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.
Investments to Republic of Belarus Sergey Novitskiy, Berlin, 28.10.2013
Belarus Heart of the Europe 32
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
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 06.08.2009 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
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 07.05.2012 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
Why Belarus? Background for investment Land availability for investment project realization - Auction - Investment project with government (Decree 10 on 06.08.2009). - Buying a ready-made building/ construction/manufacture (also for the 1 base value 130 000 BYR ~ 10 EUR). 36
Why Belarus? Background for investment Support of the local production on the state level 37
Why Belarus? Background for investment Growth of GDP during last years 38
Macro Economics Real GDP, % 12 10 8 7 11,4 9,4 10 8,6 10 7,7 6 5 5,5 4 4,7 2,1 2 0,2 1,5 0 2001 2002 1 2 2003 3 2004 4 2005 5 2006 6 2007 7 2008 8 2009 9 2010 10 2011 11 2012 2013 12 13 Source: IMF 39
Why Belarus? Background for investment Growth of construction 40
Macro Economics Residential construction thousand square meters 7 000 6630 6400* 6 000 5 000 4661 5083 5711 5480 4 000 3 000 3009 2811 3019 3502 3786 4088 4487 2 000 1 000 0 1 2001 2002 2 2003 3 2004 4 2005 5 2006 6 2007 7 2008 8 2009 9 2010 2011 201212 2013 * - plan 41
Macro Economics Residential construction on 1000 inhabitans square meters of the total area Square meters of the total area 800 700 600 500 400 300 200 100 301 281 302 350 392 426 487 533 601 699 578 474 0 12001 20022 2003 3 2004 4 2005 5 62006 2007 7 2008 8 2009 9 2010 2011 2012 42
Why Belarus? Background for investment Stable social situation 43
Macro Economics Private consumption, % vs. previous year 20 18 16 14 12 10 17,9 11,4 9,6 14,8 12,7 13,4 15,9 9,3 10,8 8 6 4 7,4 5,2 2 0 2006 2007 2008 2009 2010 0 2011 2,3 2012 2013 12001 2002 2 2003 3 2004 4 2005 5 2006 6 2007 7 2008 8 2009 9 2010 2011 2012 2013 Source: IMF Source: IMF 44
Why Belarus? Background for investment Sufficient raw materials 45
Why Belarus? Background for investment Developed infrastructure 46
Why Belarus? Background for investment Perfect logistic location Russian Federation Poland Baltic States Belarus Ukraine 47
Why Belarus? Background for investment Qualified personnel 48
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
Cons High interest rates on loans in BYR Large number of administrative procedures Total tax rate (% of profit) is high enough 50
Doing Business Project 2013: Country rating of Belarus 58 place of 185 3 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 9 473 000 58 60 2 Doing Business 2013 DTF** (% points) Doing Business 2012 DTF** (% points) Improvement in DTF** (% points) GNI Per Capita (US$) 5 830 67,1 64,7 2,4 51
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 30 42 12 Getting Electricity 171 173 2 Registering Property 3 3 No change Getting Credit 104 97-7 Protecting Investors 82 79-3 Paying Taxes 129 158 29 Trading Across Borders 151 154 3 Enforcing Contracts 13 14 1 Resolving Insolvency 56 42-14 52
Henkel in the World Sales 16.5 billions EUR 47 000 employees More than 300 plants 53
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 60.000 tons of building mixtures/year 1 October 28, 2013
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 60.000 tons of building mixtures/year 54
Investments 2005-2006: Investments to plant construction 7,0 Mio EUR, including: - Construction works 4,0 Mio EUR - Equipment 3,0 Mio EUR 2008-2010: Investments to production line extension 1,5 Mio EUR 55
Henkel Business Development in BY Strong Growing and High-Profitable Business 30.000 30,0% 25.000 20.000 NES, T ROS, % 25,0% 20,0% NES, T ROS, % 15.000 15,0% 10.000 10,0% 5.000 5,0% 0 CAGR 2007-2012 = 27,3% CAGR 2012-2016 = 13,2% 2006 2007 2008 2009 2010 2011 2012 20 13 2014 2015 2016 2017 2018 2019 0,0% Henkel Market Share in ACB business Belarus: 2007 2012 2016 2020 10% 32% 36% 41% 56
Henkel Business Development in BY Production Dynamics tons 60000 50000 50 014 55 290 55 536 58 232 40000 36 230 30000 25 436 ` 20000 16 375 10000 0 2 384 2006 1 2007 2 2008 3 2009 4 2010 5 2011 6 2012 7 2013 8 57
Henkel Business Development in BY Employee Dynamics 180 pers. 160 140 120 100 80 60 40 20 0 2005 1 2006 2 2007 3 2008 4 2009 5 2010 6 2011 7 2012 8 2013 9 58
Henkel Business Development in BY Next plans Additional investments in 2013-2014 - 1,5 Mio EUR 59
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