The Way Motovelo Finally Finished

Bicycle "Aist" or the bike "Minsk" are names that used to be known in all the countries of the so-called Soviet bloc.

Now the "Motorcycle Company Minsk-Moto" is on the verge of bankruptcy.

The Economic Court of Minsk has initiated the case. Belsat tells the story of the former leader of the domestic industry.

Small motorcycle was initially competitive with the same model of "Harley-Davidson" and "Yamaha". In the middle of the last century observers said that about small car - brand "Minsk", which became available in 1951 when the captured equipment from Germany was exported to Belarus in the last days of World War II. At the beginning of this century the majority of products of "Motovelo" were produced by the same machines.

In 2004 the Italian concern "Cagiva" - the world famous manufacturer of small cars - offered to buy "Motovelo" and infuse new life by re-equipment and new model range. An official Minsk, however, blocked the deal.

"It is possible that an official while decision making and with lack of control over him can give priority to his own interests rather than to interests of the state", economic observer Uladzimir Artsyugin explains.

Instead of selling the company profile foreign investors, the government nationalized it at first and then gave at the time to a little-known businessman Aliaksandr Muravueu. The purchase was registered by ATEC Holding controlled by him and registered in Austria.

"The situation is very similar to the situation with the plant "Luch ", when there are a few shops that produce watches under the brand name "Luch", and other premises leased under more favorable conditions," Uladzimir Artsyugin continues.

The business model chosen by Muraueu is similar to that which the official Minsk now tries to establish in respect to the production of Chinese cars "Geely". 70% of parts for motorcycles are delivered to Belarus from China. In fact, Belarusian bikers explain, "Minsk" has become an imported Chinese motorcycle, which is delivered by parts in Belarus to avoid the 20 per cent import duty levied on finished goods. Such a model in the absence of specialized expertise has led to the loss of markets in the world. The same happened to the domestic market.

"I used to ride Aist. It was a good bicycle. There are no new models now," the cyclist says.

Other person notes: "Buslik" or what's-its-name looks ugly."

Last year, after the arrest of Aliaksandr Muraueu and his top managers - they transferred assets of the plant to offshore companies - the state had to deal with the domestic production of bicycles and motorcycles again. The structure controlled by the Minsk City Executive Committee under the guise of former Mayor Mikalai Ladutska formally leases manufacturing capabilities and asks the budget for $10 million for an administrative modernization . Meanwhile, Yelizovo Glass Plant, once bought by Muraueu in the result of opaque transactions with members of the government, is awaiting bankruptcy.

Experts summarize: the story of "Motovelo" is a vivid example of nomenclative privatization, when the high-tech Western investors are neglected and members of the government sell it to little-known offshore companies. Therefore, they explain the rest of the Belarusian industry can follow the scenario if there is no involvement of independent courts, the Parliament and the mass media that would control these processes.