Rankings DB 2013 Rank DB 2012 Rank Change in Rank Starting a Business 9 9 No change Dealing with Construction Permits Getting Electricity Registering Property 3 3 No change Getting Credit Protecting Investors Paying Taxes Trading Across Borders Enforcing Contracts Resolving Insolvency

24 Henkel in the World Sales 16.5 billions EUR employees More than 300 plants 53

25 Henkel in Belarus 2004, Oct Foundation of Henkel Bautechnik JLLC 2005, July Start of plant construction in Zaslavl (Minsk region) 2006, Sept Pre-term completion of construction. Start of local production of building mixtures under Ceresit brand Planed plant capacity tons of building mixtures/year 1 October 28, 2013

26 Henkel in Belarus 2004, Oct Foundation of Henkel Bautechnik JLLC 2005, July Start of plant construction in Zaslavl (Minsk region) 2006, Sept Pre-term completion of construction. Start of local production of building mixtures under Ceresit brand Planed plant capacity tons of building mixtures/year 54

27 Investments : Investments to plant construction 7,0 Mio EUR, including: - Construction works 4,0 Mio EUR - Equipment 3,0 Mio EUR : Investments to production line extension 1,5 Mio EUR 55

28 Henkel Business Development in BY Strong Growing and High-Profitable Business ,0% NES, T ROS, % 25,0% 20,0% NES, T ROS, % ,0% ,0% ,0% 0 CAGR = 27,3% CAGR = 13,2% ,0% Henkel Market Share in ACB business Belarus: % 32% 36% 41% 56

29 Henkel Business Development in BY Production Dynamics tons `

30 Henkel Business Development in BY Employee Dynamics 180 pers

31 Henkel Business Development in BY Next plans Additional investments in ,5 Mio EUR 59

32 Thank you!

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